Do Loyalty Programs Really Enhance Behavioral Loyalty? An Empirical Analysis Accounting for Self-Selecting Members

One of the pressing issues in marketing is whether loyalty programs really enhance behavioral loyalty. Loyalty program members may have a much higher share-of-wallet at the firm with the loyalty program than non-members have, but this does not necessarily imply that loyalty programs are effective. Loyal customers may select themselves to become members in order to benefit from the program. Since this implies that program membership is endogenous, we estimate models for both the membership decision (using instrumental variables) and for the effect of membership on share-of-wallet, our measure of behavioral loyalty. We use panel data from a representative sample of Dutch households who report their loyalty program memberships for all seven loyalty programs in grocery retailing as well as their expenditures at each of the 20 major supermarket chains. We find a small positive yet significant effect of loyalty program membership on share-of-wallet. This effect is seven times smaller than is suggested by a naïve model that ignores the endogeneity of program membership. The predictive validity of the proposed model is much better than for the naïve model. Our results show that creating loyalty program membership is a crucial step to enhance share-of-wallet, and we provide guidelines how to achieve this.Attraction models;Endogeneity;Grocery retailing;Loyalty programs;Tobit-II model

Do Loyalty Programs Enhance Behavioral Loyalty: An Empirical Analysis Accounting for Program Design and Competitive Effects

This paper studies the effects of loyalty programs on share-of-wallet using market-wide household panel data on supermarket purchases.We find that loyalty programs relate positively to share-of-wallet, but the programs differ in effectiveness and some are ineffective.Both a saving component and a multi-vendor structure enhance the effectiveness of a loyalty program, but high discounts do not lead to higher share-of-wallets.Further, if households have multiple loyalty cards, the effectiveness of a specific loyalty program is much smaller.The positive loyalty program effects on share-of-wallet entail substantial additional customer revenues.However, given the high number of loyalty programs already available in the market, our model predicts that a new loyalty program introduction will only lead to small effects on share-of-wallet.loyalty;marketing;retailing

Perceived benefits of customer loyalty programs: validating the scale in the Indian context

The article endeavors to validate the scale developed by Mimouni-Chaabane and Volle (2010) that measures perceived benefits of customer loyalty programs in the Indian context. On running exploratory and subsequently confirmatory factor analyses based on the responses collected from loyalty program members from two Indian cities and across different industries, the researchers opine that in the Indian context, the scale has to undergo changes. The original scale developed and tested on French loyalty program members had sixteen items that measure five perceived benefits namely, monetary savings, exploration, entertainment, recognition and social. It was found that in the case of India, the number of items remain intact. However, the entertainment benefits dimension and the recognition benefits dimension merged to form a singular dimension which the researchers name as ‘ego pleasure’. The authors believe that this research will benefit the managers in devising strategies for particular segments of their loyalty program members. In addition, it opens up the possibility of further testing the scale in different cultural contexts.Loyalty, perceived benefit, customer loyalty program (CLP), scale, Indian loyalty market.

PENGARUH MOTIVASI KERJA DAN REWARD TERHADAP LOYALITAS KARYAWAN MELALUI KEPUASAN KERJA (Studi kasus pada PT XYZ Sidoarjo)

This research was conducted on employees of the of PT XYZ. With the purpose of this study to determine and analyze: (1) the effect of work motivation on employee loyalty, (2) the effect of reward on employee loyalty, (3) the effect of work motivation on job satisfaction, (4) the effect of reward on job satisfaction, (5) job satisfaction on employee loyalty, (6) the effect of work motivation on employee loyalty through job satisfaction, (7) the effect of reward on employee loyalty through job satisfaction. This research uses a quantitative approach, with a path analysis method through the SPSS 25 program, by testing 45 respondents' answers. This study obtained the results: work motivation has a positive and significant effect on employee loyalty, reward has a positive and significant effect on employee loyalty, work motivation has a positive and significant effect on job satisfaction, reward has a positive and significant effect on job satisfaction, job satisfaction has a positive and significant effect on employee loyalty, job satisfaction has a mediating role in the relationship between work motivation and employee loyalty, job satisfaction has a mediating role in the relationship between reward and employee loyalty

PENGARUH KUALITAS LAYANAN TERHADAP LOYALITAS PELANGGAN DENGAN KEPUASAN PELANGGAN SEBAGAI VARIABEL MEDIASI (Studi Kasus Pada Pelanggan toko online Pulvar.id di Shopee)

Pulvar.id Online Store focuses on instant beverage powder which is suitable for various types of drinks. Shopee and Pulvar.id online shop match because Shopee E-Commerce is here to connect buyers and sellers, besides that there are many benefits for sellers and buyers. The benefits provided by Shopee make a forum for sellers such as the MSME coaching program, the Export Program and assistance to sellers in conducting store operations. Many sales categories on Shopee make Pulvar.id develop and have customers because of the large variety of products sold. The purpose of this study was to determine and describe the role of customer loyalty, service quality and customer satisfaction of Pulvar.id Online Shop. This type of research is a quantitative method sampling technique determined by probability sampling by distributing questionnaires as many as 140 respondents to Pulvar.id Online Store customers. The analysis technique used is path analysis with the help of the SPSS application. The results in this study indicate that (1) Service quality has a positive and insignificant effect on customer loyalty, (2) Customer satisfaction has a positive and significant effect on customer loyalty, (3) Service quality has a positive and significant effect on customer satisfaction, (4) there is a significant influence between service quality on customer loyalty through customer satisfaction

The Effect Of Customer Satisfaction, Customer Trust On Custromer Loyalty Of The Card Users Of PT. Indosat Tbk

The research was conducted on Indosat GSM cellular card customers residing in the city of Bandung. The purpose of this study was to determine whether there is an effect of customer satisfaction and customer trust on customer loyalty in the PT. Indosat Tbk, and how much the level of customer loyalty after using the service provider Indosat. This research was conducted with statistical and descriptive methods. It is intended that the study can obtain accurate results, so the results can be trusted. Population is both the card users of Indosat for at least 6 months and those who had used the service provider Indosat. The samples were 113 respondents. The method used was the accidental sampling. The process and analytical method employed a path analysis to test hypotheses about the effect of customer satisfaction and customer trust on customer loyalty. Questionnaire instruments were developed and were processed by using a computer-assisted program SPSS 14.0 for windows and Amos 5.0. The results showed that the best model is a Theoretical Model 2. In model 2 customer trust was described as an antecedent to affect customer loyalty as compared with a Theoretical Model 1 with customer satisfaction as an antecedent. The model shows a significant relationship of trust with satisfaction and customer loyalty. Key words: Satisfaction, Trust and Customer Loyalty

TENDING RELATIONSHIP QUALITY OF YOUNG MIDDLE CLASS An Empirical Study on My Starbucks Reward Members In Semarang

This study aims to examine the effect of perceived benefit in My Starbucks Reward loyalty program in Semarang. Research design used for this study is a modification of previous research about effect of loyalty program in France which was conducted by Mimouni-Chaabane and Volle (2010). The model consists of four independent variables which are monetary benefit, exploratory benefit, social benefit, and ego pleasure. This research also used perceived relationship investment as intervening variable, whereas relationship quality is used as dependent variable. Primary data were collected by using online questionnaire from 60 respondents whom were members of My Starbucks Card and had used the card as payment method in their patron to Starbucks Semarang store. Path analysis method to aalyze the model. The result shows that all independent variables, except Monetary Benefit, have influence upon Perceived Investment Variable. Perceived. Variable Perceived Relationship Investment is found to have positive influence upon relationship quality and to have role as intervening variable

How to Design International Loyalty Programs

Despite the growing importance of customer loyalty programs in marketing practice, research about international loyalty programs is few and far between. Especially the issue of whether loyalty programs can be standardized across countries has not been addressed so far. Hence, this paper investigates whether it is feasible to standardize loyalty program design in countries with different cultural dimensions. We conducted an online experiment with customers in four countries (Australia, Germany, South Korea, U.S.) to examine how benefits that are provided by loyalty programs are perceived by different customer groups in these cultural environments. Particularly social and confidence benefits were perceived differently suggesting the need to adapt loyalty program designs. We also found that if a country is characterized by individualism, customers are more strongly attracted by program loyalty. However, this does not necessarily translate into brand loyalty