Behavioral learning theory is the
theoretical framework of this thesis in which learning is a result generated
when applying consequences1.
According to operant conditioning theory, reinforced behaviors tend to recur
than non-reinforced ones. Rothschild proposed that if brands are reinforcing to
consumers, they are likely to be more loyal to them. It is suggested by this
study that application of sales promotions may either reinforce or decrease the
loyal behavior to brands. The findings for high involvement product indicate
that “Premium offers” (a non-price promotion) plays a role of reinforcement to
enhance brand loyalty. These findings can be explained that consumers are able
to buy another product of the same favorite brand at a lower price than normal
that if without the premium offer, they cannot afford two simultaneously even
they want them both. Or the premium is a new product that is offered at a lower
price which will reduce the risk of trying a new product. Therefore, the most
significant idea derived from this finding is that non-price promotions are
more impactful on brand commitment for high involvement product. On the other
side, regarding the low involvement product, “discount” did negatively affect
brand loyalty. It maybe because “discount” habituate consumers to be
brand-switchers and to be more sensitive to price. If the promoted products do
not offer any unique attributes compared with other competitors, after the
promotion period, consumers will switch back to the old brand, or buy another
promoted brand whose offers product with the same functions. Simply put,
“discount” may be useful to boost immediate sales or draw attention of
customers, they may negatively influence the subsequent brand choice.
Furthermore, external influence such
as the economy development plays a significant role in buying habits shift. The
shift of Vietnam economy to the market economy from a centrally planned has
transformed Vietnam from the top poorest nations into a lower middle-income
nation, and continue to grow at a fast rate to be in the top of the most dynamic
economies in Asia2.
Sales promotions function as a
powerful tool during the purchase stage to provoke unplanned purchase and draw
consumer attention. However, sales promotions do not always bring about
positive results, they may either enhance or erode brand equity to some extend.
The characteristics of the market and type of marketing activities determine
the effectiveness of the promotion, not the promotion itself3.
Therefore, if consumer and the market insight are appropriately understood,
sales promotions may still contribute to the success of marketing efforts. In
short, this study has examined the nature and benefits/harm of sales promotions
on brand equity, and provide additional information to the body of literature
on sales promotions and brand loyalty. The findings of this research either
strengthen and weaken the findings of previous research, and build up some new
inquiries regarding the relationship between sales promotions and brand
loyalty. Moreover, the product involvement’s impact on decision-making process
and brand loyalty is described comprehensively.