During to the focus groups there were not many objections raised against retailers collect- ing customer data and use it for promotional purposes. However, should the data be ex- ploited and made accessible to a third party, the interviewees would strongly object. This is strengthened by Crane and Matten (2004) who argue that consumers highly value their pri- vacy and the retailer should be careful not to infringe on customer’s rights. Lacey and Sneath (2006) confirm these ideas and it is indicated, from the empirical findings, that re- tailers employing loyalty clubs must be transparent with how data is gathered and used. Another opinion which could be derived from the empirical findings, connected to the no- tions mentioned above, is that the interviewees believed that openness would create trust between retailer and customer which is vital for establishing and sustaining long-term rela- tionships, according to Morgan and Hunt (1994; cited in Hunt et al., 2006). Further, the possibility to opt out of receiving direct promotion based on personal data already exists, but retailers must be able to convey such information to consumers more clearly. Accord- ing to the theory, it is however a balancing act between gathering as much private data as possible and creating customized or personalized promotion relevant to the customers. What the empirical findings suggest is that loyalty card members find that the benefits of receiving personalized promotions outweighs the surrendering of private information, even though some indications pointed towards that consumers want to remain anonymous to- wards other consumers. The findings even suggested that collecting customer data could even benefit non-member customers as this would help to optimize prices and other mar- ket related aspects. Zabin and Brebach (2004) further strengthen this observation made by an interviewee by confirming the fact that society is evolving as technology advances, i.e. surveillance and monitoring of people and property is becoming standard norms and that privacy issues must evolve accordingly. On the other hand, one participant of the focus group voiced strong concerns that this type of data gathering could lead to a Big Brother society if further developed This concern was also brought up by Lacey and Sneath (2006) and can be expected to be viewed as major drawback to personalized promotion by some part of the population. Despite the possibility that a small contingent of a society will have such views, according to the majority of the respondents and Zabin and Brebach (2004), a Big Brother society is expected to be very unlikely to evolve.
8
Conclusions
The findings of this research indicate that the aspects of loyalty programs that can be ad- dressed with the technologically enhanced shopping tool are inspiration, convenience, and relevancy/meaningfulness.
Even though ethical considerations about the gathering and use of data cannot be ad- dressed by the shopping tool, it was found to be of importance when addressing loyalty programs in general. One participant voiced strong concerns about being monitored, which could be regarded as an underlying concern for at least a certain part of the population. However, ethical considerations to an extent that could prevent the execution of the pro- posed framework have not been found with the majority of the respondents in this re- search. If retailers ensure transparency in how the customer data is used and communicate this openly, the analysis of personal shopping data for personalized promotion should not represent a hindrance.
The most important characteristic to be addressed by the shopping tool, for loyalty pro- gram members and non-members, was found to be inspiration. Through, for example, the membership magazine, club members are finding inspiration about food and drink, which was a major reason for them to remain in the program, which indicates attitudinal loyalty towards the program. As certain features of the screen, such as the provision of recipes, were generally perceived to be inspirational when being in the store, such features should be considered to a large extent by the retailers concerning their loyalty program. Non- members expressed the desire for inspiration, which could be provided for by a limited access version of the screen. The result could then be an increase in goodwill towards the retailer, thereby leading to higher attitudinal loyalty. The proposed fear of some intervie- wees, that the display could eliminate the human freedom in being active shoppers should be countered by the possibility to individually eliminate certain functions of the display, such as the map. The display, if made accessible to non-members, would be appreciated, but if the store is not within close proximity, their behavior would not result in increased store visits i.e. behavioral loyalty. Upon offering usage of the screen at the store where non- members already shop, their attitudinal and behavioral loyalty would be increased. In order to use this momentum, the limited access version of the screen could even serve as a moti- vator for non-members to join the program for full access.
As the store functions as a stimulator of impulse purchases, the personalized recommenda- tion of products could provide more relevant suggestions for unplanned purchases. Inspi- ration can also be provided if products are recommended that have not been tried before by the customers.
The facet of meaningfulness/relevancy of a loyalty scheme, in line with existing theory, was discovered to be of importance to customers. As non-members were well aware of the benefits of programs, the necessary level of meaningfulness/relevancy has not been estab- lished to convince them to join. Upon introducing personalized promotion, the findings indicate an increase in the propensity to join a program for non-members. Some members of one program would be willing to join the scheme of an otherwise less preferred chain if personalized promotion was offered there, thereby increasing attitudinal loyalty to the new- ly joined program. An imbalance was found to be perceived between the effort to record small purchases and the related benefits, which can be addressed by retailers through an au- tomated recording of purchases. As a result, the program would be made more convenient and relevant to members, as the accumulated amount of all purchases would increase the
rewards for them. Non-members indicated that meaningfulness and relevancy of being a member can be increased by having the option to donate their obtained cash-back rewards to a charity of choice. As with this example, interviewees presented other desired options to be part of the loyalty program such as the lifestyle promotions and ecological product information. The thereby achieved additional relevance would be able to positively impact behavioral as well as attitudinal loyalty, as store visits can be increased through better pro- motion, and additional commitment can be gained. As with personalized promotion, cus- tomer segments can be targeted, offers can become relevant to e.g. vegetarians, who have not found any relevance in promotion before. Whereas current discounts can fail to pro- vide enough motivation for customers to make a return visit to the store even if the prod- uct is desired, the offered discount displayed on the screen at the point-of-sale can be enough to motivate a purchase. The degree of usefulness of the screen was found to in- crease in correlation with the size of the purchase, indicating a higher impact in larger gro- cery store formats.