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The Enis-Paul Index Model

The formula used to create the Enis-Paul Index is designed to calculate consumer inclination to patronise a given store during a specified period. In this approach, which defines absolute loyalty as one hundred percent and total promiscuity as zero percent, a loyal customer would have to patronise few stores, spend a high proportion of their available budget in a preferred store and not exhibit switching behaviour.

Li = (1 / 3) [ bi - si x (n + 1) / (k + n) - pi / m ]

For variables defined as follows:
Li = the loyalty of the ith consumer towards the store;
bi = the fraction of the budget for the product class allocated to the store during the survey period by the ith consumer;
si = the number of switches from the store to other stores during the survey period by the ith consumer;
pi = the number of stores patronised by the ith consumer during the survey period
m = the total number of store visits during the survey period
k = m - 1 = the number of opportunities to switch stores
n = the number of stores available to the consumer to purchase product category goods during the survey period.

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