Loyalty Programmes

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Executive Summary
The modern market has become very diverse with most businesses adapting to this by putting in place different marketing and promotional strategies. Those whose strategies are aimed at not only boosting sales, but also developing ties and a long-term relationship with the customer have an upper hand in the long-term benefit of the business in terms of sales and profitability. One way of achieving this is creating a customer loyalty programme which is an effective marketing tool. This is attributed to the win-win situation whereby the customers are rewarded for their loyalty as well as the business acquiring and maintaining their market share through repetitive buying hence boosting sales. This paper looks into the considerations that should be put in place when developing a loyalty program for an online grocery store. It expounds further on the benefits accrued on such a program to both the businessman and the customers. It also looks into the consumer perceptions on the rewards given by these programs and how it influences their purchase behaviour. It also analyses the Customer relationship Management (CRM) and key factors that affect the development of a customer oriented cultures. The paper concludes that for any business to maintain its competitive advantage, it needs to put in place a sound relationship with its customers. This as explained in the paper can be attained through various methods such as personalizing rewards so that they fit with the customer requirements and needs as well as putting into consideration the customer’s views and perceptions with regard to their requirements and what adds them value.

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Table of Contents
Title Page………………………………………………………………………………………..1 Executive Summary…………………………………………………………………………….2 1.0 Introduction………………………………………………………………………………….4 2.0 Literature review…………………………………………………………………………………………….5 3.0 Benefits of a Customer Loyalty programme……………………………………………..7 4.0 Survey design……………………………………………………………………………….8 5.0 Discussion…………………………………………………………………………………...9 6.0 Customer relationship management (CRM)…........................................................10 7.0 Ethical Considerations in CRM…………………………………………………………..11 8.0 Differences between online and traditional stores…………………………………….12 9.0 Conclusion…………………………………………………………………………………12 10.0 Recommendations………………………………………………………………………13 References…………………………………………………………………………………….15

1.0 Introduction
In the modern world, competition in the market place has continuously increased. This has led to most businesses being centered on fulfilling the customer requirements and needs. This can be achieved through alignment of the company’s mission and vision to the fulfillment of customer requirements. This is attainable through acquiring customer’s feedback, linking the values to their business products and services and encouraging employees to wok to the realization of these values by exhibiting it through their behaviour. Most successful companies have achieved this through paying attention to customer needs and also through consultations with their employees by implementing a customer relationship management (CRM) (Goolsbee & Brown, 2002). A Loyalty Programme as a marketing approach aims at motivating and enhancing loyalty of customers by offering them rewards, depending on how often the shop at the stores and how much they spend. According to Pozzi (2012), they are designed to offer long lasting and long-term benefits such that, the more a customer shops for a prolonged period and the more cash they spend on a store, the greater is the reward. Hence, those that remain loyal to the store for a long period have greater rewards than new shoppers or those who have been customers for a shorter period. Loyalty programs are used by businesses as a form of marketing to enhance customer retention in the long-term. However, the value of the rewards and its timing are...
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