Case Study of Sainsbury - Loyalty Card Schemes and Customer Loyalty
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Added on 2020-01-21
Case Study of Sainsbury - Loyalty Card Schemes and Customer Loyalty
Added on 2020-01-21
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Analyze relationship between loyalty card schemes and customer loyalty -Case study of Sainsbury's.1
ACKNOWLEDGEMENTI would like to thank my mentor for the bottom of my heart as they have provided megood knowledge and effective support for conducting study in an appropriate manner. I wouldlike to express my gratitude to friends, colleagues as well as family members who have guidedme at every step of thesis. Through their support I was able to accomplish my dissertation in thebest possible manner. In the series I would also like to state special thanks to my team memberswho have assisted in collecting data and in analyzing it further.
ABSTRACTCustomer loyalty is the level which business organization has achieved success inretaining customers for the long run. It reflects the positive experience of the customer towardsthe product or services. For this dissertation Sainsbury is selected which is the Britishmultinational supermarket of UK. The main objective behind this study is to analyze therelationship between the loyalty card schemes and customer loyalty. In the present study,inductive approach and interpretivism philosophy has been used by the scholar. For assessing therelationship between card scheme and customer loyalty survey has been conducted by thescholar on 40 customers of Sainsbury. From the primary data analysis it has been assessed thatcustomer loyalty plays a vital role in the growth and expansion of retail sector. Further, from thisdissertation it can be summarized that loyalty card scheme of Salisbury has high level of impacton customer loyalty. i3
Table of ContentsCHAPTER 1: INTRODUCTION ........................................................................................................31.1 Background of the study ...........................................................................................................31.2 Rationale of the study ...............................................................................................................31.3 Aims and objectives of the research .........................................................................................41.4 Research questions ....................................................................................................................41.5 Significance and scope of the study ..........................................................................................41.6 Structure of dissertation ............................................................................................................5CHApter 2: Literature review ..............................................................................................................7Theme 1: What is customer loyalty ................................................................................................7Theme 2: Significance of customer loyalty in retail sector ............................................................7Theme 3: Relationship between loyalty card scheme and customer loyalty ..................................9CHApter 3: research methodology.....................................................................................................12Research Type................................................................................................................................12Research Approach .......................................................................................................................12Research Philosophy .....................................................................................................................13Research Design ...........................................................................................................................13CHApter 4: data analysis and findings...............................................................................................16CHApter 5: conclusion and recommendations...................................................................................22RECOMMENDATIONS....................................................................................................................24References..........................................................................................................................................25APPENDIX........................................................................................................................................284
CHAPTER 1: INTRODUCTION 1.1 Background of the study Customers are the king of market and they have power to affect the growth anddevelopment of the firm to the great level. In retail industry customers satisfaction and loyalty isthe key of success. Now, fierce comparison take place in the retail sector. In order to cope upwith this situation retail companies are starting to make focus on introducing the most profitableschemes to the customers (Andy, 2005). Such schemes allow firm to perform in the market in anefficient manner. Nevertheless, companies are facing difficulty in assessing the suitable schemewhich helps them in raising customers loyalty. In order to attain success in the highlycompetitive business environment it is required for the firm to make selection of suitableschemes and loyalty factors. This dissertation is based on Sainsbury which is the Britishmultinational retailer of UK. Sainsbury makes use of wide range of loyalty schemes to satisfy theneeds of target market in an efficient manner. The present research will describe the ways andtypes of schemes which retail business organization can use of to build and raise loyalty amongthe customers. 1.2 Rationale of the study What is the research issue?In the modern time, firms who are operating in the retail sector facing high level of thecompetition. In this, it is highly difficult for the retail firms including Sainsbury to survive in themarket. In this, business units needs to introduce the attractive schemes which helps them inincreasing customer loyalty. Thus, the association between the loyalty card schemes andcustomer loyalty is recognized as an issue. Why is it an issue?Customer satisfaction and loyalty is one of the main aspects which have high level ofinfluence on the growth and success of the business organization (Butscher, 2002). Further,competitors strategies and policies also affect the loyalty of customers to the large extent. Wordof mouth publicity is also affected when customer loyalty decreased. Hence, low level ofcustomer loyalty is the significant issue in the present time. Why is it an issue now?Now, business organization cannot build and sustain competitive edge over others if they5
do not have loyal customers. In this, it is vital for the business organization to offer various orappropriate schemes to the customers which provide high level of monetary benefits to the targetmarket (Flavian, Cristobal and Guinaliu, 2008). Therefore, company needs to make suitableassociation between the loyalty card schemes and customers loyalty. How and when it is going to be investigated?In order to evaluate the research issue scholar will carry out the investigation to assess thefactors which are closely linked with the loyalty card schemes and customer loyalty. It enablesinvestigator to offer the suitable framework to Sainsbury and other firms of retail sector whichhelps them in increasing the customer loyalty. What could this research shed light on?The present investigation will shed light on the level to which loyalty card schemes andcustomer loyalty is linked with each other. Besides this, it will also present the aspects whichbusiness units need to improve in their card schemes (Denzin and Lincoln, 2005). By this,Sainsbury can raise the customer loyalty and thereby enhance their profitability aspects. 1.3 Aims and objectives of the research The main aim of the present study will be “To analyze the relationship between loyaltycard scheme and customer loyalty: A study on Sainsbury UK. ”Following will be the objectives for the present researchTo determine the significance of customer loyalty in retail sectorTo understand the link between loyalty card scheme and customer loyalty withinSainsburyTo recommend the effective ways through which Sainsbury can build effective loyaltyscheme for enhancing customer loyalty 1.4 Research questions In order to conduct study in the best possible manner researcher is required to framesuitable questions which addresses the research aims and objectives. Research questions for thepresent study are enumerated below:How important is customer loyalty in the retail sector?What is the link between loyalty card scheme and customer loyalty?What are the ways through which Sainsbury can build effective loyalty scheme forenhancing customer loyalty? 6
1.5 Significance and scope of the study The present study and it outcome is highly significant for the academic and corporatesector. At academic level students can use this study to develop their understanding about thecard scheme which are adopted Sainsbury or retail industry. Further, they can also use this studyto assess the level to which card scheme helps in enhancing the customer loyalty. Besides this,the present study and its outcome will also assists other researchers who are going to conductinvestigation on similar topic. Along with it, the study which is being carried out by theresearcher also helps companies who are operating in retail sector. Findings and framework ofthis study will assists business organization in making development in their card scheme.Through this, retail firms are become able to enhance their customer loyalty to the significantlevel. Moreover, productivity and profitability of the business organizations are highlyinfluenced by the customer loyalty. In the present era, customers prefer to purchase the product or services from the storewho charges reasonable prices. Now, customers are highly price concious in nature which maycause of high switching cost in the retail sector (Szwarc, 2005). In this, retailer can retain thecustomers for long run when they offer attractive scheme and offers to them. Thus, this studywill provide information to the retail organization including Sainsbury about the extent to whichcard scheme helps increasing the customer loyalty.1.6 Structure of dissertation Chapter 1: IntroductionIn the first chapter of dissertation researcher sheds light on the topic of research. Further,this, scholar sets the aims and objectives which help them in conducting the whole investigationin an appropriate manner. Besides this, researcher also discusses the significance and scope ofthe study in a brief manner. Chapter 2: Literature review Under this chapter, researcher will examine the secondary data sources such as books,journals and research papers. This chapter of dissertation develop deeper understanding of theresearcher on the issue. Through this, researcher can assess the extent to which card scheme andcustomer loyalty is highly associated with each other. Thus, by evaluating the viewpoints of thedifferent authors researcher is become able to present the fair outcome of the issue. Chapter 3: Research methodology 7
In this section, scholar assesses the approach and philosophy of the research study.Further, it also depicts the methods which researcher undertakes for the collection and analysis ofdata. It is the most important chapter of the study which closely influence the outcome of issue. Chapter 4: Data analysis In this part of the dissertation researcher evaluates and analyze data by taking intoaccount the suitable technique. It is the main section of the study which clearly reflects thesolution of the research issue. This chapter offer suitable framework for the last section of thedissertation. Chapter 5: Conclusion and recommendations In the 5 chapter, investigator concludes all the findings on the basis of data which isanalyzed by them in the previous chapter. Besides this, researcher also gives recommendationabout the several areas and aspect which business unit need to improve for attaining success inthe near future.8
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