Customer Loyalty and Complex Services: The Impact of Corporate Image on Quality, Customer Satisfaction and Loyalty for Customers with Varying Degrees of Service

i Based on theory from consumer behavior and cognitive psychology, the purpose of this paper is to discuss and test corporate image and customer satisfaction as two routes to customer loyalty. Based on data from 600 individual customers categorized as having high or low service expertise of three companies within the package tour industry, a conceptual model is proposed and tested empirically using structural equation modeling. The data used in the study is included in The Norwegian Customer Satisfaction Barometer. The latent variables`contribution to loyalty is estimated on the attribute level, based on path coefficients. Perceived quality has positive effects on value and customer satisfaction for the industry consolidated. Value has only significant impact on customer satisfaction for customers with a low degree of service expertise. Corporate image is positively correlated with perceived quality, customer satisfaction, and customer loyalty. Corporate image does not impact customers` perception of value. The paper concludes by claiming that for complex services, corporate image and customer satisfaction are not two separate routes to customer loyalty. Corporate image impacts customer loyalty directly whereas customer satisfaction does not. This finding was consistent with high and low service expertise. These results challenge the disconfirmation paradigm which predicts customer satisfaction as the primary route to customer loyalty. From a managerial perspective, information regarding the relative strength of the two routes is vital with regard to resource allocation in order to improve customer loyalty. i) The authors gratefully acknowledge the data provided through the funding by sponsoring companies of The Norwegian Customer Satisfaction Barometer and the support of the Service Forum at The Norwegian School of Management. We are also grateful for valuable comments made by two anonymous International Journal of Service Industry Management reviewers.