FACTORS AFFECTING CUSTOMER LOYALTY: THE CASE OF META ABO BREWERY IN SEBETA TOWN, OROMIA REGION

Abstract

It is often argued that the extent of customer loyalty affects the level of firm performance and competitiveness. Therefore, understanding the determining factors affecting customer loyalty enable firms to devise strategies to boost their level of performance. The study is carried out to investigate the factors affecting customer loyalty in the case of Meta Abo Brewery. To this end, data were mainly gathered via structured questionnaire from 353 customers of Meta beer. The study applied a quantitative research approach and explanatory research design. Data were processed via SPSS and analyzed through descriptive (frequency, percentage, mean and standard deviation) and inferential statistics (correlation and regression analysis). The findings of the study reveal that, out of the proposed four factors, only one factor namely product quality has a statistically significant positive effect on customer loyalty. However, this study couldn’t find a statistically significant effect of advertising influence and consumer’s situational variation on customer loyalty. Moreover, the study reported a statistically significant but negative effect of groups influence on customer loyalty. Based on the findings of the study, it is recommended that the organization should mainly emphasize on product quality to build customer loyalty.