Estimation of Loyalty Programmes from Customers’ Point of View: Cases of Three Retail Store Chains

Abstract

Long-term relationships between organization and customers and their loyalty become the most significant assumption of nowadays business success. To achieve customer loyalty and enhance it loyalty programmes are created and implemented. It gains special importance in those fields of activities where competition is strong and supply is standard. But loyalty programme by itself does not guarantee success. Whether it reaches organization’s aims first of all depends on the main thing if the programme is beneficial to its participants. The article deals with how loyalty programmes are estimated by Maxima, Iki and Norfos mažmena retail store chains’ customers. In the first part of the article concept of customer loyalty, essence of loyalty programme and how its value is perceived by customer are analyzed in theoretical level; in the second part – results of Maxima, Iki and Norfos mažmena retail store chains’ loyalty programme content analysis and questionnaire investigation of customers are presented. Research shows that Maxima, Iki and Norfos mažmena retail store chains’ loyalty programmes are closed; basis of reward (most often financial) is amount of points which depend on how much money customers spend on buying goods. Similar forms of investigated retail store chains’ loyalty programmes do not create special attractiveness which would stimulate customers to be loyal to certain retail store chain. Results of questionnaire investigation prove hypothesis that through discounts investigated retail store chains’ loyalty programmes more stimulate sales than enhance loyalty. Most respondents point that participation in loyalty programmes is beneficial financially but none of them mentioned getting emotional or social value. It means that loyalty of programme participants is rational, so it can be not long-term. Almost one third of respondents states that declared benefit of loyalty programme is bigger than a real one. Possibility of retail store chains’ loyalty programmes to grow loyal behaviour is doubted because only half of respondents buy in the store in which they have loyalty card. Almost one third of respondents has loyalty cards of two-three retail store chains; most of them do their shopping not far from their living/work place or where goods are cheaper. Just a little bit more than a third of Maxima LT and Iki retail store chains’ loyalty programmes participants are satisfied by the services they get but only half of them have intent to recommend these programmes to people they know. Value of loyalty programmes is doubtful even to the respondents who do not participate in any investigated programme while investigation was in progress. Loyalty programmes orientated into sales stimulation and offered by retail store chains lose their attractiveness in the eyes of a customer. It means that to attract independent customers and even more important “to tie” them, retail store chains need a lot of organizational efforts and financial resources. All of that will increase costs of creating and implementing loyalty programmes, that is why retail store chains should choose another type of loyalty programme or look for new instruments to enhance loyalty.