To investigate customer perception towards retail loyalty programs and their role in in building brand loyalty: A case study of Dunnes Value Club card program

Abstract

AIM: The aim of this study is to investigate loyalty card programs offered by grocery retailers and their promotional benefits and drawbacks and whether they have any influence on brand loyalty. The research study, therefore, sought to assess the perception of loyalty card members using Dunnes Value Club card as a case study. METHOD: The design of the study is based on an exploratory mono method qualitative research, whereby it explores the attributes of the Value Club card program which results in consumer loyalty towards Dunnes from the perspective of the consumers. The different components of loyalty and loyalty programs which were investigated were derived from an extensive literature review of brand loyalty and customer loyalty programs. The data for this qualitative study was drawn from two focus group discussions with customers who qualified as members of the Dunnes Value Club Card program. CONCLUSIONS: The conclusions drawn from this study are from a customer’s viewpoint and suggest that: customers who exhibit loyal behavior are characterized by continuous repeat purchase of a product from the same brand. Promotions and rewards offered by the Value Club card only played a supporting role in building customer loyalty towards Dunnes. Other components such as customer satisfaction, perceived value of the rewards, quality, price and convenience are all significant aspects in building brand loyalty. FUTURE RESEARCH SUGGESTIONS: A comparative study between two different loyalty programs offered by retailers in the Irish grocery retail market would give an enhanced perception of the preferences of Irish consumers. Due to lack of consensus, further investigation to satisfy customers and establish brand loyalty is needed.