Impact of Core Offering on Customer Loyalty: An Exploratory Study

The majority of customers are loyal towards Ocado, with 30% being highly satisfied and 40% dissatisfied. The study highlights the importance of core offering and past experiences in affecting customer loyalty. It suggests that online retailers must update their website regularly, make it more interactive, and offer sound after-sales service to increase customer loyalty.

RESEARCH PROJECT

TABLE OF CONTENTS
RESEARCH PROJECT...................................................................................................................1
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
1.1 Formulate and record possible research project outline specifications............................1
Research topic...............................................................................................................1
1.2 Identify the factors that contribute to the process of research project selection..............2
1.3 Undertake a critical review of key references..................................................................2
Customer loyalty...........................................................................................................2
1.4 Produce a research project specification..........................................................................4
TASK 2............................................................................................................................................6
2.1 Match resources efficiently to the research question or hypothesis.................................6
2.2 Undertake the proposed research investigation in accordance with the agreed specification
and procedures........................................................................................................................7
2.3 Record and collate relevant data where appropriate.........................................................7
TASK 3............................................................................................................................................8
3.1 Use appropriate research evaluation techniques...............................................................8
Different research methods which have been used.......................................................8
3.2 Interpret and analyze the results in terms of the original research specification..............9
3.3 Make recommendations and justify areas for further consideration..............................12
TASK 4..........................................................................................................................................13
4.1 use an agreed format and appropriate media to present the outcomes of the research to an
audience................................................................................................................................13
REFERENCES..............................................................................................................................14

INTRODUCTION
Consumers are considered as a most important part of any organization. It is quite
essential for companies to motivate their workers in order to perform well. This is the best way
through which they can provide high quality services to all their customers. Within the area of
online retailing there are several factors which affect the buying decisions of customers such as
visibility of website, price, quality of services, delivery etc (Torres and Kline, 2013). These are
some of the most common ways which highly affects the loyalty of customers. Before several
decades a retail store is the only shop from where consumers buy several products on daily basis.
This is not the case anymore. Nowadays, people are highly attracted towards the online shopping
as they can buy everything from here on a short time period. With having several positive factors
there are some negative factors which highly affect the decisions of customers (Christodoulides
and de, Chernatony, 2010). Each and every online retailer tries to attract customers by satisfying
their needs and making the right product available for its customers. It also helps in making right
product choice for their customers and motivating them to go through the making of appropriate
purchase decision.
The present research is based on the case study of Ocado Company which is British
online supermarkets and has been voted as best online supermarkets of UK. The main aim of
this study is to evaluate all those factors which affect the consumer loyalty within the online
retailing segment which affects the customer loyalty. According to Heinonen (2010) being a
loyal customer, consumer always expect quality services from company. Due to this factor,
company should take several steps by which all their workers feels motivated and give advanced
services to their customers.
TASK 1
1.1 Formulate and record possible research project outline specifications
Research topic
To identify the factors that affects the customer loyalty in online retailing in the UK: Case study
of Ocado
Research objectives
 To identify the importance of consumer loyalty within the online retailing segment
Ocado.
 To evaluate the current trends prevailing in online retailing segment
 To analyse different factor that affects the consumer loyalty in Ocado
1 | P a g e

 To provide different recommendations in order to maintain consumer loyalty within the
Ocado online retailing company.
Research Questions
 What are the factors which affects the loyalty of customer within the online retailing
segment?
1.2 Identify the factors that contribute to the process of research project selection
 To increase subject knowledge in the area of consumer loyalty
 Personal interest in the topic.
 Lack of researcher studies on consumer loyalty in Ocado
1.3 Undertake a critical review of key references
This is the most important sections of any research under which researcher can fill all the
prevailing gaps of existing literatures. Further, this section gives appropriate information about
the consumer loyalty as well as factors which affects them.
Customer loyalty
It is considered as a most important concern in which companies need to maintain their
service quality in order to maintain consumer loyalty. According to (Dick and Basu, 2004)
customer loyalty is both attitudinal as well as behavioural tendency through which they can
favour only one brand over all others. It is highly linked with the satisfaction with product as
well as convenience, performance and familiarity and comfort. Loyalty is the only factor which
encourages customers to shop more consistently and also feel positive about shopping
experience. In this competitive environment it is becoming quite difficult for companies to
develop several strategies through which they can attract more number of people. Hsin Chang
and Wang (2011) stated that it is the result of consistently positive emotional experience as well
as perceived value of an experience which includes the products and services. Liu, Guo and Lee
(2011) in his article defines that retaining customer is quite difficult than acquiring new one.
There is a consumer experience management which is the most cost effective way to drive
customer satisfaction and customer retention. With the help of this company can gain higher
competitive advantage as well as loyalty (Qureshi and et.al, 2009).
Importance of consumer loyalty within the online retailing segment

According to Bai, Law and Wen (2008) customer loyalty plays a critical role in an
organizations success. It is also considered as a main objective for strategic marketing planning.
It is the best way which secures the relationship between customers as well as services. Shoham
and Makovec (2003) defines that loyalty occurs when a customer buy a product or service
repeatedly. It clearly determines that there is a huge scope and source due to which customers are
attracted towards a single company or source. Moreover, clients are loyal towards a brand based
on their information on that brand. It defines that company needs to provide right as well as
appropriate information to their customers.
Consumer loyalty towards the online retailing can be defined as a e-loyalty in other language.
According to Dennis and et.al, (2009) it is favourable attitude and commitment towards the
online retailer that results in repeat purchase behaviour. It is highly related with the attitude of
customers towards an e-commerce website. Loyalty defines that they are always purchasing
various products from a single website and do not switch to another website. It helps
organizations in attaining higher competitive advantage by increasing their sales as well as
revenues. Further, loyal consumers always spread favourable messages about the services of
company and recommend new customers to the company.
It is being founded from past several studies that there is a huge importance of customer
loyalty within the online retailing segment. Due to technological advancements as well as several
other negative impacts of online services such as data theft, hacking etc. customers are not able
to trust on these online services. According to Torres and Kline (2013) trust is the most critical
success factor in successful service relationship. By developing appropriate relationship with
customers company is able to expand their consumer base. At the time of acquiring new
customers online, there is a lack of online consumer trust. It is also considered as a main barrier
of customer participation in e-commerce.
Factors affecting customer Loyalty in Online Retail
In the modern era, concept of online retail has been increased up to high extent and
companies are adopting this practice for boosting their competency. In this context, there are
varied factors that affect the customer loyalty and hence same need to be considered by
companies. In this regard, Santouridis and Trivellas, (2010) stated that core offering is one of the
major factors which involves core and solid benefits that been attained to customers. Loyalty is
not been boosted from card programs and lucrative schemes, but it is boosted from key benefits.

Elements of core offering within online retail includes website appearance, navigation of web
pages, display of required information, actual time span of delivery, option for payment and
effectual after sales service. If these elements are missing within the context of online retail then
loyalty also get hampered. Further, Kheng and et.al, (2010) commented that satisfaction is a key
feature that leads to attainment of loyalty. A customer can be satisfied by offering products and
services as per his/her requirements. Further, necessary and essential communication must be
made with them so that they can take buying decision based upon it.
Beside this, Hosseini, Maleki and Gholamian, (2010) found that demographics are
anotherconcern within online retail as it can affect the loyalty level of customer. In this context,
differences in the age, income, gender, race, religion, family background and other related affects
the loyalty level. One who is well versed with e-shopping, then he/she tends to be loyal to online
stores and vice versa. Further, age is main concern and it shapes loyally as well. Majority of
customers that ranges between the age group of 14 to 40 years are loyal customer and individuals
that are above 40 years are not much involved into online shopping and hence they are less loyal.
Apart from it, past experiences is another factor that shapes the loyalty as stated by
Siddiqi (2011). In case of having past experiences and it was not appropriate with online
shopping, then that customer refrains themselves from e-shopping and vice versa. Hence, it is
required that online store must meet with the expectation level of customers so that they can gain
response from it on regular basis. Furthermore, Liu, Guo and Lee, (2011) has analysed that social
media is a platform that either boost the loyalty or decline the same. This is so because, both
positive and negative reviews can be post by customers over it and this can affect the buying
behaviour of customers. Through this, loyalty also gets hampered.
1.4 Produce a research project specification
One of the most essential tasks for any researcher is to develop appropriate plan and
procedure for the same. Within this respect, Inductive approach will be applied along with
incorporating Interpretivism philosophy. With the help of this research approach researcher is
able to conduct more effective research in a sequential manner. By applying descriptive research
design researcher will able to identify all those factors which affects the consumer loyalty.
Moreover, data will be collected from both primary as well as secondary sources. Primary data
will be collected through questionnaire survey from the customers who use online retail services.
In this way, it can be stated that with the help of questionnaire survey different questions will be

asked from customers about the factors that affects their satisfaction as well as loyalty level. On
the other hand, secondary data will be gathered by the way of internet as well as various other
sources such as online articles, magazines etc. In this regard, data will be gathered from 50
customers of Ocado who are using all their online supermarket services. In order to analyze the
data, qualitative measures will be incorporated under which thematic analysis as well as
graphical representation will be done. With the help of developing various themes appropriate
discussion over the same can be done. It helps in attaining all the research objectives and
developing appropriate conclusion on the basis of these findings.
1.5 provide an appropriate plan and procedures for the agreed research specification
Activity 1th
Week
2nd
Week
3rd
Week
4t
Week
5th
Week
6th
Week
7th
Week
8th
Week
9th
Week
10t
h
We
ek
Drafting
Research
Proposal
Literature
Review
Setting
aims and
objectives
Drafting
literature
review
Drafting
of
methodol
ogy
Developin
g
questionn
aire
Collection
of Data

Analysis
of Data
Draft
Findings
Analyse
data
Remainin
g
chapters
completio
n
TASK 2
2.1 Match resources efficiently to the research question or hypothesis
Research Questions
Are you using the services of Ocado?
o Yes
o No
What is the major factor which attracts you most towards the services of company?
o Website appearance
o Quick delivery
o Navigation bars
o Core Offering
o Past Experience
How often you use the services of Ocado?
o Weekly
o Monthly
o Within 6 Months
o Yearly
What are the major factors which affect you’re buying decisions the most?
o Past experience
o Demographic factors

o Social media platform
o Core offering
Are you satisfied with the services of company?
o Highly satisfied
o Satisfied
o Neutral
o Dissatisfied
o Highly dissatisfied
2.2 Undertake the proposed research investigation in accordance with the agreed specification
and procedures
Under this particular section different research methods as well as strategies will be taken
into consideration. As per the given subject matter, it can be define that researcher will
incorporate inductive research approach within this study. Under this approach, data are being
accumulated earlier and then several theories drawn upon it. Since, the present study involves
study of consumer loyalty within the online retailing. Inductive approach helps in identifying
appropriate information about the consumer loyalty. This will be applied as a theory in the end of
research in a context of other organization. Further, the research approach followed here
qualitative as theoretical aspects related to the topic have been studied (Sam and Daniel, 2011).
Further, this study covers the descriptive research design which helps in gaining in-depth
understanding of the researcher about the consumer expectation as well as loyalty within the
online retailing.
2.3 Record and collate relevant data where appropriate
In this scenario, the whole data is being gathered by the primary as well as secondary
sources. In order to analyse primary data, data will be gathered from customers of Ocado.
Consumers can make their purchase experience better if company provides them better features
within the online retailing services. With the help of primary sources, researcher should able to
identify the factors which affects the shopping experience of customers as well as loyalty.
Further, customers can easily share their knowledge and experience regarding online retailing.
For this, a questionnaire survey will takes place through which different perception of consumers
will be identified (Merriam, 2009). Further, in this study, simple random technique will be

incorporated under which sample size of 50 customers will be selected. For this, random
sampling will be used in order to select the sample of customers. In addition to this, systematic
random sampling will be employed to select the sample of customers.
TASK 3
3.1 Use appropriate research evaluation techniques
Different research methods which have been used
Research Approach
Inductive and deductive are two major research approaches under which research can be
carried out in a more effective manner. In the present case, Inductive approach is one of the most
suitable approaches which help the researcher in moving from more specific theories to general
one (Jackson, 2010). Measuring the factors which affects the loyalty as well as satisfaction level
of customers is very qualitative in nature and it differ from people to people. Due to this,
Inductive research approach is considered to be the most suitable and effective approaches
through which different theories can be developed to related subject matter.
Research Philosophy
With the help of selecting most appropriate research philosophy researcher can develop
most appropriate knowledge about the given subject matter. Interpretivism and positivism are
two most common types of philosophies through which required information can be attained in
an effective manner (Sam and Daniel, 2011). As per the nature of this study, Interpretivism
philosophy will be used so that researcher can easily highlight all the important facts and figures
about the customer loyalty towards the online retailing segment.
Research Design
It can also be defined as a blueprint of report which guides the researcher about all those
ways which helps in order to making the study more and more appropriate. In order to make this
research much better, descriptive research design will be used so that proper insights about the
subject matter can be gained in effective manner (Creswell, 2013).
Data Collection
It is the most important sections of any research under which researcher can gather most
effective and appropriate information about the given subject matter. Primary and secondary are
two most common research methods by which researcher can collect required information
(Forzano, 2011). In the present study, data has been collected from both primary and secondary

data. Under the primary data, data will be gathered from the 50 customers of Ocado who can
share their experience about their satisfaction as well as loyalty level. It is the best way to
identify all those factors which affects the customer loyalty towards the company. On the other
hand, secondary data in the report will be collected from different books, journals, etc (Goddard
and Melville, 2004).
Sampling
As per the given report, Purposive sampling technique will be incorporated which help
the researcher in selecting the best sample. After selecting this sampling technique, sample size
of 50 customers of Ocado Company will be used (Diment, 2012). It helps in gathering their
views about the online retailing services of Ocado.
Data Analysis
This particular section is very important as it helps in selecting most appropriate
technique so that appropriate outcomes can be presented. In the present scenario, all the data will
be analyzed in terms of mixed methods. Here, both qualitative and quantitative technique is
being used in which different themes and graphs will be developed on the basis of gathered
responses. Graphs required numerical interpretation of data on the basis of which percentage will
be decided. With this respect, thematic as well as graphical representation will takes place
(Sogunro, 2002). It is the best way through which appropriate conclusion can be drawn by
developing most effective findings.
3.2 Interpret and analyze the results in terms of the original research specification
Theme: Majority of respondents uses the services of Ocado.

At the time of gathering responses of different respondents it has been identified that
most of them uses the services of Ocado. It has been identified that they are loyal towards the
company due to their effective and high quality services. As per the graphical representation it
has been identified that 80% respondents are using the services of Ocado.
Theme: Website appearance is the major factor which attracts customers most towards the
online services of Ocado.
After analyzing the responses of different respondents it has been founded that there
website must be of high quality. For a single view website is the only factor can easily change
the mindset of customers. Appearance of website highly affects the purchasing behaviour as well
as loyalty among customers. Majority of respondents (40) replied in affirmative manner and
stated that website appearance can change their mindset towards company and its services.
Theme: Most of the customers use the services of company weekly.

Ocado is the online retailing company and customers are repeatedly purchasing the
products and services of different fields such as households etc. Majority of respondents (50%)
replied that they weekly purchase the products from online retail services of Ocado. On the other
hand, (30%) of them purchase products on monthly basis.
Theme: Core offerings and past experience are the major factors affecting customer loyalty
towards online retailing.
Findings: When different consumers have been asked about the several factors affecting
their loyalty level it has been founded that core offering and past experience are two factors
which affects their satisfaction level. After gathering responses from different respondents it has
been founded that most of them (40%) replied that core offerings such as website appearance,

navigation of web pages, display of required information, actual time span of delivery, option for
payment and effectual after sales service are the major factors. These are the most effective
factors which highly affects their overall decision regarding the services of company. In case of
providing timely services with affective display of information customers are highly affected and
made their purchase decisions more appropriately. On the other hand, some of them (30%)
respondents stated that their past experience with the same company highly affects their burying
and purchasing decisions.
Theme: Satisfaction level of customers
Findings: After analyzing the responses of customers it has been identified that majority of them
were satisfied with the services of company. They clearly states that they majority of customers
are loyal towards the company. From the above graphical representation it has been identified
that 30% customers were highly satisfied while 40% of them were dissatisfied. On the other
hand, it has been identified that some of them (14%) were dissatisfied. Further, this theme clearly
states the loyalty of customers towards Ocado.
3.3 Make recommendations and justify areas for further consideration
Based on the above study, it has been found that a main factor that affects customer
loyalty within online retail is core offering and past experiences. Since, core offering includes the
main products and services which make it crucial for retail companies to focus upon it so that
more of customers can be satisfied. This factor is crucial as it helps in satisfying the actual needs
of customers. Further, it is also concluded that core offering is the main factor that helps

company in boosting its competency in the market and aids in attracting large number of
customers towards it. In this context, company must focus on core benefits and offer appropriate
delivery services, payment option, website navigation display of required information and other
related. Through this, overall loyalty of customers can be increased and this certainly makes an
impact over the growth of the business. Apart from this, company must offer sound after sales
service so that they can satisfy the needs of customers. Through this, more of customers lead to
repeat purchase and hence these will results into high loyalty. Through this, company is able to
attain the business objectives as well.
Considering the conclusion, it is required that online retailers must update their website
on regular basis and make it more interactive with customers so that their ultimate needs can be
met. In this context feedback and reviews can be taken by them with the help of survey. This will
help in identifying the loopholes and same can be rectified. In addition to it, company must make
contact with different suppliers so that product can be delivered to customers in fewer time
frames. Through this, loyalty gets increased and customers tend to become loyal towards
companies. In addition to it, company can even offer option for fast delivery and discounts on
regular basis so that more of customers get shifted towards it.
TASK 4
4.1 use an agreed format and appropriate media to present the outcomes of the research to an
audience
Done in ppt

REFERENCES
Bai, B., Law, R. and Wen, I., 2008. The impact of website quality on customer satisfaction and
purchase intentions: Evidence from Chinese online visitors. International Journal of
Hospitality Management.27(3). pp. 391-402.
Christodoulides, G. and de, Chernatony, L., 2010. “Consumer-based
brand Equity Conceptualisation and Measurement”, International Journal
of Market Research, Vol. 52 No. 1, pp. 43-66.
Creswell, J. W., 2013. Qualitative, Quantitative, and Mixed Methods Approaches. 4th ed. SAGE
Publications, Inc.
Dennis, C. and et.al., 2009. E-consumer behaviour. European Journal of Marketing. 43(9/10).
pp.1121 – 1139.
Dick, S. A. and Basu, K., 2004. Customer Loyalty: Toward an Integrated Conceptual
Framework. Journal of the Academy of Marketing Science. 22(2).pp. 99-113.
Diment, K., 2012. Qualitative Research in Accounting & Management. Q methodology: is it
useful for accounting research. 9(1) pp.66 – 88.
Forzano, L.B., 2011. Research Methods for the Behavioral Sciences. Cengage Learning. p. 158.
Goddard, W. and Melville, S., 2004. Research Methodology: An Introduction. Juta and Company
Ltd
Heinonen, K., 2010. A customer-dominant logic of service. Journal of Service Management.
21(4). pp. 531-548.
Hosseini, S. M. S., Maleki, A. and Gholamian, M. R., 2010. Cluster analysis using data mining
approach to develop CRM methodology to assess the customer loyalty. Expert Systems
with Applications.37(7). pp. 5259-5264.
Hsin Chang, H. and Wang, H. W., 2011. The moderating effect of customer perceived value on
online shopping behaviour. Online Information Review.35(3). pp. 333-359.
Jackson, S. 2010. Research Methods: A Modular Approach. USA: Cengage Learning.
Kheng, L. L. and et.al.,2010. The impact of service quality on customer loyalty: A study of
banks in Penang, Malaysia. International Journal of Marketing Studies. 2(2).pp. p57.
Liu, C. T., Guo, Y. M. and Lee, C. H., 2011.The effects of relationship quality and switching
barriers on customer loyalty.International Journal of Information Management. 31(1). pp.
71-79.
Qureshi, I. and et.al., 2009. Understanding online customer repurchasing intention and the
mediating role of trust–an empirical investigation in two developed countries.European
Journal of Information Systems.18(3). pp. 205-222.

Sam, G. A .and Daniel, S. P., 2011. Research Methodology.Gyan Publishing House.
Santouridis, I. and Trivellas, P., 2010. Investigating the impact of service quality and customer
satisfaction on customer loyalty in mobile telephony in Greece. The TQM Journal. 22(3).
pp. 330-343.
Shoham, S, and Makovec, M., 2003. Consumer Buying Behavior. Journal of Consumer
Marketing. 20(2).pp. 127-138.
Siddiqi, K. O., 2011. Interrelations between service quality attributes, customer satisfaction and
customer loyalty in the retail banking sector in Bangladesh. International Journal of
Business and Management. 6(3).pp. p12.
Sogunro, O. A., 2002. Selecting a quantitative or qualitative research methodology: An
experience. Educational Research Quarterly. 26(1). pp.3.
Torres, N. E. and Kline, S., 2013. From customer satisfaction to customer delight: Creating a
new standard of service for the hotel industry. International Journal of Contemporary
Hospitality Management. 25(5).pp.642 – 659.