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International Journal of Healthcare Management

ISSN: 2047-9700 (Print) 2047-9719 (Online) Journal homepage: https://www.tandfonline.com/loi/yjhm20

Role of service quality, trust and loyalty in building


patient-based brand equity: Modeling for public
hospitals

Rohollah Kalhor, Omid Khosravizadeh, Mohammad Zakaria Kiaei, Saeed


Shahsavari & Mohammad Badrlo

To cite this article: Rohollah Kalhor, Omid Khosravizadeh, Mohammad Zakaria Kiaei, Saeed
Shahsavari & Mohammad Badrlo (2020): Role of service quality, trust and loyalty in building
patient-based brand equity: Modeling for public hospitals, International Journal of Healthcare
Management, DOI: 10.1080/20479700.2020.1762053

To link to this article: https://doi.org/10.1080/20479700.2020.1762053

Published online: 28 May 2020.

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INTERNATIONAL JOURNAL OF HEALTHCARE MANAGEMENT
https://doi.org/10.1080/20479700.2020.1762053

Role of service quality, trust and loyalty in building patient-based brand equity:
Modeling for public hospitals
Rohollah Kalhor a,b, Omid Khosravizadeh a,b
, Mohammad Zakaria Kiaei a,b
, Saeed Shahsavari c,d
and
Mohammad Badrlo e
a
Social Determinants of Health Research Center, Research Institute for Prevention of Non-Communicable Diseases, Qazvin University of
Medical Sciences, Qazvin, Iran; bDepartment of Health Services Management, School of Health, Qazvin University of Medical Sciences,
Qazvin, Iran; cDepartment of Epidemiology and biostatistics, School of Public Health, Tehran University of Medical Sciences, Tehran, Iran;
d
Health Products Safety Research Center, Qazvin University of Medical Sciences, Qazvin, Iran; eStudent Research Committee, Qazvin
University of Medical Sciences, Qazvin, Iran

ABSTRACT ARTICLE HISTORY


In the current competitive situation, hospitals are seeking to keep their position among patients. Received 9 July 2019
This study aimed to find factors influencing on the brand equity of hospitals.in the cross Accepted 2 April 2020
sectional study, Firstly, the factors affecting the brand equity were identified Subsequently,
KEYWORDS
by holding the panel of experts, the effective factors were taken into account After Patients; brand equity;
standardization, the questionnaire was given to 450 admitted patients in Qazvin’s hospitals. hospital; structural Equation
Finally, the causal relationship between the variables was evaluated using the Structural modeling; service quality
Equation Model (SEM) on AMOS22 software, with a significant level of 0.05. Analysis of
findings revealed all fit indices were in an acceptable level. The path coefficient between
brand trust and brand loyalty with brand equity was positive (t > 1.96). Study result is
necessary for hospitals to prioritize attention to dimensions and factors affecting brand
equity in order to maintain their place in society and provide effective services

Introduction and background intangible products and services enabling them in bet-
Nowadays, marketing is one of the basic needs of each ter identification of their needs. Moreover, a high level
organization for survival, and to enhance the products of brand equity enhances customers’ satisfaction, their
quality and offered services. The lack of attention to rebate and also loyalty levels [5], which is beside a key
marketing in non-commercial organizations such as role the brand plays in business success [6,7]. There are
healthcare will lead to waste of resources, and impose a lot of different studies which have highlighted the
social and economic costs. In this regard, one of the importance of brand equity, especially in healthcare
most important marketing concepts widely discussed organizations and have regarded it as a significant
by marketing experts is brand equity, which plays a change to maintain market share. In such investi-
strategic and significant role in management decisions gations, various variables were considered with respect
and creates competitive advantages for organizations to their context and purpose. In this regard, it could be
and their customers [1,2]. Healthcare centers encoun- referred to several studies on military hospitals of Iran
ter special challenges around the world. An extended [8], Yazd hospitals, Iran [9], Seoul hospitals, Korea
number of healthcare centers face really competitive [10], Indonesia. Hospitals [11], and also some systema-
conditions owing to open-door policies in medical ser- tic and comprehensive research in Iran and all around
vice markets [3]. In this regard, creation of a renowned the world as examples. In the current situation, hospi-
hospital brand would be a valuable tool for managers to tals are seeking to obtain more market share and pre-
hire and keep doctors and nurses [4]. Having a strong serve it. They have also been making an effort to
brand in the market is one of the fundamental goals of discover new ways to generate more value in their cus-
most organizations. Financial experts believe that a tomers’ mind. However, what is problem is that the
commercial brand can provide more than just a com- managers have no information about factors contribute
mon value. Today, a brand not only is an effective to their brand equity creation in the mind of patients
tool among managers, but also is a strategic require- and customers, and the way they have to manage the
ment which helps organizations in the creation of brand’ effectiveness [12]. Hence, the objective of this
value for customers. It also assists in the creation of study was to design a questionnaire, to identify effective
sustainable competitive advantages. Successful brands dimensions on the brand equity of medical centers, and
contribute to an increase in customers’ trust to to determine their relationship in a model framework.

CONTACT Mohammad Badrlo mm.94.mb@gmail.com Student Research Committee, Qazvin University of Medical Sciences, Shahid Bahonar Blv, P.
Code: 3419759811 Qazvin, Iran
© 2020 Informa UK Limited, trading as Taylor & Francis Group
2 R. KALHOR ET AL.

The results of the current research would be useful in H3: Perceived quality has a significant impact on
planning for better services and also making appropri- brand satisfaction.
ate decision in the field of hospital services, in particu- H4: brand satisfaction has a significant impact on
lar absorbing maximize market share, utilizing accurate brand Trust.
resources and accessing to productivity at the hospital
level. H5: brand Trust has a significant impact on brand
loyalty.

H6: brand loyalty has a significant impact on brand


Methodology Equity.
The present study was a descriptive analytical research H7: brand awareness has a significant impact on brand
which carried out using a cross-sectional design in Trust.
teaching and public hospitals of Qazvin, Qazvin pro-
H8: brand awareness has a significant impact on brand
vince, Iran in 2018. The current investigation consisted
loyalty.
of three stages as follow:
H9: brand awareness has a significant impact on brand
Equity.
Comprehensive reviewing of studies
H10: brand association has a significant impact on
At this stage, previous research findings in brand equity brand Trust.
were assessed using databases. The utilized tool was a
H11: Perceived quality has a significant impact on
data collection form. This form was used to maintain
brand Trust.
integrity, reduce bias, and increase the reliability and
validity of the texts. Required data were collected H12: brand satisfaction has a significant impact on
from the databases including Irandoc, Embase, and brand loyalty.
Google scholar, IranMedex, SID, Magiran, PubMed H13: brand satisfaction has a significant impact on
and Scopus, on the basis of keywords comprising brand Equity.
‘brand equity’, ‘brand’, ‘hospital’, ‘medical service’,
‘pattern’, ‘model’, ‘hospital marketing’, ‘branding’,
and ‘effective factors’. Afterwards, the articles were Designing a questionnaire and collecting
evaluated in terms of quality. Subsequently, the effec- data
tive factors on brand equity were categorized and the
most relevant ones were arranged in a class. The con- The questionnaire was compiled based on the acquired
ceptual model for the current study is presented in information from the comprehensive review of studies
Figure 1. The present model was obtained by systema- as well as supervisors and counselors’ opinion. The
tic analyzing of the results of some comprehensive method of expert’s judges was applied to measure the
studies. face validity of the tool. And Confirmatory Factor
Based on the literature review [8], the following Analysis (CFA) were performed to evaluate the Con-
hypotheses are proposed for the study: tent validity. The questionnaire’s reliability was
assessed using the method of Cronbach’s alpha with
H1: Brand awareness has a significant impact on the rate of 92.2. The questionnaire consisted of two sec-
brand association. tions: demographic information and brand equity
H2: brand association has a significant impact on Per- assessment. The first section included questions
ceived quality. about gender, history of hospitalization and types of

Figure 1. Conceptual model of study.


INTERNATIONAL JOURNAL OF HEALTHCARE MANAGEMENT 3

hospitalization and treatment. The second section con- covariance matrices; The GFI (Goodness of Fit
tained questions concerning evaluation of brand equity Index) evaluated the relative value of variances and
dimensions including brand awareness (3 questions: covariance jointly, through the model; The RMSEA
Hospital name, Hospital Features, Other people’s (Root Mean Square Error of Approximation) showed
opinion), brand association (5questions: Beneficial an average of the model covariance matrix to the
treatment, Ability to solve patients’ problems, the abil- data covariance matrix; The CFI (Comparative Fit
ity for the general welfare of society, Affordable service Index) was used to compare the model with an inde-
price, Good reputation), perceived quality(4 questions: pendent model, and NFI (Normed Fit Index) which
Process accuracy, process speed, physicians’ knowledge evaluated chi-square values of an independent model.
and skill, quality of medical equipment), satisfaction(5 The adequacy of sampling was tested by KMO (Kaiser
questions: clinical and non-clinical Process Satisfac- Meyer Olkin), while the strength of the relationship
tion, Patient Attention, Patient Choice, Responsibility among variables was examined via Bartlett’s test of
of the Medical Staff), brand trust(4questions: Honest sphericity. In this study the KMO index was 0.89
Speech, Fairness in Hospitalization and Treatment, (more than 0.6) implying the sample number was
Patient Confidentiality, Hospital Financial Transpar- sufficient for factor analysis. Besides, the Bartlett test
ency) and brand loyalty(4 questions: Sense of belong- index was smaller than 0.05 indicating the factor analy-
ing to the hospital, re-visiting, spending time and sis was suitable for identifying the model structure. The
money on patients, offering the hospital to others). A above steps were carried out on SPSS 25.0 and AMOS
five-section Likert scale was used to analyze the impor- 22 software, and at last the final validated model was
tance of the factors affecting brand equity with the fol- presented.
lowing category: very low, low, medium, high and very
high. The studied statistical population consisted of
450 admitted patients in the teaching and public hospi- Findings
tals of Qazvin, who had been selected by Stratified ran-
Patient characteristics
dom sampling in each hospital. It is worth noting that
only the completed questionnaires were took into The number of participants in the present research was
account and the patients who had fill out the question- 450 consisting of 187 (41.6%) male and 263 (58.4%)
naire imperfectly were excluded. Considering the female. In terms of education stand, 282 (62.7%) had
unlimited size of statistical population, James Steven’s high school diploma or lower secondary education’s
method was utilized to determine the sample size. To degree, 107 (23.8%) had undergraduate’s degree, 57
this end, for each variable in the questionnaire, a (12.7%) had bachelor’s degrees and 4 (9%) had master’s
sample equal to 12 times of each variable size was pre- degree (Table 1).
dicted. The logic of such the selection, 12 samples for
each variable, was based on James Steven’s proposal
in which the selection of 10–15 items for each proposed Fit index and assessment of the model
variable is considered appropriate in multiple
To assess the compatibility and consistency of the
regression analysis using the methods such as standard
model with the research data, the fit model was used.
least squares, EFA, CFA, and SEM model [13].
The conceptual model fit was evaluated in two steps
Descriptive statistics in the present stage were used
comprising the model measurement section and the
on the statistical package SPSS 25.
structural part of the model, respectively. At the first
section, the model was appraised for validity and
Validation and presentation of final model reliability. In order to examine the significance of the
relationship between brand equity and its dimensions,
At this level, a final model for quantitative findings was
the second order factor analysis was performed. The
presented. In order to studying the causal relationships
results of standard estimation coefficients of the second
between variables in a coherent way and presentation
order factor analysis of brand equity showed that all
of the final model, SEM technique was applied. This
paths were at a significant level (Figure 2). However,
technique consists of five stages as follows: model
expression (primary model construction), model esti-
mation (data collection and variable’s matrix creation), Table 1. Demographics distribution of participants.
fit assessment (a general review of the model’s appro- Variables N %

priateness, its feasibility, and evaluating the necessity Gender male 187 41.6
female 263 58.4
of making reform), model modification and model History of hospitalization yes 202 44.9
interpretation. Moreover, 5 indexes were used to assess no 248 55.1
Type of hospitalization emergency 129 28.7
the model fit for, CFA and SEM as follows: The χ 2 Non-emergency 321 71.3
index was utilized to appraise the model general fit Type of treatment medical 169 37.6
Surgery 281 62.4
and to determine the differences between estimated
4 R. KALHOR ET AL.

Figure 2. Factors for estimating the standard factor analysis of the primary model.

as it is shown in Table 2, the obtained values for such Discussion


indexes as chi-square to degrees of freedom, GFI,
The results of this study based on the validated model
RMSEA and CFI were not in the defined range indicat-
showed that hospital’s brand awareness affects the hos-
ing the obtained model fit did not have as good fit as it
pital’s brand association and predicts it well. In this
could have. Therefore, some changes were considered
regard, having the knowledge brand name could
to be necessary in order to better fit creation. These
cause to recall brand association in customer’s mind
changes were implemented in a proposed model and
during shopping. Similar results in accordance with
the results of fit indices improved (Figure 3).
the current investigation have been reported on health-
The results of structural equation modeling analysis
care industries in Iran such as studies on some hospi-
showed a significant correlation between brand equity
tals in Tehran [14] and also a study which conducted
and its related factors (Table 3). Correlation coefficient
in Iran. [15]. The results of Buil and Martinez research
between the seven factors and brand equity indicated
in Spain and United Kingdom were also in line with the
the effect of these variables on the hospital’s brand
present study [16]. The results of validated path model
equity. In conclusion, our findings revealed a difference
also indicated a direct and significant impact of brand
between the conceptual model with the proposed
association on perceived brand quality. Such obser-
model. Moreover, the effect of brand awareness on
vation was in accordance with the previous findings
brand trust, as well as the effect of brand satisfaction
on Iran healthcare and household appliance industries
on brand equity was not confirmed in the proposed
[14], the patients of Delhi hospital, India [17], Vietna-
model.
mese banking industry [18]. In addition, there was a
direct and positive effect of perceived quality on custo-
Table 2. Comparison of fit indices in the primary and the mer satisfaction from the brand. Therefore, it could be
proposed model. concluded that improving the services quality of
Fit index Permissible limit primary model Proposed model healthcare centers would increase patients and custo-
x2
df
Less than 3 4.239 2.858 mer’s satisfaction and lead to a lot more profitability
GFI More than 0.9 0.804 0.938
RMSEA Less than 0.08 0.058 0.075
and survival maintenance of the centers than before.
CFI More than 0.9 0.872 0.901 Similar results in line with this research were obtained
NFI More than 0.9 0.839 0.909 in studying Shiraz health centers, Iran [19], mobile
INTERNATIONAL JOURNAL OF HEALTHCARE MANAGEMENT 5

Figure 3. Factors for estimating the standard factor analysis of the proposed model.

communication industries in Korea and hospitals in brand users in Istanbul [24], Arabnejad research on
Taiwan [20] and also a retail store environment in Apple products customers in Mashhad, Iran [25] and
the United States [21]. The current study results Zehir et al. investigations on global brands [26]. The
were, however, in contrast with the study of Feng results of path analysis in the confirmed model also
et al. and Wu et al. on the relationship between service showed a direct correlation between brand trust with
qualities with customer’s satisfaction [22,23]. Besides, it brand loyalty, which emphasis on the importance of
was demonstrated that brand satisfaction has a positive trust to the brand on loyalty creation. If a hospital con-
and direct effect on brand trust. With regard to this sidered fairness and justice in dealing with patients and
result, the greater is the services satisfaction, the its medical staff behaved honestly, the patients would
more would be customer’s trust to the brand. This indi- trust to the brand and valorize it. Whereupon, such
cates the consumer will probably choose a more the trust could lead to the patient’s loyalty to the men-
reliable brand in comparison to other brands. This tioned centers. In line with current study, the results of
result was in agreement with Sahin et al. studies on a study in Tehran’s hospitals, Iran, indicated the brand

Table 3. Results of structural equation modeling of dimension in final model.


Symbol hypothesis Standardized estimate SE CR Pvalue Result
H1 Brand awareness → brand association .367 .051 6.469 *** Accepted
H2 Brand association → Perceived quality .718 .065 11.089 *** Accepted
H3 Perceived quality → Brand satisfaction .698 .045 9.412 *** Accepted
H4 Brand Satisfaction → Brand Trust .167 .117 2.846 *** Accepted
H5 Brand Trust → brand loyalty .451 .052 8.212 *** Accepted
H6 Brand loyalty → brand equity .605 .067 10.355 *** Accepted
H7 Brand Awareness → Brand Trust .014 .048 0.510 .778 Rejected
H8 Brand awareness → brand loyalty .140 .042 3.185 *** Accepted
H9 Brand awareness → brand equity .083 .048 2.091 *** Accepted
H10 Brand association → brand trust .322 .086 3.465 *** Accepted
H11 Quality → brand trust perceived .167 .093 2.293 *** Accepted
H12 Brand Satisfaction → brand loyalty .288 .090 5.413 *** Accepted
H13 Brand Satisfaction → brand equity .057 .094 1.176 .244 Rejected
*** Correlation is significant at level of 0.001 (2-tailed).
6 R. KALHOR ET AL.

confidence has an effect on brand loyalty and predicts it xie confirmed the relationship between association
well [4]. There are also another research with the same with brand trust [18,35]. According to the current
findings such as studies on social media industry [27] study results, it was also demonstrated that perceived
and cosmetics industry [28]. In addition, the relation- quality will have a positive impact on the brand trust.
ship between brand loyalty with brand equity was Whatever the quality of service is improved, the custo-
confirmed in a direct and positive manner, in the cur- mer will rely more on that brand. Subsequently, the
rent study. According to this result, the greater is the brand will be stabilized in customer’s mind insofar as
loyalty of patients to hospitals, the more will be under- they tend to select a brand with the highest degree of
stood the hospital’s value. To be more precise, while a quality in their further choice. This finding was in
patient is loyal to a hospital brand, she/he will tend to line with following studies on Delhi hospital’s patients,
get a service at such specific hospital again. Thereupon, India [12], healthcare industry in Tehran’s hospitals,
the hospital would be prioritized compared with others Iran [14] and global brands in the year of 2013 [36].
and could also be recommended to other customers, The research also showed that there is a positive and
which totally leads to an improvement in brand equity direct link between brand satisfaction and brand loy-
[8]. Similar results in accordance with the present study alty. Customer’s satisfaction is one of the most impor-
have been reported in previous research such as studies tant factors affecting customer’s loyalty. Satisfied
on healthcare industries in Shiraz hospitals, Iran [19], customers will turn to loyal customers. When custo-
health drink consumers in Tamil Nadu, India [29], mer’s contentment be low, they tend to leave the pro-
Emergency cares in Pakistani hospitals [30], Indian duct and go for a competitor’s product. They will
hospitals [17]and pharmaceutical industries in India also complain about the product. Similar results in
[31]. Besides, in a systematic and comprehensive agreement with our investigation finding have been
study, a positive and significant impact of brand loyalty reported by Maleki on studying Shiraz hospitals in
on brand equity in line with the present work was Iran [19], and Hug study [37]. Moreover, the results
reported [8]. Our findings, however, were in contrast of Ozer studies in Turkey hospitals [11] and Dmitriy
with a study conducted by Kim et al. in five hospitals Zuy. Studies in Greece on the impact of respecting
in Seoul, South Korea [10]. patients’ rights on their loyalty to a brand, confirmed
The current study findings also indicated on the the present results [38]. However, our results did not
direct influence of brand awareness on brand loyalty. confirmed the effect of brand awareness on brand
This implies that a patient with positive brand experi- trust. Therefore, it could be concluded that although
ence could choose the same brand for his/her next these two variables may have a direct impact on
treatment and stay as a loyal customer to the brand. brand equity, individually, they are not able to have a
This result was confirmed by Gilani research [32], direct and positive effect on each other. Customer
while Boo et al. studies on tourists were opposite to and patient’s knowledge of a particular brand cannot
our findings [33]. The results of path analysis in the lead to trust in the brand by itself. Nevertheless, such
validated model showed no significant relationship observation was not confirmed by Severi [39]. At the
between brand awareness with brand equity. With end, our results revealed that service satisfaction does
regard to this result, it could be deduced that all people not have a direct link with the brand equity of health-
who have been admitted to a hospital, whether the hos- care centers. Although it was expected that there would
pital is considered good or not in their minds, have be a direct relationship between these two variables, the
enough knowledge and experience about that hospital. obtained results of the current research did not confirm
Thus, patient’s awareness of hospital name and brand it. In addition, it was displayed that service satisfaction
would not simply contribute to hospital’s brand pro- will not be able to increase brand equity by itself. How-
motion. It is needed to take heed of other impressive ever, it can be deduced that with increasing satisfac-
factors on the enhancement of hospital’s brand equity. tion to healthcare services, brand equity would be
The current result was in accordance with findings of a promote via influencing on other variables. The cur-
study on healthcare industries in Tehran hospitals, Iran rent achieved results were completely incompatible
[14], whereas study on the patients of the Delhi hospi- with studies on the healthcare industry in Tehran
tal, India [17], Taiwan health centers [34] were in con- [14], tourist centers in Qazvin [40]. Considering the
trast with our study. Moreover, our results showed that results of the present study, one of the probable
there is a direct and significant link between brand reasons of no significant relationship between service
association and brand trust. With increasing brand satisfaction and brand equity would be the method
association in customer’s mind, kind of trust would of data collection. The current data were collected
be created in their mind toward the treatment center. from public hospital’s patients who had no other
This research suggests that generation of mental associ- choice option in selecting other healthcare centers,
ations in customer’s mind could attract their trust lead- for example private hospitals because of high costs.
ing to their first choice. The results of previous research Therefore, we could not connect their choice option
were supportive of our results. In this regard, Ngoc and to service satisfaction. As a matter of fact, this was
INTERNATIONAL JOURNAL OF HEALTHCARE MANAGEMENT 7

one of weak points in this study, which studied data Notes on contributors
were collected from patients in public hospitals. Rohollah Kalhor, PhD, Associated professor of health service
Hence, the results cannot be generalized to other hos- management, Social Determinants of Health Research Cen-
pitals, such as private or charity hospitals. ter, Research Institute for Prevention of Non Communicable
Diseases, Qazvin University of Medical Sciences, Qazvin,
Iran. His research interests include: human resource man-
agement, performance evaluation, Financing Medical
Conclusion service.
The results of analyzing the validated model revealed a Omid Khosravizadeh, PhD, Assistance professor of health
positive and significant impact of the provided service service management, Social Determinants of Health
quality on brand satisfaction and brand trust, as well as Research Center, Research Institute for Prevention of Non
Communicable Diseases, Qazvin University of Medical
brand awareness on brand associations. However, the
Sciences, Qazvin, Iran. His research interests include:
direct and positive influence of brand awareness on human resource management, healthcare marketing, hospi-
brand equity and brand trust was not confirmed. tal branding.
Moreover, no relationship was observed between Mohammad Zakaria Kiaei, PhD candidate in health service
brand satisfactions with its equity. Our results also management, Social Determinants of Health Research Cen-
suggested a positive effect of brand association on per- ter, Research Institute for Prevention of Non Communicable
ceived quality and brand trust. According to the cur- Diseases, Qazvin University of Medical Sciences, Qazvin,
rent research, brand satisfaction could lead to brand Iran. His research interests include: Hospital Management,
Health Promotion, performance evaluation.
loyalty and also brand trust, while satisfaction itself
have no direct effect on brand equity, but can increase Saeed Shahsavari, PhD student in Biostatistics, Department
of Epidemiology and biostatistics, School of Public Health,
brand equity by creating loyalty and trust. In con- Tehran University of Medical Sciences, Tehran, Iran. His
clusion, it can be said that brand equity play an impor- research interests include: Structural Equation Modeling,
tant role in the management of health services. Interrupted time series analysis.
Hospital managers need to identify the factors and Mohammad Badrlo, Master of health service management,
dimensions affecting brand equity of their centers in Student Research Committee, Qazvin University of Medical
order to develop their own strategies based on them. Sciences, Qazvin, Iran. His research interests include: Nur-
In such the condition they would be sustainable in sing, Hospital Branding, Hospital emergency.
competing with other centers.
ORCID
Rohollah Kalhor http://orcid.org/0000-0002-6146-8761
Outlook Omid Khosravizadeh http://orcid.org/0000-0001-6893-
The highlight of this research would be suitable for 3489
Mohammad Zakaria Kiaei http://orcid.org/0000-0002-
hospital managers to create a strong hospital brand
6986-4988
in developing economies like Iran. It will also pro- Saeed Shahsavari http://orcid.org/0000-0002-0806-6026
vide rewarding guidance for hospital service market- Mohammad Badrlo http://orcid.org/0000-0002-9409-
ers on improving brand equity, locating hospital 361X
services in markets and processes for selecting
patient and customer. By implementing any of the
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