Perceived Benefits of Loyalty Programmes and Their Impact on Purchase Intentions of Customers

Abstract

The purpose of the study is to determine the perceived benefits of loyalty programmes among customers and its effect on their purchase intentions. It also determines the influence of demographics on customer loyalty programme membership and its role in relationship between perceived benefits and purchase intentions of customers in apparel stores in Jammu city. A theoretical framework is proposed based on the three integrating variables, perceived benefits of loyalty programmes, loyalty programme membership and purchase intention based on review of literature. Subsequently, a descriptive analysis has been undertaken to determine the relationship between the selected variables. The study has concluded that among the demographic variables under study, age group and income level have a significant impact on loyalty programme membership of customers while gender does not exhibit such impact. Further, it has confirmed that perceived benefits have a significant impact on purchase intentions of customers. The study also suggests the moderating role of loyalty programme membership in the relationship between perceived benefits of loyalty programmes and purchase intentions of customers. The paper has several practical implications for the stores/organizations who want to retain customers through effective loyalty programmes. When customers perceived more benefits from loyalty programmes they have higher intentions to purchase from the store of which they own a loyalty card, thus leading to long term relationship with the store. Moreover, the demographic variables included in the study may help the retailers to target the customers for loyalty card membership.