When the customer club looses in loyalty : a study of MQ’s customer club members failing loyalty

There is now a trend to move closer to the customer in the form of long-term and lastingrelationships. The market today is characterized by growing competition with new playersconstantly arising. In order to gain competitive advantage with the increasingly challengingmarket, companies require to place the customer in the centre. Being close to the customerand engage in successful efforts to create customer loyalty has become a critical successfactor in many businesses. Especially when the customers in today's market is becomingincreasingly unfaithful and continuously looking for new companies with new productofferings.Many companies have now also realized the importance of trying to retain existing customersas it is more profitable than constantly trying to acquire new ones. In times of highcompetition a loyalty programme can be used to create customer loyalty. A type of loyaltyprogramme is a customer club. By making use of customer clubs as loyalty programs, thecompany can achieve customer loyalty and differentiate their product offering. The motivebehind most customer clubs is to create purchase fidelity.Many fashion companies face the challenge of working with customer care in a way thatstrengthens the company's relationship with their customers. If a fashion company's customerclub is losing loyalty it may cause a serious problem for the company. The following problemis something that the clothing company MQ face today. We had therefore the task ofundertaking to examine the underlying causes of MQ's lack of customer loyalty amongmembers in the company’s customer club.The purpose of the paper was to examine and describe the important factors affecting thedeclining customer loyalty of MQ. By mapping and analyzing possible links between thevarious factors affecting the decrease in customer loyalty, we wanted to seek the underlyingcauses of the MQ's customer loss.In order to seek the underlying causes of the MQ's decreased customer loyalty a study on asample of the company downgraded gold- and silvermembers in the customer club wascarried out. The survey was carried out by telephone interviews in which a prestructuredquestionnaire served as input. We have also done interviews with key people in MQ.In our theoretic frame of references, we have used theories of Ralf Blomqvist et al. MagnusSöderlund, Philip Kotlas et al. and Stephan A. Butscher. We have also made use of twoscientific articles on the impact of loyalty programs.On collecting the empirical data we quickly realized that the customer club average age of 38years did not correspond well with MQ's target group of 20-40 years. The main reason forrespondents decreasing purchases of MQ in 2008 was that the range is not appealing to them.We also found that MQ had updated concept and audience in recent years and that it mayhave contributed to a vague picture of the company among its customers.In conclusion, we have found that it is primarily the older customers who are no longerattracted by MQ's range. Decreased interest in the company as a fashion supplier has led tocustomer members not visiting MQ's stores often. It has led to reduced sales and downgradedcustomers in the customer club. Most of the respondents in the survey felt that they are notinfluenced by its membership of MQ's customer club. They do not choose MQ over otherstores simply because of their membership in the company's customer club. Customer clubmembers value mostly the economic benefits of membership.Program: Textilekonomutbildninge