Framing as status or benefits? Consumers’ reactions to hierarchical loyalty program communication

Purpose A fundamental aspect of hierarchical loyalty programs is that some consumers get rewards that others do not. Despite the widespread use of such programs, academics have long debated whether these benefits are outweighed by the potential negative impact of the differential treatment of customers. This study extends our understanding, examining the impact of message framing on consumers’ reactions to hierarchical loyalty structures. Design/methodology/approach Three online studies were conducted. Study 1 uses advertisements to manipulate the message frame’s emphasis (benefits vs. status). Study 2 manipulates consumers’ frame of thought by directing their attention to either changes in benefits or status. Finally, Study 3 uses the proposed framework to reconcile contradictory findings from past research. Findings Low-frequency customers who do not expect to qualify for a superior customer tier tend to reject hierarchical programs when thinking about status. In contrast, when these customers think about concrete rewards, loyalty program messages produce no negative reactions. High-frequency customers are positively affected by communication regardless of the type of benefits framed. Research limitations/implications All studies were done online potentially limiting the external validity of the results. Nevertheless, the impact of message framing on perceptions about the loyalty program seems to be quite robust across different studies and manipulations. Practical implications When communicating with low-frequency customers managers should avoid promising status; customers should instead be motivated based on concrete rewards. High-frequency customers are indifferent to alternative emphasis of communication frames. Originality/value Marketing academics have acknowledged the importance of being able to reward top customers without demotivating light and moderate users. Our research is the first to provide a solution to this issue.

Does relationship marketing improve customer relationship satisfaction and loyalty?

Purpose - This study investigates the relationship marketing (RM) strategy of a retail bank and examines whether - after its implementation - customer relationships were strengthened through perceived improvements in the banking relationship and consequent loyalty towards the bank. Design/methodology/approach - A survey was conducted on two profitability segments, of which the more profitable segment had been directly exposed to a customer oriented RM strategy, whereas the less profitable segment had been subjected to more sales oriented marketing communications. Findings - No significant differences were found between the segments on customers’ evaluations of the service relationship or their loyalty toward the bank. Furthermore regression analysis revealed that relationship satisfaction was less important as a determinant of loyalty in the more profitable segment. Research limitations/implications - This study was conducted as a case study of one specific branch of a bank group in Finland, which limits the external validity of its results. It was not possible to ascertain if, or to what extent, customers of the more profitable segment had received the intended RM treatment. Other limitations are also discussed. Practical implications - Customer orientation is desirable within retail banking and more studies are needed on the differential drivers of loyalty across customer profitability segments. By identifying the aspects of a banking relationship that are more highly valued among more profitable customers than among less profitable customers, bank managers would be able to more effectively devise appropriate strategies for different segments. Originality/value - The study contributes to the RM literature and marketing of financial services by providing empirical evidence of the effects of RM activities on customer relationship perceptions in different profitability segments.

Can location-based mobile marketing enhance the customer experience and increase customer satisfaction and loyalty?

This study intends to explore the impact of customer experience on customer satisfaction and loyalty by trying to understand how location-based mobile marketing might enhance the customer experience. Primary data was collected from 201 smartphone users in 24 countries. Results have indicated that targeted location-based marketing positively influences customers’ experiences. Besides, the analysis has also shown a favorable impact on customers’ satisfaction and self-perceived loyalty. This suggests that location-based mobile marketing has the potential to positively add value to a customer’s experience and should therefore be considered an important tool in marketing communications.

Management consulting labs Galp loyalty

The main objective of this project was to investigate methods to create a new loyalty approach for Galp Energia in order to improve customer retention and reduce churn, related with the expansion of hypermarket chains’ in the Fuel Retail Market and the country’s economical situation. The team carried out on-spot surveys and focus groups, researched loyalty programs’ best practices, analyzed peers practices and the company’s past performance in order to find important customer insights. These were used to develop the final recommendations resulting in a new paradigm to the group’s loyalty approach alongside incremental improvements to the current loyalty solutions.

Factors influencing supermarket store loyalty

Este estudo focou na indústria de supermercados e teve como objetivo examinar o quanto os fatores referentes à existência de um programa de fidelidade em um supermercado, a fidelidade do cliente com esse programa e a percepção de valor que o cliente tem da loja, influenciam na sua lealdade à loja. Como muitas empresas têm feito um grande investimento nos Programas de Fidelidade, é certamente relevante que seja medida a efetividade desse tipo de programa. A metodologia usada foi a análise de regressão linear. Nesta análise de regressão foram consideradas as seguintes variáveis independentes: Valor percebido do programa, a Lealdade ao cartão de fidelidade da loja, o valor percebido da loja. Como variável dependente foi considerada a Lealdade à loja. A análise concluiu que os programas de lealdade em supermercados não estão funcionando como instrumentos efetivos de fidelidade e não têm relação com o Valor Percebido da Loja. O investimento das empresas nessa ferramenta não está trazendo o retorno esperado de desenvolver fidelidade no cliente.

Dynamic Management of Loyalty Program Strategies

Thesis (Ph.D.)--University of Washington, 2016-06

Identification and analysis of moderator variables:investigating the customer satisfaction-loyalty link

Purpose – Research on the relationship between customer satisfaction and customer loyalty has advanced to a stage that requires a more thorough examination of moderator variables. Limited research shows how moderators influence the relationship between customer satisfaction and customer loyalty in a service context; this article aims to present empirical evidence of the conditions in which the satisfaction-loyalty relationship becomes stronger or weaker. Design/methodology/approach – Using a sample of more than 700 customers of DIY retailers and multi-group structural equation modelling, the authors examine moderating effects of several firm-related variables, variables that result from firm/employee-customer interactions and individual-level variables (i.e. loyalty cards, critical incidents, customer age, gender, income, expertise). Findings – The empirical results suggest that not all of the moderators considered influence the satisfaction-loyalty link. Specifically, critical incidents and income are important moderators of the relationship between customer satisfaction and customer loyalty. Practical implications – Several of the moderator variables considered in this study are manageable variables. Originality/value – This study should prove valuable to academic researchers as well as service and retailing managers. It systematically analyses the moderating effect of firm-related and individual-level variables on the relationship between customer satisfaction and loyalty. It shows the differential effect of different types of moderator variables on the satisfaction-loyalty link.

One size doesn't fit all. Exploring marketing strategies for influencing three dimensions of brand loyalty

Brand loyalty is a concept that has garnered considerable interest over recent years from both marketing practitioners and academics alike. While marketers are primarily interested in ways they can generate and increase brand loyalty from their customers, academics strive to conducts research which investigates the antecedents and consequences of customer loyalty (See DeWitt, Nguyen and Marshall 2008; Russell-Bennett, McColl-Kennedy and Coote 2007).

Frequent (flier) frustration and the dark side of word‐of‐web: exploring online dysfunctional behavior in online feedback forums

Purpose Following the perspective of frustration theory customer frustration incidents lead to frustration behavior such as protest (negative word‐of‐mouth). On the internet customers can express their emotions verbally and non‐verbally in numerous web‐based review platforms. The purpose of this study is to investigate online dysfunctional customer behavior, in particular negative “word‐of‐web” (WOW) in online feedback forums, among customers who participate in frequent‐flier programs in the airline industry. Design/methodology/approach The study employs a variation of the critical incident technique (CIT) referred to as the critical internet feedback technique (CIFT). Qualitative data of customer reviews of 13 different frequent‐flier programs posted on the internet were collected and analyzed with regard to frustration incidents, verbal and non‐verbal emotional effects and types of dysfunctional word‐of‐web customer behavior. The sample includes 141 negative customer reviews based on non‐recommendations and low program ratings. Findings Problems with loyalty programs evoke negative emotions that are expressed in a spectrum of verbal and non‐verbal negative electronic word‐of‐mouth. Online dysfunctional behavior can vary widely from low ratings and non‐recommendations to voicing switching intentions to even stronger forms such as manipulation of others and revenge intentions. Research limitations/implications Results have to be viewed carefully due to methodological challenges with regard to the measurement of emotions, in particular the accuracy of self‐report techniques and the quality of online data. Generalization of the results is limited because the study utilizes data from only one industry. Further research is needed with regard to the exact differentiation of frustration from related constructs. In addition, large‐scale quantitative studies are necessary to specify and test the relationships between frustration incidents and subsequent dysfunctional customer behavior expressed in negative word‐of‐web. Practical implications The study yields important implications for the monitoring of the perceived quality of loyalty programs. Management can obtain valuable information about program‐related and/or relationship‐related frustration incidents that lead to online dysfunctional customer behavior. A proactive response strategy should be developed to deal with severe cases, such as sabotage plans. Originality/value This study contributes to knowledge regarding the limited research of online dysfunctional customer behavior as well as frustration incidents of loyalty programs. Also, the article presents a theoretical “customer frustration‐defection” framework that describes different levels of online dysfunctional behavior in relation to the level of frustration sensation that customers have experienced. The framework extends the existing perspective of the “customer satisfaction‐loyalty” framework developed by Heskett et al.

Loyalty (Brand Loyalty)

Loyalty is a desired marketing outcome for products ranging from fast-moving consumer goods, services, durables, and ideas products such as political parties and social behaviors. Evidence has shown that a base of loyal customers is advantageous for an organization as it reduces the marketing cost of doing business and improves profitability. The approaches to loyalty have varied over the decades with various schools of thoughts toward definitions, conceptualizations, and measurement. The need for understanding the nature of the product and consumer's behavior to determine the appropriate approach to loyalty is emphasized in this article. In this article, we outline the historical development of brand loyalty, the major approaches to the construct (attitudinal and behavioral) and new approaches that deconstruct attitudinal loyalty into its subcomponent parts.

Programas de fidelización en la distribución comercial de la era digital.

Hoy en día, las empresas deben adaptarse a los cambios continuos del mercado, donde el comercio electrónico crece cada año y las redes sociales y los dispositivos móviles conectan a los consumidores con las marcas. El marketing ha evolucionado gracias a las nuevas tecnologías de información y comunicación para responder a un consumidor social que está conectado gran parte del día, es exigente y además, está comprometido con el medio ambiente. En un entorno muy maduro y competitivo, el cliente se ha convertido en el activo más valorado para las empresas especialmente de distribución minorista y por eso, su fidelización es un objetivo prioritario para las compañías, quienes tratan de enfocar las estrategias de marketing hacia las relaciones con los consumidores. Pero, a pesar de la infinidad de oportunidades que ofrecen las nuevas tecnologías, los programas de fidelización implantados en el entorno digital tienen un recorrido de necesaria evolución y un ajuste de mejoras para la adaptación de un medio poco estructurado a las nuevas circunstancias. A través de este trabajo fin de grado se propone dar a conocer la actualidad sobre la distribución comercial en el ámbito digital así como las tendencias en los programas de fidelización. Además, la creciente implicación en el cuidado del medio ambiente por parte de las empresas y los consumidores se incluye como una aportación original y distintiva al trabajo.

Antecedents of loyalty to a brand : Apple clients vs. non-clients

Apple is undoubtedly a sui generis and remarkable brand in what concerns to its branding and brand experience, and remains an indisputable reference in the consumer electronics and computer industries. The aim of this study encompasses the development and empirical testing of two conceptual models that evaluate and allow to draw a comparison between Apple clients and non-clients’ perceptions, regarding brand experience, brand perceived value, price perceptions and brand trust; and that determine the antecedents of clients’ loyalty to the brand. Therefore, the contribution of this study to the literature relies on the research of the impact of brand experience on brand perceived value and on price perceptions, as well as the influence of price perceptions (positive and negative) on trust, satisfaction, and commitment to the brand. Two surveys were used to test each conceptual model, through a sample collected across the portuguese academic community. The findings prove the strong influence of the sensory and affective aspects of brand experience on both clients and non-clients. They also reveal that the negative role of price is neutralized in the presence of strong brand experience, and that the fact that Apple is viewed as an “expensive brand” may highlight its association to higher quality and prestige. Also, this study reinforces the important role of satisfaction and commitment in building customer loyalty, corroborating the existent literature. Managerial implications derived from the findings are also discussed.

Cultural adaptation of websites: a comparative study of portuguese and dutch corporate websites

Master Thesis Presented at Instituto de Contabilidade e Administração do Porto for obtaining the Master’s degree in Digital Marketing under the supervision of Professor José de Freitas Santos

Management consulting labs- Galp loyalty

The purpose of this project was to diagnose and estimate the possible value to add to the current loyalty program of Galp and to explore possible redefinitions to the loyalty approach. In order to do that it was performed a deep benchmarking about the company, exhaustive research on the existent data about loyalty and loyalty programs, new data mining with quantitative and qualitative analysis, exploratory market research and ideation sessions. Based on all the work developed, a group of five changes of paradigm were suggested through structured and innovative ideas to answer the challenge proposed.

Impact of Product Quality, Service Quality and Contextual Experience on Customer Perceived Value and Future Buying Intentions

Recognizing that high satisfaction leads to high customer loyalty, companies today are aiming for total customer satisfaction. This article explains relative impact of product quality, service quality and contextual experience on customer perceived value and intention to shop in the future. The data has been collected using a questionnaire from 205 customers of a national retailer chain. The relative importance of product quality, service quality and contextual experience on customer perceived value and thus on customer preference and future intentions was measured using multiple regression. Also, the contribution of perceived value to preference and thus on future buying intention was also measured. Structural Equation Model (SEM) using Amos 4 was used to find the overall fitness of the model. It was found that product quality, service quality and contextual experience have a major influence on customer perceived value