Factors that determine store loyalty: the case of selected supermarket chains in Nairobi.

Abstract

This study was conducted with the objective of finding out the factors that determine store loyalty and also determine the most important of such factors. The focus of the studywas the main supermarket chains in Nairobi.

To achieve the above objective, a sample of 144 customers was picked and a questionnaire was administered to each of them. The questionnaire had semi-structured and likert scale questions. The four main supermarket chains in Nairobi which include Uchumi,Nakumatt, Tusker and Ukwala were picked. Four respondents were picked from each of the 36 branches of the four chains. A recruitment guide was used to determine the loyal customers. Every fifth adult customer leaving the supermarket was asked to fill the recruitment guide to determine the loyalty status and then the questionnaire if one qualified. The researcher picked the next person in cases where one failed to qualify as loyal. Any person who had shopped in the same supermarket for more than one year was taken to be a loyal customer. The questionnaires were picked later from the respondents.

Data collected was analysed usmg the percentages, means and standard deviations. Ranking was also done. Factor analysis was used to reduce the variables and determine inter relationships.

Analysis of the data indicated that there are many factors that customers consider important in their decision of where to shop. Factors such as prices of the products, availabilityof all types of merchandise, employees knowledge of products and employees beingwarm and courteous were brought out as being important. After carrying out factor

analysis on the variables, twelve factors emerged and the variables that customers considered important were fitted to the twelve factors.

When ranking was done availability of merchandise came out as the most important factor followed by location and the store operational hours. Prompt service was also rated very high in the determination of store loyalty.