Exploring loyalty within car subscriptions, in the case of Care by Volvo - How can brand communities and social bonds be used to increase Millennials’ customer loyalty in the car subscription business model?

Abstract

Introduction: Subscription is a fairly new phenomenon, with several arising innovations. One of these innovations is Care by Volvo. This business model counters ownership of cars to accessibility to cars, which several generations also seem to do. One of these generations are millennials which are the focus of this study. The business model of subscriptions makes loyalty difficult to sustain since subscribers are not held down by a long-term commitment to it. Research question and aim: The aim of this study is to explore the role of social media-based brand communities and social bonds in increasing loyalty to a car subscription service. The research question is: How can brand communities and social bonds be used to increase Millennials’ customer loyalty in the car subscription business model? Theories about loyalty, social bonds, social media, and brand communities are used to answer this. Methodology: This study follows an exploratory approach to shed light on this little-discovered phenomenon. To answer our research question, netnography and interviews have been conducted. Results: The results of this study help us gain insight into Millennials' usage of car subscriptions, and how loyalty manifests within car subscriptions. The results also point toward how Millennials use social media, and form social bonds in brand communities. Conclusion: It has been discovered that brand communities increase the cognitive loyalty of Millennial car subscribers. Brand communities do so by granting new consumers access to information shared by community members; about a brand, product, or service. In this exchange of information, social bonds are formed, and consequently, new consumers build a preference for the brand.