ABSTRACT
SALES PROMOTIONS EFFECTS ON BRAND LOYALTY
by
Marifé Méndez
In this dissertation the field of promotion marketing was examined by studying the impact of sale promotions on brand royalty. More specifically, for products with different levels of involvement, the study assessed how effective different nonmonetary and monetary promotions are at retaining brand loyalty.
Two research questions were posed: (a) Will the effect of nonmonetary and monetary promotions on brand loyalty vary according to the extent of hedonism or utilitarianbenefits for low and high involvement products? (b) Will the preference for nonmonetaryor monetary promotions on brand loyalty have a greater or lesser effect for low and high
involvement products? It was theorized that the effect of nonmonetary and monetary promotions on brand loyalty would vary according to the extent of hedonism or utilitarian benefits for low and high involvement products (H1a and H2a). The second set of hypotheses (H2a and H2b) posited that preference for nonmonetary promotions would
have a greater on brand loyalty for both high and low involvement products. A questionnaire consisting of 36 questions provided the data that was collected from 114 subjects. Two product categories were chosen for the study: deodorant (high involvement) and laundry detergent (low involvement). For each product category, regression was used to explore the relationship between the indirect variables and the dependent variable — brand loyalty. The results did not show support for any of the hypotheses; yet, they offer valuable information on sales promotions.
Five important findings are discussed:
1. Monetary promotions are perceived to provide more utilitarian benefits.
2. Nonmonetary promotions seem to provide more utilitarian benefits than hedonic benefits.
3. “Preference for Gifts,” a nonmonetary promotion, could affect negatively brand loyalty.
4. “Buy 2 get 20% off,” a monetary promotion, could have a positive impact on brand loyalty.
5. Involvement has a positive relationship with brand loyalty.