CHAPTER2 LITERATUREREVIEW 2.1InclusiveMarketing Inclusivemarketingisusedtoadvertiseproductsorservicesthatcanrespectfully includeandrelatetothecomplexindividualswhomakeupthetargetaudience. Nowadays,withtheincreasingnumberofmediaandcommunicationssavvy,itis gettinghardertoconnectwithanaudienceandfosterarealsenseofinclusivity. (Dimitrieskaetal.,2019).BasedonJooandWu(2021),whenconsumerssee inclusivecommercialsascomparedtonon-inclusiveones,theirperspectivesand intentionscanbemorestronglyheld.Moreover,basedonCunninghamandMelton (2014),inclusivemarketingcanactuallyincreasepurchaseintention,andafter watchinginclusivecommercials,consumersaremorelikelytomakeapurchase (Qayyumetal.,2023).Thegoalofinclusivemarketingistoprovidethediverse audiencethatthecampaignisaimedatwithasenseofacceptanceandbelonging. Fromafinancialperspective,inclusionoffersmultipleadvantages.Includinga broaderdemographicwhendevelopingamarketingcampaignfacilitatesbrand expansion.Furthermore,theimpactoftheproductsbeingmarketedwillbemore effective,andlast,increasingthenumberofindividualswhobelievethatthebrand representsandvaluesthem,whichwillultimatelyresultinhigherrevenuegrowth (Isac,2021). 2.2CosmeticIndustryCurrentCondition AccordingtoStatista(2024),theworldwidebeautyandpersonalcaremarketis expectedtogrowtooverUS$646.20bnofrevenueby2024.Thereare5brandsthat dominatetheglobalcosmeticindustry,whichareL’Oréal,Unliver,Procter&Gamble, EstéeLauder,andShiseido.Oneofthemostessentialthingsingainingcompetitive advantageforcosmeticbrandsisproductinnovation(Szutowski&Szutowska,2017). InIndonesia,theprojectedrevenueisexpectedtobetheamountofUS$9.17bn (Statista,2024).ItispredictedthatthegrowthofthebeautyindustryinIndonesiacan increaseupto5.91%peryear(KementerianPerindustrianRepublikIndonesia,n.d.) Theexpansionofthecosmeticsindustryisfueledbypopulationgrowth,increasing 15 awarenessofhealthandwellness,andhigherdisposableincomes(Ferdinand& Ciptono,2022). 2.3BrandImage Brandimagecanbeexplainedasacombinationofconsumerinsightandbeliefabout abrand(Ziaetal.,2021).Agoodbrandimagecanleadtoasuccessfulbusiness,asit canincreasecustomersatisfactionandloyalty.Brandimagecandecidewhethera customershouldbuytheproductornotbecauseabranditselfshowshowdependable thenameofthebrandis,includingconfidenceinthemarket(Gazietal.,2024).The perceptionthatcustomersholdintheirmemoryaboutonebrandisimportant.The uniquenessofthebrandisconsideredasthecompetitiveimageattributesofthebrand. Abrandthatshowsvalueandhasacommitmenttoperformbetterwillcreatea positivebrandimage(Xuetal.,2022).Insomecontexts,imageisconnectedto emotions;inothers,itrepresentstheinformationthattheorganizationistryingto spread.Companiesneedtorealizethattheirimageisessentialtotheirsuccesssince brandscompetewithoneanother(Išoraitė,2018).Theroleofbrandimageis importantfordevelopingabrand.Brandimageisconnectedtothereputationand credibilityofabrandthatcanbecomeaguidelinefortheirpotentialcustomerto decideiftheyshouldtryorusetheproduct/services(Wijaya,2013). 2.4CustomerSatisfaction AccordingtoKotlerandKeller((2009),customersatisfactionisanexpressionofthe feelingthatthecustomerhasbycomparingtheproductthatthecustomerachieves withtheexpectation,resultinginobtainingsatisfactionordissatisfaction(Nainietal., 2021).BasedonAnderson,Fomell,andLehmann1994,customersatisfactionisa fundamentalindicatorthatindicatesafirm’spast,current,andfutureperformance (Fornelletal.,1996).Itisafeelingofbothhappinessanddisappointmentafterusinga product/service(Bahri&Herawan,2020).Satisfactioncouldhappenwhenthe customermeetstheirexpectationsforaproductorservice.Itistheoutcomeof customers'evaluationofaproductorservice,anditisbasedonthecustomer’s experience(Dam,2020). 16 2.5BrandTrust BasedonMobimanetal.,1993,brandtrustiswhenacustomeriswillingtorelyona brand.Itcanbeassessedfromhowthebrandfulfillsitspromises(Basiliscoetal., 2019).Itisimportantforacompanytohavebrandtrustinordertobesuccessful, becausetheyneedtobuildandmaintainrelationshipswithcustomers.Brandtrustisa connectionbetweenthecustomerandabrand.Itisarelationshipthatwasbuiltonthe basisofthecustomers’belieftorelyononebrand(Dam,2020).AccordingtoShin, Amenuvor,BasiliscoandOwusu-Antwi(2019)customerscouldtrustabrandifthey haveasenseofsecurityandconfidencethatcouldliveuptotheirexpectations(Keeet al.,2023). 2.6CustomerLoyalty Loyaltyiswhenacustomeriswillingtobuyproductswithoutbeingsensitivetothe priceandotherorganizationalvariablesastheyhavealreadyfeltcomfortablewith buyingtheproductforalongtime.BasedonJin,etal.(2012)brandimageisone factorthatcancontributetobrandloyalty.Itisthedirectoutcomeofbrandimage assessment,notjustbycustomersatisfaction(Xuetal.,2022).Customerloyaltyis whenacustomeriswillingtorepurchasetheproductorservicebecausetheyare committedtothebrand.Itisabehaviourofmakingdecisionstocontinuouslybuy productsfromonebrand(Mahgfiroh&Indriastuti,2022). 2.7ConceptualFramework Afterreviewingpreviousresearchanddoingtheliteraturereview,thisresearchwill usetheconceptualframeworkshowninFigure2.1.Theframeworkwasmergedand developedfrompriorresearch.ThefirstresearchwasfromMa'azzah&Prasetyo (2023),withtheresearchtitleof“TheInfluenceofBrandImageonCustomer LoyaltythroughCustomerSatisfactionasInterveningVariableonSkincareProducts”, whichincludedtherelationshipbetweenbrandimage,customersatisfaction,and customerloyalty.Theresearchhas3relationships,whicharebrandimageto customersatisfaction,customersatisfactiontocustomerloyalty,andbrandimageto customerloyalty.ThesecondresearchwasfromJaparianto&Agatha(2023),withthe titleof“TheInfluenceofBrandTrustandSatisfactiontowardsConsumerLoyaltyof aLocalCosmeticProductsBrandXamongGenerationZ”,whichshowsthe 17 relationshipbetweenbrandtrustoncustomersatisfaction,brandtrustoncustomer loyalty,andcustomersatisfactiononcustomerloyalty.Moreover,thethirdresearch wasobtainedfromAfrianietal.(2019),withthetitleof“BrandCommunications Effect,BrandImages,andBrandTrustOverLoyaltyBrandBuildingatPTSanko MaterialIndonesia”whichshowsthatbrandimageaffectsbrandtrust. Figure2.1ConceptualFramework (Source:Ma'azzah&Prasetyo,2023;Japarianto&Agatha,2023;Afrianietal.,2019)2.8HypothesisDevelopment 2.7.1RelationshipbetweenBrandImageandCustomerSatisfaction Acompanythatbuildsapositiveimageofabrandcanbringsatisfactiontothe customer.Theimageofabrandisimportantforthecompanytomovetowards customersatisfactionasitcanhelptoconstructtheimageofabrand(Abbaset al.,2021).Brandimageisconfirmedtobethepredecessortocustomer satisfactionandloyalty,itcaninfluencethesatisfactionofcustomers positively(Wijaya,2018).Thesatisfactionofacustomerisdeterminedby whattheyget.Theimageofthebrandcanbringpositiveornegativeimpact towardsthecustomersatisfaction,iftheimageisgood,thenthecustomerwill besatisfied,andviceversa.Iftheimageisbad,thenthecustomerwon’tbe satisfied(Ma'azzah&Prasetyo,2023).So,basedonthetheoryabove,the hypothesisforthisstudyis: 18 H1:BrandImagehasasignificanteffectonCustomerSatisfaction. 2.7.2RelationshipbetweenBrandImageandBrandTrust Accordingtoapriorstudy,brandsthathaveapositiveandpowerfulbrand imagearemorelikelytohavetrustinthebrandandarealsomorelikelytobuy thatparticularbrand(Kim&Chao,2019).Customersaremorelikelytothink thataproductisgoodwhenithasapositivebrandimage,whichsupportsthe ideathatanimageofabrandcanboostcustomertrustinitsbrands(Bernarto etal.,2020).Fromthestudyonpreviousresearch,thehypothesiswillbe: H2:BrandImagehasasignificantandpositiveeffectonBrandTrust. 2.7.3RelationshipbetweenBrandImageandCustomerLoyalty AccordingtoKandampully&Suhartanto,(2000)brandimageasanimportant variablecaninfluencethepurchasingactivityofacustomerpositivelyor negatively.InpreviousresearchthatwasconductedbyCuong&Khoi(2019), Dam&Dam(2021)brandimagehassignificantinfluenceoncustomerloyalty (Ma'azzah&Prasetyo,2023).Thatiswhythehypothesiswillbe: H3:BrandImagehasasignificanteffectonCustomerLoyalty. 2.7.4RelationshipbetweenBrandTrustandCustomerSatisfaction Previousresearchexplainsbrandtrustastheconsumer'sperceptionofthe brandandanunderstandingofhowaproductworkstosatisfythem (Apriansyah&Muhmin,2023).Customerswhowanttobelieveinbrandsthat takerisksandhavefaithinthemtoprovidepositiveoutcomesaresaidtohave trustinthebrand(Wuluretal.,2020).Productsellersandserviceproviders mustcontinuouslyestablishandvalidatetheirbrandinordertogainthetrust ofconsumers.Brandtrustwillstarttoariseifcustomershavegrown accustomedtoandbelieveinthebrandsthatareoffered.Furthermore, customerswillfeelmoreateasebecausebrandtrusthasbeendeveloped.In thisinstance,consumerhappinessisraisedbybrandtrust(Japarianto& Agatha,2023).Basedontheexplanationabove,thehypothesiswillbe: H4:BrandTrusthasapositiveeffectonCustomerSatisfaction. 19 2.7.5RelationshipbetweenBrandTrustandCustomerLoyalty Inessence,customersaremoreinclinedtoconsistentlybuyfromabusiness theycantrust.Customerswhoalreadyhavetrustinabrandaremoreinclined tomakeadditionalpurchasesfromitandmayevenbecomeloyalcustomers. (Japarianto&Agatha,2023).Oncetrusthasbeenestablished,customersare morelikelytomakerepeatpurchasesorreferotherstoaproductorservice, whichistheformofcustomerloyaltytoabrand.Customersdeveloployaltyto abrandbecausetheproducershavesuccessfullydeliveredontheirpromises, whichfosterstrustintheproduct(Tammubua,2021).Basedonprevious research,thehypothesiswillbe: H5:BrandTrusthasapositiveeffectonCustomerLoyalty. 2.7.6RelationshipbetweenCustomerSatisfactionandCustomerLoyalty Customersatisfactioncansupporttherepetitivebuyingbehaviourofa customerwhichisacustomerloyalty.Loyaltycanbegainedfromthe satisfactionofacustomertoonebrandthatoffersaproductorservices.A loyalcustomercangiveoutpositivewordofmouthandrecommendationto othercustomers,whichcanbringbenefittothebrand(Ahlawat,2023). Previousstudieshaveshownthatcustomersatisfactiondoesaffectcustomer loyaltythemost,whichiswhythecustomerneedstobesatisfiedfirstbefore onebrandcanachievetheloyaltyofacustomer(Abuetal.,2020).Basedon thestudyabove,thehypothesiswillbe: H6:CustomerSatisfactionhasasignificanteffectonCustomerLoyalty 20.