It has been suggested that generating and maintaining customer loyalty constitutes a central goal for many organizations. However, studies of e-commerce consistently find that very few web site visitors return to make purchases and, in this regard, that the loyalty of e-shoppers is, at best, elusive. Such observations have led to a number of commentators to observe that too little is known of the nature and dynamics of online loyalty. In particular, it has been argued that the development of online trust is likely to be a core driver of e-loyalty. This study is designed to contribute insights in these issues in three main ways. First, we aim to incorporate the concept of trust into extant well-established frameworks of service quality, perceived value, customer satisfaction, and loyalty. Second, an objective of the study is to test empirically, Oliver’s (1997) conception of loyalty as a four-phased, sequential chain of cognitive-affective-conative-action loyalty. Finally, we intend to contribute insights into the idiosyncrasies of online service dynamics.

After a review of existing studies, we forward a framework of service that presents loyalty as a consequence of both direct and indirect relationships with trust, perceived value, satisfaction, and service quality. This framework builds on earlier models of well-established links and positions the concept of trust as pivotal to service dynamics.

To test the developed framework and hypotheses, two surveys were conducted of online shoppers. The books and the flights markets were selected as suitable contexts, on the basis that such markets are not only the largest and fastest-growing online markets but also constitute two contexts wherein early growth expectations have been matched by later growth. The first survey focused on the customers of books.com (a pseudonym) and was administered using a direct face-to-face approach. The second survey targeted the customers of flights.com (a pseudonym) and utilized a conventional postal methodology.

Analysis of the results of the two surveys revealed a number of interesting findings. First, after a series of analyses designed to gauge the sequence and dimensionality of loyalty, we conclude that the theorized loyalty chain of Oliver (1997) produces the best fit for both studies. That is, our studies support the view of loyalty as a four dimension, sequential chain of cognitive-affective-conative-action loyalty.

In the study of books.com, all predicted associative links are as expected and statistically significant, confirming the developed framework. In this regard, strong support is found for the suggestion that trust plays a pivotal role in online service dynamics. Although many of these findings are mirrored in the study of flights.com, subtle differences are observable. While, trust remains central, the role of customer satisfaction appears somewhat diminished. These intriguing results are argued to be attributable to sectoral differences including recent environmental and organizational changes that are industry-specific.

These findings generate interesting implications for both theory and practice. Strong support is found for Oliver’s (1997) loyalty chain (although further work is needed). Moreover, the two surveys confirm the centrality of trust in service dynamics and position trust as a pivotal factor in explaining loyalty. In addition, our findings suggest important implications for e-tail practitioners. In particular, an implication of our study is that the development of trust, and therefore loyalty, is contingent on ensuring that online claims and promises exhibited in the e-servicescape, are consistent with off-line service procedures (such as delivery). In highlighting the centrality of trust to online exchange, our study promotes the view that firms should develop strategies, systems, and websites that that are designed to recognize, incorporate, and ease the concerns of online shoppers. In this regard, it is suggested that, to build online loyalty, practitioners should focus their efforts on developing mechanisms to generate and maintain trust.