2009•Acta OeconomicaRequires access

Measurement and analysis of customer loyalty to an electricity distributor, specialties of clusters of loyalty on customer market

Erzsébet Hetesi

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Abstract

During the last decades numerous studies have pointed out that good quality goods and satisfied customers are not the only two ingredients in the strive for profitability; it is rather the issue of loyal customers and loyalty that need to be placed in focus. What is loyalty and how can it be measured? Is there a general model, or are there various factors influencing customer behaviour and attachment? In which factors does the measurement of loyalty have validity and is it worth to apply these for organisations enjoying a monopolistic market position? The paper seeks to find answers to these questions, and besides exploring the theoretical background it also presents the findings of an empirical study of the loyalty of customers in the energy sector in Hungary. This study shows that this particular market consists of customers of various attitudes, which means that in order to study their loyalty different marketing methods are needed.

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What this paper is about

During the last decades numerous studies have pointed out that good quality goods and satisfied customers are not the only two ingredients in the strive for profitability; it is rather the issue of loyal customers and loyalty that need to be placed in focus. What is loyalty and how can it be measured? Is there a general model, or are there various factors influencing customer behaviour and attachment? In which factors does the measurement of loyalty have validity and is it worth to apply these for organisations enjoying a monopolistic market position? The paper seeks to find answers to these questions, and besides exploring the theoretical background it also presents the findings of an empirical study of the loyalty of customers in the energy sector in Hungary. This study shows that this particular market consists of customers of various attitudes, which means that in order to study their loyalty different marketing methods are needed.

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Available abstract

During the last decades numerous studies have pointed out that good quality goods and satisfied customers are not the only two ingredients in the strive for profitability; it is rather the issue of loyal customers and loyalty that need to be placed in focus. What is loyalty and how can it be measured? Is there a general model, or are there various factors influencing customer behaviour and attachment? In which factors does the measurement of loyalty have validity and is it worth to apply these for organisations enjoying a monopolistic market position? The paper seeks to find answers to these questions, and besides exploring the theoretical background it also presents the findings of an empirical study of the loyalty of customers in the energy sector in Hungary. This study shows that this particular market consists of customers of various attitudes, which means that in order to study their loyalty different marketing methods are needed.

Key concepts: Loyalty business model, Loyalty, Marketing, Profitability index, Business, Order (exchange), Monopolistic competition, Advertising

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