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Background: The growing importance of hospitals in physical and mental health improvement has led to focus on improving service quality; and hospitals have considered it as a major competitive advantage. This study aimed at investigating the role of improving services quality on hospital brand preference in healthcare industry.

Materials and Methods: This applied study was a descriptive one. A sample of 394 patients selected using stratified and convenient sampling from hospitals of Shiraz city. Data gathering using questionnaire; in order to data analysis, LISREL_8.80 and SPSS₁₉ were utilized using confirmatory factor analysis and structural equation modeling techniques. Data analysis was used to confirm the relationships between variables.

Results: Study results indicated that there was a significant positive effect of service quality on patient satisfaction, patient loyalty and brand equity of hospital. Patient satisfaction had positive effect on patient loyalty to the hospital and the loyalty had significant effect on hospital’s brand equity. Finally, the effect of hospital brand equity was confirmed on hospital brand preference.

Conclusion: According to the study results, it can be suggested that hospitals management take some measures for service quality improvement which can be enhanced hospital brand preference among other hospitals, both spreading justly public health in all layers of society as well as increasing profitability.

Keywords: Service quality, Brand Preference, Hospital