Cash-back Websites : An empirical study of factors influencing customer loyalty

University essay from Uppsala universitet/Företagsekonomiska institutionen; Uppsala universitet/Företagsekonomiska institutionen

Abstract:

Customer loyalty is an important issue for the success and sustainability of an online business. Moreover, the concept of affiliate marketing online business has become well-known among online shoppers in the past several years. Nevertheless, there is little research investigating customer loyalty towards affiliate marketing websites, especially in China, where this kind of websites are known as ‘cash-back website’. Therefore, this research investigates customer loyalty towards cash-back websites (51fanli.com as the leading cash-back website) in the China market. Based on previous studies and interview, this research applies six factors (cash-back promotion, price comparison service, WOM in social community, quality web design, privacy and security, trust) as core and supplementary services which influence customer perspective in loyalty. This study aims to find out which factors in cash-back websites can influence customer loyalty in the China online market. In this research, questionnaires are sent to cash-back website users to collect quantitative data. A statistical analysis is used to verify the nine hypotheses to analyze the collected data. The result points to five factors in both core and supplementary services that support customer perspective towards loyalty, while only ‘WOM in social community’ has no correlation with Chinese customer perspective towards loyalty. After comparing the results of the two groups of customers, those used 51fanli.com and those who did not use 51fanli.com, the research discover that customers who used 51fanli.com have stronger opinions on ‘privacy and security’ factor. Customer perceived value has significant positive relations to customer satisfaction that may influence customer loyalty. Furthermore, managing the loyalty programme in order to maintain high switching cost is only applicable to customers who have high satisfaction towards the website. Finally, some managerial implications suggested cash-back websites to adapt unique strategies to gain more customers and cautiously use switching cost. Maintaining a good reputation on privacy and security is another key success factor of cash-back websites in China market.

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