The Effects of Digital Marketing on Customer Relationships

Marko Merisavo

The Effects of Digital Marketing

Communication on Customer Loyalty:

An Integrative Model and

Research Propositions

HELSINKI SCHOOL OF ECONOMICS

WORKING PAPERS

W-400

Marko Merisavo

The Effects of Digital Marketing

Communication on Customer Loyalty:

An Integrative Model and

Research Propositions

Marketing

February

2006

HELSINGIN KAUPPAKORKEAKOULU

HELSINKI SCHOOL OF ECONOMICS

WORKING PAPERS

W-400

HELSINGIN KAUPPAKORKEAKOULU

HELSINKI SCHOOL OF ECONOMICS

PL 1210

FI-00101 HELSINKI

FINLAND

? Marko Merisavo and

Helsinki School of Economics

ISSN 1235-5674

(Electronic working paper)

ISBN-10: 952-488-006-7

ISBN-13: 978-952-488-009-1

Helsinki School of Economics HSE Print 2006

The Effects of Digital Marketing Communication on

Customer Loyalty: An Integrative Model and Research

Propositions

ABSTRACT

The cost efficiency and diversity of digital channels facilitate marketers¡¯ frequent and

interactive communication with their customers. Digital channels like the Internet, email,

mobile phones and digital television offer new prospects to cultivate customer relationships.

However, there are a few models explaining how digital marketing communication (DMC)

works from a relationship marketing perspective, especially for cultivating customer loyalty. In

this paper, we draw together previous research into an integrative conceptual model that

explains how the key elements of DMC - frequency and content of brand communication,

personalization, and interactivity - can lead to improved customer value, commitment, and

loyalty.

Keywords: digital marketing communication; personalization; interactivity; customer

loyalty; customer relationship management

2

CONTENTS

1

INTRODUCTION..........................................................................................3

2

DEFINITION OF DIGITAL MARKETING COMMUNICATION........6

3

AN INTEGRATIVE MODEL OF THE EFFECTS OF DIGITAL

MARKETING COMMUNICATION ON CUSTOMER LOYALTY .............7

3.1

Regular Brand Communication ¨C Benefits of Being in Touch with

Customers ............................................................................................................9

3.1.1

Frequency ............................................................................................................. 9

3.1.2

Information Processing ...................................................................................... 10

3.1.3

Brand Relationship............................................................................................. 11

3.1.4

Perceived Value.................................................................................................. 11

3.1.5

Commitment....................................................................................................... 12

3.1.6

Content ............................................................................................................... 14

3.2

Personalized Brand Communication.......................................................16

3.3

Interactive Brand Communication ..........................................................18

3.3.1

3.4

Mediating Factors....................................................................................23

3.4.1

Customer Characteristics.................................................................................... 23

3.4.2

Involvement........................................................................................................ 24

3.4.3

Relationship........................................................................................................ 25

3.4.4

Situational factors............................................................................................... 27

3.5

4

Interacting and Spending Time with a Brand..................................................... 21

Outcomes of Digital Marketing Communication for Customer Loyalty 28

DISCUSSION ...............................................................................................29

REFERENCES ....................................................................................................31

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