Consequences of Terrorism on Loyalty Programmes

Abstract

Terrorism has been thrust into our daily lives since atrocities such as the attacks on the twin towers of the World Trade Center in New York, elevated it to world attention. This resulted in a change in consumer behaviour with immediate effect not only with tourism and air travel (WTO 2002) but also with loyalty programmes.

To study this effect in relation to online loyalty programmes, ‘terrorfear was included in authors doctorial thesis to evaluate this effect. From a sample of 1,625 online respondents across four sectors (grocery, gift, adult, book) from Australia websites, results revealed a statistically significant and dramatic effect creating a diametrically opposed behaviour pattern shifting long-term perspective to short term perspective.

Businesses therefore need to be receptive and adaptive to this relatively recent phenomenon, by have contingency plans in place to respond accordingly. As there is an inverse relationship between costs and type of benefits offered (short verses long) these plans could consist of pre-arrangements with suppliers rather than having stock on hand but the ability to swiftly move strategies and access these short-term benefits thus adapting to the current environment and minimising costs.