The price transparency and its effect on customer loyalty

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School of Business | Bachelor's thesis
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Date

2025

Department

Markkinoinnin laitos

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Mcode

Degree programme

Markkinointi

Language

en

Pages

37

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Abstract

This bachelor’s thesis investigates how price transparency influences customer loyalty in today’s retail environment. The focus is on how transparent price information shapes customers’ psychological reactions and when these reac-tions support or harm loyalty. The thesis is based on a bibliometric literature review that combines a quantitative description of earlier research with a qualitative thematic analysis. The findings show that price transparency does not create loyalty directly, but works through three main mechanisms, that are perceived fairness, trust in the retailer and customer satisfaction. Transparent and clearly explained pric-es help customers see the price as reasonable, trust the retailer’s motives and feel more satisfied with the relationship. These together strengthen loyalty. At the same time, the findings show that transparency can also lead to negative reactions when prices break customers’ expectations, are presented through complex or confusing price structures, or are experienced as too high and poorly justified. The thesis brings these mechanisms together into an integrat-ed overall framework and offers practical implications for companies and di-rections for future research.

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Thesis advisor

Ilona Mikkonen, Nora Bäckman

Keywords

price transparency, customer loyalty, perceived fairness, satisfaction

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https://urn.fi/URN:NBN:fi:aalto-202601181406

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