An empirical investigation of repeat buying behavior of customers of two brands in India

Abstract

Purpose – The purpose of this paper is to attempt to test whether price and quality have any influence on customer repeat purchase probability. Managers should know the strategic determinants of repeat purchase probability to retain customers. Design/methodology/approach – Primary data were gathered on repeat purchase, price and quality via a survey of 400 customers of two brands in the Business-to-customer (B2C) sector. Then 380 × 4 data points to a logit model were fitted to estimate the effects of price and quality on customer repeat purchase probability. Findings – It was found that price, quality and price × quality influence customer repeat purchase probability substantially. Furthermore, the elasticities of repeat purchase probability to price and quality are quite high in both cases. Practical implications – Managers should use elasticities to determine how to allocate funds between price and quality to maximize repeat purchase probability. Originality/value – In view of the complexity of customer repeat buying behavior, this study deals with one aspect or feature of the total process, which does not mean that it has no value. By confirming two strategic determinants of customer repeat purchase probability and suggesting a simple rule of fund allocation, this work definitely adds some research of value to the relevant marketing literature.