Amazon Case Study: Strategies for Building and Maintaining Loyalty

This case study examines Amazon's strategies for building and maintaining customer loyalty, drawing parallels with the 'Things Remembered' case. It highlights the importance of brand loyalty in retaining customers, attracting new ones, and enhancing brand image. The study discusses how loyalty programs, reward systems (like Rewards Club), and incentives can foster customer loyalty. It emphasizes the significance of executive management support and cross-functional teamwork in implementing successful loyalty initiatives. Furthermore, the study suggests that Amazon can benefit from introducing double discount programs, offering coupons, and providing toll-free customer service to strengthen customer relationships and increase revenue generation. The analysis concludes that brand loyalty is crucial for maintaining a competitive advantage in the retail market.

Running head: BUILDING LOYALTY: A CASE STUDY OF AMAZON
Building loyalty: A Case of Amazon
Name of the Student:
Name of the University:
Author’s note:

1
BUILDING LOYALTY: A CASE STUDY OF AMAZON
Table of Contents
Introduction......................................................................................................................................2
Discussion........................................................................................................................................2
Conclusion.......................................................................................................................................4
References:......................................................................................................................................5

2
BUILDING LOYALTY: A CASE STUDY OF AMAZON
Introduction
This study focusses on building loyalty of Amazon. Brand loyalty helps the company to
retain its existing consumers and attract new customers thereby enhancing its brand image in the
current market. In this particular study, a brief summary of the article has been discussed. The
purpose of the study is also covered in this particular study. Apart from this, the concept of
building loyalty and its significance has been explained in this study.
Discussion
Things Remembered is an organization that offers customized gifts to its users on special
occasions such as weddings, anniversaries, and Christmas. Gifts like jewelry, pens, clocks,
picture frames and executive gifts. The management of this company found that the repetitive
buying behavior of its customers is comparatively lower than that of other companies. In order to
solve this issue, managers had decided to focus on building loyalty program within its workflow.
They have communicated the cross-functional team for preparing an effective loyalty program in
order to retain its consumers and attract new ones. It has been identified by the managers that
they might face issues in implementing loyalty program properly because of shortage of budget.
Therefore, they have decided to charge fee from those customers willing to enroll themselves in
the membership program. Filtering the casual buyers and identifying the loyal customers is the
primary reason behind charging a membership fee in the loyalty program. In addition to this,
consumer service with a toll-free number is being offered to its users and buyers in order to
satisfy its customers. Rewards Club is being introduced by the respective company in order to
give opportunity to its users a scope to earn reward points. About 20, 00, 000 earned reward
points before enrolling themselves in Rewards Club. It has been observed that the reward

3
BUILDING LOYALTY: A CASE STUDY OF AMAZON
certificates expire after 90 days. It has been observed that the executive management support
and members of cross-functional team worked collaboratively to make this loyalty program a
success.
The purpose of this study is to understand the significance of brand loyalty in business
settings. In accordance with Veloutsou (2015), brand loyalty means repetitive transaction rate of
customers from their preferable companies for a prolonged period. The author has collected the
data from the personalized gifts where the customer’s name as well as address are already
mentioned. The author has collected the information regarding brand loyalty of Things
Remembered from primary and secondary sources. They found that they need support from
executive managers so that cross-functional team can implement loyalty program in an effective
manner. It has been found that shortage of funds is restricting the marketing team to make
necessary improvements in the marketing plan.
It has been noticed that users and buyers purchases their desired goods and services from
the same brand irrespective of cost or convenience. Lam and Shankar (2014) have increased sale
volume and customer retention are considered as significant aspects of the brand loyalty. There
are different ways by which brand loyalty can be built in Amazon. It has been observed that
loyalty programs can be built for enhancing loyalty towards the respective company. It can
introduce Rewards Club where customers can receive incentives for enrolling themselves in this
program. It has been observed that users and buyers before enrolling themselves will receive
reward checks via mail and they do not have to pay membership charges (Pappu and Quester,
2016) This is applicable for the consumers who will frequently buy their desired items from
Amazon. In addition to this, the management working at Amazon can consider to introduce
double discount promotional programs within its working environment. Apart from this, reward

4
BUILDING LOYALTY: A CASE STUDY OF AMAZON
certificates will be given to the customers for adding value to its business. In the opinion of Luo,
Zhang and Liu (2015), it will beneficial for Amazon if it offers coupons to its customers on a
certain amount of purchase. Implementing a toll-free customer service will help this renowned
company to understand the extent of brand loyalty of its existing users and buyers.
Conclusion
From the above discussion, it can be stated that brand loyalty of customers determines the
success of a marketing plan. Coupons, promotions, loyalty programs aids Amazon to strengthen
its relationship with its users and buyers. In addition to this, introducing reward clubs, reward
certificates and incentives also increase the rate of repeated purchase of its users and buyers.
Therefore, Brand loyalty enables the company to retain competitive advantage in the competitive
retail market. Brand loyalty helps the business firm to increase its overall revenue generation.

5
BUILDING LOYALTY: A CASE STUDY OF AMAZON
References:
Lam, S.Y. and Shankar, V., 2014. Asymmetries in the effects of drivers of brand loyalty
between early and late adopters and across technology generations. Journal of Interactive
Marketing, 28(1), pp.26-42.
Luo, N., Zhang, M. and Liu, W., 2015. The effects of value co-creation practices on building
harmonious brand community and achieving brand loyalty on social media in China. Computers
in Human Behavior, 48, pp.492-499.
Pappu, R. and Quester, P.G., 2016. How does brand innovativeness affect brand loyalty?.
European Journal of Marketing, 50(1/2), pp.2-28.
Veloutsou, C., 2015. Brand evaluation, satisfaction and trust as predictors of brand loyalty: the
mediator-moderator effect of brand relationships. Journal of Consumer Marketing, 32(6),
pp.405-421.