Store loyalty and the total retail experience

Sanderson, Karin (2004-03)

Thesis (MEcon)--Stellenbosch University, 2004.

Thesis

ENGLISH ABSTRACT: With heightening competitive pressures in the retailing environment, customer satisfaction and customer loyalty have become barometers of retailer performance. Determining the relationship of all the controllable elements that encourage or inhibit consumers during their contact with a retailer, defined as the Total Retail Experience (Berman and Evans, 1998: 19), with customer satisfaction and customer loyalty, formed the basis of this study. The dimensions ofTRE that were applied in this study were five controllable components, namely personal interaction, merchandise value, internal store environment, merchandise variety and complaint handling. The empirical study was applied specifically to a retailer dealing in health, home and beauty products. Data for this study was gathered via questionnaire from 34 000 of the most loyal card holders which participated in the loyalty program offered by the health, home and beauty retailer. The results of the data study indicated that the TRE instrument was a valid instrument to measure the success of providing a positive TRE for their consumers. Further, the instruments used to measure customer satisfaction and loyalty were deemed highly reliable. Of the five elements of TRE, enhancing the quality of personal interaction should be the primary focus in improving customer satisfaction, and it is significant that this retailer's management need only focus on improving these five dimensions of TRE to enhance customer satisfaction, given that almost three-quarters of customer satisfaction was accounted for by the five TRE dimensions. Results indicated that in contrast to customer satisfaction, customer loyalty was primarily driven by product related issues, with merchandise value being the strongest predictor of loyalty. Again, it was noted that more than half of the retailer's customer loyalty could be accounted for by the five TRE dimensions. Thus, efforts to improve any of the five TRE dimensions would enhance customer loyalty within this retailer's cardholder base. The varying importance of the specific TRE dimensions to both customer satisfaction and customer loyalty allow this retailer to identify the driving forces behind each of these concepts and allow for prioritizing strategies to optimize satisfaction and loyalty within their consumer base. By analyzing the responses of the individual items (questions) that measure each of the TRE dimensions as they appeared in the questionnaire, this study enables the retailer to focus on very specific aspects that influence each dimension of the TRE experience. Overall, it must be noted that respondents had positive experiences at the health, home and beauty retailer, which provides the retailer with a useful indicator of current satisfaction and loyalty levels and a point of comparison in determining the impact of the strategies employed to heighten satisfaction and loyalty.

AFRIKAANSE OPSOMMING: Toenemende druk van mededinging in die kleinhandelomgewing veroorsaak dat klientsatisfaksie en -lojaliteit barometers van kleinhandelprestasie word. Die basis van hierdie studie is daarin gelee om vas te stel wat is die verwantskap tussen al die beheerbare elemente wat verbruikers se gedrag tydens kontak met 'n kleinhandelaar aanmoedig of inhibeer, gedefinieer as die Totale Kleinhandelervaring (TKE) (Berman en Evans, 1998: 19), en klientsatisfaksie en -lojaliteit is. Die dimensies van TKE wat in hierdie studie toegepas is, is vyf beheerbare komponente, naamlik persoonlike interaksie, handelsware waarde, interne winkelomgewing, handelsware verskeidenheid en klagte hantering. Die empiriese studie is spesifiek toegepas op 'n kleinhandelaar wat handel dryf in gesondheid-, huis- en skoonheidsprodukte. Data vir die studie is ingesamel met behulp van 'n vraelys wat aan 34 000 van die mees lojale kaarthouers wat lid is van die lojaliteitsprogram van die gesondheid-, huis- en skoonheidsprodukte kleinhandelaar, gestuur is . Die resultate van die studie toon dat die TKE instrument 'n geldige instrument is om die sukses te meet indien 'n positiewe TKE vir kliente aangebied word. Voorts is ook bevind dat die instrumente wat gebruik is om satisfaksie en lojaliteit te meet, hoogs betroubaar is. Die verbetering van persoonlike interaksie tussen kliente en personeel blyk die primere fokus te wees indien klientsatisfaksie verbeter wil word. Die vyf dimensies van TKE is verantwoordelik vir byna driekwart van kliente se satisfaksie. Die kleinhandelaar se bestuur behoort dus slegs te fokus op die verbetering van die vyf dimensies van TKE. In kontras met satisfaksie, blyk lojaliteit primer veroorsaak te word deur produk verwante kwessies, met handelsware waarde as die sterkste voorspeller van lojaliteit. Meer as die helfte van die lojaliteit aan die kleinhandelaar word teweeggebring deur die vyf dimensies van TKE. Dus, pogings om enige van die vyf dimensies van TKE te verbeter, sal lei tot 'n verhoogde klientlojaliteit onder die kleinhandelaar se lojaliteit-kaarthouers. Die varierende belangrikheid van die verskillende TKE dimensies vir beide klientsatisfaksie en -lojaliteit stel die kleinhandelaar in staat om die dryfkragte agter elkeen van hierdie konsepte te identifiseer en maak die prioritisering van strategiee om satisfaksie en lojaliteit te maksimeer, moontlik. Die ontleding van die response op die individuele items (vrae) wat elkeen van die TKE dimensies meet soos wat dit in die vraelys voorkom, maak dit vir die kleinhandelaar moontlik om op spesifieke aspekte wat elke dimensie beinvloed, te fokus. Globaal gesien is bevind dat respondente positiewe ervarings by die gesondheid-, huis- en skoonheidsprodukte kleinhandelaar gehad het en hierdie kan as 'n nuttige indikator gebruik word van bestaande satisfaksie- en lojaliteitsvlakke en ook as 'n punt van vergelyking vir die bepaling van die doeltreffendheid van strategiee wat aangewend word om satisfaksie en lojaliteit te verbeter.

Please refer to this item in SUNScholar by using the following persistent URL: http://hdl.handle.net/10019.1/50104
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