A differentiated approach to the formation of customer loyalty in the enterprises of sphere of service

UDC 33.338
Publication date: 18.03.2017
International Journal of Professional Science № 3-2017

A differentiated approach to the formation of customer loyalty in the enterprises of sphere of service

Dudkina Olga Vladimirovna
candidate of sociological Sciences
associate Professor of "Service, tourism and hospitality industry"
Of the "Donskoy State Technical University" (DSTU)
Abstract: The notion of loyalty is the basis of long-term relationships with actual and potential consumers of goods or services. True customer loyalty is revealed when the two components of loyalty - emotional and rational - are in balance and meet his preferences.
Keywords: customer loyalty, staff loyalty, loyalty program, marketing communications

  1. Introduction

True loyalty is the commitment of customer to a particular company, approval of methods, goals, resources and policy activities, both in relation to the client and to the whole environment of business – internal and external. Therefore, all these components should be as open as possible to any client. And every service personnel must be sincere carrier of ideas of the company in which he works [1].

Loyalty is the preference of a man of a certain brand, product, place, the seller that makes buying, sometimes even sacrificing something. If the customer buys just because it is convenient, profitable, need, is there loyalty or not — is still not clear.

  1. Results and Discussion

If the client buys again — it is also not proof of loyalty: it can be, simply had no other choice. Repeated and deliberate purchase under the influence of a sense of preference, where the client makes sacrifices, is a demonstration of true loyalty.

For example, the client goes through the city in the same gym, although near the house there is another, similar like a twin brother. How did this preference, this true loyalty?  It is not known. It may well be that it was the result of deliberate actions of management and employees of the fitness center.

These purposeful actions, which are very likely cause a feeling of attachment among the target audience, are the loyalty program.

A common way of attracting customers is the use of low prices and discounts [2]. But in a psychological sense, such programs do not adequately call loyal. If the seller of goods or services makes a discount, then, most likely, the price was originally too high. Therefore, to build a loyalty program only on discounts is a wrong strategy.

A loyal customer is a client who wants to buy a product or order a service only from a particular seller. But this should not mean that he does so because the firm’s product or service is cheaper. Always on the market, there may be a competitor who will offer more favorable price. In this case, the customer will go to another dealer. Our only option is to help the client in solving his problems. When a person has some need, he turns to a specific company for help. This company efficiently, quickly and at an affordable price provides this product or service. A satisfied customer will always return here again and will recommend   this company not only because it has low price, but because it is advantageous and convenient in all respects.

All existing loyalty programs, which are currently implemented by companies, based on an appeal to the prudence of customers. But we should not forget that companies do not always beneficial to support this loyalty. Once launched the customer loyalty program may not be removed from the practice because it will greatly affect the reputation of the organization. So before you launch into action any of the programs, you must predict the consequences of its development in practice and to calculate whether will be advantageous from the point of view of profitability it is these methods of attracting customers.

In other words, loyalty is the positive attitude of the customer to the company, its brand, to all activities, to the promoted product, company personnel and many other aspects. Generally, customer loyalty is determined by the duration of use of the client services company, not leaving to competitors [4].

Speaking about what is customer loyalty, it is worth noting the key importance of a positive user experience. If the person with the product or service had a positive experience with the company, the likelihood that he will return here again, is quite high.

A number of studies have shown that people, who are satisfied with the purchase of a product or service, with a considerable degree of probability will have a positive attitude to other suggestions of the same brand, the same organization [5]. Moreover, the inclusion of the audience in a special exclusive loyalty program, the presence of which allows to work with the company on privileged terms, significantly strengthens the commitment to the already valuable users.

It is not necessary to perceive commodity-money aspect as the only way to leave a favorable impression on the client. You should know that in the market there are many companies providing services similar to your and often at a better price. However, it is important for clients not only this. If the company’s image, mission, its public activity or relationship to their work coincides with the perception of the user, if you can create an emotional attachment toward the brand, consumers will agree to pay a little more just to support you, or to feel connected to your business.

An example is the huge interest in the first day of sales of the new line of i-phone with updated and not in the direction of reducing prices. Consumers seeking to buy the latest gadget release, do not expect benefits.

Proof of the necessity of stimulating and logical building of loyalty is:

— 20% of the client base of the organization brings 80% of earnings (the well-known principle of Pareto);

— a satisfied customer talks about his experience on the average three friends, and unsatisfied — says negative ten;

— the money spent on strengthening the loyalty of one customer will be repaid within a year;

— if the company considers that it is expensive, then they should know that the cost of attracting a new customer, as a rule, five times higher than on its retention;

— the growing number of satisfied customers by 5% can increase the company’s revenues by 50% [6].

From the foregoing it follows that the loyalty of existing and potential customers is one of the most important factors in the development of the company.

The question is — do they always need to stimulate consumers? The answer is quite unexpected — no. And even, in some cases, this may lead to the opposite effect — the loss of the client.

Client is better to leave alone in some cases.

First. A situation which can be called “buttery butter”. The client constantly uses the services of specific service organizations; the level of consumption close to the maximum, there is no signs of decreasing of his loyalty to the company. In this situation, you should not fill customer different stimulating promotions. The optimal strategy in this case will be a moderate promotion of the current models of customer behavior. The company needs to thank this customer in the case (key word — «in the case»). As an incentive or appreciation it is better I use pleasant surprises, not exposing any of the conditions to obtain them.

Second. The situation — «retaliation». The client may get angry if he offered to use the bonuses (to join the loyalty program) after he had an unpleasant incident with the service of this organization. In this case, before stimulating  the client should repay the dissatisfaction with the company (product, service), otherwise, the best deals can only exacerbate a negative reaction. In such a situation the company better to apologize and to charge the offended customer additional bonuses as compensation.

Third. The situation under the conditional name «bad foods customer». There are two types of motivation. The first is based on the internal needs of a person, let’s call it «emotional». The second, which is stimulated through rewards, or «rational». The use of rational motivation can neutralize emotional motivation. An example of this approach can be seen in companies that use financial prizes for the “likes” in social networks or subscribe to the company’s website. This stimulation leads to the fact that customers no longer «like» posts free of charge, and their expectations of rewards, each time only growing.

There is no and cannot be a single recipe for successful management of customer loyalty. How many companies, so many recipes. Moreover, indeed  – how many clients – so many should be recipes loyalty. The only thing that can save the raging imagination of the managers – a common algorithms of actions.

High level of emotional involvement of the client into a particular company does not guarantee regular purchases (visits), but this is the ultimate goal of service organizations. For example, a woman dreams of visiting an expensive salon, however, she uses the services of the budget salon due to financial constraints.

At the same time, the presence of regular visits (purchases) does not guarantee loyalty. Sometimes the customer uses the services (brand) because of the presents of some limits at the moment,  life circumstances or, for example, the lack of alternatives. As soon as competitors will offer him the best conditions, the client will reconsider their preferences and move on to another seller (service provider).

This may mean that the emotional and rational components of loyalty as the unity and struggle of opposites are the basis of long-term relationships with customers. The customer is truly loyal, when both components of loyalty are in balance and meet his preferences. A service organization must not only meet customer needs but to give him positive emotions, engaging in the process of creating additional value – trust.

There is another important aspect which cannot be avoided, which is noted in a number of studies suggests that in the basis of fast and stable development of the organization of sphere of service is the loyalty of the staff. Because the team, component of a company is the basis of everything. However, many managers mistakenly believe that the loyalty is the ordinary trustworthiness — that is, formal adherence to internal rules and regulations. Some people include here also common courtesy of the staff. One must not confuse these concepts. Moreover, the loyalty of the employees of the organization in sphere of service should be the goal of any Manager, because this factor can significantly increase productivity, improve the atmosphere in the team and bring many other benefits [6].

How to achieve employee loyalty of the organization? Loyalty of the company — not a formal quality of a person. It means a deep trust and respect, pride in their company. In the ideal case, if the company’s mission and its main objectives coincide with the plans of a particular employee on their own future, and resonate with his views on the world as a whole, such loyalty is true and unbreakable. It is worth remembering that the basis of any relationship is trust. As it turned out, not important — a good social package and new furniture in the office, but simple human trust to his neighbor.

That’s why, for example, if you don’t believe that your employees are able to work efficiently, having access to social networks, and therefore blocking them, then you need to change something. And not necessarily change the employees or staff selection, or maybe just their attitude towards them. In other matters, all cases are unique and much depends on the business and the leader himself.

Employees should be aware of the purpose of the company split, and informal welcome. Therefore, the important place takes the brand strategy of the organization. You should remind about it employees quite often. Should allow employees to Express their opinions, influence what is happening within the company and really grow your career. An organization where its members have no voting rights and prospects, is turning into a quagmire, where the natural solution is either to escape or to adapt to the musty swamp environment — sit quietly in your seat, sipping coffee and creating only the visibility of the work [8].

What is loyalty in the organization in sphere of service really can only be understood after a long activity in the study of this process. Opportunities should be provided for employees to feel respected by their leaders. It is necessary to encourage initiatives of colleagues, to strengthen corporate culture for a long time. And only after that will form a real team of loyal professionals.

  1. Results and Discussion

Thus, loyalty is, first and foremost, a marketing communications tool that allows you to create a company image, attract new clients and partners, worthy to fight with rivals, achieve higher levels of sales, to generate new markets. The range of use of methods of loyalty are diverse and extensive. Design and development of loyalty programs – a promising direction, which allows to increase the competitiveness of service organizations in the market, ultimately to increase the company’s profit and lead to new horizons of development.


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