Example Business Essay:Loyalty cards/schemes, what value do they have, and why do some work and others do not (appear to)?

Example Business Essay:Loyalty cards/schemes, what value do they have, and why do some work and others do not (appear to)?
In an increasingly global environment, organisations, its people, strategy and marketing, and its structure are finding themselves constantly seeking innovative ways to differentiate themselves from their competitors. The complex business interactions synonymous with modern society has witnessed the consumer gaining in status and decision making power whilst the retailer explores new avenues enabling them to provide superior products and services acting as the differentiator amongst competitors. Consequently the crux for all retailers in maintaining and attracting consumers stems from the notion of ‘customer loyalty
There appears however to be varying schools of thought over whether loyalty schemes and card do actually work in favour of the retailer, or whether the advantage lies instead in the hands of the customer, or indeed whether there is a mutually beneficial relationship present. The UK Competition Commission (2002) found that the average consumer holds at least two loyalty cards with retailers in direct competition such as Tesco and Sainsbury’s, where Shabi (2003) found at least 85 per cent of UK households have at least one loyalty card.

Dick and Beau (1994) propose that loyalty has both behavioural and attitudinal components. This dissertation will address the former of the ‘behavioural’ component and seek to identify how consumer’s behaviour has changed since the introduction of loyalty schemes in the 1990’s in relation to present day, and provide recommendations on how retailers can maximise consumer patterns to their advantage.

What will be the gain in knowledge?

The gain in knowledge which will arise from the above will present itself in the following ways:

Maximising effectiveness within customer loyalty market research to generate solid data from a questionnaire which will try to identify the ‘why’ and ‘what’ factors of consumer habits using pertinent research methods (discussed later). As retailers seek to innovate into new growth areas accurate market data is essential to maximise customer retention through a strong understanding of behaviour and motivation.
Developing new proposals for customer loyalty cards and schemes drawing on the findings from the data analysis which are more pertinent to today’s society, taking into account the increasing choice of loyalty schemes available to the consumer in an increasingly saturated ‘loyalty market’.

Example Business Essay:Loyalty cards/schemes, what value do they have, and why do some work and others do not (appear to)? 9.3 of 10 on the basis of 739 Review.