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Retail Store Management
Notes Criticism
Companies complain that these loyalty program discount goods to people that are buying their
goods anyway, and that the expense of doing these programs rarely pays. Other critics see the
lower prices and rewards as bribes to manipulate customer loyalty and purchasing decisions, or
in the case of infrequent-spenders, a means of subsidizing frequent-spenders. Commercial use
of the personal data collected as part of the programmes has the potential for abuse. It is highly
likely that consumer purchases are tracked and analyzed towards more efficient marketing and
advertising; in fact, this can be one of the purposes of the loyalty card. To some, participating in
a loyalty program (even with a fake or anonymous card) funds activities that violate privacy.
There has also been concern expressed regarding RFID technology being introduced to loyalty
cards.
Lab Exercise Go to website http://www.consumercomplaints.in/complaints/big-
bazaar-c50930.html and study the extent of customer service. Analyze and interpret it.
Loyalty and credit-card reward plans may be viewable as modern-day examples of a kickback.
An employee who needs to buy something (such as a hotel room or an airline flight) for a
business trip, but who has discretion to decide which airline or hotel chain to use, has an
incentive to choose the payment method that provides the most credit card rewards or loyalty
points, instead of minimizing cost for the organization.
Self Assessment
Fill in the blanks:
11. ........................ are structured marketing efforts that reward, and therefore encourage, loyal
buying behaviour – behaviour which is potentially beneficial to the firm.
12. A ........................ is a structured and long-term marketing effort which provides incentives
to repeat customers who demonstrate loyal buying behaviour.
13. Successful programs are designed to ........................ customers in a business’s target market
to return often, make frequent purchases, and shun competitors. In retailing, these programs
generally reward loyal customers with discounts, special offers, rebates, points, or prizes.
14. It seems that virtually every retailer tries to ........................ loyal customers these days.
15. Loyalty and credit-card reward plans may be viewable as modern-day examples of a
........................
Case Study The Importance of Customer Service
Introduction
Customer service is the whole activity of identifying customer needs in all their complexity,
satisfying them fully, and keeping them satisfied. Customers are people who buy products
and services from other people (usually companies of one sort or another).
Contd....
216 LOVELY PROFESSIONAL UNIVERSITY
