Technique of sampling Sample Population Sample Frame Sample unit Sample Size

Data Collection

• • Primary Data Secondary Data

Fig 1.1

DATA COLLECTIO :

PRIMARY SOURCE: The method of data collection is done by the way of survey; this is

a process where by first hand information is collected. This method is needed for meeting the
specific objective of research study. I have collected primary data in the form of filled structured
questionnaire by customers. In first questionnaire I collect whole data about customer’s feedback
about LOYALTY CARD. In second I collect all the data regarding to comparative analysis.

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SECONDARY SOURCE: The secondary data was collected in the form of company

profile and product profile from the Web Site of PANTALOONS. Some other Web Sites were also
referred. For collecting the required data the CSA’S of the mall were also consulted. The data has
helped in ascertaining the strategies and approaches of major players in market. Thus the study
involved collection, analysis and interpretation of a lot of data relating to this sector. The data is
collected from various sites, books, journals, etc. SAMPLE DESCRIPTION: After deciding on the
research approach and instruments, the marketing research must design the sampling plan: 1.
SAMPLI G SIZE: The target for this the customers who come for shopping inside the

mall. Sample size of the study is 200 customer’s who come for shopping inside the mall. 2. SAMPLE
SELECTIO PROCEDURE: Since it is the survey of customer, to obtain an

unbiased result the customers sample from the population were interviewed randomly. So the
sampling technique chosen for the research is Random sample technique. Every customer inside the
mall had an equal chance of being interviewed. 3. SAMPLE U IT: The customer who come for
shopping inside the mall is the sample unit.

4. CO TACT METHOD: Personal approach to each and every customer for all surveys and interviews
were the Contact method used for obtaining a proper and detailed feedback. A face-toface
Interaction took place with each sample representative. The data collected through questionnaire
was properly classified and tabulated in the form of a report. These reports formed the basis for the
comparative analysis and drawing inferences there from. From the inferences drawn certain
conclusions and recommendations were made. 5. FIELD WORK: The fieldwork was conducted for a
period of 15 days for both the research. Interviews were conducted inside the mall by face – face
interviewing. Institute Of Business Studies & Research Pune (Satish P.Goyal) Page 14
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2.1 REVIEW OF CO CEPT A D THEORIES:

FIRSTLY WE DISCUSS ABOUT WHAT IS CUSTOMER LOYALTY?

SHETH & MITTAL have defined customer loyalty as “ a customer’s commitment to a brand , store or
supplier based on a strong favourable attitude & manifested in consistent re-patronage .”

Fig 2.1 Strong Behavior weak

Strong

ATTITUDE

Weak

The above given definition of customer loyalty includes both behavior & attitude, which can result in
four possible situations as shown in above fig. When both attitude & behavior are weak , it means no
loyalty exists , weak attitude indicates the customer may not have any liking for the brand & the
store. While weak behavior means that the purchase of the brand or visiting the store is sporadic.
When the attitude & behavior are strong , it means that the customer has a strong brand or store
loyalty. The remaining two situation cases are interesting. When behavior is high but attitude is low,
it can be said that the customer has spurious loyalty, i.e the customer may buy the same brand again
& again or shop at same store regularly but may not have Institute Of Business Studies & Research
Pune (Satish P.Goyal) Page 16
a preferential attitude towards it. Very often in such instance the choice of the brand or store may
due to convenient location or the customer loyalty is incidental & not yet well founded, he or she
may easily switch brands change stores if given more choice or interesting price deals. Thus the
retailers or marketers would have to make efforts at strengthening the customer’s perception of the
brand’s or store’s image. In the quadrant with strong attitude & weak behavior, the customer can be
said to be having latent loyalty. The customer likes the brand or store but is unable to buy or visit the
same probably because the price is too high or he or she lacks accessibility to the brand or the store.
Thus in such instances , the retailers or marketers needs to reduce whatsoever barriers & tap the
hidden potential of the market. Retailers are beginning to focus their attention on encouraging
customers to visit outlets, treating them to attractive promotions, thus adding more value to their
best customers & satisfying them in the process. For to the retailers, customer loyalty will indicate
that customer are committed to purchasing merchandise & services from them & will resist the
activities of competitors attempting to attract their patronage.

The term customer loyalty is used to describe the behavior of repeat customers, as well as those
that offer good ratings, reviews, or testimonials. Some customers do a particular company a great
service by offering favorable word of mouth publicity regarding a product, telling friends and family,
thus adding them to the number of loyal customers. However, customer loyalty includes much
more. It is a process, a program, or a group of programs geared toward keeping a client happy so he
or she will provide more business. Customer loyalty can be achieved in some cases by offering a
quality product with a firm guarantee. Customer loyalty is also achieved through free offers,
coupons, low interest rates on financing, high value trade-ins, extended warranties, rebates, and
other rewards and incentive programs. The ultimate goal of customer loyalty programs is happy
customers who will return to purchase again and persuade

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others to use that company's products or services. This equates to profitability, as well as happy
stakeholders. Customer loyalty may be a one-time program or incentive, or an ongoing group of
programs to entice consumers. Buy-one-get-one-free programs are very popular, as are purchases
that come with rebates or free gifts. Another good incentive for achieving customer loyalty is
offering a risk free trial period for a product or service. Also known as brand name loyalty, these
types of incentives are meant to ensure that customers will return, not only to buy the same product
again and again, but also to try other products or services offered by the company. Excellent
customer service is another key element in gaining customer loyalty. If a client has a problem, the
company should do whatever it takes to make things right. If a product is faulty, it should be
replaced or the customer's money should be refunded. This should be standard procedure for any
reputable business, but those who wish to develop customer loyalty on a large-scale basis may also
go above and beyond the standard. They may offer even more by way of free gifts or discounts to
appease the customer. Some of the common bases for attracting customers are having dedicated
employees, variety, unique merchandise & superior customer service. But the challenge for the
retailer is to have a loyal database of customer, who will be unwilling to switch their loyalty. The
strategies are built after: 1. Developing a clear & specific positioning strategies. 2. Making customer
develop an emotional attachment with the retailer’s product offerings.

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Ten Tips to Build Customer Loyalty

The key to a successful business is a steady customer base. After all, successful businesses typically
see 80 percent of their business come from 20 percent of their customers. Too many businesses
neglect this loyal customer base in pursuit of new customers. However, since the cost to attract new
customers is significantly more than to maintain your relationship with existing ones, your efforts
toward building customer loyalty will certainly payoff. Here are ten ways to build customer loyalty:

1.

Communicate. Whether it is an email newsletter, monthly flier, a reminder card for a tune up, or a
holiday greeting card, reach out to your steady customers.

2.

Customer Service. Go the extra distance and meet customer needs. Train the staff to do the same.
Customers remember being treated well.

3.

Employee Loyalty. Loyalty works from the top down. If you are loyal to your employees, they will
feel positively about their jobs and pass that loyalty along to your customers.

4.

Employee Training. Train employees in the manner that you want them to interact with customers.
Empower employees to make decisions that benefit the customer.

5.
Customer Incentives. Give customers a reason to return to your business. For instance, because
children outgrow shoes quickly, the owner of a children?s shoe store might offer a card that makes
the tenth pair of shoes half price. Likewise, a dentist may give a free cleaning to anyone who has
seen him regularly for five years.

6.

Product Awareness. Know what your steady patrons purchase and keep these items in stock. Add
other products and/or services that accompany or compliment the products that your regular
customers buy regularly. And make sure that your staff understands everything they can about your
products. Read Know Product Basics for more.

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7.

Reliability. If you say a purchase will arrive on Wednesday, deliver it on Wednesday. Be reliable. If
something goes wrong, let customers know immediately and compensate them for their
inconvenience.

8.

Be Flexible. Try to solve customer problems or complaints to the best of your ability. Excuses ? such
as "That's our policy" ? will lose more customers then setting the store on fire. Read our 60Second
Guide to Managing Upset Customers for more information.

9.

People over Technology. The harder it is for a customer to speak to a human being when he or she
has a problem, the less likely it is that you will see that customer again.

10.

Know Their ames. Remember the theme song to the television show Cheers? Get to know the names
of regular customers or at least recognize their faces.

Building loyalty through advocating certain essential factors:

Customers are constantly changing & their expectations also rising. Consumer behavior in the
organised retail industry has altered drastically in the last few years. The retail market is growing not
only in terms of nos. but also in terms of stature, image & class. Alongside with Indians becoming
world class service. So it becomes vital for retailers to pay attention to every little detail in order to
be successful. This can be done by providing a good brand & store experience. For this in general the
retailer will have to look into various aspects such as: Timing of the store In store design & layout
Welcome the customer receives The ability to browse easily The behavior & product knowledge
possessed by sales persons The facility for making payments The attractiveness of the loyalty
programs The packaging & The exit. All these above aspects are really very important for the
customer to experience delightful shopping experience in the mall. If not handled well, it could
result in a disgruntled consumer , who will spread a bad word-of-mouth. On the contrary, if the
overall brand & store experience is Institute Of Business Studies & Research Pune (Satish P.Goyal)
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positive & pleasant , the retailer may gain a flow of customer who would likely to patronize the
outlet again & again. Further it is also likely that the popularity of the store increases through word
of mouth.

How to improve CUSTOMER LOYALTY in organization?

Strong customer service is the bedrock for creating loyal customers. Make it a priority by properly
training your staff and continually reinforcing the message that the customer comes first. You can
also let your customers know that you value their business by reaching out to them through
newsletters, postcards, and e-mail, so they're aware of seasonal sales and special products. Install a
strategy for responding to customer inquiries and complaints and create a fair, flexible return policy.
Finally, once you've developed a rapport with loyal customers, you can reward them with special
discounts on products or services. Loyalties schemes are different for different organizations.
Basically loyalty schemes are there for the existing customers or for coming customers for their
benefits.

In the study carried out by A .C. IELSO

company of BRITISH super market shoppers on the

basis of their attitude towards price & promotions, five groups of customers were identified:

BRA DED EVERY DAY LOW PRICI G (ELDP) SEEKERS (19%) : These customers were strapped for cash
due to limited income, so they shop around to get the best price on their favorite brands, generally
seeking ELDP instead of promotions which may require them to alter their buying patterns i.e. they
go for bulk purchases. Such customers are low on store loyalty but high on brand loyalty.

LOW- PRICE FIXTURES FERRETS (23%): These customers are young families with strained financial
expenses due to growing expenses due to growing expenses like mortgage Institute Of Business
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etc. they are very budget conscious ,though dislike bulk purchases, they seek price deals & use
coupons .They respond well to store loyalty schemes but tend to switch brands although they may
spend a lot on store brands.

PROMOTIO

JU KIES(18.4%): These customers will do anything to get the lowest

shopping bill – they find a thrill in finding bargain sale & take pride in telling others where such sales
take place. They may switch between rational & store brands, having loyalty neither for the brands.
Thus retailers & marketers will not earn any long-term gain from such customers. STOCKPILERS
(21%): These customers are affluent & are unconcerned about the size of their bill. They select
stores based on the location , product assortment. & product quality rather than price or
promotions. They may take advantage of the promotions on their favorite brands, happily buying in
bulk to stockpile & save money, although they may not switch brands. They can easily be the
retailers delight since they may be loyal to both brands & stores. PROMOTIO ALLY OBLIVIOUS
(18.3%): This group is basically driven by habit, settled on brands & stores & not interested in
exploring better deals. They may occasionally indulge in soft deals such as free items or coupons but
dislike aggressive promotions & deals. So they reliable to a certain extent.

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FACTORS ESSE TIAL FOR BUILDI G STORE LOYALTY

A. Make shopping a delightful experience. E E. customer complaint handling & +ve attitude S S E N T
I A L S F. build customer loyalty through adopting multi channel retailing. F O R C. understand
customer needs & provide a mutually beneficial customer service. B U I L D I N G L O Y A L T Y

B. offer spice of variety under a single roof.

G. adopt innovative or unique concept to please the customer.

D. provide physical appeal Leading to store brand loyalty

Fig 2.2 FACTOR FOR BUILDING LOYALTY

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THIS IS ALL ABOUT THE CUSTOMER LOYALTY IN RETAIL SECTOR.

In CE TRAL for loyalty scheme there is a card named “FUTURE CARD”. This card we called it as a
credit card which is powered by ICICI CREDIT card. The customer can collect it from any ICICI bank
branch or from any PANTALOON’S outlets. Its available all over. This future card can be applicable in
any store or mall comes under FUTURE GROUP. Anyone whose monthly income is above min.5000
can be a part of this loyalty card.

Aaj se

Kharchey

ban gaye

kamai !

This is the slogan of the future card. Apart from this CENTRAL’s goes with various loyalty services
such as FREE redeem of parking coupons, free alteration to all customers, sometimes free home
delivery to customers etc. this is the loyalty scheme run by CENTRAL.

The main benefit beyond this future card is you can use this card in various outlets run by FUTURE
GROUP! Apart from this as we talk about other player in retail sector SHOPPERS having FIRST
CITIZEN card. INDIA BULL MEGA STORE having PPC(pyramid power club) which goes with loyalty
card.

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Before FUTURE CARD there were CENTRAL CARD which is only applicable for CENTRAL’S purpose. It
is a loyalty card for CENTRAL’S customers. Following are some details about CENTRAL’s card.
Exclusive Benefits

•••

Get 0% EMI option for purchases more than Rs. 3,000/- at Central. Get free gift voucher of Central
worth Rs. 250/- with the offer booklet. Earn 4 reward points for every Rs.100/- spent at Central. Also
earn 1 reward point for every Rs. 200/- spent at merchant establishments other than Central.

•••

Priority Payment Counters at Central for cardholder to save valuable time. Cardholder gets priority
to view the product launches and seasonal collections at Central. Upto 10% discount to all
cardholders restaurants within Central, on bills of Rs. 250/- and above.

••

Get 12 free coffee vouchers on approval of card. The Cardholder will get access to select airport
lounges across the country with complimentary snacks and non-alcoholic beverages.

All the benefits of Solid Gold Card.

These were all the benefits provides by CENTRAL’S card.

After that PANTALOONS introduces FUTURE CARD for all its stores. Future card is powered by ICICI
BANK (CREDIT CARDS). Future card is like a retail credit card. Lots of offers & gifts are there on the
FUTURE CARD.
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BRA DS BIG BAZAAR

GIFTS & OFFERS 1st 3 months 15% off on fashion 1st 3 months 10% off on general Merchandize. 1
KG Food bazaar sugar free 1st 3 months 3% off on foods. Rs.100 off on apparel purchase of Rs. 500
or get a T-shirt worth Rs. 299 on apparel purchase of Rs. 1000 Rs. 50 off on Rs.1000 & above
purchase. For 1st 3 months Rs. 250 off on Rs. 2500 & above purchase.

FOOD BAZAAR

Pantaloons

Central

BRAND FACTORY purchase.

Rs. 50 off on Rs. 1000 & above For 1st 3 months Rs. 250 off on Rs.2500 & above purchase.

DEPOT Shoe Mport/genm Planet sports

F123/CO TOP 10 Home Town

STAR & SITARA eZONE Futurebazaar.com

Bombay blue COPPER CHIMNEY YATRA

Rs .50 book free from exclusive depot collection per month. Shoe polish/socks FREE on Rs. 100 per
month. Airtel live VAS cards ( worth Rs. 500 content FREE) Rs. 249 Spalding/Converse cap FREE on
purchase of Rs.111 & above per month. 1 video game FREE per month with load of min. Rs. 50 Rs.
200 off on Rs. 1000 & above purchase. Gift worth Rs.250 for every Rs. 1000 & above spent per
month. Get gift worth 7.5% of purchase above Rs. 10,000 at HOME TOWN. 1 time foot massage FREE
per month. A head phone worth Rs. 199 with purchase through FUTURE CARD at eZONE. A Future
card & futurebazaar.com MUG worth Rs.50 on 1st purchase every month. 10%-15% off on total bill
amount. 10%-15% off on total bill amount 10%-15% off on total bill amount

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PENNE SPAGHETTI The Apollo Clinic

10%-15% off on total bill amount 10%-15% off on total bill amount For 1st 3 months 50% discount
on a range of special FUTURE CARD & Apollo health checkups. 15% off on health check up. 20% off
on diagnostics checkups. Get 2.5% surcharge waiver on fuel purchases at select HPCL outlets. 10%
discount for Future card holders on all Lilliput apparels & accessories. 15% discount on all Lilliput
footwear. Inaugural offer: 1 face / body firming session plus counseling worth Rs. 2000 FREE. Regular
offer: slimming/beauty/hair package 30% flat discount. Regular offer: beauty services -30% flat
discount. Regular offer: 15% off on RBS(salon services) 15% off on Domestic packages 10% off on
Weekend breaks. 12.5% off on INTERNATIONAL packages.

HP Lilliput

VLCC

Travel Port

Table 2.1 list of brands in FUTURE CARD

These are all details about FUTURE CARD. These are all offers which are provided by FUTURE CARD.
This is first time in INDIA that any company providing such type of LOYALTY CARD which any 1 can
use in number of brands. This type of card really change the mind of customer towards the LOYALTY.

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2.2 REVIEW OF PREVIOUS RESEARCH & FI DI G

FOLLOWING RESEARCH HAS BEEN DONE BY :

Grahame R. Dowling Australian Graduate School of Management University of New South Wales &
Mark Uncles School of Marketing University of New South Wales Sydney 2052 Australia. Abstract

In a bid to strengthen relationships with their customers marketers are showing renewed interest in
customer loyalty programs. But how effective are these programs? Surprisingly—given their current
popularity—the evidence is equivocal. Research on “normal” patterns of loyalty in established
competitive markets suggests that in many cases it is hard to obtain exceptional advantages through
the launch of a loyalty program. Also, competitive forces tend quickly to erode any differential gains.
Before introducing a loyalty program, managers would be wise to fully cost it (including
development, marketing and on-going costs), and compare these costs with a realistic assessment of
the benefits of the program—an assessment that goes beyond the rhetoric of relationship
marketing. Here we argue that to stand the best chance of success under tough market conditions, a
loyalty program must enhance the overall value-proposition of the product or service. This in turn
will help to motivate buyers to make the next purchase of a product, and therefore support other
aspects of the firm’s offensive and defensive marketing strategy.

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The Claimed Benefits of Loyalty Programs Advocates contend that loyalty programs are more
profitable to a firm because: (a) The costs of serving customers are less, (b) Loyal customers are less
price sensitive, (c) They spend more with the company, and (d) They pass on positive
recommendations about their favorite brands/suppliers.

J. . SHETH & B. MITTAL IN “CUSTOMER BEHAVIOUR” Thomson South Western learning,2003 give
definition of CUSTOMER LOYALTY as given below: SHETH & MITTAL have defined customer loyalty as
“ a customer’s commitment to a brand , store or supplier based on a strong favourable attitude &
manifested in consistent re-patronage .” REY OLDS,DARDE & MARTI , 1975 come with the new study
that “a sample of older , lower income group & less educated women were willing to shop in the
same store & avoid the risk of shopping in the new stores.” ARIEH GOLDMA ,(1977-78) in his study
said that, “store loyal consumer to be engaged in less repurchase search , know about fewer stores
& less likely to shop even in stores known to them.” He also found that “the shopping behavior or
style to more likely exist among low income consumers because they were constrained by their
inability to shop much.” J.F. DASH , L.G. SCHIFFMA & CO RAD BERE SO , 1976 they came with the

study that “store loyal consumers found more risk in shopping & hence felt being store loyal would
reduce the risk of shopping in unknown stores.” YA KELOVICH , SKELLY AD WHITE , 1982 they found
that “more no. of single parent household also limited the amount of time available for shopping &
the additional cost of being store loyal was worth the time saved.”

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Rosalind McMullan, Audrey Gilmore Abstract:

Purpose – The purpose of this paper is to focus on establishing individuals' levels of loyalty and what
sustains and develops their customer loyalty. This paper recognizes the importance customer loyalty
has for many competitive organizations and industries. However there has been less focus on what
value customer’s attach to customer loyalty in this context. Design/methodology/approach – A two-
stage study is presented, establishing individual levels of loyalty and then identifying the role of
mediating effects in loyalty development. The first stage involved a postal survey, including a 28-
item scale, designed to measure customer loyalty, and its sustainers and vulnerabilities (mediating
effects). The second stage, and the main focus of this paper, uses scores from the loyalty scale (high,
medium and low levels of loyalty) to examine what sustains and develops loyalty amongst differing
levels of development. Findings – The findings highlight the importance of identifying, understanding
and managing mediating effects, in the context of loyalty development. The research emphasizes
the importance of a differentiated approach to developing and managing customer loyalty by
appropriately rewarding customers at different levels. The findings highlight the need to
acknowledge the importance of reciprocity in terms of which aspects of service customers value.
Originality/value – The main contribution of this paper is that it uniquely identifies an approach to
understanding the sustaining and vulnerability effects mediating customer loyalty development
going beyond previous categorization attempts. Understanding this approach should lead to
effective customer loyalty management and greater awareness of managing recognition, reciprocity
and rewards.

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About Future Group

Future Group is one of the country’s leading business groups present in retail, asset management,
consumer finance, insurance, retail media, retail spaces and logistics. The group’s flagship company,
Pantaloon Retail (India) Limited operates over 6 million square feet through 450 stores in 45 cities.
Some of its leading retail formats include, Pantaloons, Big Bazaar, Central, Food Bazaar, Home Town,
eZone, Depot, Future Money and online retail format, futurebazaar.com. Future Group companies
includes, Future Capital Holdings, Future Generali India, Indus League Clothing and Galaxy
Entertainment that manages Sports Bar, Brew Bar and Bowling Co. Future Capital Holdings, the
group’s financial arm, focuses on asset management and consumer credit. It manages assets worth
over $1 billion that are being invested in developing retail real estate and consumer-related brands
and hotels. The group’s joint venture partners include Italian insurance major, Generali, French
retailer ETAM group, US-based stationary products retailer Staples Inc, UK-based Lee Cooper and
Indiabased Talwalkar’s, Blue Foods and Liberty Shoes. Future Group’s vision is to, “Deliver
Everything, Everywhere, Every time to Every Indian Consumer in the most profitable manner.” The
group considers ‘Indian-ness’ as a core value and its corporate credo is - Rewrite rules, Retain values.

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Pantaloon Retail (India) Limited

Pantaloon Retail (India) Limited, is India’s leading retailer that operates multiple