IDEAS home Printed from https://ideas.repec.org/a/eee/joreco/v15y2008i5p386-398.html
   My bibliography  Save this article

On the impact of loyalty cards on store loyalty: Does the customers’ satisfaction with the reward scheme matter?

Author

Listed:
  • Demoulin, Nathalie T.M.
  • Zidda, Pietro

Abstract

Most customers hold several loyalty cards of competing retailers. Past studies looking into the impact of card ownership on store loyalty showed mixed results. We postulate that loyalty cards are effective only when customers value the rewards associated with them. We investigated to what extent the satisfaction with loyalty card rewards affects the effectiveness of loyalty card programmes in the food retail sector. From the analyses of survey data within the framework of store choice models, we confirm that loyalty card owners are more store loyal. More precisely, we show that when holders are satisfied with the reward scheme of the loyalty card programme, they are more loyal and less price sensitive than unsatisfied card holders.

Suggested Citation

  • Demoulin, Nathalie T.M. & Zidda, Pietro, 2008. "On the impact of loyalty cards on store loyalty: Does the customers’ satisfaction with the reward scheme matter?," Journal of Retailing and Consumer Services, Elsevier, vol. 15(5), pages 386-398.
    • Handle: RePEc:eee:joreco:v:15:y:2008:i:5:p:386-398
    DOI: 10.1016/j.jretconser.2007.10.001
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0969698907000756
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.jretconser.2007.10.001?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Rajiv Lal & David Bell, 2003. "The Impact of Frequent Shopper Programs in Grocery Retailing," Quantitative Marketing and Economics (QME), Springer, vol. 1(2), pages 179-202, June.
    2. Liebermann, Yehoshua, 1999. "Membership Clubs as a Tool for Enhancing Buyers' Patronage," Journal of Business Research, Elsevier, vol. 45(3), pages 291-297, July.
    3. N. Demoulin & P. Zidda, 2006. "On the differences between loyalty card adopters and nonadopters," Post-Print hal-00256549, HAL.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. García Gómez, Blanca & Gutiérrez Arranz, Ana M & Gutiérrez Cillán, Jesús, 2012. "Drivers of customer likelihood to join grocery retail loyalty programs. An analysis of reward programs and loyalty cards," Journal of Retailing and Consumer Services, Elsevier, vol. 19(5), pages 492-500.
    2. Chen, Yanyan & Mandler, Timo & Meyer-Waarden, Lars, 2021. "Three decades of research on loyalty programs: A literature review and future research agenda," Journal of Business Research, Elsevier, vol. 124(C), pages 179-197.
    3. Firend Al. R., 2018. "Marketing Strategies of Services and Purchasing Incentives in Asia," GATR Journals jmmr187, Global Academy of Training and Research (GATR) Enterprise.
    4. Demoulin, Nathalie T.M. & Zidda, Pietro, 2009. "Drivers of Customers’ Adoption and Adoption Timing of a New Loyalty Card in the Grocery Retail Market," Journal of Retailing, Elsevier, vol. 85(3), pages 391-405.
    5. Filipe, Sandra & Marques, Susana Henriques & Salgueiro, Maria de Fátima, 2017. "Customers' relationship with their grocery store: Direct and moderating effects from store format and loyalty programs," Journal of Retailing and Consumer Services, Elsevier, vol. 37(C), pages 78-88.
    6. Sharma, Dheeraj & Verma, Varsha, 2014. "Psychological and economic considerations of rewards programs," Journal of Retailing and Consumer Services, Elsevier, vol. 21(6), pages 924-932.
    7. Mimouni Chaabane, Aida & Pez, Virginie, 2017. "“Make me feel special†: Are hierarchical loyalty programs a panacea for all brands? The role of brand concept," Journal of Retailing and Consumer Services, Elsevier, vol. 38(C), pages 108-117.
    8. Steyn, Peter & Pitt, Leyland & Strasheim, Arien & Boshoff, Christo & Abratt, Russell, 2010. "A cross-cultural study of the perceived benefits of a retailer loyalty scheme in Asia," Journal of Retailing and Consumer Services, Elsevier, vol. 17(5), pages 355-373.
    9. Chen, Shiuann-Shuoh & Choubey, Bhaskar & Singh, Vinay, 2021. "A neural network based price sensitive recommender model to predict customer choices based on price effect," Journal of Retailing and Consumer Services, Elsevier, vol. 61(C).
    10. Arbore, Alessandro & Estes, Zachary, 2013. "Loyalty program structure and consumers' perceptions of status: Feeling special in a grocery store?," Journal of Retailing and Consumer Services, Elsevier, vol. 20(5), pages 439-444.
    11. Danaher, Peter J. & Sajtos, Laszlo & Danaher, Tracey S., 2016. "Does the reward match the effort for loyalty program members?," Journal of Retailing and Consumer Services, Elsevier, vol. 32(C), pages 23-31.
    12. Hu, Xin & He, Liuyi & Liu, Junjun, 2022. "Status reinforcing: Unintended rating bias on online shopping platforms," Journal of Retailing and Consumer Services, Elsevier, vol. 67(C).
    13. Ologunebi, John, 2023. "An analysis of customer retention strategies in e-commerce fashion business in the UK: A case study of Primark," MPRA Paper 119040, University Library of Munich, Germany.
    14. Zou, Fei & Yang, Mei & Zhou, Yanju & Deng, Yaling & Xie, Baiwei, 2024. "Goal-gradient point rewards can increase consumers' willingness to purchase poverty-alleviating products," Socio-Economic Planning Sciences, Elsevier, vol. 92(C).
    15. Ebo Botchway & Jack McLaughlin & Jan Verpooten & Siegfried Dewitte, 2023. "Loyalty Programs in Second-Hand Markets Stimulate Demand but May Interfere With Supply," RAIS Conference Proceedings 2022-2024 0357, Research Association for Interdisciplinary Studies.
    16. Alex Belli & Anne-Maree O’Rourke & François A. Carrillat & Ljubomir Pupovac & Valentyna Melnyk & Ekaterina Napolova, 2022. "40 years of loyalty programs: how effective are they? Generalizations from a meta-analysis," Journal of the Academy of Marketing Science, Springer, vol. 50(1), pages 147-173, January.
    17. Pandit, Ameet & Vilches-Montero, Sonia, 2016. "Are reward cards just a business deal? The role of calculative versus emotional card commitment in driving store loyalty," Journal of Retailing and Consumer Services, Elsevier, vol. 31(C), pages 355-360.
    18. Joachain, Hélène & Klopfert, Frédéric, 2014. "Smarter than metering? Coupling smart meters and complementary currencies to reinforce the motivation of households for energy savings," Ecological Economics, Elsevier, vol. 105(C), pages 89-96.
    19. Ashley, Christy & Noble, Stephanie M. & Donthu, Naveen & Lemon, Katherine N., 2011. "Why customers won't relate: Obstacles to relationship marketing engagement," Journal of Business Research, Elsevier, vol. 64(7), pages 749-756, July.
    20. Bahri-Ammari, Nedra & Bilgihan, Anil, 2017. "The effects of distributive, procedural, and interactional justice on customer retention: An empirical investigation in the mobile telecom industry in Tunisia," Journal of Retailing and Consumer Services, Elsevier, vol. 37(C), pages 89-100.
    21. Helgesen, Øyvind & Ivar Håvold, Jon & Nesset, Erik, 2010. "Impacts of store and chain images on the “quality–satisfaction–loyalty process†in petrol retailing," Journal of Retailing and Consumer Services, Elsevier, vol. 17(2), pages 109-118.
    22. Vesel, Patrick & Zabkar, Vesna, 2009. "Managing customer loyalty through the mediating role of satisfaction in the DIY retail loyalty program," Journal of Retailing and Consumer Services, Elsevier, vol. 16(5), pages 396-406.
    23. Stathopoulou, Anastasia & Balabanis, George, 2016. "The effects of loyalty programs on customer satisfaction, trust, and loyalty toward high- and low-end fashion retailers," Journal of Business Research, Elsevier, vol. 69(12), pages 5801-5808.
    24. Meyer-Waarden, Lars, 2015. "Effects of loyalty program rewards on store loyalty," Journal of Retailing and Consumer Services, Elsevier, vol. 24(C), pages 22-32.
    25. Coelho do Vale, Rita & Verga Matos, Pedro & Caiado, Jorge, 2016. "The impact of private labels on consumer store loyalty: An integrative perspective," Journal of Retailing and Consumer Services, Elsevier, vol. 28(C), pages 179-188.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Demoulin, Nathalie T.M. & Zidda, Pietro, 2009. "Drivers of Customers’ Adoption and Adoption Timing of a New Loyalty Card in the Grocery Retail Market," Journal of Retailing, Elsevier, vol. 85(3), pages 391-405.
    2. Steyn, Peter & Pitt, Leyland & Strasheim, Arien & Boshoff, Christo & Abratt, Russell, 2010. "A cross-cultural study of the perceived benefits of a retailer loyalty scheme in Asia," Journal of Retailing and Consumer Services, Elsevier, vol. 17(5), pages 355-373.
    3. Leenheer, J. & van Heerde, H.J. & Bijmolt, T.H.A. & Smidts, A., 2006. "Do Loyalty Programs Really Enhance Behavioral Loyalty? An Empirical Analysis Accounting for Self-Selecting Members," ERIM Report Series Research in Management ERS-2006-076-MKT, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam.
    4. García Gómez, Blanca & Gutiérrez Arranz, Ana M & Gutiérrez Cillán, Jesús, 2012. "Drivers of customer likelihood to join grocery retail loyalty programs. An analysis of reward programs and loyalty cards," Journal of Retailing and Consumer Services, Elsevier, vol. 19(5), pages 492-500.
    5. Dorotic, Matilda & Verhoef, Peter C. & Fok, Dennis & Bijmolt, Tammo H.A., 2014. "Reward redemption effects in a loyalty program when customers choose how much and when to redeem," International Journal of Research in Marketing, Elsevier, vol. 31(4), pages 339-355.
    6. Leenheer, J. & Bijmolt, T.H.A. & van Heerde, H.J. & Smidts, A., 2002. "Do Loyalty Programs Enhance Behavioral Loyalty : An Empirical Analysis Accounting for Program Design and Competitive Effects," Discussion Paper 2002-65, Tilburg University, Center for Economic Research.
    7. Christiaan Behrens & Nathalie McCaughey, 2015. "Loyalty Programs and Consumer Behaviour: The Impact of FFPs on Consumer Surplus," Tinbergen Institute Discussion Papers 15-048/VIII, Tinbergen Institute.
    8. Arun Gopalakrishnan & Zhenling Jiang & Yulia Nevskaya & Raphael Thomadsen, 2021. "Can Non-tiered Customer Loyalty Programs Be Profitable?," Marketing Science, INFORMS, vol. 40(3), pages 508-526, May.
    9. Faramarzi, Ashkan & Bhattacharya, Abhi, 2021. "The economic worth of loyalty programs: An event study analysis," Journal of Business Research, Elsevier, vol. 123(C), pages 313-323.
    10. Federico Rossi & Pradeep K. Chintagunta, 2023. "Consumer Loyalty Programs and Retail Prices: Evidence from Gasoline Markets," Marketing Science, INFORMS, vol. 42(4), pages 794-818, July.
    11. Brahim Idir, 2018. "L’impact des bénéfices perçus des programmes de fidélisation sur la fidélité à l’enseigne : le rôle médiateur de la fidélité au programme de fidélité," CEPN Working Papers 2018-03, Centre d'Economie de l'Université de Paris Nord.
    12. Wagner Kamakura & Carl Mela & Asim Ansari & Anand Bodapati & Pete Fader & Raghuram Iyengar & Prasad Naik & Scott Neslin & Baohong Sun & Peter Verhoef & Michel Wedel & Ron Wilcox, 2005. "Choice Models and Customer Relationship Management," Marketing Letters, Springer, vol. 16(3), pages 279-291, December.
    13. Alina Filip, 2011. "Loyalty Programs. Role, Structure and Potential Benefits," International Journal of Economic Practices and Theories, Academy of Economic Studies - Bucharest, Romania, vol. 1(2), pages 88-93, September.
    14. Bies, Suzanne M.T.A. & Bronnenberg, Bart J. & Gijsbrechts, Els, 2021. "How push messaging impacts consumer spending and reward redemption in store-loyalty programs," International Journal of Research in Marketing, Elsevier, vol. 38(4), pages 877-899.
    15. Bies, Suzanne, 2022. "Examining the effectiveness of activation techniques on consumer behavior in temporary loyalty programs," Other publications TiSEM ade86df3-4846-4318-938f-a, Tilburg University, School of Economics and Management.
    16. Florez-Acosta, Jorge, 2021. "Do preferences for private labels respond to supermarket loyalty programs?," Journal of Economic Behavior & Organization, Elsevier, vol. 188(C), pages 183-208.
    17. Nastasoiu, Alina & Vandenbosch, Mark, 2019. "Competing with loyalty: How to design successful customer loyalty reward programs," Business Horizons, Elsevier, vol. 62(2), pages 207-214.
    18. Mimouni-Chaabane, Aîda & Volle, Pierre, 2010. "Perceived benefits of loyalty programs: Scale development and implications for relational strategies," Journal of Business Research, Elsevier, vol. 63(1), pages 32-37, January.
    19. Ricard Gil & Evsen Korkmaz & Ozge Sahin, 2020. "Can free-shipping hurt online retailers?," Quantitative Marketing and Economics (QME), Springer, vol. 18(3), pages 305-342, September.
    20. Ricard Gil & Evsen Korkmaz & Ozge Sahin, 0. "Can free-shipping hurt online retailers?," Quantitative Marketing and Economics (QME), Springer, vol. 0, pages 1-38.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:joreco:v:15:y:2008:i:5:p:386-398. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: https://www.journals.elsevier.com/journal-of-retailing-and-consumer-services .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.