How do loyalty program structures, compared to direct price reduction strategies, influence customer spending behaviour in retail stores in Dublin?

Abstract

This study examines how loyalty program structures, compared to direct price reduction strategies, influence customer spending behaviour in retail stores in Dublin. The research aims to assess perceptions of value and fairness, evaluate the impact of price discounts, analyse the role of loyalty program participation, and explore consumer attitudes toward spending control and decision-making. A quantitative research design was adopted, using a structured questionnaire with Likert-scale items distributed to 100 respondents. The data were analysed using descriptive statistics and reliability testing, with Cronbach’s alpha indicating strong internal consistency (0.894). The findings reveal that direct price reductions have a stronger immediate influence on purchasing behaviour, particularly in encouraging unplanned spending and store switching. However, loyalty programs contribute to increased customer retention, spending concentration, and perceived satisfaction. While consumers recognise the value of both strategies, price sensitivity remains a dominant factor, highlighting the need for retailers to balance short-term incentives with long-term engagement strategies.