Loyalty Program Avoidance

Abstract: Loyalty programs have become an important element of the modern company and its existence can be noticed in every kind of businesses. The aim with loyalty programs is to win customers loyalty in order to keep them away from the competitors. However, there are some issues existing in creating and maintaining long-term relationships, for instance when consumers choose to decline participation in loyalty programs. A qualitative research method with an inductive approach has been used, by using the interview method CIT to collect the empirical data. 82 open-ended interviews were made with respondents from Sweden and Hungary in order to identify possible differences in loyalty program avoidance between the two countries. Based on the answers, a model with factors that indicates loyalty program avoidance was created, which represent the foundation of the literature review. The result of the study has shown that both similarities and dissimilarities between the nationalities exist, where the major difference is preference of convenience and personal issues. The study indicates that the Swedish consumers tend to reject loyalty program offers for the convenience reasons, in terms of store distance and bad service, while the Hungarian consumers are more concerned about their personal integrity, such as trust and privacy. However, similarities that could be clearly observed were issues with commitment, gaining benefits and struggling with time pressure.