Influences of consumer loyalty cards on store Loyalty: The case of uchumi and nakumatt Supermarkets in Nairobi
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Date
2006Author
Naftali, Kennedy K
Type
ThesisLanguage
enMetadata
Show full item recordAbstract
The management of customer relationship as a source of competitive advantage has
become a vital component in success of firms. The firms have realized the need to
develop such long-term relationships to guarantee constant streams of revenues and
profitability. Of the strategies that firms have employed in influencing store loyalty
has been the use of loyalty cards. The use of loyalty cards as a knowledge tool has
become so critical that retailers are offering customers rewards in return for
continuous use. The main question has been whether loyalty cards really influence
store loyalty. This study empirically researched on the influence of loyalty card on
store loyalty.
To achieve this objective, a descriptive survey was performed. The research targeted a
sample of 200 of which 200 responses were received. This represented a 100%
response survey rate. Primary data was collected using a semi-structured
questionnaire and data analyzed using percentages and mean scores. Research
assistants were trained on the administration of questionnaire and follow up
conducted as a control tool.
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The comparative findings demonstrate that loyalty card do indeed influence store
loyalty. The study confirmed that most consumers .v.iewed the loyalty cards as useful
and were willing to provide personal information to the firms. The study however
noted that loyalty cards cannot work in isolation as the only factor that influence
customer's store loyalty development. Results of this study show that customers also
focus heavily on the everyday low price, assortment of items, customer service,
convenient, location and quality of merchandise as their top factors for developing
store loyalty. Therefore, companies have to take the whole package into
consideration. Firms need to communicate the value additions that arise from using
loyalty cards.
It is the recommendation of this study that firms address the issues of rewards
obtained from the use of loyalty cards. The current consumer perception is that the
value proposition is not enough and firms need to better communicate this value
proposition. Further research should be conducted to determine the effect that number
of loyalty cards that consumer have in influencing their store loyalty .
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Citation
A management research project submitted In partial fulfillment of the requirements For the award of masters of business Administration (mba) degree school of Business, university of Nairobi.Publisher
Business Administration and planning