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Article
Publication date: 6 September 2011

Nor Asiah Omar and Rosidah Musa

This research aims to empirically develop a reliable and valid scale for measuring the service quality of retail loyalty programmes (loyalty programme service quality…

Abstract

Purpose

This research aims to empirically develop a reliable and valid scale for measuring the service quality of retail loyalty programmes (loyalty programme service quality (LPSQual)) in the context of department stores and superstores in Malaysia.

Design/methodology/approach

By adapting the process proposed by Churchill for developing measures of marketing constructs, an instrument to assess LPSQual in Malaysia is formulated. The methodology consists of developing the scale based on a literature review and qualitative method. The proposed scale is then purified and validated through exploratory factor analysis and confirmatory factor analysis.

Findings

The proposed instrument (LPSQual) contains 26 attributes in seven dimensions: reward, tangibility, policy, information usefulness, courteousness/helpfulness, personalization and communication.

Research limitations/implications

Further testing of the scales across multiple contexts is necessary for validity enhancement.

Practical implications

Retail managers must give serious thought to the non‐material or “soft‐benefits” component in a loyalty programme which emphasizes courteous/helpful and personalized services. Thus, managers need to focus on service personnel by providing training to upgrade employees' skills in creating and delivering pleasant experience/service encounters to cardholders.

Originality/value

The main contribution of this paper is the development and validation of a new scale called LPSQual, which focuses on service quality in a loyalty programme. On the one hand, it is a pioneer in the study of service quality in loyalty programmes and, on the other hand, it confirms results from other researches on non‐material strategies that can be used in loyalty programmes.

Details

International Journal of Retail & Distribution Management, vol. 39 no. 10
Type: Research Article
ISSN: 0959-0552

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Article
Publication date: 8 March 2013

Lars Meyer‐Waarden, Christophe Benavent and Herbert Castéran

This article aims to dwell on theoretical, managerial, and empirical knowledge to improve loyalty programme efficiency. Its intention is to try to understand how economic…

Abstract

Purpose

This article aims to dwell on theoretical, managerial, and empirical knowledge to improve loyalty programme efficiency. Its intention is to try to understand how economic, hedonist, relational, convenience, informational rewards enhance or undermine customers' perceived programme benefits as well as subsequently loyalty according to individual shopping orientations (economical, hedonist, social‐relational, apathetic, brand/loyal).

Design/methodology/approach

The research uses self‐determination theory (SDT) and purchase orientations to classify types of rewards in terms of their effect on perceived programme benefits and loyalty. Scales are developed through exploratory and confirmatory factor analysis. To validate the hypotheses, surveys in two retail chains (grocery/perfumery) are used. Structural equation modelling confirms the research model.

Findings

Perceived benefits and loyalty vary according to purchase orientations, in line with the SDT. Intrinsic (extrinsic) rewards motivate customers to act to obtain a benefit within (apart from) the target of their purchase orientation and influences loyalty positively (have low impact on loyalty).

Research limitations/implications

Further testing of reward types, in(ex)trinsic motivation, across multiple contexts is necessary for validity enhancement as it remains challenging to categorize purchase orientations and rewards. It is necessary to precisely define the degree of the relationship among an intrinsic purchase orientation and perceived loyalty programmes' benefits as orientations might be multidimensional.

Practical implications

Differentiation through tailored rewards is necessary in markets with strong competition to appeal to different segments. Differentiation could be achieved through nonmonetary benefits. The principal role of loyalty programmes should be to identify and segment customers as a means to improve resource allocations.

Originality/value

This is one of the pioneer articles in the use of SDT in marketing research. SDT provides a multi‐benefit framework which identifies the different (non‐) monetary rewards customers may value (in)extrinsically when participating in loyalty programmes. The development of scales which focus on rewards and the impact of purchase orientations on loyalty programmes' perceived benefits is another contribution.

Details

International Journal of Retail & Distribution Management, vol. 41 no. 3
Type: Research Article
ISSN: 0959-0552

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Article
Publication date: 9 May 2016

Carol L. Esmark, Stephanie M. Noble and John E. Bell

This paper aims to examine the impact of an open loyalty programme (anyone can join) versus a selective programme (requirements must be met) to show what types of loyalty

Abstract

Purpose

This paper aims to examine the impact of an open loyalty programme (anyone can join) versus a selective programme (requirements must be met) to show what types of loyalty programmes are most effective. In-group identification, gratitude, stage of relationship and visibility are additionally examined.

Design/methodology/approach

Two studies use experimental methodology to initially test the relationships. A third study uses survey and panel data.

Findings

Open programmes lead to more in-group identification, while selective programmes lead to higher levels of gratitude, especially in mature stages. Visible programmes lead to more in-group identification. Industry differences are presented.

Research limitations/implications

The first two studies use a student sample (although Study 3 uses penal data). The research is limited to the variables examined. The findings add to theory by showing differences between open and selective loyalty programmes.

Practical implications

The findings show how different retailer offerings change the value and experience to the customer leading to loyalty intentions. Loyalty programme designers can tailor their programme structure to fit their customers and overall strategy. The findings also shed light on the strategic importance of tiered loyalty programmes.

Originality/value

The examination of how a customer enters a loyalty programme is not in current literature. The research shows how loyalty intentions are impacted by design of the programme, including how a customer signs up for a programme. The mechanisms through which the relationship works increase the understanding of loyalty programme effectiveness.

Details

European Journal of Marketing, vol. 50 no. 5/6
Type: Research Article
ISSN: 0309-0566

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Article
Publication date: 21 September 2010

Patrick Vesel and Vesna Zabkar

The purpose of the article is to investigate relationship quality in retail relationships as influenced by its antecedents (loyalty programme quality and personal…

Abstract

Purpose

The purpose of the article is to investigate relationship quality in retail relationships as influenced by its antecedents (loyalty programme quality and personal interaction quality) and resulting in customer loyalty to the retailer. The focus is on loyalty programme members' perceptions and differences between segments of consumers with different levels of involvement in the product category.

Design/methodology/approach

The method used was a consumer survey. Two waves of cross‐sectional telephone interviewing with 116 and 410 members of a retail loyalty club were conducted. Structural equation modelling served for the estimation of relationships in an integrated conceptual framework among constructs of loyalty programme quality, personal interaction quality, relationship quality and loyalty, relevant to the development of retail relationships.

Findings

The findings suggest that loyalty programme quality is important for relationship quality; however, efforts to assure personal interaction quality with customers are needed to improve relationship quality as well as customer loyalty. The study deepens knowledge of relationship quality's antecedents and consequences in the retail environment with regard to segments of customers with different levels of product category involvement.

Research limitations/implications

The research is limited to members of a selected DIY retailer's loyalty programme, not accounting specifically for membership in multiple loyalty programmes. Future research could use different methodologies such as longitudinal studies to examine dynamic relationships among the constructs in the study.

Practical implications

In the retail context, practical implications of the impact of loyalty programme quality and of personal interaction quality on relationship quality and customer loyalty are considered.

Originality/value

The paper contributes to the understanding of members' perceptions and responses to relationship quality as well as to some mechanisms underlying customer loyalty in loyalty programmes.

Details

European Journal of Marketing, vol. 44 no. 9/10
Type: Research Article
ISSN: 0309-0566

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Article
Publication date: 15 February 2008

Lars Meyer‐Waarden

In the retailing sector, consumers typically patronize multiple outlets, which leaves outlets striving to earn a greater portion of consumer expenditures. The purpose of…

Abstract

Purpose

In the retailing sector, consumers typically patronize multiple outlets, which leaves outlets striving to earn a greater portion of consumer expenditures. The purpose of this paper is to improve theoretical and empirical knowledge about the impact of retailing loyalty programmes on customer purchasing behaviour.

Design/methodology/approach

The effects of two loyalty programmes on customer behaviour are studied through marketwide panel data on supermarket purchases.

Findings

The impact of loyalty programme membership on customer purchase behaviour is significant.

Research limitations/implications

All behavioural indicators show that members and non‐members of loyalty programmes demonstrate significantly different purchase behaviours, irrespective of other factors. The purchase intensity of cardholders, in terms of total and average shopping baskets, share of purchases, purchase frequency and inter‐purchase time, is significantly higher than that of non‐members throughout the entire three‐year period and the trading areas. The findings require confirmation in other retailing sectors before they may be considered fully generalisable.

Practical implications

Retailers may apply the findings in their attempts to segment their target market, which enables them to allocate their marketing expenditures more effectively.

Originality/value

The study contributes to more “generalisable” knowledge by investigating marketwide scanner panel data about competitive purchasing, loyalty programmes and store locations.

Details

European Journal of Marketing, vol. 42 no. 1/2
Type: Research Article
ISSN: 0309-0566

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Article
Publication date: 15 March 2013

Nor Asiah Omar, Che Aniza Che Wel, Norzalita Abd Aziz and Syed Shah Alam

Retaining and cultivating customer loyalty has become increasingly important for loyalty programme providers and retailers due to the highly competitive environment. The

Abstract

Purpose

Retaining and cultivating customer loyalty has become increasingly important for loyalty programme providers and retailers due to the highly competitive environment. The purpose of this paper is to develop and test a model investigating how loyalty programme service quality (LPSQual) enhances programme perceived value and programme satisfaction to win loyalty among cardholders.

Design/methodology/approach

Quota sampling technique, using a self‐administered questionnaire survey, was used with a total of 400 respondents who are card holders of loyalty programmes from departments and superstores in the capital of Malaysia.

Findings

It is found that all the loyalty programme service attributes (policy, reward, tangibility, information usefulness, courteousness/helpfulness and communication quality), with the exception of personalization, have a significant positive influence on perceived value. The positive relationship between perceived value‐programme loyalty and programme satisfaction‐programme loyalty was also significant. The result also suggests that programme satisfaction affects store loyalty only through programme loyalty.

Practical implications

The results highlight the crucial role of loyalty programme service attributes in influencing value, satisfaction and loyalty among card holders of a loyalty programme.

Originality/value

This paper seems to be the first in investigating the impacts of LPSQual on value, satisfaction and loyalty in departments and superstores, particularly in the Malaysia context.

Details

Measuring Business Excellence, vol. 17 no. 1
Type: Research Article
ISSN: 1368-3047

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Article
Publication date: 16 March 2010

Elena Cedrola and Sabrina Memmo

Loyalty programmes are an important tool with which retail companies manage relationships. While the last 15 years have seen a broad dissemination of loyalty programmes in…

Abstract

Purpose

Loyalty programmes are an important tool with which retail companies manage relationships. While the last 15 years have seen a broad dissemination of loyalty programmes in new sectors and new countries, since the early 2000s, both in the academic and managerial world, the power of loyalty programmes to stimulate retention and support loyalty, has been brought into question. The purpose of this paper is to focus on these elements, analyzing data collected on a sample of loyalty cardholders.

Design/methodology/approach

The paper presents the results of an exploratory study focused on a sample of loyalty cardholders by means of telephone interviews.

Findings

The empirical data demonstrate that loyalty is not created and supported by a loyalty programme and prove how weak and limited such programmes are, especially point collection programmes. Programme effectiveness can however be achieved if there is a continuous search for differentiation and through reduced loss (discounts) and extra gain (prizes) initiatives.

Research limitations/implications

The analysis of what customers expect and how they behave towards programme innovations needs further empirical detail. For the future, qualitative research should be provided, as well as analyses of a higher number of socio‐demographical variables and life‐styles.

Originality/value

The paper provides empirical data on customer behaviour and opinion towards loyalty programmes.

Details

International Journal of Retail & Distribution Management, vol. 38 no. 3
Type: Research Article
ISSN: 0959-0552

Keywords

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Article
Publication date: 7 October 2014

Zhibin Lin and Dag Bennett

The purpose of this paper is to examine the construct of retail customer experience (CE) and its links to satisfaction and loyalty; and to test whether loyalty programmes

Abstract

Purpose

The purpose of this paper is to examine the construct of retail customer experience (CE) and its links to satisfaction and loyalty; and to test whether loyalty programmes perform a moderating effect on those links.

Design/methodology/approach

A variety of retail attributes are integrated to develop a holistic CE construct using formative measures, with four in-built, differentiated replication studies conducted in the supermarket and department store sectors in China.

Findings

The empirical results confirm the model of CE’s impact on customer satisfaction and loyalty; but reveal that loyalty programmes perform an insignificant moderating role in enhancing the linkages in the model.

Research limitations/implications

Further studies may examine whether our findings hold true for each individual loyalty programme. The paper calls for more studies based on multiple, in-built, differentiated replication studies and measures to encourage publication of negative empirical results so as to ensure empirical generalization and self-correction in the literature.

Practical implications

Retail managers should focus attention on the design and delivery of great CE, without placing great reliance on loyalty programmes. Both cognitive and emotional attributes of retailing services should be considered for managing a holistic CE.

Originality/value

The paper examines a model of CE with loyalty programme as a possible moderator; it uses formative measures of CE, multiple in-built replications and reports negative empirical results, which are critical to the development of scientific progress in retail management research.

Details

International Journal of Retail & Distribution Management, vol. 42 no. 10
Type: Research Article
ISSN: 0959-0552

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Article
Publication date: 1 February 2000

Adrian Palmer, Una McMahon‐Beattie and Rosalind Beggs

Analyses the variety of loyalty programmes that exist within the UK corporate hotel sector. A literature review leads to the proposition that in order to be…

Abstract

Analyses the variety of loyalty programmes that exist within the UK corporate hotel sector. A literature review leads to the proposition that in order to be cost‐effective in stimulating repeat business, loyalty programmes should reflect the business environment in which they operate. Loyalty programmes vary in the extent to which they collect, analyse and use customer information. A conceptual framework is developed in which information management and customisation are related to each other. This proposition supports the argument that there is no single formula for the development of a successful loyalty programme within the hotel sector. Although questions are raised about how the effectiveness of a loyalty programme can be measured, the proposition that market characteristics, information intensity and level of customisation can influence the effectiveness of a loyalty programme, is accepted.

Details

International Journal of Contemporary Hospitality Management, vol. 12 no. 1
Type: Research Article
ISSN: 0959-6119

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Article
Publication date: 21 September 2010

José Manuel Ponzoa Casado and Pedro Reinares Lara

The relevance of this study lies in the search for alternative sales channels, not originally intended for this end, at a time of general crisis within the tourism sector…

Abstract

Purpose

The relevance of this study lies in the search for alternative sales channels, not originally intended for this end, at a time of general crisis within the tourism sector. In spite of the great number of companies from the tourism sector that join multi‐sponsor loyalty platforms and the high volume of tourism service offers (flights, journeys, hotel accommodation, etc.) made and accepted through this medium, little is known about basic aspects for the management of such companies' participation. The paper aims to investigate this issue.

Design/methodology/approach

Using data from a leading programme in the Spanish market over a wide period of time – ten years and nearly 100,000 point redemptions have been analysed – additional sales in different tourism service categories, related with the redemption of points, have been evaluated by comparing them with other offers made.

Findings

Tourism service offers are indeed one of the reward choices most popular among cardholders. In order to obtain tourism offers the consumer usually makes up their points total in the programme to the required level by making additional payments. It is important to classify cardholders according to their point credit‐rating (the rate at which they accumulate points in the programme) and make them offers in accordance with their preferences.

Practical implications

The benefits that a tourism service provider may obtain by joining a multi‐sponsor loyalty programme and including its services as reward offers are discussed. For programme managers information and conclusions relevant to reward catalogue design are also expounded.

Originality/value

This paper helps tourism service providers to take decisions with regard to joining a multi‐sponsor loyalty programme by reviewing important issues relating to both point redemption and sales.

Details

Tourism Review, vol. 65 no. 3
Type: Research Article
ISSN: 1660-5373

Keywords

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