Incentives, benefits, identification, and relationship quality in the Danish retail industry

The purpose of this paper is to explore the relationship between retailers and their consumers by analyzing the importance of the benefits (material and non-material) that consumers receive from a retail organization. The paper departures from a services marketing perspective, including customer based brand equity, and the focus is put on consumer identification with the retailing organization and their perceptions of satisfaction and future commitment. Drawing on the tenets of services marketing and social identity theory, the study proposes a model of the relationship among the relevant constructs. This is tested by using survey data collected from 1000 respondents of a Danish retail organization. The sample is restricted to members of this Danish retail organization’s membership program. The data analysis is performed through variance-based structural equation modelling using the partial least squares method. The paper posits organizational identification as a nexus between consumer perceptions of a retail organization and the quality of the ongoing relationship between the retail organization and consumers participating in the member-program. From a practical perspective this study demonstrates the importance of relational issues that promote organizational identification as a mean of strengthening relationships with consumers. The paper finds that significant links exist between the benefits that consumers receive and their degree of organizational identification with the member program. The consumer’s mind-set is key to the membership-program and relationship quality. Additionally, trust in the organization and the intention to maintain a long term relationship determines consumer’s involvement in the retail organization’s membership program.