CUSTOMER LOYALTY IN CONVENIENCE STORES

A Research Paper Presented to

Prof. Glendonn Sobrejuanite

In Partial Fulfillment
of the Requirement for
Research 1B Methods of Research, 8:30-9:30 pm

Chapter I
 INTRODUCTION

Background of the Study

Customer loyalty is viewed as the strength of the relationship between an

individual’s relative attitude and re-patronage. (Oliver, 1999) Although customer

satisfaction is a crucial part of a business, satisfaction alone cannot take a

business to a top level, there should be customer satisfaction which produces a

positive financial result especially in regular purchases. (Oliver, 1999) Today’s

unforgiving market where creating and maintaining customer loyalty is more

complex than it used to be in the past years, and because of technological

breakthrough and widespread of the internet uses, loyalty building requires the

company to focus the value of its products and services and to show that it is

interested to fulfill the desire or build a relationship with customers (Griffin 2002).

According to a study of 500 leading global brands, cart abandonment rates

reached 75.6% across retail, travel, and fashion and this abandonment is often

caused by "sticker shock" after tax and shipping prices have been applied.

(Bernazzani, 2018) Truly understanding the customer means understanding their

values and sense of worth, and shared valued have a huge impact on if a customer

will be loyal to a brand. In fact, CeB surveyed consumers on customer loyalty and

found that customers were loyal "not to companies, but to beliefs” depending on

the industry, customers may find more value in non-monetary or discounted

rewards while any company can offer promotional coupons and discount codes if

they want to since businesses that can provide value to the customer in ways other

than dollars and cents have a unique opportunity to connect with their audience.
(Bernazzani, 2018) In a world where hundreds of different options for virtually any

product or service a customer might purchase, the fact that so many keep coming

back to the same brands is really saying something. (Bernazzani, 2018) It indicates

that a customer trusts and loves a brand, and that the value they get from being a

customer outweighs the potential benefit of a lower price or a different product from

another brand. (Bernazzani, 2018)

In Finland, Dahlgren (2011) in the study entitled “Brand Loyalty and

Involvement in Different Customer Levels of A Service Concept Brand” aimed to

build a framework to link the dimensions of brand loyalty and brand involvement,

to capture the differences between different customer levels of a service concept

brand and to contribute to the understanding of what factors contribute to loyalty

and involvement in different customer levels of a group fitness brand. The study of

Dahlgren (2011) revealed that several differences were found between the

framework, and the loyalty and involvement dimensions in practice, especially in

the context of brand loyalty dimensions. Also, the factors detected through the

statistical factor analysis imply that the multi-dimensional conceptualization of

brand loyalty used in theoretical framework of the study is not directly applicable

to the context of a group fitness brand so, further development of the

conceptualization of the dimensions of brand loyalty used as measures for service

concept brands should be performed. Moreover, the findings of the cluster analysis

suggests that making a distinction between behavioral and attitudinal loyalty is an

effective segmentation and target marketing tool.

 In the Philippines, particularly in Iligan City, Manala-O (2018), in the study

entitled “Factors Affecting Customer Loyalty Among Generation Z in the Fast-food

Industry” aimed to explore the factors that customers consider when developing

loyalty to a fast-food brand and the moderating effects of gender and income. In

the study of Manala-O (2018), Spearman’s Rank Correlation test, Linear and

Multiple Regression analysis were used to examine the relationships between the

direct factors contributing to customer loyalty and the effect of the moderating

variables, where findings revealed that Generation Z customers find customer

satisfaction, brand trust, brand image and self-congruity as important factors when

forming loyalty to a certain fast-food brand. Moreover, income did not moderate

any of the relationships between these factors and customer loyalty because

gender was found to moderate only the customer satisfaction-customer loyalty and

brand image-customer loyalty relationships and females have lower average

customer satisfaction and brand image scores than male Generation Z customers.

More researches have come up to study customer satisfaction, customer

loyalty and marketing strategies of brands, however, the present study filled in the

gap since most studies are concerned with famous brands like Amazon, Bench,

and etc., while this paper focused solely not on a particular brand but a local

establishment which is Convenience Stores in the Philippines. Therefore, this

study is a necessity to fully understand if there is a significant difference in

Customer Loyalty if respondents are grouped according to their profiles.

Statement of the Problem

 The main purpose of the study is to know the importance of Customer

Loyalty in Convenience Stores in terms of Pricing, Location or Product Assortment.

Specifically, it will seek answers to the following questions:

1. What profile of the respondents in terms of:

1.1 Age

1.2 Sex

1.3 Civil Status

1.4 Occupation

2. What is the importance of Customer Loyalty in Convenience Stores in terms

of:

2.1 Promotion

2.2 Customer Relation

2.3 Price

2.4 Product

3. Is there a significant difference in the importance of Customer Loyalty in

Convenience Stores when respondents are grouped according to profile?

Hypothesis

There were no significant differences in the Importance of Customer Loyalty

in Convenience Stores when respondents are grouped according to Age, Gender,

Civil Status and Occupation.

Review Related Literature

 This section is the information that was seen to be significantly related to

the study. Data was gathered from books, blogs, journals and internet to support

the study about the Customer Loyalty in Convenience Stores.

Customer Loyalty

In the fields of business, emerging today’s generation is a growing number

of cluttered markets, relationship marketing is somehow growing for survival.

Gronroos (1996) said that based on the traditional marketing, most of the

companies market is unremitting to raise awareness and to get more customers.

However, the main purpose of marketing is to bind, raise and preserve healthy

relationship between the company and customer. The trend relationship marketing

philosophy expands from completing a sale to start a relationship; from closing a

deal to create loyalty. (Kandampully, 1998)

Customer loyalty is a customer's willingness to buy from or work with a

brand again and again, and it's the result of a positive customer experience,

customer satisfaction, and the value of the products or services the customer gets

from the transaction. (Bernazzani, 2018) Brands obviously want to provide great

customer service so customers will continue subscribing or purchasing, but

customer loyalty is paramount to brands' success, simply because loyal customers

can grow business faster than sales and marketing. (Bernazzani, 2018) Customer

loyalty is another important factor in customer satisfaction. The impact of the

satisfaction in loyalty has been the most popular subject in study of the Marketing

theory. Therefore, several studies have proved that satisfaction and loyalty have
the direct connection between one another. As satisfied customers are loyal and

dissatisfied customers are a vendor (Heskett 2011.)

Customer Loyalty is defined as a commitment to repurchase where a

customer can patronize a certain product repeatedly in the future. (Ganesh et al.,

2000; and Jamal and Anastasiadou, 2009) Loyal customers tend to have a high

level of recommendation and repurchase intention (Chi et al., 2009) and meeting

customers demand it can gain loyalty and it’s one of the most important issues that

management might encounter nowadays. According to Athanasopoulou (2009),

customer loyalty become more possible through the evolution of long term,

mutually beneficial affinity with the customers while Yi and Jeon (2003), believed

that one of the most useful marketing techniques that executives can impose is a

customer loyalty program which is a promotional scheme designed to increase

loyalty by providing incentives to customers through added benefits.

Customer loyalty is the act of choosing one company’s products and

services consistently over their competitors. (Chambers, 2018) When a customer

is loyal to one company, they aren’t easily swayed by price or availability because

customers would rather pay more and ensure the same quality service and product

they know and love (Chambers, 2018). Customers that trust the companies they

do business with will be more likely to purchase again in the future because it is

the result of a company consistently meeting and exceeding customer

expectations (Chambers, 2018). The importance of customer loyalty impacts

almost every metric important to running a business because without happy

customers that continue to buy from you, the business won’t survive (Chambers,
2018). New customers tend to cost more to acquire, and don’t spend as much

money as loyal, repeat customers that is why keeping customers coming back for

more is critical to business success and it’s short term profit grabs don’t work

because loyal customers are just better for business: they help you grow and they

keep profits high (Chambers, 2018).

According to Manala-O (2018), customer loyalty is one of the main goals of

fast-food brands because in an industry where stiff inter-brand competition exists

and customer preferences regularly change, fast-food brands need to monitor the

preferences of their customers since the biggest customer segment for fast-food

brands now is Generation Z, and companies are taking a closer look at their

behavior in order to maintain their loyalty. An industry that substantially thrives on

customer loyalty and is considered as one of the biggest sectors that greatly

contributes to the Philippine economy is the fastfood sector (Bureau, 2012). The

change in customer preferences and significance of Generation Z now and in the

future more so has made it clear that in order for fast food operators to remain

competitive is to monitor young customers’ buying behavior and develop

appropriate strategies (Manala-O, 2018). Hence, there is a need for fast-food

retailers to study Generation Z customers and understand their buying behavior

now; also managers should know what makes this market segment loyal to a brand

and the certain factors that impact loyalty the most because the need for this

information is urgent so as not to miss market opportunities in a reason that fast-

food retailers could not stay relevant and in touch with their younger market

(Weikel, 2014).
 In terms of increasing store’s loyal customer, Jenkins (2010), and Gentry

and Kalliny (2012) stated that customer loyalty can give opening for enhancing

profitability and business sustainability while Seenivasan (2011) and Hassan

(2012) indicated that loyalty is a key element to a supermarket’s success and that

it is a strategy that redeems the value and at the same time catalyzes such loyal

behavior and can be daunting feat for supermarket marketers. Also, Hassen,

Jensen and Stubbe (2011) stated that customers who are set to have a price

preference over quality are shift between retailers to determine the best price.

Customers who already justify switching or just those who’s more interested in the

price level rather than quality are less likely to stay loyal to one’s supermarket,

which can negatively impact store loyalty. (Hassen, Jensen and Stubbe, 2011)

Convenience Store

A convenience store is a retail outlet that sells a limited range of prepared

and ready-to-eat foods, bottled and fountain beverages, household staples,

tobacco products and periodicals. (Petersen, 2019) Convenience stores are

typically small in size, are open extended hours, and, in most cases, are staffed by

a relatively small team of cashiers, stock workers, and managers. While there can

be significant differences between individual convenience stores, these stores are

stocked, located and designed for customers who are on the go and need to pick

up just a few items and because convenience stores are often open late at night,

early in the morning and on holidays, many people also rely on them for emergency

purchases of things like ice, milk, eggs or over-the-counter medicines when regular

stores are already closed. (Petersen, 2019)

 According to UK Essay (2017), a convenience store is a small store that

sells items such as bakeries, beverage, biscuit, car care, confectionary, groceries

or some selective processed food, lubricants, personal care and household, salty

snacks or local tidbits, tobacco, newspaper and magazine and some part of petrol

kiosk may also sell windshield washer fluid, radiator fluid and maps. A

convenience store can be a reasonably profitable business because many people

will pay extra to buy an item quickly and conveniently or sometimes to make up

for the convenience they offer and the price in convenience store, are often higher

the supermarkets or hypermarkets because it is believed that the key for a

successful convenience store is the location which is why stores are normally

located along busy roads, high population neighbourhoods and petrol kiosk. (UK

Essay, 2017)

Promotion

In marketing, promotion refers to a different sort of advancement. A sales

promotion entails the features—via advertising and/or a discounted price—of a

particular product or service. Product promotions can also be classified as "sales"

or "specials." (Kenton, 2019) Product promotions are designed to increase sales

of a product or service while promotional tactics run the gamut—from coupons to

two-for sales or buy one and get a second one free to straight dollar markdowns

or percentage discounts. (Kenton, 2019) On the other hand, sales promotions are

usually carried out through online media such as social media platforms, digital

communication such as mobile SMS, print media such as newspapers, or in a

physical location such as a retail store while other ways used to promote a

business or product include word of mouth, business cards, and flyers. (Kenton,

2019)

According to Ekonomski (2011) promotion is one of the marketing mix’s

components and its job is to raise awareness of the product or services data and

develop consumer preference for goods or services. Promotion in a wider sense

is a notion for improving something, and in a smaller sense it is an aspect of a

marketing mix. (Meler, 1997) Advertising is the most popular type of promotion and

it can be described as paid communication with the target group through

advertisements supplied through suitable media such as journals, radio, TV,

websites, and etc. (Alfirevic, 2013) Promotion is a marketing term used to describe

all marketing communications activities and includes personal selling, sales

promotion, public relations, direct marketing, trade fairs and exhibitions,

advertising and sponsorship. (Friesner, 2014)

According to Kotler et al., (2010) as stated by Friesner (2014) stated that

The promotions mix or the marketing communications mix is the specific blend of

promotion tools that the company uses to persuasively communicate customer

value and build customer relationships while Friesner (2014) stated that promotion

needs to be precisely coordinated and integrated into the businesses’ global

communications message called Integrated Marketing Communications (IMC)

where the message through the available channels to deliver a consistent and

clear message about your company’s brands, products and services and any
movement away from the single message confuses the consumer and undermines

the brand. (Friesner, 2014)

Richa (2014) stated that the service industry usually has stiff competition

across different verticals and businesses would need a lot of promotions to pass

on the right message to potential customers and while advertising, online and

direct marketing are the best ways to promote the service people need to have a

good mix of communication channels to address a larger audience. While, Martin

(2014) stated that the marketing communication strategies and techniques all fall

under the promotion heading and these may include advertising, sales promotions,

special offers and public relations Martin (2014). Whatever the channel used, it is

necessary for it to be suitable for the product, the price and the end user it is being

marketed to and it is important to differentiate between marketing and promotion

because promotion is just the communication aspect of the entire marketing

function (Martin, 2014).

On the same vein, Friesner (2014) stated that online promotions include

many promotions’ mix elements while online businesses regularly send out

newsletters which are targeted using e-mail and mailing lists, which is a form of

direct marketing and websites are premium vehicle in the public relations industry

to communicate particular points of view to relevant publics. (Friesner, 2014)

Promotion is the element of the marketing mix which is entirely responsible for

communicating the marketing proposition therefore, marketers work hard to create

a unique marketing proposition for their product or service. (Friesner, 2014)

Place
 Place in case of services determine where is the service product going to

be located (Bhasin, 2017). For example, the best place to open up a petrol pump

is on the highway or in the city because a place where there is minimum traffic is

a wrong location to start a petrol pump (Bhasin, 2017). Similarly a software

company will be better placed in a business hub with a lot of companies nearby

rather than being placed in a town or rural area (Bhasin, 2017). Establishments or

stores need to evaluate placement options to understand where the customer is

most likely to make a purchase and what are the costs associated with using

channels because multiple channels may help target a wider customer base and

ensure access. (Martin, 2014). On the other hand, if the product serves a niche

market then it may make good business sense to concentrate distribution to a

specific area or channel because the perceived value of the product is closely tied

in with how it is made available to all people (Martin, 2014).

Martin (2014) stated that, place or placement has to do with how the product

will be provided to the customer. The placement strategy will help assess what

channel is the most suited to a product (Martin, 2014). How a product is accessed

by the end user also needs to compliment the rest of the product strategy because

distribution is a key element of product placement or assortment (Martin, 2014).

Product assortment refers to the variety of products that a retailer presents

to the consumer. In determining the optimal product assortment, retailers need to

decide on product line breadth– the number of product lines or variety offered by

the firm– as well as product line depth, the number of categories within a specific

product line. (Khan, 2012) A product assortment strategy is a strategic tool that
retailers use to manage and increase sales in retailing which involves the number

and type of products that stores display for purchase by consumers. The strategy

is comprised of two major components: a) the depth of products offered, or how

many variations of a particular product a store carries and b) the width of the

product variety, or how many different types of products a store carries. (Tardi,

2019) A product assortment strategy is a retail industry sales tool with the concepts

of depth and breadth at its core, however, not all retailers will be able to use both

components of this strategy at the same time. (Tardi, 2019) A product assortment

strategy is not one-size-fits-all; it needs to be customized to respond to a

business's parameters and can have many layers of sub and related strategies, as

each store will need to tailor the strategy to address its own particular needs and

goals. (Tardi, 2019)

The place where business owners choose to conduct their service or put up

their business can make or break their organizational growth (Richa, 2014). It is

important to understand how visible the setup would be to potential customers and

how frequently it would be visited by consumers (Richa, 2014). For example,

setting up a fast-food centre near a college or office hub, where students and

professionals can quickly grab a bite or next to a big restaurant in a classy

neighbourhood is a good choice of place to put up a business. (Richa, 2014) Place

decisions outline where a company sells a product and how it delivers the product

to the market (Twin, 2019). The goal of business executives is to get their products

in front of the consumers most likely to buy them (Twin, 2019). In some cases,
this may refer to placing a product in certain stores or refers to the product's

placement on a store's display (Twin, 2019).

Pricing

Competitive pricing is the process of selecting strategic price points to best

take advantage of a product or service based market relative to competition

(Chappelow, 2019). This pricing method is used more often by businesses selling

similar products since services can vary from business to business, while the

attributes of a product remain similar (Chappelow, 2019). This type of pricing

strategy is generally used once a price for a product or service has reached a level

of equilibrium, which occurs when a product has been on the market for a long

time and there are many substitutes for the product (Chappelow, 2019).

The Economic Times (2019) defined Price as the value that is put to a

product or service and is the result of a complex set of calculations, research and

understanding and risk taking ability and a pricing strategy takes into account

segments, ability to pay, market conditions, competitor actions, trade margins and

input costs, amongst others. There are several types of Pricing Strategies namely:

a) Premium Pricing where a high price is used as a defining criterion that works in

segments and industries where a strong competitive advantage exists, b)

Penetration Pricing where a price is set artificially low to gain market share quickly

and once the promotion period is over and market share objectives are achieved,

the price will be raised, c) Economy Pricing which targets the market share and
high market share and where there are no-frills price which means that margins

are wafer thin; overheads like marketing and advertising costs are very low, and

d) Skimming strategy where the price is high and is charged for a product until

such time that competitors allow after which prices can be dropped (The Economic

Times, 2019).

Convenience store prices are almost always higher than what a consumer

would pay at a traditional grocery store. The premium pricing reflects the added

value of being able to buy something quickly, although grocery stores command

more loyalty from repeat and large volume customers due to their more competitive

price points (Petersen, 2019). According to Wikipedia (2011) price concerns about

the pricing policies or pricing models from a company. Due to the widely-use of the

Internet, many applications could be found in both consumers’ and producers’

perspective. From consumers' side, the Internet enables people to make a

comparison to a real-time prices before they make a consumption decision, which

is time-saving and effort-saving for the consumers. As for the suppliers, they can

adjust prices in the real-time and provides higher degree of price transparency with

customers. Besides, the Internet is more likely to ease the pressure on price

because online-producers do not have to put budget on renting a physical store.

Hence, making new or adjusting pricing strategies is essential for the company that

wants to enter the Internet market (Wikipedia, 2011). The pricing strategy for

services is difficult to achieve, unlike in products, wherein the final price depends

on the raw materials, cost of production and distribution etc. However, in service
pricing, you cannot measure the cost of the services you offer that easily (Richa,

2014)

Gordon (2012) emphasized economic cost to be a price where the number

of consumers pays for a certain product and service while William, et al. (2012)

stated that the consumer’s idea about the price is important and vital in regards to

buying behavior of the products and services and because of intangibility of the

nature of service, price become decisive quality pointer. The product has always

set the price required to have a precise thought of the symbolic role that the price

is playing in determining the role of product target market and in customers mind,

in terms of pricing, it is not about the amount they’d paid to produce but the cost of

goods are the main thing that consumers are losing access to have the benefits

and points of ownership or use of a product. (Gilaninia, et al. 2013) Pricing strategy

is the policy a firm adopts to determine what it will charge for its products and

services, while Strategic approaches fall broadly into the three categories of cost-

based pricing, competition-based common factor among pricing strategies is that,

in the end, the total revenue generated from the price set multiplied by the units

sold has to cover the costs of operation and to allow a sufficient profit margin,

which secures an acceptable return on investment. (Sammut-Bonnici and

Channon, 2015)

According to Martin (2014), price covers the actual amount the end user is

expected to pay for a product and how a product is priced will directly affect how it

sells. This is linked to what the perceived value of the product is to the customer

rather than an objective costing of the product on offer because if a product is

priced higher or lower than its perceived value, then it will not sell so it is imperative

to understand how a customer sees what you are selling (Martin, 2014). If there is

a positive customer value, than a product may be successfully priced higher than

its objective monetary value, conversely, if a product has little value in the eyes of

the consumer, then it may need to be underpriced to sell (Martin, 2014). Price may

also be affected by distribution plans, value chain costs and markups and how

competitors price a rival product (Martin, 2014). Richa (2014) stated that in the

education industry, how you set the price of the quality of education is significant

or if you are in the food and hospitality industry, how you charge the customers for

the care shown by the host or hostess, the ambience in the restaurant or the fine

taste of your delicacies is also important. Therefore, pricing plays a crucial role in

the services marketing mix for your business. (Richa, 2014)

Product

The product in service marketing mix is intangible in nature because like

physical products such as soap or detergent, service products cannot be

measured (Bhasin 2017). Service products are heterogenous, perishable and

cannot be owned; thus it has to be designed with care (Bhasin 2017). Generally

service blue printing is done to define the service product like for example – a

restaurant blueprint will be prepared before establishing a restaurant business as

this service-blueprint defines exactly how the product is going to be (Bhasin 2017).

Unlike a product, a service is intangible and cannot be measured in terms of look,

feel and other qualities present in a commodity but it can be customized to suit the

user requirements and give a personal touch. The service product is

heterogeneous and perishable in nature just like a normal product and needs to

be designed with the utmost care to increase customer satisfaction (Richa, 2014).

According to Khadka and Maharjan (2017), product quality is also another

core factor of the customer’s satisfaction and loyalty because it is a collection of

features and sharp brand product characteristics which have a contribution to the

ability to fulfill specified demand. Product qualities also have different dimensions

such as features, performance, reliability, durability, serviceability and customer

perceived quality. (Khadka and Maharjan, 2017) Out of all these dimensions,

mainly five elements, product durability, product variety, product freshness,

product attractiveness, and product equity, have been used to measure the

satisfaction and loyalty of the customers. (Khadka and Maharjan, 2017)

The product is either a tangible good or an intangible service that is seem

to meet a specific customer need or demand (Martin, 2014). All products follow a

logical product life cycle and it is vital for marketers to understand and plan for the

various stages and their unique challenges (Martin, 2014). The problems that the

product is attempting to solve and the benefits offered by the product and all its

features need to be understood and the unique selling proposition of the product

needs to be studied, so the potential buyers of the product need to be identified

and understood (Martin, 2014).

According to Wikipedia (2017) Product refers to what the business offers

for sale and may include products or services whereas Product decisions include

the "quality, features, benefits, style, design, branding, packaging, services,

warranties, guarantees, life cycles, investments and returns. Variety of products

help the retailer understand the buying behavior of the customers because the

perceptions of the quality product vary from one another. (Khadka and Maharjan,

2017) Because of product variety, the firms will get an opportunity to pay attention

towards the customer and also increase the greatest product variety and this will

increase the growth and volume of the product as well as the customers'

satisfaction and loyalty to a great extent. Hence, the firms had begun to develop

the satisfaction and loyalty of the customers by offering quality goods and services.

(Khadka and Maharjan, 2017)

Convenience store product assortments are limited to items that people are

likely to need while commuting, traveling, or when their household supply runs out.

Grocery stores, on the other hand, tend to offer a wide range of products in all of

their categories, including fresh foods, prepared foods, household products and

personal care. (Petersen, 2019) It’s not unusual for traditional grocery stores to

offer several brands within a very limited product category like for example, grocery

store shelves often hold several different brands of peanut butter and within each

brand, there may be several types of peanut butter, such as creamy, crunchy, and

no-added-sugar, however, these brand varieties may also be available in multiple

sizes but by contrast, a convenience store is likely to carry only one brand of

creamy peanut butter and the same is true for other products, such as dish soap,

shampoo or diapers. (Petersen, 2019) Convenience stores usually sell hot and

ready-to-eat foods such as hot dogs, nachos, pre-made sandwiches, and salads

which makes the store often sell frozen entrees and snacks that can be reheated
in the store’s microwave while fountain drinks and hot coffee are also always

available. (Petersen, 2019)

THEORETICAL FRAMEWORK

This research used the Marketing Mix 4P’s Model of McCarthy (1960).

According to Martin (2014), the marketing mix is a crucial tool to help understand

what the product or service can offer and how to plan for a successful product offering.

The marketing mix is most commonly executed through the 4 P’s of marketing which

refers to: Promotion, Place, Price, and Product.

Figure 1 shows the conceptual paradigm of the study consisted of

independent variable which refers to the Age, Gender and Civil Status of the

respondents while the dependent variable refers to the 4 P’s of marketing namely:

Promotion, Place, Price, and Product.

CONCEPTUAL FRAMEWORK

Figure 1
 Customer Profile
1.1 Age
1.2 Sex
1.3 Civil Status

4P’s Marketing Mix Model

● Promotion
● Place
● Price
● Product

Customer Loyalty in Convenience Stores

Name (Optional): _________________________________________________

Age: 18-25 26-35 36-45 46-55 55 above
Civil Status: Single Married
Rating Scale Description Interpretation

4.21-5.00 Strong Agree/Always This means that the self-concept or

competency skill is manifested all the
times.

4.21-5.00 Agree/Often This means that the self-concept or

competency skill is manifested often
times.

2.61-3.20 Neutral/Sometimes This means that the self-concept or

competency skill is manifested
sometimes.

1.81-2.60 Disagree/Seldom This means that the self-concept or

competency skill is manifested rarely.

1.00-1.08 Strongly This means that the self-concept or

Disagree/Never competency skill is never manifested.

CUSTOMER LOYALTY
Promotion 5 4 3 2 1
1. The store provides special holiday discounts.
2. The store has percentage sale and promotions.
3. The store provides birthday discounts.
4. The store gives coupons for customers to claim.
5. The store provides discounts for PWDS and Senior Citizens.

Place 5 4 3 2 1
1. The store is located near the streets.
2. The store is located in a safe area.
3. The store has a small and narrow area.
4. The store can accommodate many people.
5. The store becomes overcrowded if there are many people.
 Price 5 4 3 2 1
1. The price is affordable for all customers.
2. The price is convenient for all customers.
3. The price is economical for all customers.
4. The price is low-cost for people on budget.
5. The price suits the product that they sell.
Product 5 4 3 2 1
1. The products are in best conditions.
2. The products are always organized.
3. The products have expiration dates.
4. The products are easy to find.
5. The products are classified and organized.

Comments and Suggestions: _______________________________________

________________________________________________________________

________________________________________________________________.

Thank You!

Significance of the Study

The researchers would like to come up with relevant data on the importance

of the customer loyalty in convenience stores. The questionnaire was adapted

from the study of Alegria and Olarte (2017). The study questionnaire from the

study conducted by Alegria and Olarte (2017) entitled “Market Positioning of

Convenience Stores as Perceived by Business Students” was used because it

aimed to determine the market positioning of convenience stores perceived by

business students. The study revealed that ages ranging from 16-18 has the

highest number of UM CBAE students in Davao City with a percentage of 43%.

Most students are taking up Marketing Management that takes part at 71%. In

terms of Year Level, the majority of UM CBAE students in Davao City are

Sophomore students comprising at 44%. The result of Market Positioning of

Convenience Stores among UM CBAE students in Davao City in the application

of establishing the right price with the mean of 3.83, including variey of assortment

with a mean of 3.82 and finding the appropriate location with the highest mean of

3.85. The overall mean of all items is 3.83 with a descriptive equivalent of high.

The findings also showed that there is no significant difference on Market

Positioning of Convenience Stores among UM CBAE students in Davao City. The

questionnaire used in the study of Alegria and Olarte (2017) is a descriptive

research design which is similar to the research design used by the present study

therefore, the questionnaire fits perfectly to the objectives of the present study

since both studies concern with the customer loyalty of convenience stores and

the importance of customer loyalty in terms of promotion, place, price and product.

The results of this study will provide information, ideas and give input on

the importance of customer loyalty in convenience stores when respondents are

grouped according to their profile.

The results of the study could be beneficial to the following:

 Customers. The results of this study will let the customers know how their

satisfaction are measured and valued, and that the importance of their loyalty will

determine the success of one’s establishment in the business world.

Service Providers. The results of this study may help the service crews,

managers and administration of the company of convenience store to further

develop their business strategy on how to manage and provide high-quality service

to the customers as well as the strategies to acquire loyal customers.

Future Researchers. The results of this study may help the future

researchers to expound the scope of this study, to explore the different types of

loyalty and how the effects of customer loyalty programs to the customers and the

business establishments.

Definition of Terms

The following terms are defined to establish a common frame references.

They are defined operationally in relation to the study.

Customer Loyalty: refers to the loyalty of customers in terms of Price,

Promotion, Product and Place.

Customers: refers to the fourth year students in Bachelor of Science in

Business Administration Major in Marketing Management in the University of

Mindanao and the College of Business Administration Education who are regular

customers of convenience stores.

Convenience Store: refers to the research corpora of the study where the

respondents become customers of the said business establishment

 CHAPTER II
METHODS

Presented in this chapter are the discussions of the research about the

Importance of Customer Loyalty Program in Convenience Stores, the instrument

used and the statistical tools employed.

Research Design
Descriptive correlational research method will be used in this study.

According to Stangor (2011) descriptive correlational design creates a snapshot of

the current state of affairs and assesses the relationships between and among two

or more variables. This research design can easily ascertain the importance of

customer loyalty in convenience stores and the significant difference in the

importance of customer loyalty programs in terms of Promotion, Place, Price and

Products when respondents are grouped according to their profiles.

Research Respondents

The respondents of this study are the fourth year students in Bachelor of

Science in Business Administration Major in Marketing Management in the

University of Mindanao and the College of Business Administration Education who

are regular customers of convenience stores in Davao City. The study used the

purposive sampling. The sample was divided into meaningful segment of

population who used to determine the sample size of 30 respondents for a total

population of 100%. The researchers themselves will administer 20 questionnaires

and there should be 20 questionnaires to be retrieved. There should be a 100%

retrieval rate. The sampling method was used because it was the most efficient

among the probability designs. Furthermore, this sampling method, although not

as rigorous as some, sampling method is necessary because of its practicality. In

addition, care was used to ensure that the researchers who administered the

instrument did not influence the answer of the respondents. The researchers will

identify the importance of customer loyalty in convenience stores and the

significant difference when grouped according to their respondents’ profile. Thus,

the administration of the instrument will start on October 11, 2019 and the expected

date of the retrieval of the instrument will be on the same date.

Research Instrument

There are four parts in the questionnaire and it has 20 items overall. The

first part of the questionnaire is about the Promotion. The first part has five items.

The second part of the questionnaire is about the Place. The second part has five

items also. The third part of the questionnaire is about the Price. The third part has

five items too. The last part of the questionnaire is about Product. The last part has

five items as well. The statements were measured in a five Likert scale. The Likert

scale measures importance of customer loyalty in convenience stores and the

significant difference of customer loyalty when grouped according to their

respondents’ profile.

Specific process will undertake in making the questionnaire by reading

literature to create a pool of items for inclusion in the instrument. This survey tool

will be validated by some group of experts to assure that the items in the

questionnaire are appropriate and correct. The comments, suggestions and

recommendations of the experts will be properly taken and reflected by the

apprentices. The importance of customer loyalty will be based on the average

weighted mean. These scores will be categorized and scaled using the exact limits

with descriptive equivalent.

Exact limits Description Interpretation

4.21-5.00 Strong Agree/Always This means that the self-concept /

competency skill is manifested all the
times.
4.21-5.00 Agree/Often This means that the self-concept /
competency skill is manifested often
times.
 2.61-3.20 Neutral/Sometimes This means that the self-concept /
competency skill is manifested
sometimes.
1.81-2.60 Disagree/Seldom This means that the self-concept/
competency skill is manifested rarely.
1.00-1.08 Strongly This means that the self-concept/
Disagree/Never competency skill is never manifested

Data Gathering

These are the following procedures that will conducted in gathering the

research data;

1. Through the purposive sampling, the researchers sought the permission of the

Faculty of Business Administration, the fourth year students in Bachelor of Science

in Business Administration Major in Marketing Management in the University of

Mindanao and the College of Business Administration Education.

2. After the grant of permission, the questionnaires will be explained and

administered.

3. After the questionnaires will be retrieved. It will be matched and tabulated in a

spreadsheet program and statistical methods will be used to answer the research

problems.

Statistical Treatment of Data

The statistical tools employed in treating the problem were the following:

Mean. This will be used to determine the effect of customer loyalty programs in

Convenience Stores in Davao City.

Analysis of Variance (ANOVA) and T-Test. These will be used to determine if

there is a significant difference of the effect of customer loyalty programs in

convenience stores when respondents are grouped according to their profile.

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