3.0 Course Work B
a)Title of Research: “To analyse the factors which influence customer loyalty - A study of Morrisons, UK”
b) Background of Study:
In the present business scenario, business organisations face a cut-throat competition with their rival firms. There is an increasing trend which is going on that firms and economies want to develop at a fast pace. When organisations desire for more market benefits, they try to shift their marketing strategies from traditional to modern ways. The focus of firms in today's business context has moved from transactions to relationships. There is an increasing tendency towards customer loyalty marketing in the current business scenario. While considering the current market environment, customer loyalty is essential for business organisations. For companies, customers are their key assets and they can attain additional value from customers only when they are given with due attention (Pan Sheng and Xie, 2012). Taking the perspective of firms, to develop customer relationships give them invaluable resources and get more reliable information about customers. From the perspective of customers, loyal customers are helpful in reducing cost of firms. Along with that, they are like a part-time employee who gives information about products and services to his family members, relatives and friends. This type of partnership reaps effective outcomes on the growth and development of companies. The customer loyalty strategies make a significant effect on development and progress of firms. Due to the tough competition, firms have pressure to make cordial and strong relationships with their customers so that more profits can be reaped (Tu Wang and Chang, 2012). There are many organisations which make investment to retain their customers. Generally, it is known that there is a positive relationship between customer loyalty and firm’s profitability.
c) Rationale of the Study:
In the modern business scenario, there have been a growing trend which has forced firm to change their traditional marketing methods to modern relationship methods of marketing . Under this procedure, several components make varied impacts on the loyalty of customers. Apart from this, relationship marketing and other concepts such as customer satisfaction and customer loyalty strategies appeared in 1980s and 1990s. It is a very fresh subject and there have been various researches which have discussed about this topic. In the present study, factors which make their significant impact on customer loyalty in retail organisations of United Kingdom are being investigated. For this intent, Morrisons has been selected for the study.
d) Research Aim, Objective and Questions:
Research aim: To analyse the factors which influence customer loyalty- A study of Morrisons, UK”.
1) To investigate the factors which affect customer loyalty in Morrisons
2) To understand the importance of customer loyalty in Morrisons
3) To recommend some effective strategies to retain and enhance customer loyalty
1) What are the factors which influence customer loyalty in Morrisons?
2) Why customer loyalty is important in Morrisons?
2.0 Literature Review
Factors that Impact Customer Loyalty
If a business organisation is not able to offer products and services to its customers which will satisfy them and if their rival firm are providing better deals after few months then there will be very less chances to gain advantage of customer loyalty. Firm has to notice that loyalty is not measured in sales figure. Loyal and involved customers are the best brand advocates of business who act as the ambassadors for firm within their social group. According to Martínez and del Bosque, (2013) core offer is one of the main factors that influence customer loyalty. It is not about gimmicks or loyalty card programmes which put a direct impact on customer loyalty. It is the main offer that decides how long will customer stay with a firm's products and services. Organisation has to know and understand what customer wants and then pay attention to it. This considers several variables such as location of firm, standards of products and services and their quality. Paul and Rana, (2012) asserted that satisfaction also directly impacts customer loyalty to a great extent. Satisfaction is always expected by customers whenever they buy a product or service. Even if they are satisfied with the products and services, then it is not essential that they will be sticking to the same for a longer time. There are possibilities that they will move on to another product. Convenience is also one variable which makes a significant influence on customer loyalty. When they purchase products, they will become loyal towards just because of the simple reason that stores are very near and convenient to be reached. Due to this reason, they purchase on a regular basis from those outlets. Beneke and et. al.,(2013) stated that customer service are also an important factor which affects customer loyalty. The manner in which an organisation stands behind its products is important as the product itself. If warranty is good and issues of customers are quickly solved then they will become loyal towards the organisation. Personal relationships are also one of the essential factors which affect the faith of customers. The manner in which they are treated by third parties like sales person, store clerk or sales representative can make or break loyalty. Many customer get impressed by the behaviour and presentation techniques of sales man, that they buy product. Harvey and Houlihan, (2012) said that reputation of an organisation also plays a vital role in customer loyalty. How the products is playing in the social media as well as commercial media can make significance affects on long term relationships between customer and firm. The financial conditions, employees and sourcing practices of organisation are nor scrutinised due to growing transparency across the world in which customer think that they vote with their buying.
Importance of Customer Loyalty
There are many reasons for which customer loyalty and commitment is necessary for business enterprises. Loyal customers according to the definition, buy products and services on a repeated basis. They stay for a long time as they do not like to changes their sellers unless they a a valid reason behind it. Most probably they only leave products and services of a firm if it breaks their trust and confidence or in case if the rival organisation introduced something better and cheap. In accordance with the view of La and Choi, (2012) loyal customer lays their emphasis on purchasing from selected vendors. They will purchase products from one firm only which the other customer purchase from any other place. They will give their valuable suggestions and advices for making modifications in goods and services which may prove profitable. Therefore, firms take their recommendations in a very serious manner. One other aspects which highlights the significance of loyal customers is that loyal consumers are more known with good and services and thus they require less support. Instead of calling for support when a problems takes place, they are more interested and capable as compared to other customer in finding out a solution to their issues using self service portal of organisation. Wasserburger, (2016) asserted that loyal customers separate firms from price competition. They are not concerned about checking prices of products against rival firm. This is because of simple reason that they trust their organisation with which they are associated. But business enterprises should also pay attention on their thoughts about price of products and services. Along with these, loyal customers acts as brand ambassadors of an organisation. They do not just share their bad experiences with their friends and family, but also talk about good experiences and particularly the exceptional ones. This turn into great stories and they share it with their circle. This is very important for the organisation as it improves the brand image of the firm. Beneke and et. al.,. (2013) stated that loyal customer give honest and high qualitative feedback and reviews as they want to help the organisation to make improvement in its offerings. If firms give due respect and value to their reviews then it will increase the level of trusts and confidence in them. Many firm when launch a new product or service, they take use of their loyal customer as focus groups. They are the only ones who give their responses and answers to social media posts which makes requests for viewpoints and opinions. According to the view of Tu Wang and Chang, (2012) loyal customers are always in favour of the organisation to which they are loyal. Even there are situations which seems to be negative for company, then also they will take side of firm only. They also prove their loyalty when organisation is facing an economic crisis or downfall. Thus they are called dedicated and committed customers.
3.0 Research Design and Methodology
This section of research present important statement to the researcher for conducting an effective investigation along with some logical methods for it. It is helpful for the reader to analyse the chosen methods used by the researcher for carrying out the study by exactly understanding the facts. This section has thus used several analyses measures of the investigator which are elaborated here:
Research Design: The foremost consideration for the investigator is to conduct the investigation by firstly choosing logical pattern for beginning the study. However, this is a dependable factor which relies on the selected title of the research. In the present study, the topic of research is to analyse those factors that impacts customer loyalty in context of Morrisons (Vamsi Krishna and Kodali, 2014). For this, descriptive research design is being chosen which provides assistance to the researcher for conducting a deep research on the title of the study. The other type of research design i.e. explanatory design and exploratory design are not taken in use for this particular investigation.
Research Approach: The approaches for research are the interpreted formulation of the investigator for conducting the research in a defined way. A selected research approach is then responsible to showcase the entire context of the study. There are two type of distinct research approaches. One is inductive research approach and other is deductive research approach (Gioia Corley and Hamilton, 2013). For the present study, inductive research approach is being applied which has turned the investigation in a particular context of analysing the factors which affect customer loyalty with reference to Morrisons. There are also some other tact of research approaches such as deductive approach which it not being applied in the present research as it restricts the overall scope of investigation and it takes the research into specific context which cannot be applied for the present research title.
Research Philosophy: Another important concern of investigation is to choose a philosophical method to conduct the investigation. In the context of this, there are two type of research philosophies which are named as Interpritivism and Positivism research philosophies. Both of them are very different from each other. In the current research, Interpritivism is being taken into use. This is basically done for assessment of the subjective nature of the title of study. The second choice of positivism is not being preferred as it does not assists the researcher to carry out the present subject because of its objectives analysis (Nayar, 2012).
Data Collection: Data collection is a very essential concern for the investigator to collect reliable set of data and information from several sources. There are two methods of data collection which are called Primary data collection and Secondary data collection along with using appropriate resources for them. Primary sources of data collection is are taken directly from respondents for collecting needed data and information from them (Rossi Wright and Anderson, 2013). On the other hand, secondary sources of data are gathered by referring for some pre-set information from dependable resources like authentic books, online publications, journals etc. For the present investigation, the researcher has selected primary sources of data collection. The other sources which is secondary data are being taken through reports of organisation and government agencies.
Sampling: There are two distinct measures for sampling that basically refers to distributing research respondent with a proportionate manner. In the present study, the investigator has preferred for purposive method of sampling in which 10 customer of Morrisons has been interrogated. The other method of random distribution is not preferred in the present study because it has non probable techniques which makes random mixture of participation (Kitchin and Tate, 2013). But, the preferred method of purposive sampling is reliant on the way of designing a probable distribution of respondent which is shown is the current study.
Data Analysis: Data analysis is analysing the afore gathered data in which it is done through choosing any methods of analysing the data. With reference to this, there are two type of different tact of data analysis which are qualitative and quantitative data analysis. Selection of suitable technique from these techniques relies on present philosophy of the investigation (Cozby and Bates, 2015). Thus in the context of the current study which is being conducted to analyse the factors which makes their significant impact on customer loyalty of Morrisons. For this, the investigator has also taken interprivitismn philosophy for interpreting the subjective nature of research title. Due to which the qualitative methods for analysing data has been the most suitable method for assessing current subject matter by conducting a thematic investigation for it.
Ethical Issues: Ethical issues basically refers to ethical implication during the research is carried out so that its moralised nature can be defined. With reference to this, there are various ethical considerations which should be followed by the investigator. This comprises of taking a prior permission of respondent of investigation which were customers in this study (Bringle Hatcher and Jones, 2012). They should take participation in the survey with their own willingness and should not be forced by the researcher. An another ethical aspect of the research is to make appropriate citation of the work done to remark an attached study by collectively referring to reliable secondary sources of data collection. In the present investigation, it has been observed that an ethical approach has been taken by the researcher in which customer of Morrisons were punctually approved about their own interest to take part in survey before sending them mails of the designed questionnaire (Tavakoli, 2012).
Research Limitations: There are some confining components when a well defined study is carried out in which the surveyor has a primary need for adequate time and monetary resources to conduct investigation. But there was a limited budget and restricting time period for conducting such a wider set of study. These are the most essential concerns of the investigator (Nayar, 2012). Thus, it is necessary for surveyor to conduct a projected research by taking help of Gantt Chart so that a well defined span and effective measures to make budget like activity based method can be executed to plan the investigation. Both these methods are being taken in use by the investigator for conducting the present research of analysing the factors which impacts the loyalty of customer in context of Morrisons.
4.0 Time Table And References
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- Bringle, R.G., Hatcher, J.A. and Jones, S.G. eds., 2012. International service learning: Conceptual frameworks and research. Stylus Publishing, LLC..
- Cozby, P.C. and Bates, S., 2015. Methods in behavioral research. McGraw-Hill.
- Gioia, D.A., Corley, K.G. and Hamilton, A.L., 2013. Seeking qualitative rigor in inductive research: Notes on the Gioia methodology. Organizational Research Methods, 16(1).pp.15-31.
- Kitchin, R. and Tate, N., 2013. Conducting research in human geography: theory, methodology and practice. Routledge.
- La, S. and Choi, B., 2012. The role of customer affection and trust in loyalty rebuilding after service failure and recovery. The Service Industries Journal, 32(1).pp.105-125.
- Martínez, P. and del Bosque, I.R., 2013. CSR and customer loyalty: The roles of trust, customer identification with the company and satisfaction. International Journal of Hospitality Management, 35. pp.89-99.
- Nayar, S., 2012. Grounded theory: A research methodology for occupational science. Journal of Occupational Science, 19(1).pp.76-82.
- Pan, Y., Sheng, S. and Xie, F.T., 2012. Antecedents of customer loyalty: An empirical synthesis and reexamination. Journal of Retailing and Consumer Services, 19(1).pp.150-158.
- Paul, J. and Rana, J., 2012. Consumer behavior and purchase intention for organic food. Journal of consumer Marketing, 29(6).pp.412-422.
- Rossi, P.H., Wright, J.D. and Anderson, A.B. eds., 2013. Handbook of survey research. Academic Press.