1. Consumer Retention &
Loyalty Programs; Do
They Work?
Matt Crowley, Dan Spezzano, Brandon
Maisonet, Connor Monaghan
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2. Agenda
1. Introduction
2. Literature Review
a. Customer Retention
b. Store Environment
c. Resisting Competition
d. Emotional Attachment
3. Methodology
4. Results
5. Discussion
6. Conclusion
7. Q & A
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3. 1. Introduction
● Research Statement
○ Our research determines whether or not CLPs will have an effect on customer retention.
● Research Question
○ Do Customer Loyalty Programs work?
● Purpose of Study
○ Determine if CLPs work as a business strategy in retaining customers.
● Importance of Study
○ This research will benefit firms, and researchers who would like to further understand how to obtain repeat
customers.
○ Customers would also benefit from the research, as they can understand what makes a good CLP and when
they should take advantage of one.
● Previous Studies
● Deficiencies
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4. 2a. Literature Review
Customer Retention
● Measures how loyal one’s customers are.
● Satisfied customers spend more, cost less, and refer other customers to the
business.
● Hypothesis: If loyalty programs are implemented, then there will be greater
customer retention, as opposed to not implementing a loyalty program.
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5. 2b. Literature Review Cont.
Store Environment
● The lighting, music, color, ease of access, and supply.
● Is the store easy to navigate and does it appeal to it’s audience?
● Hypothesis: If a store caters to a customer's aesthetic appeal, then they are
more likely to return to that store.
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6. 2c. Literature Review Cont.
Resisting Competition
● Trust, defensive towards your brand, loyalty programs help companies
retain their customers, so they are customers for life
● Hypothesis: If a customer is enrolled in a CLP, then they will be more likely
to resist competition.
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7. 2d. Literature Review Cont.
Emotional Attachment
● An emotional attachment can be formed between a customer and a brand,
just like it can be formed between one person and another person, pet, or
place.
● Three big factors that can contribute to one’s emotional attachment to a
brand are affection, connection and passion.
● Hypothesis: If a consumer is attached, then they
will go to that brand frequently, which will make
a small, but definite impact on the brand’s
financial improvements.
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8. 3. Methodology
● Conducted a survey with the variables of:
○ Loyalty Programs
○ Store Environment
○ Customer Service
○ Customer Satisfaction
○ Customer Retention
● Collected and examined survey results and determined significant relations
between these variables.
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9. Regression Model
Store Environment
Customer Service
Loyalty Programs
Customer Satisfaction Customer Retention
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10. Hypothesis of Regression Model
1. Ease of access and aesthetic Appeal → Customer Satisfaction
2. Friendly and exceptional employees → Customer Satisfaction
3. Involving and rewarding CLP’s → Customer Satisfaction
4. Appealing to customers wants → Customer Retention
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1. Store
Environment
2. Customer
Service
3. Loyalty
Programs
4. Customer
Satisfaction
Customer
Retention

11. Demographic Results
Gender Frequency Relative Frequency
Male 62 62%
Female 38 38%
Totals: 100 100%
Age Frequency Relative Frequency
19 and Younger 38 38.38%
20-24 54 54.54%
25 and Older 7 7.07%
Totals: 99 100%
Race Frequency Relative
Frequency
African 4 4%
African American 1 1%
Asian 5 5%
Caucasian 86 86%
Hispanic 3 3%
Other: Arabic 1 1%
Totals: 100 100%
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12. Demographic Results Cont.
Income Frequency Relative Frequency
<$20,000 60 60%
$20,001 - $40,000 0 0%
$40,001 - $60,000 4 4%
$60,001 - $80,000 3 3%
$80,001 - $100,000 1 1%
>$100,000 3 3%
Don’t Know 15 15%
Decline to Answer 14 14%
Totals: 100 100%
Education Frequency Relative Frequency
Some College 68 68%
2 Year Degree 11 11%
4 Year Degree 14 14%
Master’s Degree 4 4%
Doctoral Degree 1 1%
Professional Degree 0 0%
Don’t Know 0 0%
Declined to Answer 2 2%
Totals: 100 100%
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13. Reliability Scores
Survey Variables Alpha Score
Customer Service 0.65
Store Environment 0.46
Loyalty Programs 0.53
Customer Retention 0.48
Customer Satisfaction 0.33
Participants clearly understood the
questions.
.7+
Participants mostly understood the
questions.
.41-.69
Participants didn’t understand the
questions.
.4 and Below
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14. Regression Results
Independent
Variables
Significance of
Independent
Variables
Explanation of Data:
Customer Service 0.130 Customer Service collected has no relationship with Customer Satisfaction.
Store Environment 0.000 Store environment has a very strong relationship with Customer Satisfaction.
Loyalty Programs 0.002 Loyalty Programs holds a strong relationship with Customer Satisfaction.
Dependent Variables Significance of
Dependent
Variables
Explanation of Data:
Customer
Satisfaction
0.000 Customer Satisfaction holds a very strong relationship with Customer Retention.
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15. Discussion
● Customer Service and Customer Satisfaction.
● Store Environment and Customer Satisfaction.
● Survey demographics.
● Prior to research, we all thought CLP’s worked.
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16. Conclusion
● Customer Loyalty Program
implementation.
● Regression Results and Relationship
Limitations:
● Sampling Size (100)
● Sampling Error
● Survey Participant Inaccuracy
● Largely Male and Caucasian
● Possible Group Bias
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17. Questions?
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