Initially they were the preserve of air transport. However, lately several other industries and companies are adopting them because of the rewards they promise. The working assumption is that customers should be made to develop…
Download file to see previous pages...
Atkinson (364) asserts that opinion on how successful these loyalty schemes are divided, but there is consensus on their advantages and disadvantages.
The main advantage is that; as these customers feel rewarded they are motivated to purchase more; thus, increasing the company’s benefits. This will in the long term boost the sales of the business. However, the flipside of this argument is that if the status of customers is downgraded or remains the same, the customers feel unappreciated and may wholly cut their business links with the organization.
Secondly, as a customer buys more and more their spending habits are noted and so more targeted products are put at their disposal. This makes the customer to be extremely satisfied since they get what they most require. The flipside of this argument is that the customer buys beyond their means and is likely to drastically change their spending habits when they are unsustainable. This is usually to the detriment of the business.
There are several theories that explain customer behavior when rewarded as discussed above. The two notable ones though are equity theory and attribution theory. Atkinson (367) claims that equity theory seeks to study the relational satisfaction that is derived from rewards of different kinds. People evaluate the value of a relation based on the fairness or unfairness of distribution of rewards and costs. According to this theory, people feel indebted to fair treatment (Atkinson 368). On the other hand, limited reward or unfair treatment leads to dissatisfaction. It is also common for people getting the unfair treatment to feel underappreciated. Among the foundations of Equity theory is the assumption that people always seek to maximize their rewards, people get distressed in unequal relationships and then they try to restore parity in such unequal relationships.
The other theory is the attribution theory. According to the theory, people analyze success or failure based
...Download file to see next pagesRead More
Concept of Loyalty Before going into the discussion regarding concept of loyalty, let us get a better understanding of what loyalty actually is. Singh, in an article, found that loyalty is a strong force that keeps us in a relationship, whether it is a personal or business relationship.
The researcher states that loyalty is one of the most important themes of the play King Lear by William Shakespeare, since the plot is fundamentally shaped by Lear’s attempt to judge the loyalty of his daughters towards himself. The author thinks that Lear’s way of judging the love and loyalty of his daughters for him is shallow and unsophisticated.
Customer loyalty deals with the behavior, attitudes and perceptions of customers. Customers are considered to be an asset for any business as they can provide good ratings, testimonials and evaluations to different products and services, which are available in the market (Reinchheld, 2006, 56).
The roles of consumers are changing, rather than they should run after the seller, the seller has to convince them and keep on reminding them about the seller’s existence in the market, it is very difficult these day to differ between the sentences “every thing is marketing” and “marketing is everything”.
have good attitudes toward a Brand shown through repeat purchase behavior and recommendation of the product; the most important aspect of Brand Loyalty is the true good feelings of a consumer towards a product. This essay will deal with the aspects of Brand Loyalty.
It would follow that the behavior of man is intrinsically linked to his/her value system and the environment. While the socio-cultural and religious guidelines broadly determine the parameters of one’s way of living, the personal values become the important elements of decision making in social interaction.