| Abstract: | Costco successfully transferred its Warehouse Membership Club (WMC) format to Australia. This research: 1) develops a conceptual framework to examine the role of consumer perception of format-specific core attributes in shaping the hedonic shopping experience and customer loyalty; and 2) compares Australian consumers' responses to the novel WMC format with U.S. consumers' responses to the familiar, mature format. We collected survey data from Australian and U.S. Costco members after Costco's entry into Australia's retail market and we tested the proposed model with a multiple-group structural equation modelling technique. Our findings suggest that value and hedonic shopping experience contribute to consumer loyalty in both countries. However, value is perceived as more important in shaping hedonic shopping experience, but less important in building loyalty in Australia than in U.S. When transferring a retail format that is novel to host country consumers, global retailers should factor in the novelty effect and emphasize the management of core format attributes that embrace the differences and carry particular importance in building customer loyalty. |
