Zhang, Jason Q.; Dixit, Ashutosh; Friedmann, Roberto
March 2009
Journal of the Academy of Business & Economics;2009, Vol. 9 Issue 2, p173
Academic Journal
It is a traditionally accepted notion that loyal customers are more profitable. Recent research, however, questions the effects of customer loyalty. In light of this controversy, we propose a conceptual framework to examine the outcomes of customer loyalty. We test the proposed outcomes with the data from the consumer packaged goods industry. Our results indicate that customer loyalty may indeed be a practical predictor of profitability, though an important note of caution needs to be raised.


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