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Electronic Loyalty Vs. In Store Customer Loyalty

1580 words - 7 pages

E-Loyalty v Traditional In-Store Customer Loyalty: Has the maturity of online retailing influenced customer loyalty online in favour of offline retailing?

Literature Review
Natalie Stewart


Introduction
The purpose of this literature review is to explore the current literature based on customer loyalty towards online stores, also known as ‘e-loyalty’, in comparison to the traditional in-store ‘offline’ method. Relevant literature will be evaluated and concluded based on whether online retailers have taken over the traditional shopping method and consumer’s loyalty is now referred to as e-loyalty, based on the favour of online shopping. This literature will look at secondary research ...view middle of the document...

This can be based on numerous qualities and experiences which influence repetitive buying behaviour. There are many reasons why customer loyalty is important, including effective forecasting for the retailer when based on regular customers. Figure 1 shows the positive economic effects of customer loyalty online produced by Schrodter (2003) (Heinemann et al., 2010).


E-Loyalty Definition
Schefter and Reichheld (2000) define e-loyalty being all about quality customer support, on-time delivery, compelling product presentations, convenient and reasonably priced shipping and handling, and clear and trustworthy privacy policies (Shankar et al., 2001) while Srinivasan (2002) defines e-loyalty as a customer’s favorable attitude toward the e-retailer that results in repeat buying behaviour (Srinivasan et al., 2002).

Consumer Behaviour
Consumer behaviour can be defined as the behaviour that consumers display in searching for, purchasing, using, evaluating, and disposing of products and services that they expect will satisfy their needs (Schiffman et al., 2010). In order for retailers, both online and offline, to understand consumer buying behaviours, they first have to understand the typical behaviour of their customers. Kotler and Keller (2011) state that consumer buying behavior is the study of the ways of buying and disposing of goods, services, ideas or experiences by the individuals, groups and organizations in order to satisfy their needs and wants. Buyer behavior has been defined as “a process, which through inputs and their use though process and actions leads to satisfaction of needs and wants” (Enis, 1974, p.228). Kumar (2010) states consumer buying behavior “refers to the buying behavior of final consumers, both individuals and households, who buy goods and services for personal consumption” (Kumar, 2010, p.218).

Online Retailing and E-Loyalty
“Electronic commerce has been growing rapidly in recent years. Many businesses are turning towards the Internet to market their products” (Liao et al,. 2010).This virtual growth has opened up a wide range of opportunities for both the consumer and businesses, allowing online retailers to successfully gain a large consumer loyalty base. Wolfinbarger (2001) expresses that the number of consumers buying online and the amount being spent by online buyers has been on the rise, continuing to clarify that online sales have doubled (Wolfinbarger et al., 2001). “Customers attitudes towards the internet have changed significantly during the last two decades. In consumer markets, shoppers are becoming more attuned to buying online and digital technologies enable them to be well-informed when making purchasing decisions." (Chaffey et al, 2012, pg63) This indicates and highlights that more consumers are now comfortable and able to purchase goods online, with it being more convenient to buy goods online than visit a store as it fits in with the new consumer working lifestyle. Not only is online...

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