Customer Loyalty in Retail Sector

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Role of Customer Loyalty Programs in the Retailing Sector Executive Summary: Customer loyalty schemes (or programs) are explicit efforts by the retailers in different formats to gain the long term patronage from the customers. Loyalty schemes are designed and developed for variety of reasons: to reward the loyal customers, to generate more information about the customer behaviour, buying patterns. It also helps to influence consumer behaviour, and as defensive measure to combat a competing scheme. The purpose of this study is to describe the objectives of the loyalty schemes, the origin its evolution over the years, the important aspects of its implementation and strategic approaches to maximise the impact. This will also focus on the…show more content…
A response from the customer to come back and repeatedly use the product or service is a definite indicator of the customer to be loyal. Through loyalty programmes companies therefore can track the behaviour of customer, and trends of his activities over a period of time. It can lead to customer behaviour where customers can book earlier, stay longer, do vacationing more often, and earn reward points for this behaviour with the brand. So loyalty programmes provide an opportunity to learn about the customer’s preferences, and expectations. Customers tend to be loyal only when they can identify their values matching with those of the brand. This leads to brand association from the customer’s with the company’s logo, brand. Eyeballs Buyers Loyalty Action Performance Consideration Awareness There are five types of the consumer behaviour which have been measured over particular period of time span: the percentage of consumers buying a brand, number of purchases per buyer, the percentage who continue to buy the brand repeatedly, the 100% loyal customers and the segment of population who buy other brands. Polygamous Loyalty: This is a theory which is for the stationary markets, customer loyalty is divided into number of brands. The long run propensities to buy a particular brand for a customer now a days is very less the primary reason being the choice of too many brands in the same sector. So polygamous loyalty is actually
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