Previous marketing research has been trying to identify a stronger and more enduring predictor of brand loyalty than customer satisfaction in competitive markets. Perceived value, the difference between benefits and costs, appears to be the perfect candidate. Does it? Drawing from the literature on customer-company identification and brand health, this two-essay dissertation proposes that customer-brand identification (CBI), defined as the customer's perception, emotional significance, and value of sharing the same self-definitional attributes with a brand, constitutes a sustainable competitive advantage. Compared with perceived value, CBI is expected to be more predictive and enduring in explaining brand health, both current health under normal market conditions and brand resistance under abnormal circumstances such as competitive attacks. Essay 1 examines the relative importance of CBI vis-a-vis perceived value as the economic driver in predicting customer repurchase intention and customer forgiveness in a cross-sectional setting. Hierarchical linear modeling using a data set of 6,000 consumers from 15 countries shows that cross-sectionally, perceived value is a stronger driver of customer loyalty intention while CBI is more predictive of customer forgiveness. Furthermore, these relationships are generally non-linear, with increasing returns. Surprisingly, national culture interacts more with CBI than with perceived value in predicting customer behavior. Essay 2 complements the first essay by investigating why it is important to build CBI in a competitive, disruptive market setting using a longitudinal design. Results show that when a market is disrupted by an innovative new entrant, CBI saliency serves as a more enduring predictor of switching behavior, an important indicator of customer behavioral loyalty that underlies both the current wellbeing of a brand and all measures of brand resistance.
