Does innovation contribute to generate brand equity and customer satisfaction?: Evidence in the large grocery distribution

Abstract

The development of this work aims at an approach to the concept of retail innovation, from a threefold approach: product innovation, marketing innovation and relational innovation. In addition, their links to other constructs that have traditionally sparked special interest in marketing research, such as brand loyalty, brand equity, and satisfaction, are examined. To do this, a theoretical model is delimited, which is contrasted through an empirical analysis based on a survey of a sample of 510 customers from three commercial grocery formats —hypermarket, supermarket and discount store— in the province of Valencia. In order to test the proposed relationships in the form of hypotheses, the data collected was analyzed using the partial least squares regression (PLS) technique. The results confirm the role of innovation as a driving force for brand loyalty, enhanced by ICT. In addition, there are chained effects of brand loyalty on brand equity and of this last variable on satisfaction. Finally, the derived conclusions guide a set of recommendations for management, based on the benefits observed when developing innovation processes in the largest grocery retailers.