Customer Loyalty Research : Can customer loyalty programs really build loyalty?

Bachelor thesis English OPEN
Romppanen, Maiju ; Kellgren, Cecilia ; Moradi, Ladan (2007)
  • Publisher: Internationella Handelshögskolan, Högskolan i Jönköping, IHH, EMM (Entrepreneurskap, Marknadsföring, Management)
  • Subject: Customer loyalty programs | customer clubs | Customer relationship management | customer loyalty | loyalty | Relationsmarknadsföring | Kundlojalitets program | Kundlojalitet | Loja-litet | detaljhandel | Business studies | Företagsekonomi

Background: During the last decades the efforts to foster customer relationships have become important due to increased competition in the consumer markets. One of the most popular strategies have been to introduce customer loyalty programs which are believed to enhance the customer loyalty. The popularity of the customer loyalty programs is based on the beliefs that loyal customers are lucrative and these programs would bond the customers to the company. More recently however, the discussion whether these statements are accurate has started to blossom. Loyal customers are not necessarily as profitable as believed and it is not easy for companies to gain competitive advantage because almost all companies have similar customer clubs. Purpose: This thesis evaluates through a case study of a Swedish retail company whether customer loyalty programs manage to create loyalty among their members. Appropriate features of loyalty will be examined with the intention to evaluate whether there exists other factors outside the loyalty programs that are also influencing the creation of loyalty. Method: A qualitative study was conducted to answer the purpose of the thesis. Within the case study several semi-structured interviews were carried out with INTERSPORT and 20 telephone interviews with INTERSPORT customers. Empirical material was analyzed with a reflection to the theoretical framework and the research questions. Conclusions: Customer loyalty programs can enhance the creation of loyalty, but should be seen as a complement to other aspects of the business, namely, the product line, the customer service and the store concept. However, sustainable customer loyalty is difficult to obtain because many customers today are loyal to several companies instead of one.
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