The Role of Discount Pricing Strategies on Customer Loyalty
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Background of the study
Discount pricing strategies have long been employed by brands to attract price-sensitive consumers and stimulate short-term sales. In competitive markets, offering discounts can serve as an effective tool to increase customer loyalty by rewarding repeat purchases and incentivizing new customers to try a product (Afolabi, 2023). However, overreliance on discounts may also lead consumers to question the regular pricing, potentially eroding brand prestige. Research indicates that when executed strategically, discount pricing can strengthen customer relationships by creating a perception of value and fairness, which are essential for long-term loyalty (Chukwu, 2024). Brands must carefully balance discount offerings to avoid devaluing the product while still providing attractive incentives. This study investigates the role of discount pricing strategies in influencing customer loyalty, analyzing data from loyalty programs, sales records, and consumer surveys. The aim is to identify optimal discount approaches that enhance customer loyalty without compromising brand integrity (Okeke, 2025).
Statement of the problem
While discount pricing strategies are effective in boosting short-term sales, they can undermine long-term customer loyalty if overused. Consumers may become accustomed to discounts, reducing their willingness to purchase at regular prices and potentially harming brand perception. Despite the known benefits, there is limited research on how discount strategies impact loyalty over time, particularly in competitive markets. This study seeks to address the gap by exploring how various discount pricing approaches influence customer loyalty and overall brand perception (Ibrahim, 2023).
Objectives of the Study
To evaluate the impact of discount pricing on customer loyalty.
To identify effective discount strategies that promote long-term loyalty.
To recommend best practices for balancing discounts and brand value.
Research questions
How do discount pricing strategies affect customer loyalty?
What discount approaches are most effective in retaining customers?
Which strategies can prevent brand devaluation while offering discounts?
Significance of the Study
This study is significant as it examines the influence of discount pricing strategies on customer loyalty, providing actionable insights for brands to optimize their pricing tactics. The findings will aid in designing discount programs that reinforce customer loyalty and enhance brand perception (Chin, 2024).
Scope and Limitations of the Study
The study is limited to selected industries where discount pricing is prevalent and focuses on its impact on customer loyalty. It does not extend to all market sectors or international contexts.
Definitions of Terms
Discount Pricing Strategies: Promotional pricing tactics offering reduced prices.
Customer Loyalty: The tendency of customers to repurchase from a brand.
Brand Integrity: The perceived consistency and quality of a brand.
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