International Journal of Retail & Distribution Management

Purpose – This research aims to empirically develop a reliable and valid scale for measuring the service quality of retail loyalty programmes (loyalty programme service quality (LPSQual)) in the context of department stores and superstores in Malaysia.

Design/methodology/approach – By adapting the process proposed by Churchill for developing measures of marketing constructs, an instrument to assess LPSQual in Malaysia is formulated. The methodology consists of developing the scale based on a literature review and qualitative method. The proposed scale is then purified and validated through exploratory factor analysis and confirmatory factor analysis.

Findings – The proposed instrument (LPSQual) contains 26 attributes in seven dimensions: reward, tangibility, policy, information usefulness, courteousness/helpfulness, personalization and communication.

Research limitations/implications – Further testing of the scales across multiple contexts is necessary for validity enhancement.

Practical implications – Retail managers must give serious thought to the non-material or “soft-benefits” component in a loyalty programme which emphasizes courteous/helpful and personalized services. Thus, managers need to focus on service personnel by providing training to upgrade employees' skills in creating and delivering pleasant experience/service encounters to cardholders.

Originality/value – The main contribution of this paper is the development and validation of a new scale called LPSQual, which focuses on service quality in a loyalty programme. On the one hand, it is a pioneer in the study of service quality in loyalty programmes and, on the other hand, it confirms results from other researches on non-material strategies that can be used in loyalty programmes.