Customer Loyalty Program

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There are different reasons of introducing the loyalty programs by stores. Uncles (2003) proposed two aims of customer loyalty programs. First is making a better relationship between the store and customer. So this is beneficial to sustain the current customer base in good position. The second aim is to rise a revenue by increasing purchase levels. The scholar believes that loyalty programs are popular because they can increase profits by reaching both of these aims. One view of a loyalty program is that, it works as a marketing tool targeted to build customer loyalty (Dowling & Uncles, 1997). Another view is that loyalty program is marketing plan constructed to give reward to customers (Liu, 2007). Jan Hillesland (2013) proposed that purpose…show more content…
These attitudes can be assessed by identifying how many customers like the store, have commitment to it, would recommend to others, and have good opinions and feelings about it. The summary of research conducted by Ahluwalia et al. (1999) shows that attitudinally-loyal customers have much attention to negative rumors about the store comparing to non-loyal customers. As a result, customers with positive attitude towards the store, suggested to form a relationship with their favor stores. Fournier (1998) says that positive attitude will be stronger when it is sustained by other members of the loyalty program. The good examples are: soccer team, Harley-Davidson bikers, Jeep brand fests. There are many store choices in order to do shopping there. Therefore, for achieving the customer to become part of a loyalty program there has been widely implemented customer satisfaction and service quality actions by retailers. As soon as customers become members of loyalty programs of a store, the negative sides will be minimized and positive sides will be strengthened (Mitchel,…show more content…
The attitude plays vital role in customer loyalty. Meanwhile, there is a need for previous positive attitude in order to consider customer’s behavior as true loyal (Solomon, 1996; Huang and Yu, 1999). There is no empirical research that analyzes in a deeper the correlation between members in loyalty programs and their attitudes. The lack of practical research on issue about relationship of attitude and loyalty programs is considered to be a research gap. Nevertheless, there were made few researches on customers’ attitudes toward loyalty programs. The research made by Meyer‐Waarden concludes that influence of loyalty programs on attitude can be observed from two sides: differentiation loyalty and purchase loyalty (2008). The differentiation loyalty designed in a way to cut customers’ awareness toward the prices of a product. As a result, the customers with low sensitivity to price changes are more stimulated to pay higher than average prices for products they usually buy (Rowley, 2000). Moreover, the differentiation loyalty may impulse the customer to purchase products in higher price/quantity or select exclusive products with higher quality (Reichheld, 1996). The similar explanation is provided by Bolton et al. (2000) who states that superstores develop more superior services along with extra value and in this way stores distract the attention of customers

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