Brand Loyalty
There are many factors that may lead to a stronger brand loyalty towards foreign products compared to local products. Firstly, most of Malaysian consumers do not trust local brands, especially in terms of quality (Doctoroff, 2002). Research done by Wong and Sidek (2008) found that product quality is the most important factor as most of the Malaysian respondents choose product quality as the main factor that influences their loyalty towards a particular brand. This may includes the processor, colour, function and the performance of the product (Frings, 2005). According to Sproles and Kendall (1986), brand loyalty is also related to the awareness of and high desire for high quality products and the need to buy the best choice compared to other available brands which most probably referring to the performance of the high quality products. Study done by Synovate also shows that more than half of young consumers in Malaysia more care about the quality than any other consideration, even though the price is more expensive (Chhan, 2007).
Thus, in order to be able to compete with foreign brands in terms of product quality, local companies need to improve more on their product quality in order to convince the consumers and built the trust in them. This can be done by investing more on the Research and Development (R&D) project as the outcome can always be used to improve the current product of the local brands, as well as coming with a new product design to the market which will give the company a competitive advantage. Competitive advantage here is gained when a company can do something that rival firms cannot do, or owns something that rival firms desire. R&D is very crucial especially for technology-based company such as mobile phone producer as they need to upgrade and improve their product together with the changing environment. They need to answer the questions, such as “How are our customers changing?” and “Are new technologies being developed that could put us out of business?”. This type of on-going market research will help the company in ensuring the optimal relevance of their products, as well as ensuring that the products are tailored to the current technology and taste.
Next factor for stronger brand loyalty towards the foreign brand is the promotion. According to Wong and Sidek (2008), promotion is a component of marketing mix which is a very important kind of communication with the consumers, and it have a positive relationship with the brand loyalty. It includes the use of advertising, sales promotions, personal selling, as well as publicity, that will help to channel the information of the new products to the consumers, help to establish ideas and perceptions in their mind, and also help to show the differences of the product with other available products in the market. For foreign brands, the producers are very efficient in promoting their product worldwide as