Group Written Assignment

Customer Loyalty: The Influence of Customer Engagement through Customer Loyalty Program.

Prepared for Dr. Noor Akma Binti Mohd Salleh

Prepared by

Suraya Natrah Malek CGA 130148Logeswari Murugesan CGA 120150Suriati Hussain CGA 130129

Contents

1.0 BACKGROUND.................................................................................................................1

2.0 PROBLEM STATEMENT................................................................................................1

3.0 RESEARCH QUESTIONS................................................................................................3

4.0 RESEARCH OBJECTIVES..............................................................................................3

5.0 LITERATURE REVIEW..................................................................................................3

6.0 THEORETICAL FRAMEWORK....................................................................................4

7.0 HYPOTHESES...................................................................................................................5

8.0 METHODOLOGY.............................................................................................................6

8.1 MEASURES.....................................................................................................................6

9.0 DATA ANALYSIS AND FINDINGS................................................................................6

9.1 DEMOGRAPHIC.............................................................................................................6

9.2 NORMALITY ASSESMENT..........................................................................................7

9.3 RELIABILITY..................................................................................................................7

9.4 FACTOR ANALYSIS......................................................................................................7

9.5 CORRELATION ANALYSIS..........................................................................................9

9.6 REGRESSION ANALYSIS.............................................................................................9

10.0 RECOMMENDATION....................................................................................................11

11.0 LIMITATION......................................................................................................................12

12.0 CONCLUSION....................................................................................................................12

APPENDIX 1 - QUESTIONNAIRE..........................................................................................15

APPENDIX 2 - DEMOGRAPHIC.............................................................................................18

1.0 BACKGROUND

In a service oriented industry like the telecommunication industry, loyalty is of the greatest importance. Several studies have been conducted on the correlation between increased levels of customer retention to increased revenue and profits. Cultivating customer loyalty is one of the key goals of relationship marketing (Palmer, Dant, Grewal, & Evans, 2006). Various strategies and programs are implemented by service providers to ensure their customers stay loyal and to reduce the number of customers who switch their services to other service providers.

One of the many strategies adopted by telecommunication service providers to improve customer loyalty is to implement customer loyalty programs. The goal of these programs is to establish a higher level of customer retention especially in the high values customer segments by providing increased satisfaction to these customers (Bolton, Kannan, Bramlett). Having a customer loyalty program does not automatically guarantee customer loyalty, but it does help an organization to get close to its customers through its customer engagement activities. This study is to investigate how an organization can increase customers’ emotional engagement through its loyalty program and how this emotional attachment affects customer loyalty. The study uses Telekom Malaysia TM Rewards program as a case study.

In 2010, Telekom Malaysia (TM) has launched a point based customer loyalty program called TM Rewards. The key objectives of the program are to have a closer engagement with customers and to develop a long lasting emotional attachment between customers and Telekom Malaysia.

A customer who enrols in the program can accumulate points every time they pay their bills promptly. These points can be used for bill rebates or to redeem various redemption merchandises. The following are the program basic characteristics:

Memberships are offered only to Telekom Malaysia customers. Point rewards are given to members who pay their bills promptly. Members can use their points for bill rebate or for merchandise redemption. Rewards points expire after 3 years Members receive additional benefits in the form of discount vouchers from

program participating partners, special promotion for members on Telekom’s other products and services and other benefits.

2.0 PROBLEM STATEMENT

Interviews were conducted with TM Rewards management and operational personnel to get detailed first-hand information on loyalty program from management perspective. There are a few area of concerns highlighted by the management which include:

Low members’ participation in the loyalty program. Currently, there are 15 percent active members in TM Rewards. This study defines an active member as a member who has at least made one contact with the program through its various touch points within one year. Since the main objective of the

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loyalty program is to have closer engagement with customers, low members participation indicates the program does not meet its original objective.

Reasons why customer do not become active in the programThere is a need to conduct a study on why program members remain active in a loyalty program. The findings of this study could be used to formulate a strategy to improve members’ participation in the program.

Customers complaintsCustomers usually complaint about the negative experience they encounter such as difficulties in using the self-service customer portal, delay in getting redemption merchandise, incorrect point statement, and others. Since one of the goals of customer loyalty program is to enhance customer experience which can contribute to the overall effort of customer retention, customer complaints need to be addressed promptly and effectively.

Program effectiveness Program effectiveness could be measured based on how member perceive the program. High value perception indicates the effectiveness of the program. Organization should not measure program effectiveness solely from monetary benefits it bring to the organization but also from customers’ perspective. For example, TM Reward measure the effectiveness of the program is based on the following measurement criteria:

Comparison on the behavior of customers who are TM Rewards members against the behavior of overall customers of Telekom Malaysia in term of average revenue per user (ARPU) and in term of payment behavior.

Comparison on the percentage of program active members against the industry standard. TM Rewards defines an active member as a member who has at least made one contact with the program through its various touch points within one year.

Having a customer loyalty program does not translate to customer loyalty. In the telecommunication industry in Malaysia, most if not all of the players have implemented customer loyalty programs in one form or another. An understanding on the variables influencing customer perceived value of customer loyalty program could help an organization to continuously engage its customers with the goal of creating greater customer experience which may lead to customer loyalty. Boltan et al. (2000) suggested that “customer motives for loyalty program participation and perceived value of a specific customer loyalty program are linked to each other”.

Many organizations found that a lot of members do not continuously engage with the loyalty program. The problem occurs when the loyalty programs fail to treat their members as their core element. The first step to achieve the effectiveness of customer loyalty program is by looking at it from members’ point of view. The entire structure of the program needs to be based on both of the organization as well as the customer objectives and perspectives.

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3.0 RESEARCH QUESTIONS

In this research, we will analyse the effectiveness of a customer loyalty program from the customer perspectives and the following research questions are defined:

1. What are the factors that influence consumers to have a commitment in a loyalty program?

2. How does customer commitment affect customer loyalty?

The findings could be used by the organization to develop a strategy to increase participation of non-active members.

4.0 RESEARCH OBJECTIVES

The research objectives of the study are:

1. To examine the relationship between customer motives (utilitarian motives and hedonic motives) to customer commitment in a loyalty program.

2. To determine the relationship between commitment and customer loyalty.

5.0 LITERATURE REVIEW

In order to get detailed insights on how customer loyalty program affects customer loyalty, various literature on the subjects are used as references. The keywords used when searching for these literature are ‘loyalty program’, ‘loyalty program perceived value’, ‘loyalty program effectiveness’, ‘telecommunication industry loyalty program’ and ‘benefits of loyalty program to customers.

A few literatures suggest that the main factor customers join a loyalty program and how it strengthens the relationship with the organization is due to the perceived benefits of the program (Bolton, lemon and Verhoef, 2004). Previous research has classified these benefits into the following categories - utilitarian benefits and hedonic benefits.

According to Mimouni-Chaabane and Volle (2010), “utilitarian benefits are benefits which are primarily instrumental, functional, and cognitive, provide consumer value by offering a means to some end”. Hirschman and Holbrook (1982) describes hedonic values are “values that come from non-instrumental, experiential, emotional, and personally gratifying benefits”.

Utilitarian values financial values to loyalty program members such as product discounts, appreciation reward points, free airtime for mobile phone users and special offerings to loyalty members.

Hedonic values come from intangible benefits in the form of emotional and physiological satisfaction such as gratification from redeeming merchandizes. Johnson (1999) argues that “loyalty programs attract consumers because of the pleasure associated with collecting and redeeming points”.

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Organization should be aware on how customers feel towards loyalty programs because these could gauge the customers’ attachment to the organization. Kreis and Mafael (2014) argue that customers’ value perception towards a loyalty program can be derived from whether the program fulfils customers’ needs.

6.0 THEORETICAL FRAMEWORK

The research theoretical framework is shown in the following diagram whereby the main dependent variable is customer loyalty. The independent variable is utilitarian motive – financial advantages and hedonic motives – excitement and experience. Emotional engagement is the mediating variable. The mediating variable is further classified into commitment.

Figure 1: Direct relationship between independent and dependent variables

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Figure 2: Mediating variable between independent and dependent variables

7.0 HYPOTHESES

The following hypothesis will be tested in order to assist in meeting the research objectives:

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8.0 METHODOLOGY

8.1 MEASURESThe research data was collected through questionnaires (Appendix 1) that were randomly distributed to TM (Telekom Malaysia) clients at the TM Point Menara TM outlet. Permission was obtained with the help of TM Rewards personnel that was interviewed at the beginning of this report. The questionnaire starts with introductory statement that described the purpose of the survey and asked respondents to administer their own responses, and assuring them of confidentiality etc.

The questionnaire content was divided into 2 sections-demographic information and questionnaires related to the research model. In the survey we used seven-point Likert scales with 1=strongly disagree, to 7=strongly agree.

Out of 43 questionnaires that were distributed, only 39 respondents were members of TM Rewards program.

9.0 DATA ANALYSIS AND FINDINGS

During data analysis, we tried to transform and model the data with the objective of highlighting useful information suggesting possible recommendations, limitations and conclusions regarding customer loyalty in the TM Rewards Program. SPSS was used for the analysis of data.

9.1 DEMOGRAPHICBased on Appendix 2, most of the participants are female (60.5%), between the ages of 31 to 40 (32.6%), income level between RM 4,001 to RM 5,000 (39.5%) and most have been a member of TM Rewards between 1 to 5 years period (32.6%). This is probably due to the aggressive promotion and advertisement to new customers since it was launched in 2009. From the table, we can also see that most of the members have logged into TM Rewards Portal once in more than two months (39.5%); and 28 out of 39 respondents that have given back a complete questionnaire are not a member of other telco loyalty program.

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9.2 NORMALITY ASSESMENT

The normality test was assessed with the four construct in this study which are Benefit, Excitement, Commitment and Loyalty.

The result is shown as per the table below:

Normality Shapiro-Wilk (S-W) (p-value)

Skewness Kurtosis Mean Trimmed Mean

Commitment .184 -.273 .701 4.72 4.74Benefit .013 -.638 1.847 5.08 5.12Excitement .761 .254 -.029 4.47 4.46Loyalty .001 -1.283 2.248 4.93 5.03

Table 1: Normality Assessment Result

For a data to be normal, p-value needs to be more than 0.05. From the S-W test, we can say that Commitment and Excitement data are normal whereas Benefit and Loyalty are not normal. However, looking at the skewness level which is ±1.50, we consider the data as being normal. But the kurtosis indicates that there is a high “peakedness” for both. As for the mean, it indicates that on average the respondent has answered “slightly agree” for all the dimensions.

9.3 RELIABILITYThe reliability of the four scales (Benefit, Excitement, Commitment and Loyalty) is analysed using Cronbach alpha coefficient. The Cronbach alpha coefficient measures the scale’s internal consistency in which the ideal value should be above 0.7. Cronbach’s alpha with value more than 0.7 is considered high reliability and lower than that value is referred as low reliability. The Cronbach’s value for this study ranged from 0.778 to 0.930, thus showing that the scales were reliable and the items used for each scales hung together as a set and had positive correlation.

Benefit showed a good Cronbach’s alpha (0.821). While for the Excitement and Loyalty, each of them showed a high level of internal consistency with the Cronbach alpha of 0.927 and 0.930 respectively. Commitment had an acceptable Cronbach’s alpha (0.778). The high values of Cronbach’s alpha (greater than 0.7) for all the variables illustrate that the questionnaire used in this study is reliable.

9.4 FACTOR ANALYSISThe factorability of the 15 items was examined with principal components analysis (PCA) using SPSS. The suitability of data for further analysis was assessed before performing the PCA. From the correlation matrix, it was revealed that there are many coefficients of 0.3 and above. The KMO measure of sampling adequacy was 0.802, exceeding the recommended value of 0.6, and the Bartlett’s test of Sphericity was significant (p<0.05) supporting the factorability of the correlation matrix.

PCA revealed the presence of 3 components with eigenvalue more than 1, exploring 55.9%, 13.2% and 9.2% respectively. The scree plot revealed a break after the 3rd component and

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the communalities were all above 0.3 (see table 2), that confirms each of the item shared a common variance with other items.

Using varimax with Kaiser Normalization rotation for the 15 items, the below rotated component matrix was revealed with the three factors explaining 78% of the variance. The suppression loading of less than 0.5 was selected because the sample is not very big. The result showed that all the 15 items have a primary loading over 0.5. The factor loading matrix is presented in Table 2.

Component Communalities

1 2 3

Excitement_MerchandiseRedemption .887 .826

Excitement_PointsForMerchandiseRedemption .832 .806

Excitement_DiscountVouchers .812 .762

Excitement_FeelHappyRedeeming .786 .718

Excitement_VariousBenefitsEnjoyment .722 .801

Excitement_FeelAppreciated .632 .719

Loyalty_Recommendation .862 .848

Loyalty_ShareExperience .848 .806

Loyalty_Convince .846 .846

Commitment_Assistance .801 .793

Commitment_PayOnTime .680 .623

Commitment_StayOnProgram .596 .525 .732Benefit_BillRebateRedemptionSavesMoney .850 .914Benefit_TMRewardsProgSavesMoney .818 .833Benefit_PointsForBillRebateRedemption .733 .703

We can see that all items are loaded in the same factors which show consistency with the construct. However loyalty and commitment have been interpreted as being in the same component by SPSS.

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Table 2 : Rotated Component Matrix

9.5 CORRELATION ANALYSISUsing the Pearson method, the below table shows the correlations among the variables. From the result below, all the variables show a significant positive relationship.

Mean_Benefit

Mean_Excitement

Mean_Commitment

Mean_Loyalty

Mean_Benefit 1 .582** .645** .487**

Mean_Excitement .582** 1 .573** .584**

Mean_Commitment .645** .573** 1 .811**

Mean_Loyalty .487** .584** .811** 1(*p<0.05, **p<0.01)

Table 3: Correlations of the variables

9.6 REGRESSION ANALYSISIn testing the hypothesis, regression analyses were carried out. Two parts of regression analyses were done for this study. First part was to analyse the direct relationship between the utilitarian and hedonic motives and customer loyalty, and the second was to analyse the relationship mediated by commitment.

First analysis results are as below:

Part 1 Independent Variables

Dependent Variable

R² Adjusted R²

Beta (β)

Regression 1 Mean_Benefits Mean_Loyalty 0.374 0.339 0.222Mean_Excitement 0.455**

(*p<0.05, **p<0.01)

The first analysis had an R squared value of 37% that indicates utilitarian and hedonic motives explained this amount of the variance in customer loyalty. Although the result for utilitarian motives showed a medium strength correlation with customer loyalty (r=49%, n=39, p<0.01), it however does not contribute significantly to customer loyalty (β=22%, p>0.05). This is probably because a customer’s loyalty towards a program does not depend on how much the customer are able to gain from financial advantages. Hypothesis 1 is not supported.

The result showed that hedonic motives correlate strongly with loyalty (r=0.584, n=39, p<0.01). It also showed that a significant unique contribution comes from this motives (β=46%, p<0.05). This probably explains that when customers experience hedonic motives, they feel happy and excited, and thus looking forward to redeeming rebates and vouchers hence making them loyal to the program. Hypothesis 2 is thus supported.

For the second part, two regression analyses were carried out to see the relationship between mediating variable ie commitment with both the independent variables and dependent variable. Below are the results.

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Table 4 : Regression result for direct relationship

Part 2 Independent Variables

Dependent Variable

R² Adjusted R²

Beta (β)

Regression 1 Mean_Benefits Mean_Commitment 0.475 0.446 0.472**Mean_Excitement 0.298

Regression 2 Mean_Commitment Mean_Loyalty 0.658 0.649 0.811**(*p<0.05, **p<0.01)

The value of R squared above indicates that Benefit and Excitement explained 48% of the variance in Commitment whilst Commitment explained 66% of the variance in Loyalty.

There is a strong positive correlation between Benefit and Commitment of 65% (n=39, p<0.01). It also predicted that Benefits make a strong unique contribution of 47% (p<0.05) in explaining Commitment as compared to Excitement that does not make a significant unique contribution (β=30%, p>0.05) although its correlation was a strong 57% (p<0.05). Unlike the result showed between utilitarian motives and customer loyalty in the direct relationship, financial advantages however shows a significant relationship to commitment. This is probably because when members find that they could have financial advantages from the bill rebates for instance; members would show more commitment to collect more points to reap the benefit. With these points we can say that Hypothesis 3 is supported and hypothesis 4 is not supported.

On the second regression analysis, commitment and loyalty have a very strong positive relationship (r=0.811, n=39, p<0.01). Commitment also makes a very strong unique contribution to Loyalty (β=81%, p>0.05). This is probably because when members feel committed to the program, they will not tend to change provider and hence increase their loyalty towards the program. Hypothesis 5 is thus supported

The final regression was done to analyse the mediation effect. Below are the results.

Part 2a Independent Variables

Dependent Variable

R² Adjusted R²

Beta (β) Sig.

Regression 1 Mean_Benefits Mean_Loyalty 0.690 0.664 -0.144 0.278Mean_Excitement 0.223 0.076Mean_Commitment 0.777** 0.000

(*p<0.05, **p<0.01)

The relationship above describes that Loyalty has significant relationship with commitment, but a non-significant relationship with benefit and excitement. From the result obtained, it favours our hypothesis that commitment mediates utilitarian and hedonic motives for customer loyalty to take place. Members become more loyal to the program when their commitment increases, given the benefits and excitement that made them feel committed. Hypothesis 6 is thus supported.

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Table 5: Regression result for mediating variable with independent and dependent variables

Table 6: Regression result for mediating variable

10.0 RECOMMENDATION

Based on the data analysis, hypothesis 5- “There is a positive relationship between commitment and customer loyalty” is supported. This means, if a customer is an active and committed customer loyalty program member, he or she will remain loyal to the organization. This finding is similar with Kim et al. (2013), “program loyalty was a significant predictor of customer loyalty”.

TM Rewards currently has 15% active members. Since there is a positive relationship between member’s commitment and customer loyalty, it is recommended that Telekom Malaysia should entice its 85% non-active TM Rewards members to become more active and be more engaged in the program.

Based on previous interview, TM promotions are limited to Below the Line (BTL) promotions such as on the ground events, marketing at TM point outlets, and telemarketing. It is highly recommended that TM starts promoting TM Rewards using Above the Line (ATL) approach such as TV marketing campaign because it has wider coverage and largest audience. This approach promotes the program to non-active members as well as non-members.

The survey result also shows that commitment mediates the relationship between financial motive and hedonic motive to customer loyalty program (H6). TM Rewards rebate redemption is a successful approach supported by the data. Hence, TM should maintain this redemption scheme or TM can also increase the rebate amount to make it more attractive.

The survey analysis also shows that there is no direct relationship between hedonic motives and commitment (H4). In many literatures, it has been suggested that hedonic benefits is one of the factors why people join a loyalty program (Mimouni-Chaabane and Volle, 2010). Even though the data analysis does not show that there is a direct relationship between hedonic benefits and commitment, this is probably due to the hedonic benefits (merchandise benefits) do not trigger sufficient excitement for members. We suggest TM to implement new strategy to overcome this problem. For example TM can engage premium partner for its merchandise redemption as well as having collaboration with major retail outlets.

The results that showed financial motives do not have relationship with customer loyalty (H1) and commitment (H3) could suggest that TM should probably have more attractive financial benefits to offer to their members to increase their commitment and loyalty. For example having more rebate programs that further contributes to more savings for the members.

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11.0 LIMITATION

This survey has a few limitations. One of the limitations is the small sample size. Since the survey period is short, we only captured the data from a limited sample, which is customers who visited TM point at Menara Telekom. In order to get better result, a bigger sample sized from different geographical area should be used in future research. One way to accomplished this is by having a collaboration with TM Rewards to conduct an online survey via email to the active members. Additional questionnaires could also be developed so that the data could be analysed more accurately.

Another limitation to this survey is that it might not be applicable to other industries since the survey was conducted only with customers in the telecommunication industry. Other industry such as retails and banking may produce different result from the study.

This study found that there is no direct relationship between financial advantages and customer loyalty. Future research could be conducted to investigate further.

12.0 CONCLUSION

From the study, it can be concluded that customer loyalty program does contribute to customer loyalty. Both financial (utilitarian) and hedonic benefits play important roles in customer loyalty. Many organizations spend a lot of money implementing customer loyalty program. However, not many members seem to value the program offering (Kreis, H, Mafael, A 2014). Since there is a direct relationship between loyalty program and customer loyalty, companies should continuously promote its customer loyalty program. According to Yi and Jeon (2003), “loyalty program may only be successful in building customer loyalty if they actually contribute to customer value perception and in turn increases in value drive customer loyalty”.

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REFERENCES

TM Rewards, Available at: < https://www.tm.com.my/TMRewards/Consumer/Pages/Home.aspx >

Keller, KL 2013, Strategic Brand Management: Building, Measuring, and Managing Brand Equity, 4th edn. Pearson, England.

Lovelock, C, Wirtz, J 2011, Service Marketing: People, Technology, Strategy, Pearson, 7th

edn. England.

Aaker, D 2014, Aaker on Branding: 20 Principles That Drive Success, Morgan James Publishing, New York.

Kreis, H & Mafael, A 2014, ‘The influence of customer loyalty program design on the relationship between customer motives and value perception’, Journal of Retailing and Consumer Services, 21 (2014) 590–600.

Kim, HY , Lee, JY , Choi, D , Wu, J & Johnson, KKP 2013, ‘Perceived Benefits of Retail Loyalty Programs: Their Effects on Program Loyalty and Customer Loyalty’, Journal of Relationship Marketing, 12:2, 95-113.

Ryu, K, Han, H & Jang, S 2010, ‘Relationships among hedonic and utilitarian values, satisfaction and behavioral intentions in the fast-casual restaurant industry’, International Journal of Contemporary Hospitality Management Vol. 22 No. 3, 2010 pp. 416-432.

Toufaily, E & Ricard, L 2012, ‘Customer loyalty to a commercial website: Descriptive meta-analysis of the empirical literature and proposal of an integrative model’, Journal of Business Research, 66 (2013) 1436-1447.

Lewis, M 2014, ‘The Influence of Loyalty Programs and Short-Term Promotions on Customer Retention’, Journal of Marketing Research, Vol. XLI (August 2004), 281–292.

Stauss, B, Schmidt, M & Schoeler, A 2005, ‘Customer frustration in loyalty programs’, International Journal of Service Industry Management, Vol. 16 No. 3, 2005 pp. 229-252.

Tor W. Andreassen Line L. Olsen, (2008),’The impact of customers' perception of varying degrees of customer service on commitment and perceived relative attractiveness’, Managing Service Quality: An International Journal, Vol. 18 Iss 4 pp. 309 – 328.

Anna S. Mattila, (2004), ‘The impact of service failures on customer loyalty’, International Journal of Service Industry Management, Vol. 15 Iss 2 pp. 134 – 149.

Maria Del Mar Alonso-Almeida Merce Bernardo Josep Llach Frederic Marimon, (2014), ‘Building loyalty through functional and hedonic quality’, Industrial Management & Data Systems, Vol. 114 Iss 3 pp. 387 – 404.

Aida Mimouni-Chaabane, Pierre Volle 2010, ‘Perceived Benefits of Loyalty Programs: Scale Development and Implications for Relational Strategies’ Journal of Business Research, 63 (1), pp.32-37.

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O’Brien, L & Jones, C 1995. ‘Do Rewards Really Create Loyalty?’ Harvard Business Review, 73 (May/June): 75-82.

Ruth N. Bolton, P.K. Kannan & Mathew D. Bramlett. 2000, ‘Implications of Loyalty Program Membership and Service Experiences for Customer Retention and Value’ Journal of the Academy of Marketing Science, Volume 28, and No.1: 95-108.

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APPENDIX 1 - QUESTIONNAIRE

Dear Sir/Madam,

We are a group of MBA students from University Malaya, Kuala Lumpur currently doing a project to fulfil our subject requirement for Research Methods in Business (CMGB 6103). We are interested to know how customer engagement can influence the effectiveness of a loyalty program i.e. TM Rewards offered by TM Malaysia to their members like you. This research will enable TM Malaysia to develop strategies to enhance customers’ loyalty as well as increasing participation from the non-members. For this purpose, we would like you to fill in the following questionnaire. It will take no more than five minutes of your time. Your response will be kept strictly confidential and will be used only for the purpose of this study. Thank you so much for your time.

Kind Regards, Suraya Natrah Malek (CGA 130148)Logeswari Murugesan (CGA 120150)Suriati Hussain (CGA 130129)

Please tick () your answer in the place that best describe the followings

Section A: Respondent Profile1. Gender.

Male Female

2. Age group 3. Income level Below 21 Under RM 2,000 21 to 30 RM 2,001 to RM 3,000 31 to 40 RM 3,001 to RM 4,000 41 to 50 RM 4,001 to RM 5,000 51 to 60 RM 5,000 and above Above 60

Section B: Basic TM Rewards Information4. Are you a TM Rewards member?

Yes No ( Please specify) ________________________________________________

5. How long have you been a TM Rewards member? Less than 1 year 1 to 5 years More than 5years

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6. How often do you log in to TM Rewards PortalAt least once a

month

Once in 2month

Once in more than 2 months

7. Are you a member of other telco loyalty program? Yes No

Section C

Please tick () your answer in the place that best describe the followings

1StronglyDisagree

2Disagree

3SlightlyDisagree

4Moderate

5Slightly Agree

6Agree

7Strongly

Agree

C1: Benefits1 2 3 4 5 6 7

8. TM Rewards program saves me money 9. Bill rebate redemption saves me money 10. I like to use my points for bill rebate

redemption

C2: Excitement

11. I like to use my points for merchandise redemption

12. I am always looking forward to TM Rewards monthly promotion discount vouchers

13. I enjoy the various benefits offered by TM Rewards (such as discount vouchers offered by TM Rewards partners)

14. I feel excited from TM Rewards merchandise redemption

15. TM Rewards program makes me feel appreciated

16. Using TM Rewards makes me feel happy since I can redeem merchandises that I don’t usually get outside TM Rewards

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C3: Commitment1 2 3 4 5 6 7

17. I always pay my bill on time to earn points

18. I will not change my service provider from TM to others even if they have similar loyalty program

19. Customer Service Assistance makes me feel committed as a member.

C4: Customer Loyalty

20. I would recommend TM Rewards to my friends and family

21. I share my redemption experience in social media

22. I try to convince friends and family to visit TM Rewards portal

This is the end of the questionnaire. Please check to make sure you have not skipped any questions.

We sincerely appreciate your time and cooperation on this.Thank you!

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APPENDIX 2 - DEMOGRAPHIC

Statistics

Gender Age Income Level Membership Length Login_Frequency

N Valid 43 43 43 43 39 39

Missing 0 0 0 0 4 4

Statistics

Other_telco_membership

N Valid 39

Missing 4

Frequency TableGender

Frequency Percent Valid Percent

Cumulative

Percent

Valid Male 17 39.5 39.5 39.5

Female 26 60.5 60.5 100.0

Total 43 100.0 100.0

Age

Frequency Percent Valid Percent

Cumulative

Percent

Valid Below 21 1 2.3 2.3 2.3

21 to 30 12 27.9 27.9 30.2

31 to 40 14 32.6 32.6 62.8

41 to 50 12 27.9 27.9 90.7

51 to 60 3 7.0 7.0 97.7

Above 60 1 2.3 2.3 100.0

Total 43 100.0 100.0

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Income Level

Frequency Percent Valid Percent

Cumulative

Percent

Valid Under RM2,000 2 4.7 4.7 4.7

RM 2,001 to RM 3,000 8 18.6 18.6 23.3

RM 3,001 to RM 4,000 11 25.6 25.6 48.8

RM 4,001 to RM 5,000 17 39.5 39.5 88.4

Above RM 5001 5 11.6 11.6 100.0

Total 43 100.0 100.0

Membership

Frequency Percent Valid Percent

Cumulative

Percent

Valid Yes 39 90.7 90.7 90.7

No 4 9.3 9.3 100.0

Total 43 100.0 100.0

Length

Frequency Percent Valid Percent

Cumulative

Percent

Valid Less Than 1 Year 12 27.9 30.8 30.8

1 to 5 Years 14 32.6 35.9 66.7

More Than 5 Years 13 30.2 33.3 100.0

Total 39 90.7 100.0

Missing System 4 9.3

Total 43 100.0

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Login_Frequency

Frequency Percent Valid Percent

Cumulative

Percent

Valid At least once a month 10 23.3 25.6 25.6

Once In 2 months 12 27.9 30.8 56.4

Once in more than 2 months 17 39.5 43.6 100.0

Total 39 90.7 100.0

Missing System 4 9.3

Total 43 100.0

Other_telco_membership

Frequency Percent Valid Percent

Cumulative

Percent

Valid Yes 11 25.6 28.2 28.2

No 28 65.1 71.8 100.0

Total 39 90.7 100.0

Missing System 4 9.3

Total 43 100.0

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