Effects of Loyalty Programs on Financial Performance: The Moderating Role of Company Size.

Abstract

The purpose of this study was to develop an original framework to explore the direct effect of Loyalty programs on a firm’sfinancial performance and to discuss the moderatingrole of company size. The study applies two original concepts-Loyalty programsand companysize to develop an integral model that enhances the firm’sfinancial performance.Secondary data was extracted from financial statements. Explanatoryresearch design which wasnon-experimental in nature was employed to analyze the effect of company size on financial performance of selected service industry firms. Panel data analysis was used to link the relationship between the Loyalty programs, company size and financial performance.Findings indicated that company size moderatesthe relationship between loyalty programs and Financial Performance of the selected firms in the service industry in Kenya