The Interaction Between Customers’ Brand Perception and Loyalty Schemes: the Example of Tesco Clubcard in Uk

Individual Research Assignment

Title: The interaction between customers’ brand perception and loyalty schemes: the example of Tesco Clubcard in UK

Introduction:

This research mainly focuses on the relationship between customers’ perception of brand and the loyalty schemes through the analysis of Tesco clubcard.

More and more retailers and other service providers have introduced loyalty schemes over the past few years. Previous commentators have discussed loyalty schemes in terms of rewarding loyal customers, generating information, manipulating consumer behaviour through relationship marketing, and defending against competitive schemes (O’Malley, 1998; Mauri, 2003, pp. 13-14; Dick, and Basu,1994). However, limited attention has been given to the interaction of brand perception of customers and loyalty schemes (Crittenden, Divett, and Henderson, 2003; Rowley, J. (2005).

Tesco Clubcard has been chosen in this article for a number of reasons:

❖ Tesco has a reputation for being innovative in their use of information technology solutions (Rowley, 2003).

❖ Tesco is the UK’s largest retailer, with a very significant customer base. In addition many of those customers return at weekly or similar intervals. This means that Clubcard data and relationships are both deep and wide. Tesco collects consumption data on a significant proportion of the UK population, on a regular basis.

❖ Tesco Clubcard integrates customer interaction across both click and brick channels.

❖ Tesco Clubcard engages with a large number of corporate partners in relation to the earning and delivery of rewards.(Rowley, 2003)

In addition, as a Tesco clubcard owner, the researcher has impressed by how this retailer manage its brand through the loyalty schemes. As a result, the researcher particularly interested in digging out that the way in which the loyalty schemes affect people’s perception of the brand in general.

Aims:

The research aims to investigate whether the loyalty...