Table of Contents
CHAPTER 4: RESULTS AND DISCUSSION
Introduction
The following chapter is related to analysis of results and its discussion for this particular study. The aim of this study is to evaluate the effectiveness of loyalty program in the building and development of customer loyalty and the industry/sector selected for this study is grocery retailing. The independent variable of loyalty program has been divided into four sub variables that are trust commitment corporate image and customer satisfaction while the dependent variable of study is customer loyalty. The study aims to analyse the impact of loyalty programs based on these four variables on customer loyalty overall in the grocery retailing industry. The results are discussed as under.
Demographics Analysis
The above chart illustrates the distribution of males and females among all respondents in study. The total number of respondents in this study was 200 where 119 males participated in the study and 81 were females that took part in study.
The second chart in demographics section illustrates the age distribution of 200 respondents that participated in the study. Study showed that most of respondents were from age 31 to 36 years while second most were more than 43 years of age. 38 35 and 27 respondents lay in age group 37 to 43 years 24 to 30 years and 18 to 23 years respectively. This shows that most people shopping in grocery stores are aged between 31 to 36 years.
The third chart illustrates income of respondents. Most of respondents that took part in study were in income group of £5501 to £6500 while second most were in age group £2500 to £3500. This shows that mostly people in income group of £5501 to £6500 are shopping in grocery stores to fulfil their grocery needs.
Descriptive Analysis
The responses were collected with the support of survey questionnaires which have been analysed with the descriptive test on SPSS are mentioned as follows: gathered with the help of survey questionnaires have been analyses with the descriptive analysis which are as follows.
Table 1: Customers purchases based on trust
According to survey results of the table mentioned above 85 of the total respondents agreed to the statement that customers purchase goods and services offered by the company because trust is considered as the significant element that has helped consumers in purchasing goods and services. On the other hand 16 respondents negate with the statement while 52 remained neutral to the statement. The outcome of this study is similar to the study conducted by Luarn and Lin (2003: 159) trust amongst the customers is developed based on the integrity and honesty in the business communication and can urge them to purchase the goods and services based on the trust.
Table 2: Trust Increases Credibility
According to survey results mentioned in the above table 40 of the total respondents agreed to the statement that trust increases credibility of the company with respect to its products and services. However 20 respondents negates to the statement while 51 respondents remained neutral throughout the research. This result is similar to the study of Chaudhuri and Halbrook (2001) which have highlighted the importance of trust and credibility with respect to customer loyalty as credibility is an essential factor which can make the business efficacious.
Table 3: Trust increases willingness of the Customers towards Company
In the table mentioned above when considering a total of agree and strongly agree it represents that a total of 140 respondents out of 200 were in the favour that trust increases the willingness of the customers towards the company and their offerings. Moreover only 14 respondents negate with the statement while 46 respondents remained neutral to this question. The results can be confirmed by the study of Ball et al. (2004) who have focused on the notion that trust is one of the most important elements for the companies operating in a highly competitive business environment. Hence it increases the willingness of the customers to purchase the products from trust-worthy organisations.
Table 4: Commitment influences the Customers
The table illustrated above explains that around 130 of the respondents out of 200 agree with the statement that commitment has influenced the customers to continue their association with the company. On the contrary side only 16 respondents out of 200 disagrees with the statement while 48 respondents remained neutral for this question. The results of the statement are similar to the study of Dimitriades (2006: 787) commitment is amongst the important factors affecting the loyalty amongst consumers and it can strongly enhance the relationship between the company and the customers.
Table 5: Mutual Commitment can enhance customer relationship
The table mentioned above represents that around 143 respondents out of 200 were in the favour that relationship between the consumers and companies are based on the mutual commitment. On the other side 14 respondents were not in the favour of this statement and 46 still remained neutral to this statement. The results are similar to the study of Mattila (2004: 137) which stated that a mutual commitment made by the organisation can enhance the relationship amid the customers and the company.
Table 6: Commitment can reduce switching intention
The table demonstrated above explains that around 120 respondents out of 200 were in the favour that commitment has played an important role in reducing the switching intention of the consumers. On the other hand 21 of the respondents were not in the favour of the statement where 59 remained neutral for this statement. The results are similar with the study of Jones et al. (2010) which stated that the switching behaviour of the customers can be eliminated through presenting an effective commitment for the customers.
Table 7: Corporate Image has increased the likelihood of shaping the response
The table presented above portrays that around 125 of the respondents out of 200 agree with the statement that corporate image has significantly increased the likelihood of shaping the response of the customers. Moreover 56 remained neutral to this statement while 19 respondents were against the statement stated above. The results are relatable to the study of Minkiewics et al. (2011) which stated that corporate image has been argued to have a significant impact on the consumer loyalty and their satisfaction level.
Table 8: Corporate Image can shape trust and satisfaction level
The table presented above highlights that around 133 of the respondents were in the favour of the question statement that corporate image has the ability to shape the trust and satisfaction level between the customers. However only 15 respondents negated the statement believing that corporate image shapes the trust and satisfaction. Moreover 52 respondents were neutral to this statement which signifies that either they were not aware of the question statement or were reluctant to give the answer.
Table 9: Corporate Image has influenced the customers to mould their attitude and behaviour
The table mentioned above represents that around 140 of the respondents were in the favour of the statement that corporate image has the significant influence on the customers to mould their attitude and behaviour towards the respect of the company. Moreover 13 respondents were not in the favour of question statement while 57 respondents remained neutral to the question statement.
Table 10: Customer Satisfaction has stimulated the consumers for specific brands
The table mentioned above represents that 139 respondents remained positive towards the statement that customer satisfaction has stimulated and motivated the consumers to prefer the specific brand over others available in the marketplace. Moreover 11 respondents disagree with the statement while 50 respondents remained neutral to the question statement incorporated in the questionnaire. The results are relatable to the study of Noble et al. (2014: 363) which stated that customer satisfaction can be stimulated for specific brands in the marketplace.
Table 11: Satisfaction has influenced the Customers to purchase the goods and services
The table mentioned above represents that 127 of the respondents remained positive towards the statement that satisfaction has influenced the customer to frequently purchase the goods and services offered by the company. Moreover 16 respondents disagree with the statement while 57 respondents remained neutral to the question statement incorporated in the questionnaire.
Table 12: Satisfaction Amongst customers increases their loyalty
The table mentioned above represents that 133 of the respondents agreed with the question statement that satisfaction amongst the customers increases the likelihood of the customers to be engaged in the loyalty programs. On the other hand 23 respondents disagree to the statement while 44 respondents remained neutral to the question statement.
Table 13: Building and Maintaining Outstanding Loyalty
The table mentioned above represents that 128 of the respondents remained positive towards the statement that building and maintaining outstanding loyalty amongst the customers has become the rising concern for the companies. In addition to the above statement around 11 respondents disagree with the question statement while 60 remained neutral towards the statement.
Table 14: Customer Loyalty Plays influential role
The table mentioned above represents that 127 of the respondents remained positive towards the statement that customer loyalty has played an influential role in the success and growth of the companies. However around 19 of the respondents out of 200 disagree with the statement while 55 remained neutral to the question.
Table 15: Customer Loyalty increases the attraction and retention of the customers
The table mentioned above represents that 132 of the respondents remained positive towards the statement that customer loyalty increases the attraction and retention of the customers. However around 14 respondents out of 200 disagree with the statement while 55 remained neutral to the question.
Correlation Analysis
The correlation analysis shows the interdependence of two or more variables upon each other. According to Kinnear and Gray (2006) correlation analysis is a statistical technique that is used to evaluate the relationship between variables of study. In this study the relationship between trust commitment corporate image customer satisfaction and customer loyalty is investigated through correlation analysis from SPSS. The results are shown as follows.
Table 1 Correlation Analysis
The correlation analysis shows the relationship among all variables of study. Apart from relationship between all the independent variables with the dependent variable the relationship between all independent variables itself is also depicted in the above table. However the study has only interpreted the results for relationship between the dependent variable of customer loyalty and other independent variables falling under the umbrella of loyalty program that are trust commitment corporate image and customer satisfaction. The total number of responses in the study was 200. The results showed that relationship between trust and customer loyalty is significant as well as strong having 71.9% relationships. The second relationship was analysed for commitment and customer loyalty. The results showed that relation was significant and moderate having value of 68.5%. Similarly relationship of corporate image and customer satisfaction with customer loyalty was strong and significant having values of 75% and 84.2% respectively. The findings have been fortified by study conducted by Zakaria et al. (2014: 27) stating that loyalty programmes and customer loyalty are strong correlated.
Overall results from correlation analysis show that relationship of customer loyalty with trust commitment corporate image and customer satisfaction is strong and significant. The relationship is also direct or positive in nature.
Regression Analysis
Table 2 Model Summary
The above table is the model summary table from regression analysis that has been applied in order to evaluate impact of trust customer satisfaction corporate image and commitment on customer loyalty. The ‘R’ value in this table shows the relationship among all variables of study and it indicates that all variables are correlated at 74.9%. The ‘R Square’ value shows that how much cumulatively all independent variables predict the dependent variable. The results show that all independent variable are able to predict customer loyalty by 67.8%.
Table 3 ANOVA Table
The analysis of variance shortened to ANOVA is an analysis to determine the model fitness of model used in the study. The ANOVA test results are analysed through two values that are ‘F’ value and sig value. Both the values of ‘F’ and significance show that model used for the study is appropriate and significant to use.
The coefficients table fulfils the main aim of study of identifying the impact of independent variables which include trust commitment corporate image and customer satisfaction on customer loyalty. The results from coefficients table show that the impact of all independent variables that are trust commitment corporate image and customer satisfaction is significant on customer loyalty because the significance value for all the variables is lesser than alpha value of 0.05 indicating a significant impact. Moreover beta values from unstandardized coefficients shows that how much change in one unit of dependent variable brings in independent variable. This is depicted through regression equation.
The results from regression analysis showed that impact of loyalty programmes on customer loyalty is significant and it has also been identified in the study conducted by Zakaria et al. (2014 : 27) stating that companies are investing hefty amounts into loyalty programmes to build customer loyalty in grocery retail market.
Regression Equation
Y = α + β1X1+…… βnXn
Here Y represents the dependent variable that is customer loyalty. Alpha is the constant value while B is the coefficient of independent variable and X is the independent variable. Thus Customer Loyalty = 2.942 + .752 (trust) + .664 (commitment) + .593 (corporate image) + .881 (customer satisfaction).
Discussion
Objective 1: To investigate the concept of customer loyalty in grocery retailing setting
The objectives of the study were apparent to the researcher as they were focused towards the customer loyalty in the grocery retailing setting. Consequently the first objective of the study is focused towards the investigation of the concept of customer loyalty in grocery retailing setting. This objective was theoretical nature which the researcher achieved reviewing several theoretical concepts and literature in order to fulfil the objective successfully. However the objective was successfully achieved by the researcher by reviewing several theories and concepts previously postulated by the practitioners and scholars.
The researcher by reviewing some theories and concepts found out that customer loyalty is essential for the organisation particularly for the grocery retail setting. It is highlighted by Akbar and Parvez (2009) in the grocery retailing sector customer loyalty is more important because the switching behaviour of the customers is highly relatable in this case. If the customers do not get valued by their grocery retail stores then they are likely to have a switching behaviour. It was also found by Ball Simões and Machás (2004) that customer loyalty has played an influential role in the success and growth of companies; therefore grocery stores setting have relied extensively on keeping the customers loyal rather than replacing them with potential customers. Therefore the concept of customer loyalty in the grocery retailing setting is significantly important for the organisations in order to remain competitive in the industry.
Objective 2: To understand the prevalence of loyalty programs in the building customer loyalty in grocery retailing in United Kingdom
The second objective of the study was apparent to the readers as it was aimed towards understanding the prevalence of loyalty programs in the building of customer loyalty in grocery retailing in the UK. The objective of the research was successfully achieved by the researcher by viewing some relevant theories and concepts as the objective proposed by the researcher was theoretical in nature. After reviewing several literatures it was found out by the researcher that loyalty programmes are one of the most essential parts of the structured marketing efforts.
The ultimate purpose of loyalty programmes is to ensure that the customers are frequently rewarded for their outstanding association with the company (Dorotic et al. 2012: 219). Moreover the results were also in the favour of the statement that loyalty programs designed for the customers helps in building strong loyalty particularly in the grocery stores. However the grocery stores in the United Kingdom have designed certain loyalty programmes which have played an influential role in encouraging the customers to develop positive buying behaviour. Therefore it is made evident in the study that the prevalence of loyalty programs in building customer loyalty in grocery retailing in the United Kingdom.
Objective 3: To evaluate the effectiveness of loyalty programs undertaken by grocery retailers with respect to customer loyalty
The third objective proposed by the researcher was statistical in nature which was achieved by the researcher through statistical testing. Moreover the objective was successfully achieved by the researcher as the loyalty programs were found to be highly effective for the grocery retailers in the context of customer loyalty. It was also found from the results that loyalty programmes have played an important role in making the customers realise that they are a valuable asset for the company. Moreover it was also revealed from the study that loyal customers are likely to have less switching behaviour while adopting strategies through which they can retain within the organisation. Therefore it is made evident throughout the study about the effectiveness of loyalty programs which should be undertaken by the grocery retailers with respect to customer loyalty.
The objective was also successfully achieved as it provides the final results pertaining to the research hypotheses. The research hypotheses confirms that there is a significant impact of loyalty programs on customer loyalty. The test also confirms that the sub variables of the indepdent variable i.e. customer loyalty programs and its sub variables such as trust commitment corporate image and customer satisfaction also have a significant impact on loyalty of the customers. Therefore it is evident that the grocery retailers in the UK can take advantage of Loyalty programmes in order to enhance the loyalty of the customers.
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