An analysis of the UK’s largest franchised supermarket chains reveals that the success of the franchised model depends on the degree to which it is able to control and shape customer behaviour.
The study, by retail consultancy firm RBC, examined how franchised supermarkets managed customer behaviour by focusing on the importance of loyalty.
RBC analysed data from more than 4,500 franchised stores in the UK and found that loyalty was key to achieving high sales and loyalty retention.
It found that a franchised store’s loyalty management practices were more likely to be based on the brand and customer experience, rather than just a marketing strategy.
In other words, the franchiser’s loyalty strategy should not be based around a single strategy, but instead include both the brand, customer experience and customer loyalty, according to RBC.
“In the UK, franchising is one of the most successful strategies for retail growth, and is a key part of the reason why UK supermarkets are in such high demand,” said Tom Wetherill, head of strategy at RBC Retail.
This suggests that the strategy should focus on the different ways in which a retailer can achieve high sales.
“There is a real sense of loyalty among the customer, but we should also consider the ways in to how the franchisor can make that loyalty work,” he added.
For example, loyalty can be about providing an experience and value proposition that is both familiar and engaging.
This could include a simple product experience that is familiar to customers, and can be tailored to the customer’s interests and preferences.
Other strategies include using the customer to promote the store’s brand and its brand to attract new customers.
Finally, loyalty management can be structured in a way that maximises the likelihood that customers will return to a store once they have had a chance to enjoy the experience, with incentives for repeat visits and discounts for returning customers.
The study also found that the value of loyalty can vary depending on the retailer, and how the customer interacts with the store.
A large proportion of the loyalty managers in the study were based in the larger supermarkets, but a large proportion were also in smaller retail chains such as Tesco, Marks and Spencer, Sainsbury’s and Waitrose.
These were all companies that offered loyalty to customers with very strong loyalty levels, such as Sainsburys and Waitress.
But as the study shows, the loyalty of the customers is not only linked to the level of loyalty, but also to the type of loyalty management, RBC found.
As well as loyalty management for the individual store, it found that there was a strong link between loyalty and customer retention and loyalty with loyalty.
The results showed that, in addition to loyalty, customers are more likely than other shoppers to return to the store once a month, with those who return to it having a greater satisfaction with the experience.
Overall, the study found that customer loyalty is not a one-off phenomenon, but is a strategy that is used throughout the entire retail chain, and that is important as it helps ensure that stores remain profitable and successful.
Read more about franchising:The study found the loyalty levels of customers at each of the top 10 franchised chains were consistently lower than those of the average shopper.
At Waitrose, loyalty was lower than at Tesco and at Sainsby, while at Sainbury’s it was lower at the lower end of the scale.
Only at Sirocco did loyalty show a consistent pattern across all of the chains.
At Sainsbread, loyalty levels were higher than at Waitrose and at Marks and Simmons, while loyalty was higher at Saver.
At Waitress, loyalty at Waitr was lower compared to other chains.
At Saver, loyalty did not show a consistency across all the chains, and at Waitress it was higher than Sainsbys.
At all of these chains, loyalty is important, as it gives the customer a sense of value.
However, the research found that in some cases loyalty levels at each retailer may vary, and in some instances customers are not always happy with the loyalty at their store.
In addition to the findings of the RBC study, the report also found:Customers are more satisfied with loyalty at stores with a lower level of management.
Customers at Waiters were more satisfied than Waitresses at all other stores.
Customer satisfaction levels at Waitrs are also lower than Waiters at other chains, with higher levels of satisfaction found at Waitresses than Waitr.