EFFECTS OF PRODUCT INNOVATION AND PRODUCT QUALITY ON BRAND LOYALTY: AN EMPIRICAL STUDY ON SMART MOBILE PHONES

Businesses try to differentiate from their competitors and to achieve a large market share, to survive in an increasingly competitive environment in the globalized world. In this direction, businesses should be positioned on the axis of continuous change and renewal. Since the products / brands are more similar to each other in terms of their functional properties, since they do not have a distinct selection criterion in consumer preferences, the quality and innovations made in products become more decisive in consumer preferences. The main purpose of the research is to examine the effect of product innovation and product quality on brand loyalty. Also this study examines effects of product innovation and product quality on brand awareness and brand image. In the scope of the research, 432 questionnaires were applied to smart mobile phone users living in the central district of Rize. After elimination of missing and incorrect questionnaires, 400 questionnaires were included. Data were analysed by Structural Equation Modelling. As a result, it is found that both product innovation and product quality have positive direct effect on brand loyalty and also have positive indirect effect on brand loyalty through brand awareness and brand image. In the study, it is also determined that that brand awareness and brand image have significant positive effect on brand loyalty. In this context, it is important for the smart mobile phone brands to be open to innovations and attach importance to quality in terms of providing customer loyalty