The mediating influence of loyalty programmes on repeat purchase behaviour in the retail sector

Abstract

While there has been significant research on loyalty programmes in the last two decades, little has been done on the youth market in South Africa. Using the social exchange and relationship marketing theories, the study examines the mediating influence of customer satisfaction, trust and commitment in the relationship between loyalty programmes and repeat purchase behaviour of South African youth. The methodology involved a self-administrated questionnaire adapted from previous studies. Data was collected from 263 South African youth who are loyalty programme members. The study tested six hypotheses using Structural Equation Modeling. The software used was SPSS 22 for descriptive statistics and IBM Amos 22. The findings indicate that all six hypotheses are supported. They also suggest the significance of customer satisfaction as a strong mediator of loyalty programmes and repeat purchase behaviour. Moreover, the study reveals that the mediating influence of customer commitment on loyalty programmes and repeat purchase behaviour is the weakest. The findings reveal that by building customer satisfaction and customer trust amongst the youth, marketers can positively impact on the success of loyalty programmes and repeat purchase behaviour. This study contributes to the literature on loyalty programmes amongst youth within a developing market context. It can assist marketers in developing sound loyalty programmes aimed at the youth market in South Africa. Limitations and future research directions are discussed.