It has been noted (JB Hi-Fi annual report, 2014) JB is facing still competition in the market and they are looking for some specific measures to increase sales in recession time. Liu (2007) has argued loyalty program increases the habit of repeated purchases in the customers. These loyalty programmes are more beneficial for customer and company in long term commitment. These loyalty programmes binds customer with a company for longer duration and it avoids customer retention also. Many companies introduce different promotional coupons; scratch cards etc. on single time purchase of their products but those coupons are only “one-shot deals” (Liu, 2007). Loyalty program is permanent solution of the problem.
Now-days every industry is facing the problem of customer switching to another product. The loyalty program can decrease the customer switching to great extent. When the proportion of loyal customers is high, the promotion of potential switchers affected by promotion programmes is low (Tsao et al, 2009). The industries try to attract the customers through different promotional campaigns and programmes.
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loyal, latent loyal, spurious loyal and no loyal (Chacon & Macon, 2011). The airline industry has seen some terrific advantage by introducing loyalty programmes in their services. These loyalty programmes has increased their sales and customer base. The clients like to travel with same airlines to get more advantage of these loyalty programmes. The customers are spending more time with the same brands and it decreases customer retention. In the survey they have found 73.5 % customers are more loyal towards the airline services and 22.3 % are latent loyal customers (Chacon & Macon, 2011). Almost all the industries are taking advantage of loyalty programmes to increase their clientele. In this recession time JB Hi-Fi can use the advantage of these loyalty programmes to increase their sales in great