Investigating Customer Loyalty Effects on Sainsbury's Practices

This report investigates the effects of customer loyalty on Sainsbury's practices and performance. It begins with an introduction outlining the research aim, questions, and objectives, followed by a literature review that explores the impact of consumer loyalty on team performance and the relationship between customer loyalty and overall company performance. The research methodology employs a quantitative approach, utilizing questionnaires administered to marketing employees and secondary data analysis. The results section presents statistical findings, including descriptive statistics and regression analysis, which reveal a positive relationship between customer loyalty practices and company operations. Discussion of the findings highlights the importance of customer loyalty strategies, such as the Nectar program, in enhancing profitability. The report concludes with recommendations for Sainsbury's to further improve customer loyalty, emphasizing the need to adapt to changing consumer needs and maintain ethical practices. The report provides valuable insights into the role of customer loyalty in the retail sector and offers practical recommendations for businesses aiming to strengthen customer relationships and improve performance.

INQUIRY PROJECT

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
Aim of research...........................................................................................................................3
Research question.......................................................................................................................3
Research objective......................................................................................................................3
LITERATURE REVIEW................................................................................................................3
Effects of consumer loyalty and its contribution to team performance at Sainsbury.................3
Relation between the consumer loyalty with the performance of employees and overall
company......................................................................................................................................4
RESEARCH METHODOLOGY.....................................................................................................5
RESULT AND DISCUSSION........................................................................................................5
Finding........................................................................................................................................5
Discussion.................................................................................................................................14
RECOMMENDATION.................................................................................................................15
CONCLUSION..............................................................................................................................15
REFERENCES..............................................................................................................................16
APPENDIX....................................................................................................................................17

Title- An investigation into the effects of customer loyalty on practices at Sainsbury.
INTRODUCTION
For the success of the business the most essential aspect for the companies is to focus on
the satisfaction of the consumer. This is pertaining to the reason that if the consumer will not be
satisfied then this will reduce the profitability of the company. The present study is based on
company Sainsbury which is a retail chain of supermarket within UK and was founded in 1869
by John James Sainsbury. The current study will evaluate the impact of customer loyalty over the
team performance of the employees at the company. Also, the present study will outline the
relationship among the loyalty of consumer with the performance of the company.
Aim of research
The aim of the research is to investigate how customer loyalty has improved the working
practices of Sainsbury.
Research question
1. How customer loyalty has contributed to team performance at Sainsbury?
2. What is the relationship between customer loyalty and the performance at Sainsbury?
Research objective
 To assess the effects of customer loyalty over the performance of team with respect to
Sainsbury.
 To compare and contrast the relationship among the customer loyalty and performance
within Sainsbury.
LITERATURE REVIEW
Effects of consumer loyalty and its contribution to team performance at Sainsbury
As per the views of Ramanathan and et.al., (2017) consumer loyalty is defined as
behavioral tendency of the consumer in favor of a particular company’s product over other
competitors. In simple words it is referred to as the consumer preferring a particular product
among various kinds of product available to the consumer. Within the business environment
there are different types of companies providing same type of product or service. Hence, it is
essential that the company provides some distinct feature within their products such that they
attract and stimulate consumer to stay loyal with the company.

In contrast of this Kanakaratne, Bray and Robson (2020) states that when the consumers
are loyal with a particular company then this implies that company is providing better services
and due to this brand image of company increases. As a result of increase in brand image of
company, the employees get motivated and they work in better and effective manner. This is
particularly because of the reason that when the employees will be motivated then they will
perform the work in more effective manner. This is particularly because of the reason that when
consumer will be satisfied then this will improve the working capability of employees. The
reason underlying this fact is that positive view of the consumer motivates employees to work in
more effective and efficient manner.
On the other side, Omar and et.al., (2021) argues that when there will be positive loyalty
of consumers with the company then this will improve efficiency of the business. This is
particularly because of the reason that when consumers are loyal towards the company then it
implies that business is providing better services which stimulates buyer to stay connected with
the company. Hence, as a result of this goodwill and brand value of company increases to a great
extent. Thus, this will motivate all the employees and team within the company to work in more
effective manner.
As per the views of Tao and et.al., (2018) there are different types of strategies which are
assistive in managing the loyalty of the consumers. The major strategy for the company is use of
loyalty program named Nectar. Under this scheme, every time the consumer shops at Sainsbury
some points are collected and when the points reach the required amount then they will get some
offers. On the other side, Thompson and McLarney (2017) states that the taking continuous
feedback from consumer can also stimulate them to become loyal consumer of company. this is
pertaining to the fact that when company will frequently review the views and suggestion of the
consumers then this will build good image of company in minds of consumers.
Relation between the consumer loyalty with the performance of employees and overall company
With reference to the work of Czeczotko, Górska-Warsewicz and Laskowski (2020) there
is positive relation between the loyalty of consumer and performance of employees. This is
majorly pertaining to the fact that when the consumers are stable and has long term relation with
the company then this improves operational efficiency of the company. In addition to this,
continuous consumer loyalty motivates operational team to work in more effective manner. This
is particularly because of the reason that consumer will only be loyal towards the company when

they will be getting high quality product and services. Hence, it is the duty of the company and
its operation team that they must provide better quality product to the consumers. This good
quality product will improve the goodwill of the company and in addition to this more consumer
will be attracted towards the company.
RESEARCH METHODOLOGY
For the completion of research in successful manner it is essential to decide for the
methods of research in advance (Chu and Ke, 2017). This is particularly because of the reason
that when the methodology is being decided in advance then it assists the researcher in
completing the study in successful manner. For the present study on customer loyalty at
Sainsbury use of quantitative methodology has been undertaken. This is particularly because of
the reason that use of factual information provides more logical and relevant outcomes.
Hence, in order to conduct study on basis of quantitative analysis, data will be collected
from the primary respondent that is sample of 15 respondents from the marketing department of
Sainsbury. This data will be collected with help of the questionnaire directly from the marketing
employees of Sainsbury. The marketing employees are selected as they know that how consumer
loyalty affects the working of the company. further this collected data will be evaluated with help
of the SPSS (Drawson, Toombs and Mushquash, 2017). This is being used as this will assist
company in developing hypothesis and testing its relationship. In addition to the primary data,
use of secondary data will also be undertaken. This will include the use of different books,
journal and articles relating to the consumer loyalty in Sainsbury.
RESULT AND DISCUSSION
Finding
Statistics

Q1. Are
you aware
of the
concept of
customer
loyalty?
Q2. Does
company
employ
various
strategies
for
enhancing
loyalty of
consumer
within
Sainsbury?
Q3. What
is the
impact of
directing
the
practices
for
consumer
loyalty
over
performanc
e of
company?
Q4. What
are the
major
practice
which
Sainsbury
uses in
order to
increase
loyalty of
consumers
?
Q5. What
are the
benefit of
focusing
on the
consumer
loyalty by
the
company?
Q6. Is
there any
challenge
in
managing
and
maintainin
g consumer
loyalty?
Q7. What
is the
impact of
these
challenges
over the
level of
loyalty of
consumers
?
N
Valid 15 15 15 15 15 15 15
Missin
g 0 0 0 0 0 0 0
Mean 1.7333 1.3333 1.4667 1.6667 2.5333 1.3333 1.9333
Median 1.0000 1.0000 1.0000 1.0000 3.0000 1.0000 2.0000
Mode 1.00 1.00 1.00 1.00 3.00 1.00 2.00
Minimum 1.00 1.00 1.00 1.00 1.00 1.00 1.00
Maximum 5.00 2.00 3.00 4.00 4.00 2.00 3.00
Theme 1- Strongly agreed that there is awareness relating to concept of customer loyalty.
Particular Frequency Percent
Strongly agreed 10 66.7
Agreed 2 13.3
Neutral 1 6.7
Disagreed 1 6.7
Strongly disagreed 1 6.7
Total 15 100.0

Theme 2- Yes company makes use of various strategies for improving loyalty of consumers.
Particular Frequency Percent
Yes 10 66.7
No 5 33.3
Total 15 100.0

Theme 3- Positive impact is there of practices used for consumer loyalty.
Particular Frequency Percent
Positive 10 66.7
Negative 3 20.0
No impact 2 13.3
Total 15 100.0

Theme 4- Loyalty Program Nectar is the major practice which is used by the company for
increasing consumer loyalty.
Particular Frequency Percent
Loyalty program named
Nectar 10 66.7
Focus on quality of
products 2 13.3
Reward the consumer 1 6.7
Continuous feedback from
the employees 2 13.3
Total 15 100.0

Theme 5- Competitive advantage is the major benefit of focusing on the loyalty of consumer
by the company.
Particular Frequency Percent
Increase in sales of
company 3 20.0
Increase in goodwill of the
company 2 13.3
Competitive advantage 9 60.0
All of the above 1 6.7
Total 15 100.0

Theme 6- Yes, there are challenges which affect managing consumer loyalty.
Particular Frequency Percent
Yes 10 66.7
No 5 33.3
Total 15 100.0

Theme 7- Negative is the impact of challenges on the loyalty level of consumers.
Particular Frequency Percent
Positive 3 20.0
Negative 10 66.7
No impact 2 13.3
Total 15 100.0

Regression analysis
H0- There is no significant relation between the practice used by Sainsbury with the loyalty of
consumers.
H1- There is significant relationship between the practices used by company with the consumer
loyalty.
Model Summary
Model R R Square Adjusted R
Square
Std. Error of
the Estimate
1 .893a .797 .781 .34786
a. Predictors: (Constant), Q4. What are the major practice which
Sainsbury uses in order to increase loyalty of consumers?
ANOVAa

Model Sum of
Squares
df Mean Square F Sig.
1
Regression 6.160 1 6.160 50.909 .000b
Residual 1.573 13 .121
Total 7.733 14
a. Dependent Variable: Q3. What is the impact of directing the practices for consumer
loyalty over performance of company?
b. Predictors: (Constant), Q4. What are the major practice which Sainsbury uses in order
to increase loyalty of consumers?
Coefficientsa
Model Unstandardized Coefficients Standardized
Coefficients
t Sig.
B Std. Error Beta
1
(Constant) .473 .166 2.855 .014
Q4. What are the major
practice which Sainsbury
uses in order to increase
loyalty of consumers?
.596 .084 .893 7.135 .000
a. Dependent Variable: Q3. What is the impact of directing the practices for consumer loyalty over
performance of company?
Discussion
From the finding it is clear that the alternate hypothesis that is there is relationship is
present among the variable that is practices of consumer loyalty and its impact over the
operations of company. This is particularly because of the reason that significance value is 0.000
which is smaller than the significance value of 0.05. Hence, it can be stated that there is positive
relation of the impact of consumer loyalty practices over the consumer.
In support of this Sainsbury’s overhauls Nectar with shift to digital loyalty program,
(2021) articulates that use of various strategies of improving consumer loyalty increases the
profitability of the company. This is particularly because of the reason that when company will
employ the various strategies for attracting consumer then this will stimulate and motivate the
consumers to continuously buy the product and services of Sainsbury. Hence, it is necessary for

the company to focus on the need and requirement of the consumers. This will increase the
interest of the consumer towards the product and services of the company.
RECOMMENDATION
With the above analysis and discussion, it is clear that for any company including
Sainsbury loyalty of consumer is very essential. This is particularly because of the reason that if
consumer will not be happy and satisfied then it will decrease operational efficiency of company.
Some of the recommendation for Sainsbury for improving consumer loyalty are as follows-
 Firstly, it is recommended to company to continuously monitor and adapt to the changes
taking place in the need and requirement of consumers. This is pertaining to the fact that
when the product and services will be in accordance to need of consumer then they will
be attracted towards the company.
 Another recommended strategy is to follow all the ethical practices and company must be
transparent. This is particularly because of the reason that when company will be
transparent to consumers then this will attract large number of consumers and sales of
company will increase.
CONCLUSION
In the end, it is concluded that success of the company is dependent over the number of
consumer towards the company only. This is particularly because of the reason that when the
consumer will not be loyal to the company then this will affect the working of company. the
above report concluded that focus of company more on consumer loyalty creates a positive
impact over the company. From the finding it was evaluated that loyalty program named Nectar
was an effective strategy for attracting the consumer to stay loyal with the company.

REFERENCES
Books and Journals
Chu, H. and Ke, Q., 2017. Research methods: What's in the name?. Library & Information
Science Research. 39(4). pp.284-294.
Czeczotko, M., Górska-Warsewicz, H. and Laskowski, W., 2020. Towards Sustainable Private
Labels—What is the Consumer Behavior Relating to Private Labels in the UK and
Poland?. Sustainability. 12(15). p.6035.
Drawson, A. S., Toombs, E. and Mushquash, C. J., 2017. Indigenous research methods: A
systematic review. International Indigenous Policy Journal. 8(2).
Kanakaratne, M. D. S., Bray, J. and Robson, J., 2020. The influence of national culture and
industry structure on grocery retail customer loyalty. Journal of Retailing and Consumer
Services. 54. p.102013.
Omar, S., and et.al., 2021. M-commerce: The nexus between mobile shopping service quality
and loyalty. Journal of Retailing and Consumer Services. 60. p.102468.
Ramanathan, U., and et.al., 2017. Impact of customer loyalty and service operations on customer
behaviour and firm performance: empirical evidence from UK retail sector. Production
Planning & Control. 28(6-8). pp.478-488.
Tao, M., and et.al., 2018. Users’ acceptance of innovative mobile hotel booking trends: UK vs.
PRC. Information Technology & Tourism. 20(1). pp.9-36.
Thompson, J. and McLarney, C., 2017. What effects will the strategy changes undertaken by
next Plc have on themselves and their competition in the UK Clothing Retail Market?.
Journal of Commerce and Management Thought. 8(2). p.234.
Online
Sainsbury’s overhauls Nectar with shift to digital loyalty program. 2021. [Online]. Available
through: <https://www.marketingweek.com/nectar-digital-loyalty-scheme/>

APPENDIX
Questionnaire
Name:
age:
gender:
Q1. Are you aware of the concept of customer loyalty?
 Strongly agreed
 Agreed
 Neutral
 Disagreed
 Strongly disagreed
Q2. Does company employ various strategies for enhancing loyalty of consumer within
Sainsbury?
 Yes
 No
Q3. What is the impact of directing the practices for consumer loyalty over performance of
company?
 Positive
 Negative
 No impact
Q4. What are the major practice which Sainsbury uses in order to increase loyalty of
consumers?
 Loyalty program named Nectar
 Focus on quality of products
 Reward t2he consumer
 Continuous feedback from the employees
Q5. What are the benefit of focusing on the consumer loyalty by the company?
 Increase in sales of company
 Increase in goodwill of the company

 Competitive advantage
 All of the above
Q6. Is there any challenge in managing and maintaining consumer loyalty?
 Yes
 No
Q7. What is the impact of these challenges over the level of loyalty of consumers?
 Positive
 Negative
 No impact
Q8. What are some of the recommendation through which consumer loyalty can be increased
by the business?