Loyalty Is To Make Consumers More Dependent On Suppliers

Essay by denom94 April 2014

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IB0 - 07A Skills Assignment 2 384382

Loyalty Is To Make Consumers More Dependent On Suppliers.

When we look at it, we see that companies' main goals are to create well-known brand and have a customer loyalty in a high way. In order to attract customers develop many exclusive marketing programs. There has been lots of argues about whether loyalty programs create interdependency between consumers and suppliers or not. Companies know that it is challenging for a customer to find a producer whom he or she trusts at the first time, at this point loyalty programs are the source for help. Since one of the goal of loyalty programs is to strengthen the bond between the consumer and the brand (Uncles, Dowling, & Hammond, 2003, p.4). Hence, from the producers' perspective loyalty means to make consumers more dependent on suppliers. Both for producer and consumer will gain benefit from these loyalty programs.

Consumers are the ones who purchase goods or services. Therefore they hold all the power, and producers must make some efforts to understand consumer, what they want, what they like or even what they need. Because producers know that, at the end consumers are going to make a choice from all the goods that has been offered to them, and producers want them to choose their product. The term 'loyalty program' captures a variety of marketing initiatives, including reward cards, gifts, tiered service levels, dedicated support contacts, and other methods that positively influence consumers' attitudes and behaviours toward the brand or firm (Henderson, Beck, & Palmatier, 2011). To analyse loyalty programs we can use discount cards as an example. Discount cards are widely used by majority since they offer lots of things to consumers and companies collect data via these cards. Particularly younger consumers acquiesce when it comes...