The impact of customer relationship management on customer loyalty and customer retention within UK-based SMEs in the beauty industry: a case study of Panache Beauty
Year: 2025
Type: dissertation
Study design: Observational Study
Abstract: Customer loyalty is an important aspect of the business, especially when it comes to the service sector. Loyal customers reflect the organisation's performance, and it helps the company gain a competitive advantage over rival brands. Time and again, it is proved that the retention of clients is a much more effective and cheaper method for business growth rather than gaining a new customer. With this awareness, companies are trying hard to take measures to retain their customers and maintain customer loyalty. Customer relationship management is the key to this, and the organisation needs to gain the trust and commitment of customers to retain them. The beauty industry is one of the most competitive industries in the service sector.With so many competitors existing in the market and new ones appearing on a daily basis, organisations need to take measures to ensure customer retention. In the case of beauty salons, customers are the key assets. Only those organisations that identify and value this fact will be able to survive the high competition and rivalry existing in the market. This research explains the importance of customer relationship management, customer loyalty and customer retention that helps organisations in the service sector by analysing the customer relationship management of Panache Beauty, an SME in the UK that provides skin and facial treatments.The research was conducted based on available literature in the field of customer relationship management, customer loyalty and retention in the beauty parlour industry. Other than depending on existing literature, a survey and a few interviews were conducted to understand the market and attitude of Panache Beauty customers. Surveys and interviews were also useful in studying the expectations of customers during their visit to the parlour. Various factors affecting customer relationship was also revealed during the survey and interviews. The results are analysed using statistical analysis methods available under SPSS and presented and compared under various subsections.On analysing the survey results, it became clear that one of the most effective methods to overcome the risk posed by larger organisations to SME's in the beauty sector is to have loyal customers. It is wiser to retain existing customers than find new ones as it is cheaper than the latter method. The study also revealed that beauty parlours are considered a facility to get beauty-related treatments and as a place of relaxation. Thus, it was found that the overall environment also plays a crucial role in ensuring customer retention. The most important factor that influences customer satisfaction is staff behaviour. From the study, it became clear that the organisations that are able to ensure skilled and experienced staff, who are also good at communicating with the customer, are more likely to thrive in the business. Various other aspects were also found important in customer satisfaction and retention in the beauty industry. The research also suggests various methods that can be adopted by Panache Beauty in order to ensure customer satisfaction and thereby customer retention as well as loyalty and thus overcome the tough competition posed by rival brands.
Author: Jha, Suprim
Institution: University of the West of Scotland
Language: English
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W7103894848
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