The influence of loyalty programs on loyal consumer behavior

Abstract

A dynamic business environment and intense competition require companies to create numerous incentives for consumers to keep them loyal. Various incentives are available to marketing managers. Their combination depends on the company's goals on the one hand and consumer characteristics on the other. Loyalty programs have traditionally been based on financial incentives aimed at the average consumer. The means on which modern loyalty programs are based are more diverse and complex, and are often based on information technology. They are focused on personalization, that is, the creation of incentives for the individual consumer and the dominant provision of hedonic and symbolic values. The goal of such programs is consumer loyalty to the company/brand, not to the program itself. Starting from the differences between traditional and modern consumer loyalty programs, the author's intention in the paper is to investigate the impact of both programs on consumer loyalty. The impact of traditional programs on consumer loyalty was investigated through financial benefits, flexibility and program reliability, and the impact of modern loyalty programs through personalization, social benefits and gamification. Additionally, the paper analyzed the moderating role of gender and age as consumer demographic characteristics on the degree of loyalty to the program itself and loyalty to the company/brand. Identified relationships between the investigated variables enabled a comparison with the results of existing research and the formulation of recommendations necessary for managing consumer loyalty.

Keywords

• consumers
• loyalty
• loyalty program
• demographic characteristics
• incentives