Are pub discount cards loyalty cards?

Hobbs, Rachel and Rowley, Jennifer (2008) Are pub discount cards loyalty cards? Journal of Consumer Marketing, 25 (6). pp. 369-377. ISSN 0736-3761

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Abstract

Abstract: Purpose – This research aims to explore the extent to which pub or bar discount cards that are distributed to students function as loyalty cards, or make a contribution to relationship building. The research also aims to make a contribution to the role of “instant discount” loyalty cards. Design/methodology/approach – Data were collected on the design of the discount card schemes, their advantages and disadvantages from the customer and management perspective, the business motivations for introducing the scheme, the student motivations in purchasing the cards, and the impact of membership on profitability, popularity of venues, and repeat visits. Three main methods of data collection were used: questionnaires to collect a profile of customers' views; a focus group to gain a more in-depth understanding of customer attitudes and behaviour; and, interviews with pub managers to understand the operation of the scheme and their perceptions of the impact of the scheme. Findings – Pub discount cards do not generate either behavioural or attitudinal loyalty directly, but indirectly through the issue of a discount card, whose associated discounts cause a “flocking” behaviour through which the atmosphere in the pub is enhanced and its popularity and patronage are increased. The relationship between the customer and the pub is then mediated by customer-to-customer interactions and, thereby, in turn the discount cards “add value” for both customers and businesses. Originality/value – This research makes a contribution to the use of discount/club cards in the hospitality sector, outside of the major schemes such as airline and hotel reward schemes. In addition, research into the use of these schemes provides a unique opportunity to understand the way in which the student demographic adopts and uses loyalty and discount cards.