Customer Satisfaction and Loyalty in Retail Supermarkets: A Case Study of Tesco

Customer satisfaction a ladder
to customer loyalty in a super
market case study of Tesco

LIST OF TABLES
Table 1: Knowledge about customer satisfaction and customer loyalty.....................................14
Table 2: Customer satisfaction helps in measuring happiness level of customer.......................15
Table 3:Helps in turning target buyer into loyal customer.........................................................16
Table 4:Importance of customer satisfaction..............................................................................17
Table 5:Importance of customer loyalty.....................................................................................18
Table 6: Factor to influence customer satisfaction.....................................................................19
Table 7: Methods to boost customer satisfaction........................................................................21
Table 8:Challenges faced in absence of customer satisfaction strategy.....................................22
Table 9:Impact of customer satisfaction on business performance............................................23
Table 10: Agreed that customer satisfaction helps the company to create strong customer
loyalty base.................................................................................................................................24

LIST OF FIGURES
Figure 1: Knowledge about customer satisfaction and customer loyalty...................................15
Figure 2: Customer satisfaction helps in measuring happiness level of customer......................16
Figure 3: Helps in turning target buyer into loyal customer.......................................................17
Figure 4: Importance of customer satisfaction............................................................................18
Figure 5: Importance of customer loyalty...................................................................................19
Figure 6: Factor to influence customer satisfaction....................................................................20
Figure 7: Methods to boost customer satisfaction......................................................................21
Figure 8: Challenges faced in absence of customer satisfaction strategy...................................22
Figure 9: Impact of customer satisfaction on business performance..........................................23
Figure 10: Agreed that customer satisfaction helps the company to create strong customer
loyalty base.................................................................................................................................24

Table of Contents
LIST OF TABLES........................................................................................................................2
LIST OF FIGURES.......................................................................................................................3
CHAPTER 1: INTRODUCTION.................................................................................................5
Overview of the topic.............................................................................................................5
Background of company.........................................................................................................5
Research Aim.........................................................................................................................6
Research objectives................................................................................................................6
Research Questions................................................................................................................6
Research Rationale.................................................................................................................6
Significance of research.........................................................................................................7
Outline of methodology..........................................................................................................7
CHAPTER 2: LITERATURE REVIEW......................................................................................1
What is the concept of customer satisfaction and customer loyalty within retail super
market?...................................................................................................................................1
What are methods used by Tesco in order to increase customer satisfaction and customer
loyalty?...................................................................................................................................3
The impact of customer satisfaction on improving the customer loyalty and business
performance within Tesco......................................................................................................5
CHAPTER 3: RESEARCH METHODOLOGY..........................................................................8
CHAPTER 4: DATA ANALYSIS AND FINDING..................................................................12
Questionnaire........................................................................................................................12
Frequency distribution table.................................................................................................14
Data presentation..................................................................................................................16
CHAPTER 5: CONCLUSION AND RECOMMENDATION...................................................28
REFERENCES............................................................................................................................31

CHAPTER 1: INTRODUCTION
Overview of the topic
Customer satisfaction is a process of making customer happy with the products and
services. Within an organisation customer satisfaction plays an important role as it helps in
acquiring new customers, increase brand credibility and also drive revenue. Customer
satisfaction generally helps in determining the how the products and services of organisation
meets the expectation of customers (Anouze, Alamro and Awwad, 2018). There are various
ways which can be used by the company in order to measure the satisfaction level of customers
such as customer satisfaction survey questions, net promoter score, customer experience
metric, customer effort score and various others. Customer satisfaction helps in improving the
growth and performance of business. It also helps in retaining the new customer as acquiring
new customer are cheaper (Lim, Tuli and Grewal, 2020). This topic is chosen as it helps in
provides the information related to the importance of customer satisfaction and how it helps in
improving their loyalty towards the brand. The reason behind selecting this topic is that it
provides knowledge related to the chosen study and also examine the different methods used
by the company for increases the customer satisfaction and customer loyalty.
Background of company
The chosen organisation for this investigation is Tesco, it is a retail brand that offers
different varieties of products and services to its customers. The brand was founded in 1919 in
Hackey, London, UK and also it was founded by Jack Cohen. Tesco has its supermarket,
hypermarket, convenient shop and superstore at global level including 11 countries. The
organisation focuses on offering products and services at low cost which helps in attracting
large number of customer towards the brand. The vision of Tesco is to be most highest valued
business among customer, communities and stakeholders. The objective of Tesco is to
maximise the sales and increase their profitability by delivering exceptional services to its
customers. Therefore, brad promises to its customers that they provide best possible shopping
experience. The strength of Tesco is that it have strong geographically presence which helps in
attracting more and more number of target audience and also enhances the profitability of
business.

Research Aim
To analyse importance of customer satisfaction as a ladder to customer loyalty within a
super market. A case study of Tesco.
Research objectives
 To understand the basic concept of customer satisfaction and customer loyalty within
retail super market.
 To identify methods used by Tesco in order to increase customer satisfaction and
customer loyalty.
 To analyse the impact of customer satisfaction on improving the customer loyalty and
business performance within Tesco
Research Questions
 What is the concept of customer satisfaction and customer loyalty within retail super
market?
 What are methods used by Tesco in order to increase customer satisfaction and
customer loyalty?
 What is the impact of customer satisfaction on improving the customer loyalty and
business performance within Tesco.
Research Rationale
The major rationale behind conducting this research is to gain in-depth knowledge on
the importance of customer satisfaction as a ladder to customer loyalty within a super market.
This investigation helps in determining the importance of customer satisfaction and its
influence on the productivity and performance of business (Hamzah and Shamsudin, 2020). In
addition to that the current study also helps in gaining knowledge regarding the concept of
customer satisfaction and customer loyalty within retail supermarket. Therefore, the current
research is also helpful in providing the different methods which can be used by the company
in order to boost the customer satisfaction and customer loyalty. Thus, it also identifies the
impact of customer satisfaction on improving the customer loyalty and business performance.
This investigation is also helpful for the researcher as it meets their dual perspective i.e.
personal and professional perspective. In terms of personal objective, this investigation is
helpful as it completed the investigation in structural format with significant manner. The skills

of the investigator will also get enhanced while conducting the investigation including
communication skills, presentation skills, analytical skills, problem solving skills and many
others. The professional perspective of researcher will also be attained as the research helps in
developing professional career in better way by improving their knowledge related to the
chosen topic. Thus, this investigation is quite helpful in attaining the personal and professional
perspective of the investigator.
Significance of research
This research is important as it helps in providing brief information related to the
chosen study i.e. importance of customer satisfaction as a ladder to customer loyalty within a
super market. It helps in providing the impact of customer satisfaction on gaining the loyalty of
customer and improving the business performance (Ali and et. al., 2021). The present study is
important for the students, organisation and researcher. This study is important for researcher
as it helps in providing understanding about the chosen topic and also they can avail knowledge
related to the research methods (Otto, Szymanski and Varadarajan, 2020). For students, this
research is helpful as it helps in improving their understanding related to the topic which they
can use in their academics. At last, this research is helpful for organisation as they can know
the different methods for enhancing the satisfaction and loyalty of customer towards the brand.
Outline of methodology
The methodology which is chosen by the investigator within this research is
quantitative research methods. The reason behind choosing this method is that it provides
numeric information in effective and efficient manner. By choosing this method, researcher
accumulates information in terms of statistical facts and figures due to which aim and
objectives can be attained in appropriate way. The other methods which is used by the
investigator for accumulating the information are deductive approach, positivism philosophy,
quantitative research choice, primary and secondary data, frequency distribution analysis and
many others. Within this investigation, 30 respondents are selected by the researcher on the
basis of random sampling method in order to collect information related to the chosen study.

CHAPTER 2: LITERATURE REVIEW
What is the concept of customer satisfaction and customer loyalty within retail super market?
According to the point of view of Slack and et.al., (2020) customers play a vital role in
any company or market because it is defined as the individual or person that are able to purchase
or buys a goods and services from the business or shop. They are important because they drives a
revenue, increasing the profit by purchasing the commodity of services or product. In relation to
customer satisfaction and customer loyalty, customer satisfaction is also one of the most
important term in any company or industry because it is helps to increasing the profit and
productivity of the product. Customer satisfaction can be defined as the measurement of attitude
of the customers towards the services, product or brand. Customer satisfaction is determines as
the customer that are happy with the company's services, capabilities and products (Ahn, and
Kwon, 2021). Customer satisfaction is important because it is increasing the number of
customers and increasing the sale of the product as well. Therefore the concept of customer
loyalty refers to the commitment between brand and customers where customer continue their
purchasing the product. Customer loyalty is depends on the product and services of the company
where they are happy with the product and purchase it continuously with company. On the behalf
of retail industry, the concept of customer satisfaction and customer loyalty can be defined as the
important term of the industry because satisfaction of the customer and customer loyalty helps to
increase the productivity and performance of the company. It is also helps to improve the
company image and reputation. Customer satisfaction is the concept of customer's attitude
towards the product and services of the industry. It can be increase and improve by providing the
good product and services and providing the goods and services according to their needs and
wants. Therefore customer loyalty is the term of commitment between the company and
customer where a customers are able to purchase the product from the one company and chooses
the same product (Wong, 2021). customer loyalty is refer to the loyal customer of the company
where they are commit to purchase the same product from the same company or industry. The
concept of customer satisfaction and customer loyalty within retail super market is defining as
loyal customer where they are able to get the goods and services according to their needs and
wants which is helps in increasing their satisfaction and improve their loyalty towards the
products and company as well. It is also helps to increase the image and product value of the
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