Green loyalty? Unveiling consumer preferences in sustainable temporary loyalty programs

Abstract

Almost every food retailer offers them – temporary loyalty programs (TLPs). TLPs aim to enhance customer loyalty by offering enticing, product-based incentives. However, an emerging concern arises regarding the sustainability impact of these programs, and consumers have started questioning the sustainability of TLPs offered by retailers. This concern is primarily driven by the mounting consumer interest and awareness surrounding sustainability, requesting retailers to include sustainability dimensions in their TLPs and their sustainability strategy. Using conjoint analysis, this study investigates which of the three sustainability dimensions influences consumers' decision to participate in a TLP. As consumers often weigh sustainability attributes against other attributes, the competing TLP attributes of price, reward timing and brand were also included in this study. A total of 469 consumers were integrated in the data analysis. The results display that consumers have a higher intention to participate in a TLP when it focuses on the dimension of social sustainability, integrates a low-price level, delayed rewards, and provides unbranded rewards. However, as indicated by the results of a segmentation analysis, four heterogeneous consumer segments are identified, displaying an environmental sustainability-driven segment, a segment that favours no sustainability but delayed rewards, a consumer segment that favours social sustainability, and finally a segment that is price driven and in favour of delayed rewarded TLP products. Hence, the result indicates a need for more personalised TLPs that can greatly benefit from green data and technology communication approaches. The findings of this study are of relevance as they increase understanding of consumers’ preferences for sustainability in TLPs; while providing stakeholders fruitful (data-driven) direction to cope with sustainability demands expressed on the consumer side without putting their business at risk.