Behaviour Change

PROPAGANDA FOR CHANGE is a project created by the students of Behaviour Change (ps359) and Professor Thomas Hills @thomhills at the Psychology Department of the University of Warwick. This work was supported by funding from Warwick's Institute for Advanced Teaching and Learning.

Friday, March 15, 2013

Loyalty Cards

The vast majority of fast food restaurants, amongst other outlets, are offering 'rewards' to customers to entice them on continually going back to the restaurant. By doing this, customers readily go back and spend more and more money in these restaurants to build up enough 'loyalty points' until they can get something for free or discounted.
An example of this persuasive experience is in the above picture, whereby nandos have a progression of rewards based upon the number of visits you have made. Once you have made 3 visits you get a 'free 1/4 chicken'; 6 visits gets you a 'free 1/2 chicken'; and 10 visits gets you a mighty 'free whole chicken'. Although it says it is free, you still need to spend a minimum amount to be able to claim the reward.
Another example of this is the below loyalty card from Cafe Nero. For this one you need to buy 9 coffees to have a 10th one free.  
A study by Demoulin and Zidda (2008) looked at whether having a loyalty card effects a persons loyalty to that store/chain. 180 individuals were interviewed face-to-face about the loyalty cards they hold, the frequency with which they return to the store, and their satisfaction with the loyalty rewards (on a 5-point likert scale). Analysis of individuals responses showed that people that hold loyalty cards are more loyal to those stores than those who do not possess loyalty cards.
A possible explanation of this finding is that individuals are persuaded by the opportunity to receive something for free without doing anything they usually wouldn't. Thus, they carry out the required goal-directed behaviours (in this case continually revisitng a store/restaurant) to acheieve this reward.
Demoulin, N. T. M., & Zidda, P. (2008). On the impact of loyalty cards on store loyalty: Does the customers' satisfaction with the reward scheme matter? Journal of Retailing and Consumer Services, 15, 386-398.


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