Loyalty program benefits and their effect on relationship quality and loyalty to the retailer

Authors

  • Karen M. Corbishley Department of Marketing & Retail Management, Durban University of Technology, PO Box 1134, Durban, KwaZulu-Natal, South Africa https://orcid.org/0000-0002-1261-2341
  • Corné Meintjes Department of Strategic Communications, University of Johannesburg, Auckland Park, Johannesburg, Gauteng, South Africa https://orcid.org/0000-0003-3391-4565
  • Roger B. Mason Department of Marketing & Retail Management, Durban University of Technology, PO Box 1134, Durban, KwaZulu-Natal, South Africa https://orcid.org/0000-0001-7927-1767

DOI:

https://doi.org/10.20525/ijrbs.v12i2.2320

Keywords:

consumeristic, altruistic, egoistic, satisfaction, commitment, trust, Customer Loyalty Programmes

Abstract

Loyalty Programs (LPs) aim to increase profit by rewarding, with various benefits, customers who patronize the retailer. This study investigated the benefits LPs provide in the South African Fast-moving consumer goods (FMCG) marketplace and how these influence relationship quality and loyalty between retailer and customer. How the perceived benefits of LPs contribute to relationship quality (satisfaction, trust and commitment), and how they lead to loyalty are examined. To illustrate these relationships, a model showing three independent (perceived benefits, namely altruistic, consumeristic, and egoistic) and three dependent variables (relationship quality, namely trust, satisfaction, and commitment), plus customer loyalty, was developed. A quantitative survey was administered electronically over 11 days to a randomly selected sample of 5000 consumers per day from a commercial database, resulting in 1944 responses. After the deletion of incomplete or inappropriate responses, 479 usable replies remained. Since this sample was self-selected, it should be considered a convenience sample. Structural equation modelling (SEM) with confirmatory factor analysis (CFA) was applied to test the hypotheses and develop the model. SEM indicated that respondents consider egoistic and consumeristic benefits as the same. Furthermore, trust and satisfaction manifest as a single construct. Both consumeristic and altruistic benefits had a significant positive relationship with this unified construct of trust/satisfaction, and the relationship between altruistic benefits and commitment was also positive and significant. Finally, although neither altruistic nor consumeristic benefits appeared to contribute directly to loyalty, a positive relationship existed between the new construct of trust/satisfaction and those of commitment and loyalty. The pathway to loyalty is indirect, and to reach this sought-after goal, relationship quality constructs must first be achieved.

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Author Biographies

Karen M. Corbishley, Department of Marketing & Retail Management, Durban University of Technology, PO Box 1134, Durban, KwaZulu-Natal, South Africa

Dr Corbishley is a Senior lecturer in the Department of Marketing and Retail Management at Durban University of Technology. She specialises in the field of retail management and has conducted studies in relationship marketing; customer loyalty, loyalty programmes and cause related marketing.

Corné Meintjes, Department of Strategic Communications, University of Johannesburg, Auckland Park, Johannesburg, Gauteng, South Africa

Dr Corné Meintjes is a Senior Lecturer in Strategic Communication at the University of Johannesburg. She has lectured in strategic communication, marketing and public relations. She has presented 20 conference papers and published 10 journal paper, both locally and internationally. She has been involved in academia in various roles for the past 18 years and have complete a BCom, BCom Honours, MCom and DCom degrees. At the time of the research Dr Meintjes was the supervisor in her capacity as Senior lecturer at the Durban University of Technology.

Roger B. Mason, Department of Marketing & Retail Management, Durban University of Technology, PO Box 1134, Durban, KwaZulu-Natal, South Africa

Professor Roger Mason is a Retired Research Professor in Marketing at Durban University of Technology, and is the Wholesale and Retail Leadership Chair at Cape Peninsula University of Technology. He has lectured in retail, marketing, management and strategy. He has in excess of 30 conference papers and 61 journal papers, both locally and internationally. His business background includes marketing management and consultancy in a variety of industries. He holds PhD, MBL and BA degrees.

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2023-03-25

How to Cite

Corbishley, K. M., Meintjes, C., & Mason, R. B. (2023). Loyalty program benefits and their effect on relationship quality and loyalty to the retailer. International Journal of Research in Business and Social Science (2147- 4478), 12(2), 1–14. https://doi.org/10.20525/ijrbs.v12i2.2320

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Strategic Approach to Business Ecosystem and Organizational Development