Customer engagement as a mediator of brand trust and customer loyalty: Does it works?

This study investigates the interrelationships among perceived value, brand trust, customer engagement, and customer loyalty in the Indonesian telecommunications industry. While previous studies often position trust as a mediator between engagement and loyalty, this research explores an alternative mechanism in which customer engagement mediates the effect of trust on loyalty. Using a purposive sampling approach, survey data were collected from 93 IndiHome customers in Medan Sunggal District. The data were analyzed with Partial Least Squares Structural Equation Modeling (PLS-SEM) to test both measurement and structural models. The results reveal that perceived value significantly influences customer loyalty but does not significantly predict engagement. Brand trust emerges as a central determinant, exerting significant effects on both engagement and loyalty. Furthermore, customer engagement strengthens loyalty directly and mediates the relationship between trust and loyalty, confirming its pivotal role as an active behavioral mechanism. These findings diverge from conventional models by highlighting a reversed pathway in which trust fosters engagement, and engagement consolidates loyalty. Theoretically, the study contributes to the refinement of loyalty formation models by positioning engagement as a key mediating construct. Practically, the results underscore the importance for service providers to build trust and foster engagement—through transparent communication, interactive platforms, and community-building initiatives—in order to transform customer confidence into long-term loyalty.