Customer loyalty in Business Essay Example | Topics and Well Written Essays - 1000 words

Customer loyalty in Business - Essay Example Customer loyalty is considered to be the propensity or inclination of the consumer to select a particular product or service, which meets his or her needs. In the business domain, customers are labeled as brand loyal as they are most likely to select a particular brand as compared to the alternatives available. Customer loyalty is the product of well structured, organized and planned programs, which concentrate on the retention of customers (East, Wright & Vanhuele, 2008, 45). Research suggests that customers, who become targets of customer loyalty programs, are most likely to remain loyal to a particular brand. For customer or brand loyalty, habit is considered to an important element. It is considered to be the main element, which can influence the overall progress and development of the organization. It is used by different organizations in order to retain existing customers and to win potential customers. As mentioned earlier, business is mainly dependent on it customers. Researc hers have identified five main types of customer loyalty, which are discussed below.Monopoly loyalty is considered to be that loyalty in which the choices of customers are restricted. It is rare and extreme case and the loyalty of the customer is away from loyalty and devotion. Research suggests that monopoly loyalty is considered to be resentful. From customer satisfactions surveys conducted, it was concluded that consumers were dissatisfied and discontented when their choices were restricted.(Reinchheld, 2006, 103). Cost of change loyalty In theory, each and every supplier is in competition with one another, which indicates that their customers may use substitutes. However, in actual practice, customers are most likely to remain loyal to their existing supplier because of difficulties they experience in switching suppliers. Turning to substitutes only takes place when the customers are dissatisfied with their existing product or service (Reinchheld, 2006, 105) . Incentivised Loyalty Incentivised loyalty is considered to be the result of excessive marketing to promote the product or service in the market. It might influence consumers, who are not using their own financial resources(Reinchheld, 2006, 109). Research suggests that majority of the people in United Kingdom are most likely to have more than one loyalty cards of different competing super markets, petrol stations or airlines. Loyalty points are considered to be discount tools, which would assist in meeting their needs and requirements that wider range. Habitual Loyalty Habitual loyalty is often termed as â€Å"everyday form of repeat business† (Reinchheld, 2006, 111). Time is considered to be an asset and therefore, several consumers resort to familiar habits and routines in order to achieve with maximum utilization of time. For instance, a weekly to the same superstore is conducted as it is convenient and habitual. Colleagues meet in the same restaurant for lunch(Reinchheld, 2006, 112). Consumers are most likely to visit the same petrol situation in order to save time. From this perspective,