Analysis of key indicators that affect the expected benefit of customers when using loyalty cards
Abstract
The aim of this paper is to define the significance of different indicators that affect the expected benefit of customers when using loyalty cards in the purchasing process in the retail sector. As the most important indicators that affect expectations while using loyalty cards, the following was tested: price discounts, more efficient service and rewards, personalized communication, payment option, better information, status symbols and additional benefits. The research was conducted on a sample of 552 holders of loyalty cards of the largest retail chains in selected Central Europe (CE) and South East Europe (SEE) countries. The values of indicators for different categories of customers and different markets can be determined based on the obtained results and conducted tests. The determined values of the indicators are the basis for the formation of a regression model that will serve the chain managers to optimize the loyalty programs in relation to the identified customer expectations.
Keyword : loyalty cards, retailing, retail sector, customers, customers’ loyalty, customers’ benefits, loyalty programs, CE and SEE countries
How to Cite
Končar, J., Marić, R., & Vukmirović, G. (2019). Analysis of key indicators that affect the expected benefit of customers when using loyalty cards. Journal of Business Economics and Management, 20(5), 821-840. https://doi.org/10.3846/jbem.2019.10186
This work is licensed under a Creative Commons Attribution 4.0 International License.
References
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Dunković, D., & Petković, G. (2015). Loyalty programs in grocery retailing: Do customers provoke a tiered rewarding system? Poslovna izvrsnost, 9(1), 9-26.
Filipe, S., Henriques Marques, S., & Fátima Salgueiro, M. (2017). Customers’ relationship with their grocery store: Direct and moderating effects from store format and loyalty programs. Journal of Retailing and Consumer Services, 37, 78-88. https://doi.org/10.1016/j.jretconser.2017.03.002
Grubor, A., & Đokić, N. (2015). Determinants of choice of global and national food products’ brands. Strategic Management, 20(2), 58-67.
Huberman, B. A., Loch, C. H., & ÖNçüler, A. (2004). Status as a valued resource. Social Psychology Quarterly, 67(1), 103-114. https://doi.org/10.1177/019027250406700109
Jeftić, J. (2015). Modern trends in sales – phenomena of associated loyalty programs. Annals of the Faculty of Economics in Subotica, 51, 43-57.
Kellgren, C., Moradi, L., & Romppanen, M. (2007). Customer loyality research. Jönköping: Jönköping International Business School.
Končar, J., & Marić, R. (2015). Job satisfaction in trade sector: Evidence from the retailers in the largest supermarkets of the Western Balkans. Revija za socijalnu politiku, 22(3), 375-392. https://doi.org/10.3935/rsp.v22i3.1268
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Leenheer, J., Van Heerde, H., Bijmolt, T., & Smidts, A. (2007). Do loyalty programs really enhance behavioral loyalty? An empirical analysis accounting for self-selecting members. International Journal of Research in Marketing, 24(1), 31-47. https://doi.org/10.1016/j.ijresmar.2006.10.005
López, Á. R., & Martín, G. R. (2019). The marketability discount in Spanish valuation multiples: investors’ perception in listed companies versus private transactions. Journal of Business Economics and Management, 20(1), 107-130. https://doi.org/10.3846/jbem.2019.8101
Lovreta, S., Berman, B., Petković, G., Veljković, S., Crnković, J., & Bogetić, Z. (2010). Customer realationship management. Beograd: Faculty of Economics and Data Status.
Lovreta, S., Končar, J., & Petković, G. (2013). Kanali marketinga, trgovina i ostali kanali. Beograd: Univerzitet u Beogradu.
Khalil, S. M., Ullah, O., & Khalil, D. S. H. (2018). The effect of customer loyalty programs on customer retention in Pakistan. Journal of Business and Tourism, 4(2), 237-251.
Marić, R., Radnović, B., Djuranović, D., & Vukmirović, G. (2017). Socially responsible behavior of sales staff: evidence from Western Balkans supermarkets. Inzinerine Ekonomika-Engineering Economics, 28(1), 110-119. https://doi.org/10.5755/j01.ee.28.1.15764
Marić, R., & Kraleva, V. (2017). Loyalty programs in the function of customer relationship strategy. The Annals of the Faculty of Economics in Subotica, 53(38), 251-264.
Melnyk, V., Van Osselaer, S. M., & Bijmolt, T. H. (2009). Are women more loyal customers than men? Gender differences in loyalty to firms and individual service providers. Journal of Marketing, 73(4), 82-96. https://doi.org/10.1509/jmkg.73.4.82
Mercadé-Melé, P., Molinillo, S., Fernández-Morales, A., & Porcu, L. (2018). CSR activities and consumer loyalty: The effect of the type of publicizing medium. Journal of Business Economics and Management, 19(3), 431-455. https://doi.org/10.3846/jbem.2018.5203
Pesonen, J., Komppula, R., & Murphy, J. (2019). Plastic loyalty – Investigating loyalty card programs for a Finnish hotel chain. Tourism Management, 73, 115-122. https://doi.org/10.1016/j.tourman.2019.01.023
Plazibat, I., Šušak, T., & Šarić, T. (2016). Functionality of customer loyalty programs in retail. Ekonomska misao i praksa, 1, 303-318.
Putra, A. P., Armanu, A., & Sudjatno, S. (2019). The influence of corporate social responsibility, brand personality and corporate reputation on brand loyalty of modern retailers. Jurnal Aplikasi Manajemen, 17(1), 66-75. https://doi.org/10.21776/ub.jam.2019.017.01.08
Rao, D., & Kotian, R. R. (2018). The impact of loyalty cards in retaining customers: A study with reference to mega mart retail outlet in mangalore city. Anveshana, 8(1), 103-124. https://doi.org/10.23872/aj/2018/v8/i1/176267
Reinartz, W. J. (2010). Understanding customer loyalty programs. In M. Krafft & M. Mantrala (Eds.), Retailing in the 21st century. Berlin: Springer Berlin Heidelberg. https://doi.org/10.1007/978-3-540-72003-4_25
Tekić, T. (2018). Development of B2C e-commerce in the European Union countries. Annals of the Faculty of Economics in Subotica, 54(40), 171-182. https://doi.org/10.5937/AnEkSub1840171T
Vesel, P., & Zabkar, V. (2009). Managing customer loyalty through the mediating role of satisfaction in the DIY retail loyalty program. Journal of Retailing and Consumer Services, 16(5), 396-406. https://doi.org/10.1016/j.jretconser.2009.05.002
Vilkaite-Vaitone, N., & Papsiene, P. (2016). Influence of customer loyalty program on organizational performance: A case of airline industry. Inzinerine Ekonomika-Engineering Economics, 27(1), 109-116. https://doi.org/10.5755/j01.ee.27.1.10267
Alina Elena, C. (2016). Social media – a strategy in developing customer relationship management. Procedia Economics and Finance, 39, 785-790. https://doi.org/10.1016/S2212-5671(16)30266-0
Anđelković, A., & Radosavljević, M. (2018). Improving order-picking process through implementation of warehouse management system. Strategic Managament, 23(1), 3-10. https://doi.org/10.5937/StraMan1801003A
Antonova, S. (2013). The use of loyalty program in the Bulgarian cruise industry. Montreal: Universute du Quebec a Montreal.
Anić, I. D., Rajh, E., & Bevanda, A. (2012). Decision-making styles of young consumers in Bosnia and Herzegovina. Young Consumers, 13(1), 86-98. https://doi.org/10.1108/17473611211203966
Bakic, O., Hrabrovski-Tomic, E., Muhi, B., & Kovacevic, J. (2010). Marketing and management implementation on megatrends in modern tourism. UTMS Journal of Economics, 1(2), 17-25.
Bell, S. J., & Eisingerich, A. B. (2007). The paradox of customer education: Customer expertise and loyalty in the financial services industry. European Journal of Marketing, 41(5/6), 466-486. https://doi.org/10.1108/03090560710737561
Berman, B. (2006). Developing an Effective Customer Loyalty Program. California Management Review, 49(1), 123-148. https://doi.org/10.2307/41166374
Carter, B. (2016). Customer loyalty statistics: 2016 edition. Retrieved from https://blog.accessdevelopment.com/customer-loyalty-statistics-2016-edition
Carraher, S., Parnell, A. J., & Spillan, E. J. (2009). Customer service‐orientation of small retail business owners in Austria, The Czech Republic, Hungary, Latvia, Slovakia, and Slovenia. Baltic Journal of Management, 4(3), 251-268. https://doi.org/10.1108/17465260910990975
Cho, Y. J. (2019). A study on US consumers’ loyalty to online shopping mall: Focused on group buying social commerce. Journal of Convergence for Information Technology, 9(2), 75-84. https://doi.org/10.26710/jbsee.v4i2.441
Danojević, A. (2016). Unapređenje lojalnosti kupaca putem potrošačkih kartica. Subotica: Faculty of Economics.
Demoulin, N. T. M., & Zidda, P. (2008). On the impact of loyalty cards on store loyalty: Does the customers’ satisfaction with the reward scheme matter? Journal of Retailing and Consumer Services, 15(5), 386-398. https://doi.org/10.1016/j.jretconser.2007.10.001
Dorotic, M., Bijmolt, T. H., & Verhoef, P. C. (2012). Loyalty programmes: Current knowledge and research directions. International Journal of Management Reviews, 14(3), 217-237. https://doi.org/10.1111/j.1468-2370.2011.00314.x
Drinčić, D., Vranješ, M., & Gašević, D. (2014). Consumer loyalty in retailing. School of Business Journal, 2, 91-106. https://doi.org/10.5937/skolbiz2-7397
Dunković, D., & Petković, G. (2015). Loyalty programs in grocery retailing: Do customers provoke a tiered rewarding system? Poslovna izvrsnost, 9(1), 9-26.
Filipe, S., Henriques Marques, S., & Fátima Salgueiro, M. (2017). Customers’ relationship with their grocery store: Direct and moderating effects from store format and loyalty programs. Journal of Retailing and Consumer Services, 37, 78-88. https://doi.org/10.1016/j.jretconser.2017.03.002
Grubor, A., & Đokić, N. (2015). Determinants of choice of global and national food products’ brands. Strategic Management, 20(2), 58-67.
Huberman, B. A., Loch, C. H., & ÖNçüler, A. (2004). Status as a valued resource. Social Psychology Quarterly, 67(1), 103-114. https://doi.org/10.1177/019027250406700109
Jeftić, J. (2015). Modern trends in sales – phenomena of associated loyalty programs. Annals of the Faculty of Economics in Subotica, 51, 43-57.
Kellgren, C., Moradi, L., & Romppanen, M. (2007). Customer loyality research. Jönköping: Jönköping International Business School.
Končar, J., & Marić, R. (2015). Job satisfaction in trade sector: Evidence from the retailers in the largest supermarkets of the Western Balkans. Revija za socijalnu politiku, 22(3), 375-392. https://doi.org/10.3935/rsp.v22i3.1268
Kyguoliene, A., Zikiene, K., & Grigaliunaite, V. (2017). The influence of perceived benefits on the satisfaction with the loyalty program. Inzinerine Ekonomika-Engineering Economics, 28(1), 101-109. https://doi.org/10.5755/j01.ee.28.1.14635
Leenheer, J., Van Heerde, H., Bijmolt, T., & Smidts, A. (2007). Do loyalty programs really enhance behavioral loyalty? An empirical analysis accounting for self-selecting members. International Journal of Research in Marketing, 24(1), 31-47. https://doi.org/10.1016/j.ijresmar.2006.10.005
López, Á. R., & Martín, G. R. (2019). The marketability discount in Spanish valuation multiples: investors’ perception in listed companies versus private transactions. Journal of Business Economics and Management, 20(1), 107-130. https://doi.org/10.3846/jbem.2019.8101
Lovreta, S., Berman, B., Petković, G., Veljković, S., Crnković, J., & Bogetić, Z. (2010). Customer realationship management. Beograd: Faculty of Economics and Data Status.
Lovreta, S., Končar, J., & Petković, G. (2013). Kanali marketinga, trgovina i ostali kanali. Beograd: Univerzitet u Beogradu.
Khalil, S. M., Ullah, O., & Khalil, D. S. H. (2018). The effect of customer loyalty programs on customer retention in Pakistan. Journal of Business and Tourism, 4(2), 237-251.
Marić, R., Radnović, B., Djuranović, D., & Vukmirović, G. (2017). Socially responsible behavior of sales staff: evidence from Western Balkans supermarkets. Inzinerine Ekonomika-Engineering Economics, 28(1), 110-119. https://doi.org/10.5755/j01.ee.28.1.15764
Marić, R., & Kraleva, V. (2017). Loyalty programs in the function of customer relationship strategy. The Annals of the Faculty of Economics in Subotica, 53(38), 251-264.
Melnyk, V., Van Osselaer, S. M., & Bijmolt, T. H. (2009). Are women more loyal customers than men? Gender differences in loyalty to firms and individual service providers. Journal of Marketing, 73(4), 82-96. https://doi.org/10.1509/jmkg.73.4.82
Mercadé-Melé, P., Molinillo, S., Fernández-Morales, A., & Porcu, L. (2018). CSR activities and consumer loyalty: The effect of the type of publicizing medium. Journal of Business Economics and Management, 19(3), 431-455. https://doi.org/10.3846/jbem.2018.5203
Pesonen, J., Komppula, R., & Murphy, J. (2019). Plastic loyalty – Investigating loyalty card programs for a Finnish hotel chain. Tourism Management, 73, 115-122. https://doi.org/10.1016/j.tourman.2019.01.023
Plazibat, I., Šušak, T., & Šarić, T. (2016). Functionality of customer loyalty programs in retail. Ekonomska misao i praksa, 1, 303-318.
Putra, A. P., Armanu, A., & Sudjatno, S. (2019). The influence of corporate social responsibility, brand personality and corporate reputation on brand loyalty of modern retailers. Jurnal Aplikasi Manajemen, 17(1), 66-75. https://doi.org/10.21776/ub.jam.2019.017.01.08
Rao, D., & Kotian, R. R. (2018). The impact of loyalty cards in retaining customers: A study with reference to mega mart retail outlet in mangalore city. Anveshana, 8(1), 103-124. https://doi.org/10.23872/aj/2018/v8/i1/176267
Reinartz, W. J. (2010). Understanding customer loyalty programs. In M. Krafft & M. Mantrala (Eds.), Retailing in the 21st century. Berlin: Springer Berlin Heidelberg. https://doi.org/10.1007/978-3-540-72003-4_25
Tekić, T. (2018). Development of B2C e-commerce in the European Union countries. Annals of the Faculty of Economics in Subotica, 54(40), 171-182. https://doi.org/10.5937/AnEkSub1840171T
Vesel, P., & Zabkar, V. (2009). Managing customer loyalty through the mediating role of satisfaction in the DIY retail loyalty program. Journal of Retailing and Consumer Services, 16(5), 396-406. https://doi.org/10.1016/j.jretconser.2009.05.002
Vilkaite-Vaitone, N., & Papsiene, P. (2016). Influence of customer loyalty program on organizational performance: A case of airline industry. Inzinerine Ekonomika-Engineering Economics, 27(1), 109-116. https://doi.org/10.5755/j01.ee.27.1.10267