An Analysis of Customer Loyalty and Reward Schemes for H&M

This report presents a research project focused on H&M, a fashion company, and its strategies to enhance customer loyalty and market coverage. The research explores various methods for analyzing customer behavior, including qualitative and quantitative approaches, and discusses factors influencing the selection of research methods. The project outlines the importance of reward schemes and their impact on consumer choices. It also provides a critical review of key references related to customer loyalty and reward programs. The research proposal emphasizes the need for a clear understanding of the topic, realistic timelines, cost-effectiveness, and appropriate presentation of findings. The report examines different research methodologies, such as primary and secondary data collection, inductive and deductive research, and their suitability for the fashion industry. Ultimately, the research aims to provide insights into how H&M can effectively implement customer loyalty programs and attract a larger market share. The report also touches upon the importance of price sensitivity and the emotional bonds between customers and brands.

RESEARCH PROJECTS

Table of Contents
RESEARCH PROJECTS................................................................................................................1
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
1.1 Research project outline specifications:................................................................................3
1.2 Factors that contribute to the process of research project selection:....................................4
1.3 Critical review of the key references:...................................................................................5
1.4 Research project proposal:....................................................................................................6
1.5 Appropriate plan and procedure for the research:.................................................................7
CONCLUSION................................................................................................................................7
REFRENCES...................................................................................................................................9

INTRODUCTION
It is observed that customers has wide range of product substitutes with them. They can choose
any product from the markets after comparing all the substitutes. Here is the company H&M
which deals in the fashion line providing clothes to all age group people and for both the males
and the females(Denscombe,2014)As this is a sector in which there are many other companies
also dealing in the same business type the cited company face the problem of covering the
maximum market. Therefore it becomes important to provide the customer with loyalty and other
rewards schemes to attract them and to influence them to choose the products of the cited
company over the other related goods that are also available in the market.
Literature review
The below research will be presenting the literature grounds of the fashion industry which
includes the methods and theories which are base of my research. The literature review is starting
from the concepts of consumer buying behaviour and continue with the modes of selecting the
different sources of data collection. Then the literature review is ending with research proposals
and with the critical review of the different references.
TASK 1
1.1 Research project outline specifications:
The research is about how the fashion company H&M can do starts its research process after
analysing each alternative that is there present in the market. Research projects help the
management in taking the various decisions which may be long term term decisions or short
term. The consumer before buying any product do the effective comparison between all the
available options. The price of the product becomes the grounds for doing the comparison. The
customer is very sensitive to the price. They react instantly with the change in the price.
Therefore it is necessary to provide the customer with extra benefits of rewards or to build a
loyal relation with the customer to attract them more and also to maintain long term relation with
them. For this exciting schemes for the regular customers should be made in order to make them
feel good. This makes a positive connection between the client and the company. These rewards
can be provided on different scales(Neuman and Robson 2012).The turbo charged vouchers
provide the customers to provide them rewards with big benefits like giving the vouchers or
other schemes in which they get the benefit receives higher value products at low price which

encourage them to buy more. A research report can help in getting a more clear vision that
weather these reward schemes helps in increasing the total sale of the company or not. For this
different questions could be asked to the customers like what type of promotional tool attracts
them the most, what is their criteria to select their product from different available options. Other
research questions can be based on what category of reward is most favoured by the customer of
different segments and also why. There responds should be carefully analysed so that the
company can take the actions and plan their strategies accordingly.
1.2 Factors that contribute to the process of research project selection:
One of the biggest challenge with the organisations today is to prepare the most effective report
for their business as it need to cover a number of factors. Therefore the method of preparing the
report should be selected carefully so that the managers can use the report data in their decision
making and also get the full knowledge of the market. The different research methods have there
different positives and negatives. Depending upon the type of research requirements the method
should be selected. For selecting the research method it is necessary to understand each method
of conducting the research in detail. After understanding each of them the company can decide
which type is best suitable for them(Shagoury and Power 2012).Some of them are as follows:
1.Qualitative research: This research gives the dimensions to the company. These reports help
the business to take decisions regarding the quality of there products. This research provide the
organisation with non numerical data. Deep theoretical results are provided in this research type.
It require enough time to prepare this reports. In this the interpretation is done by an individual
therefore there are chances of wrong analysis also as it is tough to conclude such a big data into
small results which are used by the company as a conclusion of the report. These reports are
more favoured in the education, political and social work sectors. It is tough to compare the
response of different customer as they do not give the exact idea of the customer response but
provide with a description of response. This method is less suitable for H&M as they need more
statistical data so that they can do the comparison of different responses and accordingly take the
decision(MinochaTranand Reeves,2010).
2.Quantitative research: It is the research in which the report provide the result in statistical
manner. This research is more easy to be understood as in this the results are presented in
graphical manner. The user of the report can get the idea just by looking at the report. Different
methods are used for the presentation of the data like pie chart,graphs,histogram etc. These tools

help in comparing the different observations and also conclusions are made more easily. Also
with the help of the quantitative research there are less chances of errors in the interpretation of
the results as they can be easily make out by looking on the different digram. It require proper
knowledge of statistics in order to give the right results as any mistake in the calculations will
make the whole report useless. Also wrong presentation of data will lead to wrong decision
making process. Therefore although this method has many advantages but only if used
effectively(Creswell,2013).
3.Primary Method- this is the method inj which the researcher collects the data directly from the
respondents. These are the first hand(Michalski Carbonell. and Mitchell,2013)There are different
ways through which the data can be collected like with the help of direct interview, distribution
of questionnaire. It is favourable when the researcher needs the latest results and also the nature
of the information is one for which personal reactions also need to be observed. As the cited
company is dealing on a large scale it becomes difficult for it to conduct the research through
using primary data. It require a lot of time to conduct the surveys and also the geographical
barriers may also be faced while conducting the research. Although this research gives more
close and related observations it becomes difficult to conduct research for a large scale
customers(Verschuren,Doorewaard,and Mellion,2010).
4.Secondary Method: It is the method in which the report is prepared on the basis of the data that
is already available in the market. The source of data for such reports are newspapers, journals,
previous reports, internet etc. As this business is dealing in the fashion trend which always keeps
on changing with change in mind. Fashion never remain constant therefore it is not advisable to
the company to use this method as the interpretations will be wrong of will be less effective.
5.Inductive research: While performing the inductive research the researcher begins with the
topic of the research and discover all the related aspects of the particular research. Till the
research is not completed the researcher can not make any hypothesis at the initial stages. It
provide the researcher with total grounded theory in the qualitative research and the detailed
exploratory analysis of the data in the quantitative theory. It works in the bottom up direction and
focuses on enabling the understanding of the dynamics and also helps in understanding the
individual behaviour. This help the user to construct alternative futures for the concern product.
6.Deductive Research- This theory begins with hypothesis and than the data is tested in order to
check weather the developed hypothesis is correct or not. It is a top down flow in the direction.

Provide more scientific results and is widely used. In this theory the data is collected than
different patterns are analysed to finally develop the theory for the research.
1.3 Critical review of the key references:
On analysing the reviews of different books and journal it is observed that there are mixed
reactions to the customer loyalty and reward schemes in the practical life. No particular reward
theory can be said as the perfect one as there is lack of knowledge about the successful
programme of loyalty which is applicable to all the customers. According to Michael McCall
Clay Voorhees the loyalty programme remains affected by three different programmes which are
programme structure, reward structure and the consumer factor also. Another book by Sarah
Tanford says that the price is related with the reward for membership. It suggested that all the
members come into commitment with the organisation once they are loyal to the company but
also develops a emotional bond with the company. This shows how every book and journals
have almost same views on the concern topic that weather rewards and customer loyalty actually
work(Zavala,2013)hey favour the topic by providing how the companies are benefited through
establishing loyalty with the customers as this develops a emotional bond with the customers.
Once the customer are emotionally attached with a particular brand they become a life time
member of the concern brand.
1.4 Research project proposal:
Before starting up the research the researcher is expected to have complete knowledge about the
topic of the research an also should have gone through the previous reports of the same type so
that it can assist him in doing the research in more effective manner. The research proposal must
ensure the following factors:
1. Prior study of the topic: Before starting the research the researcher should do the study of
the topic for the report. This help him in conducting the research in more effective
manner. Once the researcher is familiar with the topic he can decide on the methodology
of the research more easily.
2. Realistic time: It takes time to prepare an effective research report therefore adequate
time should be given to the researcher for the report making so that the can concentrate
more on the quality of the report. If it is made in hurry than there are chances that the
researcher may skip the important which can effect the ultimate decision making.

3. Cost efficiency: while preparing the research report the cost of making should also be
considered. A report is not effective only if it contains all the required information. If
high cost is inured on the preparation of the research report than it will add to the total
cost of the project which is not favourable in all the situations.
4. Appropriate title page: The title of the research report should be carefully selected as it
gives the first impression of the project report. It should directly reflect the subbject
matter and should be brief and to the point(PanPaul and Jain2011).
5. Review of research literature: References plays an important role in any research report
therefore they should be carefully selected . Also the research should provide the apt
solution to the problem in order to give its maximum contribution
6. Outline the research report: The details of the procedure should be given in the research.
All there information related to the techniques followed, proof of the quality consultant
should be there in the project report. It should be described that which statistical tools are
being used and also the written material analysis to be followed(Hadiz, 2010)
7. Attachments: All the related documents should be provided with the report like the
different sources from where the information is gathered and also the C.V.
8. Editing: It is very important to do the require editing in the report before handling it to
the ultimate customer. It has to be done very carefully.
1.5 Appropriate plan and procedure for the research:
The research will take time in the formulation into the final product. The total time taken can be
understood by studying the Gantt chart for the given report. The Gantt chart help in studying the
time taken by individual task for their completion(McNaught and Lam,2010)With this the the
responsibility for performing each task can be established and also all the problem that may
occur while performing the specific task is acknowledged. This help in appointing the right
person for the right job depending upon the nature of work and capabilities of the individual.
Also the managers can be informed about the work in progress status by using the data from the
Gantt chart. The given Gantt chart shows how each task is taking different time duration
therefore it is necessary to divide the whole work into specific different tasks to get the exact
estimation.
TASK
NAME START END DURATION

TASK 1 1/14 1/21 5
TASK 2 1/16 1/23 1
TASK 3 1/20 1/28 4
TASK 4 1/24 2/2 2
TASK 5 1/14 2/5 5
TASK 6 1/20 2/6 3
CONCLUSION
From the above report it can be concluded that how important it is to adopt a perfect method of
making the research report in order to prepare an effective manner. The sources of data for the
project report has major influence on the content of our project report. The references also play
an important role in the preparation of the report as they give the impression of the authenticity
of the report quality(Liangand Turban2011)Before starting work on the report formation the
proposals should be carefully analysed so that the report remains free from any mistakes.

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