Building and sustaining profitable customer loyalty for the 21st century

The concept of customer loyalty is conspicuous by it's ubiquity. Therefore, there is no surprise that it is one of the most widely studied areas by researchers and one of the most widely implemented marketing initiatives, by practitioners. This article draws upon past research to review important findings related to customer behavior and attitude in the context of customer loyalty. Further, research related to linking loyalty to profitability and forward looking metric such as the customer lifetime value is reviewed to propose a conceptual framework for building and sustaining loyalty and profitability simultaneously at individual customer level. A two-tiered rewards structure is presented as a means for marketers to operationalize the framework. The conceptual framework hopes to serve as a platform to understand the evolving dominant logic of loyalty programs for building and sustaining loyalty in the twenty first century as well as induce further research in that direction. (C) 2004 New York University. Published by Elsevier. All rights reserved.