Effects of ICT Service Innovation and Complementary Strategies on Brand Equity and Customer Loyalty in a Consumer Technology Market

Abstract

This paper examines the effects of information and communication technology (ICT) service innovation and its complementary strategies on brand equity and customer loyalty toward ICT service providers. We draw from research on brand equity and customer loyalty, ICT innovation management and strategy complementarity to propose a model that includes new constructs representing ICT service innovation — i.e., service leadership — and its two complementary strategies — i.e., customization-personalization control and technology leadership — and how their interactions influence customer loyalty through customer-based brand equity. We test our model using data from an online survey of 1,210 customers of mobile data services. The results show that service leadership and customization-personalization control have significant direct impacts on ICT service providers’ brand equity. Moreover, when either the level of technology leadership or the level of customization-personalization control is high, the impact of service leadership on brand equity is enhanced. In turn, brand equity has significant impacts on consumers’ affective loyalty and conative loyalty, but not on cognitive loyalty. Our study contributes to the literature on service management and service science, and in particular to the management of ICT service innovation in a consumer technology market.

Keywords: ICT service innovation, ICT service management, service leadership, technology leadership, customization, personalization, brand equity, customer loyalty, strategy complementarity, mobile data services