Utilitarian and Hedonic Values Affect Brand Switching : Consumer Satisfaction as Moderator

This study tested the existence of positive relationship between utilitarian values, hedonic values and consumer satisfaction. Further it also tested the significance of utilitarian and hedonic values influenced by consumer satisfaction affecting brand switching. Four independent products and brands were selected for data collection. Confirmatory factor analysis validated two dimensions along with factors via utilitarian values which include savings, convenience, affordability and multiple benefits. Hedonic values included freedom, self-expression, entertainment and exploration. Regression analysis revealed the existence of relationship between dependant and independent variables with variance obtained by these two dimensions and factors to be on higher side. Hypothesis proved a positive effect of both utilitarian and hedonic values on customer satisfaction. Customer satisfaction created by utilitarian and hedonic values has significant effect on brand switching. Managerial implications include suggestions on product pricing, variety, availability, upgrading consumer knowledge and consumer personal image.


Introduction
Brand switching is a phenomenon which had been investigated by marketers to understand the relationship between brands and consumer satisfaction.It takes simple common sense to judge, that those consumers who are satisfied will least think of switching and consumers who are dis-satisfied will think of alternatives (Ravindra, Rajagopal, & Vijay, 2008;Asta & Jurate, 2012;Kevin, Eric, & Bianca, 2003).Ironically the same is not true, there are research evidences like Hung, Yi, Yu & Monle (2004) showing up satisfied consumers switching.The effective solution is to identify and focus on the switching group (Hung et al., 2004).Consumers switch for variety of reasons ranging from minute to serious.In the first place there is a need to hold these consumers; secondly practicing managers need to think lowering the rate of switch group (Mittal, William, & Patrick, 1998).Hung et al. (2004) in their study opined, value creation cached the attention of both practioners and researchers on how it will influence the brand switching.Mittal et al. (1998) as well as Babin, Darden and Griffin (1994) had confirmed similar phenomenon.Kevin et al. (2003) had proved value creation segmented into two, utilitarian and hedonic values (Voss, Spangenberg, & Grohmann, 2003;Batra & Ahtola, 1990;Crowley, Eric, & Kevin 1992;Babin et al., 1994;Kim, 2006).The former consists of those benefits which are directly visible to consumers (Batra & Ahtola, 1990).The later consists of in-direct benefits derived by the consumers (Asta & Jurate, 2012;Cheng, Zhen, Allan, & Zong, 2000;Arnold & Reynolds, 2003).Both utilitarian and hedonic values have the power to influence the consumer satisfaction (Ravindra et al., 2008;Kevin et al., 2003;Batra & Ahtola, 1990;Heasun, Hyunjoo, & Daejoong, 2012;Kim, 2006).Sheth, Newman and Gross (1991) in their study had factors which affected consumer satisfaction such as advertising, positioning, price, perceived quality, product features, relationships, symbols, attributes, identity, origin, culture and so on.Hung et al. (2004) also had similar view and Asta and Jurate (2012) further categorized them into three segments.Ravindra et al. (2008) in their study had viewed that value creation has a good pie of share in addressing consumer satisfaction and halts consumer switching.Hung et al. (2004) had done similar argument.This study tries to address the relationship between utilitarian and hedonic values directed by consumer satisfaction leading to lowering the consumer switching, refer figure 1.

Literature Review
Utilitarian value: this study examines the positive relationship between consumers' need for utilitarian value in their buying effecting satisfaction and further brand switching behavior (Ravindra et al., 2008;Hung et al., 2004;Mittal et al., 1998).A review of the issues deriving utilitarian value brings to light savings, convenience, affordability and multiple benefits assessed by consumers from a particular purchase and consumption (Kevin et al., 2003;Hung et al., 2004;Babin et al., 1994;Kim, 2006).Consumers actively assess tangible benefits and direct their buying actions based on their past experience, knowledge gained, information at disposal (Dhar & Wertenbroch, 2000.Utilitarian value forms the first expectation trigger in the consumers buying decision (Batra & Ahtola, 1990).Ravindra et al. (2008) reveal that brands which offers utilitarian value better than others becomes the first consumer choice, which is similar to Babin et al. (1994).Consumer satisfaction and brand switching forms post purchase behavior (Hung et al., 2004;Mittal et al., 1998).When consumer compares expectations with value delivered from purchase, this defines satisfaction and further decision on switching (Mittal et al., 1998).
Hedonic value: hedonic values are hidden and non-tangible, consumers tries to feel and experience them (Batra & Ahtola, 1990;Arnold & Reynolds, 2003;Kim, 2006).Kevin et al. (2003) had revealed many values such as freedom, self-expression, entertainment and exploration are some of these feelings and experiences.These values had been confirmed by Cheng et al. (2000); Arnold & Reynolds (2003); Babin et al. (1994).Hedonic values are non-basic in nature; they are not a part of primary function of a product (Asta & Jurate, 2012;Dhar & Wertenbroch, 2000).Consumers gain knowledge and information on hedonic values (Hung et al., 2004;Kim, 2006); they also store them deep in the memory which are mostly in the sub-conscious form (Batra & Ahtola, 1990;Arnold & Reynolds, 2003).Consumers post purchase mechanism will have positive effect from hedonic values (Asta & Jurate, 2012;Cheng et al., 2000;Mittal et al., 1998).Hedonic values will help a brand to boost customer satisfaction and will result in switching from one brand to another in pursuit of value search (Ravindra et al., 2008;Cheng et al., 2000;Mittal et al., 1998).
Customer satisfaction and Brand switching: customer satisfaction is an evaluation process of pre-purchase expectations versus post-purchase consumer experience (Mittal et al., 1998;Sheth et al., 1991).As defined by Day (1984), customer satisfaction is a post purchase assessment about a consumers purchase decision.Similarly Kotler & Armstrong (2013) expressed customer satisfaction as post purchase evaluation of actual compared to expected by products or services.In another study done by Thomson et al. (2005) had stated that satisfaction results immediately after consumption.Customer satisfaction is the most effective and popular method prevalent in the research field and industry practice to measure whether customers stick to the brand or do they slip to another (Asta & Jurate, 2012;Ravindra et al., 2008;Mittal et al., 1998;Sheth et al., 1991).Hung et al. (2004) in their study had revealed that both utilitarian and hedonic values can enhance consumer satisfaction by establishing a horizon which cushions their belief that their expectations are meet or exceeded by a particular brand, similar studies were done by Voss and Grohmann (2003); Batra and Ahtola (1990); Crowley et al. (1992); Babin et al. (1994); Heasun et al. (2012).In previous studies like Dhar & Wertenbroch (2000) argued that utilitarian values drives instant boost to customer satisfaction for example if a consumer decides to buy with a budget in mind, when a particular brand meets his expectations lower than pre decided budget, it will delight the consumer (Ravindra et al., 2008;Kim, 2006;Sheth et al., 1991).In all the exchanges which result in tangible benefits like saving cost, extra quantity, more features, free service will right away satisfies the customers (Asta & Jurate, 2012;Ravindra et al., 2008;Kim, 2006;Sheth et al., 1991).Hedonic value on the other hand will help marketers build the brand over a long period of time (Cheng et al., 2000;Babin et al., 1994).Hedonic will create rich experience for the consumers and positions the brand along the lines of images (Asta & Jurate, 2012;Dhar & Wertenbroch, 2000).The affective behaviour of the consumer can be influenced (Batra & Ahtola, 1990;Arnold & Reynolds, 2003).Predominantly addressing the consumer emotions and feelings by hedonic values is in practice.Consumers deriving fun, enjoying freedom, expressing joy, feeling happiness will lead to satisfaction (Ravindra et al., 2008;Cheng et al., 2000;Mittal et al., 1998).When values create strong consumer satisfaction they will help consumer sticking to the brand if and only when the value creation mechanism is a continued practice (Asta & Jurate, 2012;Ravindra et al., 2008).H3: Customer satisfaction derived from utilitarian and hedonic values significantly affect brand switching.

Methodology
To test the hypothesis, the study had selected four different products and respective top brands which delivered both utilitarian and hedonic values.First, as per the deductive method a pilot consumer group of 50 were explained about utilitarian and hedonic concepts.Immediately they were asked to rank the products which provided the most utilitarian and hedonic value from a list of 20 products and 80 brands.Upon on grouping these ranks, the top four products and respective brands were smart mobile phone/i-phone, car/Toyota, television/Samsung and laptop/Lenovo.A set of nineteen statements with a descriptive question at the end were finalized using extensive literature review of the constructs.Items were generated to suit to the objective of the study.Final questionnaire (refer Appendix A) was administered to a sample of 400 consumers in all, giving equal weightage to all the products.A seven point Likert scale was used where 1 indicated "high dis-agreement" and 7 indicating "high agreement" with the respective statements.Four demographic characteristics age, gender, education and profession were also included in data collection.At First, a respondent filtering question was orally asked to select the respondents who had purchase and consumption experience of more than six months.This method was adopted to include only those respondents who had derived utilitarian and hedonic values.Data was collected using systematic random sampling.Three places were selected for collection of data via mobile phone outlets, car dealer outlets, consumer electronic durable outlets.At the entrance, every five minutes one respondent was administered the questionnaire.The methodological limitation for this study is, a respondent is considered valid if he/she has derived utilitarian and hedonic values for any of the products/brands listed.

Data Analysis and Discussion
To analyze the data SPSS version 22 for Windows environment was used with instructions from Andy Field (2013).At first the theoretical model was considered as priori, since it is based on sound theoretical background.A pre-assumption was established that between observed variable and latent variable the relationship is true.Confirmatory factor analysis (CFA) by principal component analysis for extraction and varimax with Kaiser normalization for rotation was used for scale refinement and to test the data validity.CFA results given in table 1 indicate that the factor loadings clearly validate two dimensions, though five dimensions were given as output.The rotated inter correlation between constructs and dimensions were strong only for two dimensions.Correlation is also established among constructs and other three dimensions, but the relationship does not exceed minimum threshold loading values established in the past literature of 0.6.These results confirm the theoretical background to be true.In other words, savings, convenience, multiple benefits and affordability are factors of utilitarian value and self-expression, exploration, entertainment and freedom are factors of hedonic values.Unidimentionality was checked whether data was moving in the same direction to achieve the common objective.The procedure started by checking items in line with the respective constructs and independent constructs were in line with dependent variable.Multidimensional measures were used to assess this process.Table 2 results reveal, on "zero to one scale" the CFI, NFI AGFI scores were on higher side and RMSEA scores for the two dimensions were less than 0.05 indicates strong scale fitness.A study done by Kevin et al. (2003) for the dimensions utilitarian and hedonic had similar results related to testing unidimentionality via AGFI = .88,NFI and CFI = .97.Present study results match and are better than the reference study with AGFI = .905&.892,NFI = .899& .842and CFI = .912&.870 used for utilitarian and hedonic dimensions.Additionally in the present study RMSEA was applied with values .031&.025.
For checking the reliability Cronbach's α was assessed for each of the dimensions with values .892& .874.These values were higher than .88 and .87recorded by Kevin et al. (2003) in their study indicating the scale and data reliability comparatively on par with other similar studies.Bentler Bonnet coefficient was used to know the scale and data validity, values higher than 0.9 are considered as standard for validity of acceptable levels.The calculated values indicate that validity was achieved.To establish the dependence-independence relationship between variables, chi-square analysis was used.The dependent variable "will not switch the brand" established significant dependence relationship with utilitarian variables via savings, convenience, multiple benefits, affordability, hedonic variables via self-expression, exploration, entertainment, freedom, satisfied with the brand and moderating variable satisfaction with brand.The regression models shown in table 3 contributed significantly and predicted 10.8 percent variation by savings, 23.3 percent variation by savings, convenience, 24.8 percent variation by savings, convenience, multiple benefits and 10.7 percent variation by savings, convenience, multiple benefits, affordability and 19.2 percent variation by savings, convenience, multiple benefits, affordability, satisfied with the brand.
As its significant predictors shown in table 6 indicate that independent variables such as self-expression, exploration, entertainment, freedom, satisfied with the brand were related to dependent variable i.e., "will not switch the brand", Hence, the following regression models were evolved : Whereas, Y= will not switch the brand, Xi= Self-expression; X2= Exploration, X3= Entertainment, X4= Freedom, X5= Satisfied with the brand.

Conclusions and Managerial Implications
Utilitarian and hedonic values are an area which had been vastly explored by researchers, practitioners and taught well in the academic curricula.This study tried to put various factors into one scale.These factors were derived from diverse literature.Hence their unidimentionality was checked which proved all the factors were directed towards one path.Data reduction evolved with utilitarian and hedonic values to be valid dimensions.
Further Chronbach alpha checked the data validation to be true.
Results clearly indicate that utilitarian values like savings, convenience, multiple benefits, affordability significantly explained a variance of 69.6%.The moderating variable customer satisfaction improved the variance explanation significantly by 88.8%.Savings, convenience and multiple benefits significantly explained the highest variance with 24.8%, indicating their role in consumer sticking to brand.Managerial take on this helps them to know savings, convenience and multiple benefits are a good combination of utilitarian values to include in their market offers to stop the customer from switching the brand.Hedonic values like self-expression, exploration, entertainment, freedom, satisfied with the brand significantly explained a variance of 55.4%.The moderating variable customer satisfaction improved the variance explanation significantly by 74%.Self-expression, exploration, entertainment and freedom significantly explained the highest variance with 18.9%, indicating their role in consumer sticking to brand.This helps the decision makers to know self-expression, exploration, entertainment, freedom are a good combination of hedonic values to consider.
Hypothesis one reveals that utilitarian values positively affect customer satisfaction; similar results were made by Ravindra et al (2008).Savings with a χ²=126.603,p=0.000 tested at p<.05 has positive affect on customer satisfaction.Since savings give monetary benefits to the customer, preference will be quite obvious, other studies like Hung et al. (2004) reveal similar results of utilitarian values such as price incentives, price savings, special pricing having positive influence on customers.In a recent study done by Hyokhin et al. (2015) identified that fair pricing positively effects brand.Toyota in cars and Samsung in television comparatively to competitors give convincing savings to customers in terms of price.Convenience with a χ²= 84.117, p=0.000 tested at p<.05 reveals buying experience with the respective products and brands shows a positive effect on customer satisfaction (Note 1).In a similar study done by Ravindra et al (2008) had proved that satisfaction is the result of a product meeting the utilitarian expectations.The products and brands involved in this study are widely available through outlets both offline and online, hence customers accessing these products with ease and minimum effort.Affordability with a χ²=102.207,p=0.000 tested at p<.05 reveals pricing for the products and brands is done based on the target market needs, customers know the amount of value they would be deriving out the purchase.Lenovo which is a growing brand with sufficient superior features offered at very affordable prices.Multiple benefits with a χ²= 61.042, p=0.000 tested at p<.05.Products and brands are designed to meet multiple needs of the customers, like for example in the category "phone" i-phone offers many benefits like calls, sms, e-mail, online transactions, video and audio download and upload and many more.In their study Batra & Ahtola (1990) had concluded that benefits from utilitarian values such as product benefits had positive influence on consumer buying.In a similar study by Mittal et al. (1998) it was found that when product benefits meet or exceed the expectations, customers give a positive response in repurchase.According to Ji & Deborah (2014) brands help consumer perform better and benefit out of them.Savings through competitive pricing, reach of product availability, value with affordability and multiple usage of the product can be considered by practioners for decision making from the point of utilitarian values.
Hypothesis two reveals that hedonic values positively affect customer satisfaction, Ravindra et al (2008) had results exhibiting hedonic values resulting in delight.Freedom with χ²=98.027,p=0.000 tested at p<.05 had positive affect on customer satisfaction.Freedom of selection is offered with needed variety giving the customers freedom of choice, Cheng et al. (2000) in their study had revealed that hedonic values had significant affect on variety seeking.A similar study was done by Sheth et al. (1991) in which they proved that variety seeking novelty is positively associated with utilitarian values and further results in customer satisfaction.In another study done by Van Trijp et al. (1996) variety seeking was proved to influenced repeat purchase.Toyota offers a wide variety of variants like "Yaris" for entry level customers, Camry for executive level, Lexus for premium level, Dyana for small entrepreneurs, and Sequoia for big families.Self-expression with a χ²=262.110,p=0.000 tested at p<.05 had positive effect on customer satisfaction.Owning the product and brand gave consumers a feeling of pride and enhancement of personal image, Asta and Jurate (2012) had concluded that hedonic values will satisfy self-esteem and personal ego of the customers.Image has several shades like for example ownership of "iphone" gives the customer technical superiority image, ownership of Samsung television gives modern image.Entertainment with a χ²=118.743,p=0.000 tested at p<.05 had positive affect on customer satisfaction.Post purchase use of the brand gave the customer expected joy and amused them with features and services, a similar but not same is expressed by Ravindra et al (2008).In another study by Brakus et al. (2009) stated excitement and emotional warmth influence customer satisfaction.Samsung with variants like smart televisions, Lenovo with its touch screen and paper thin laptops provide a great entertainment value to the customers.Exploration with a χ²=118.743,p=0.000 tested at p<.05 has positive affect on customer satisfaction.When these brands were used, they improved the knowledge of the customers.Customers feel that these brands added to their overall learning process.Samsung smart television has features to connect to internet and interact with customers intelligently.From the hedonic values managerial fraternity can seek the following issues; meaningful variety, specific image, additional features, space for learning new things into their decision making.
Hypothesis three reveals that customer satisfaction derived from utilitarian and hedonic values had significant affect on brand switching.With a χ²=68.144,p=0.000 tested at p<.05 had significant affect on brand switching.
A similar result was obtained by Ravindra et al (2008) in which they had mentioned that consumer will involve in positive word of mouth and repeat purchase when utilitarian and hedonic values are met or exceeded.Crowley et al. (1992) in another study opined that utilitarian and hedonic values will deliver satisfaction based on products low or high benefits offered.Contradicting to this Cheng et al. (2000) had results showing there is a negative relationship between utilitarian and hedonic values, this indicates they cannot together have significant effect.In a study done by Dhar & Wertenbroch (2000) in a similar context had proven that both utilitarian and hedonic values will have different significance level of influence on customers post purchase behaviour.When customers are taken care with suitable utilitarian and hedonic values by the marketing offerings, they will not think for switching the brand.Consumers keep shifting their preferences, hence the study of utilitarian and hedonic values differ from time to time across geographical locations.

Figure 1 .
Figure 1.Utilitarian, hedonic, consumer satisfaction model of the study

Table 1 .
Confirmatory factor analysis

Table 3 .
Results of regression models for the effect of Utilitarian values on Brand switching Predictors: constant, savings, convenience, multiple benefits, affordability, satisfied with the brand.

Table 4 .
Predictor effects and beta estimates for the effect of Utilitarian values on Brand switching

Table 5 .
Results of regression models for the effect of hedonic values on brand switching Predictors: constant, self-expression, exploration, entertainment, freedom, satisfied with the brand.

Table 6 .
Predictor effects and beta estimates for the effect of hedonic values on brand switching