How does the reward scheme system implemented by organisations help to increase the sales profit - Dissertation Example

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Is a Reward Scheme Effective at Increasing Customer Retention? An Empirical Study of Tesco and ParknShop Abstract Purpose. The present study aims to determine whether satisfaction with loyalty schemes influence customer loyalty within the specific context of the retail industry…
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How does the reward scheme system implemented by organisations help to increase the sales profit
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Download file to see previous pages These are all ascertained within the UK and HK contexts, respectively. Design/methodology/approach. The study is a quantitative research, which takes on a descriptive-correlational research design. Using a purposive sample of UK and HK patrons of Tesco and ParknShop, the research made use of a survey questionnaire to gather primary data and address the objectives of the study. The responses were encoded onto the Statistical Package for the Social Sciences (SPSS) version 17.0 for statistical analysis. Findings. The study found that satisfaction with the loyalty scheme is significantly correlated with the frequency of shopping at the retail entity for both UK and HK samples. Moreover, satisfaction with the loyalty scheme is significantly correlated with frequency of using the loyalty scheme card for both UK and HK samples. The Chi-square tests suggest that for UK and HK patrons, there is an apparent judgment on customer loyalty as contributed by loyalty schemes, and this is primarily positive. These suggest that both UK and HK customers have a relatively positive attitude towards the value and contribution of loyalty schemes in building customer loyalty. Loyalty schemes are significantly correlated with frequency of recommending the loyalty scheme card to friends and family for both samples. The outcomes indicate that there seems to be a relationship between beliefs and loyalty behaviours for UK and HK patrons. ...
Such loyalty schemes should be further investigated in terms of their effectiveness in maximising value for their patrons and profitability. Tesco and ParknShop should make a continual effort to instill stronger engagement from its clients to enhance their customer value proposition at the least possible expense. There are other relationship marketing programmes which may serve a similar purpose such as discount coupons, personalised offers, credit cards for the retail institution, among others. Keywords: Customer loyalty in retail, retail marketing, customer loyalty, Tesco, ParknShop Chapter 1 Introduction 1.1 Introduction Technology’s overarching aim is to enhance organisational performance (Jackson 2005). One technological means of increasing customer retention is through effectual loyalty schemes (Raman, Wittmann, and Rauseo, 2006), which may assist the enterprise in transforming cold data into warm, personalised relationships. Over the long haul, this dovetailed use of loyalty schemes may lead to a sharp understanding of customers – their profile, needs, and wants – towards enhancing their sense of loyalty to the products and services of the organisation (Oliver 1997; Shimp 2003). Loyalty schemes may entail or incur considerable cost from the organisation; however, it may also significantly reduce the advertising cost that is necessary for attracting new patrons. Some critics contend that it may loyalty schemes may no longer beneficial in improving organisational performance (Reichheld, Markey, and Hopton 2000),. In particular, loyalty schemes have been widely use by grocery, travel and retail sectors, including the Tesco Clubcard, Boots Advantage Card and the Nectar Card within the specific context of the UK. There are several reasons ...Download file to see next pagesRead More
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