The fairness of loyalty programs in South Africa are subjective to organizations that discriminate value proposition segmentation and that exploit personal information captured by their consumers, through the absence of an equity and exchange theory.
Loyalty programs are coordinated, membership based marketing activities that use targeted communications and customize the delivery of branded goods and services to build loyal and effective bonds with the funding firms. It can be seen as a rewards program for customers who frequently make purchases to a specific company and thereby encourage loyal buying behaviours, by using various loyalty cards, sale coupons and access to new products or free merchandise. Organizations use these as marketing tools to support their consumer relationship management strategies and decision making processes.
“Loyalty programs can be tracked back to 1896 through the introduction of S & H Greenstamps, which are the largest purchaser of consumer goods in the world.” (1) The technology boom in the 1990’s caused an exponential growth through the economically developed world. “All Canadians 97% participate in at least one loyalty program”(2). This shows that there is a continuously growing number of loyalty programs used and that therefore the awareness of providing them in an honest and justly manner is crucial.
“Organizations should aim to effectively strengthen their marketing position through a loyalty program without compromising on their customer’s perception of fairness.” (3) These programs should be favorable to customers by equitably administering and thoroughly communicating all underlying context relating to how firms use loyalty programs. Keeping all customers aware at a persistent level of und...
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...ery effort to prevent such negative exposure. Setting separate management operations relative to distinct customer levels of achievement, purchasing ability and rank orders ensures that all areas of the market segments are involved and considered at all times. When measuring the perceptions of customers the Likert scale may be used, on which the respondents can indicate their agreement of feeling fairly treated by being ranked on a scale. When collecting the data of the various surveys and interviews correlation and regression analysis is a powerful statistical technique option that provides reliable and accurate data to prove the underlying research problem.
In conclusion the research problem has many areas of future research in South Africa by examining the fairness of loyalty programs through the equity theory, exchange theory and an experimental research design.
In light of an evolving market, faced with new competitors, and after a careful analysis of their current customers, the Vanguard Group (hereinafter referred to as “Vanguard”) realizes it must rethink its entire marketing strategy. However, in order to protect and leverage their competitive advantage, which is their low management fees, and to optimize the loyalty that their customers continuously demonstrate toward their organization, they must now target the most profitable segment for them, and develop the best way to serve and delight these customers.
-the potential of Loyalty Programs to coerce consumers rational behaviour is put into question. Rational Choice theory provides a compelling argument which claims that numerous reward facilities genuinely strive to satisfy the consumer’s needs in full. Experiments support the statement listing the variety of benefits enjoyed by the program’s members, who prove to be rational in choosing one or more reward schemes looking after their satisfaction first. Loyalty programs appear to hold a firm position in the market, maintaining the balance between their designer’s goals and benefits provided to the consumers.
Facilitating customer participation in Qantas loyalty program and that of partners by coming up with new products, services, forming new partnerships and offering additional exciting benefits that which will attract the targeted market segments and even new customers. Qantas Loyalty program participation can be enhanced by awarding Qantas Frequent Flyer points for purchases made online and offering membership levels or entitlements that will offer distinct and enhanced personalised benefits as well as privileges to
In life, it is important to have someone's loyalty. In the story, Buying Loyalty, written by Chang Tu shows how one can see this in many different points of view. Throughout the story, Feng Hsuan sings about not having enough necessities, and after he sings, he earns them. At the end of the story Feng Hsuan burns the taxes of the people trying to gain the people’s loyalty. This eventually does show Lord that he has the people's loyalty. Thus, in Buying Loyalty, the main theme is that one can’t buy loyalty, one must earn it.
...rs since the reward is tangible. Since 80 percent of profit comes from a small percentage of customers, programs should be developed to retain them. Companies will use resources that aren’t available to the entire customer base to ensure they are retaining their most valuable customers and offering incentives to encourage others to move up.
Ninety percent of Canadians are enrolled in at least one loyalty program. Market research has shown that loyalty programs are growing to be very popular in today’s market. A loyalty program is a program offered by a company to customers, who make frequent purchases. Loyalty programs are of benefit to both the consumers and the business. The consumers benefit by receiving coupons, special access to sales and new products whereas the company benefits by gaining an abundance of knowledge about the consumers, through their purchasing habits. Loyalty programs have proven to be very successful for several companies such as Target, Starbucks, and Shoppers Drug Mart. The senior management in sales and marketing believe that initiating a loyalty program
In order to fulfill customer needs, companies offer a lot of shopping ways to customers like bonus point programs and membership programs. Customers can obtain the redemption products and enjoy discounts when purchasing by joining these programs, which can lead to save more.
Customer survey is one of the toughest and mind boggling task many fear doing, especially those who provide services to customers. There have been debates on the best method to be used in ensuring that the survey is accurate. Different methods have been proposed concerning the accuracy of some of the methods used, and no proper consensus reached on the method to use. Different business uses different methods, but in the recent past many surveys have been done using the Likert Scale Questionnaire Method. This technique has been found to boost the level of accuracy because it is a psychometric tool. Likert Scale measures attitudes, beliefs, and opinions by allowing those surveyed to indicate their degree of agreement or disagreement in a multiple choice formats (Likert, 1932). Even though very difficult to construct, there have been positive comments about its accuracy. Likert Scaling is also praised on its ease with data interpretation and computing (LaMarca, 2011), making Likert Scaling the best option to be used by many businesses trying to find out what the customers think of their operation. With all talks and debates about Likert Scaling, it is important to see how it is used in a survey by analyzing how to construct its can be properly constructed.
The management at Tesco’s seem to place an emphasis on customer needs through the ‘Tesco Values’ philosophy, expressed as two values “no one tries harder for customers; treat people how we like to be treated”(Tescoplc, 2013)3. Tesco’s maintain that this represents listening to customers and using all the tools at their disposal, such as, Clubcard data, Frontline contact with employees, focus groups and research trackers to gather information (Loyalty square, 2013). Subsequently, this communication allows the company to act i...
Loyalty is one of the traits that people generally say is important to them in relationships, be it romantic, friendship, business, or otherwise. Yet some of us don’t make it a priority or give that quality enough credit. Also, loyalty is most of the time the basis of these other concepts. Without the presence of loyalty a strong relativity can never be built. Other than emotional relativities, loyalty is valid for many other areas, as well. However, loyalty is a multi-valued concept. “Can be true to his word, the words said, to a loved one.” - Veronica Roth, Allegiant. Indeed, the meaning of this word is one infinite devotion beyond other factors. Loyalty should be manifested in relation to everything. There are
Strive to earn customers’ long-term loyalty by working to deliver more than promised, being honest and fair to provide exceptional personalized service that creates a pleasing business experience.
With the dilemma stated, the management question would be how do we increase customer satisfaction? Research questions, which are the objective of the research study, would include – what can management do to improve customer satisfaction, how is employee attitude and motivation connected to customer satisfaction, should we add employee incentives to reward increased customer service ratings, and should we modify hiring and training procedures?
Customer satisfaction measures the expectation of a customer relating to the product and services provided by the retail stores. Satisfied customers tend to be loyal to the organization and make more and more purchase from the same store, which in turn is beneficial for the organization. According to Hoyer and Maclnnis (2001) satisfaction can be compared with the feeling of acceptance, relief, pleasure and
To effectively sell a product or service, organizations have to really know how customers behave, regarding to what they buy. The study
Task 1: Critically evaluate the key concepts/theories on the topic of the effectiveness of loyalty programmes on customer loyalty