How product financing affects customer loyalty
July 22, 2015
What is the impact of product financing on brand awareness, customer satisfaction, and customer loyalty? Sophieke Verhoeven researched this question in her thesis as part of her TIAS Master of Marketing. "My research has been of great value to my employer."
Image: © Nationale Beeldbank
What did you research?
“For my employer, a proprietary auto financier, I researched the impact of product financing on brand experience. I wanted to know whether customers with financing have a different bond with the product, in our case Peugeot or Citroen cars, than customers who do not have funding. We could use the outcomes to request additional resources for promotional funding from the car importer. We could think of innovative ways to have customers not pay any interest upfront or to provide options for deferred payment. These financial benefits are free to the customer, but naturally someone must pay for them. If I could prove that through financing a customer, they will in the future find themselves preferring a product of the same brand, it will help us to get the car importer to free up money for these schemes."
Customer loyalty, repeat purchases, and brand experience
How did you carry out your research?
I started with studying the literature. That was great fun to do, and I, therefore, devoted a lot of time to that. I have tried to map the various studies regarding customer loyalty, repeat purchases, and brand experience. There have been many studies on these subjects, but the results are inconclusive. There seems to be some indication that having additional products can certainly affect brand experience. That is why I decided to conduct further quantitative research in order to have sufficient support for my hypothesis. During my quantitative research I interviewed 2,000 customers through an online survey.
More often a repeat purchase
What were the results?
Unfortunately, these results were less than positive for my employer. I have not been able to demonstrate a direct impact of product financing on product brand awareness, customer loyalty, and customer satisfaction. However, customers of my employer who do have product financing, in practice often make more repeat purchases than customers without financing. Product financing has also been crucial for customers when buying a Peugeot and Citroen.
What did you do with the research results?
The results of the study have been discussed in detail with the importers. Eventually we have all learned from it and the results are now part of the strategic plan for the coming years. We will also conduct the research among another group of customers, namely the lease drivers. My research has certainly been of great value to the company.
TIAS Master of Marketing
Because it connects theory and practice, the Master of Marketing has been of great value to Sophieke Verhoeven.Are you also looking for an academic marketing master that is practically relevant? Download the brochure.