Compatibility effects in evaluations of satisfaction and loyalty

The goal of this research is to help understand the difference between satisfaction and loyalty based on the nature of the judgment tasks involved. By drawing on the notion of the prediction- decision inconsistency, we posit satisfaction as a consumption/experience utility and loyalty as a decision utility to explain the missing link between satisfaction and loyalty. An important assumption that may be driving the prediction-decision inconsistency, but has not been addressed, is the different criteria that consumers use in arriving at the two different types of utilities. The authors argue that this difference affects the compatibility, and resulting influence, of quality versus price information on satisfaction and loyalty evaluations. An empirical study of 183 firms using data from the American Customer Satisfaction Index is reported which supports the proposed compatibility effects. Implications for marketing theory and practice are discussed.