This paper studies the effect of loyalty in retail with a focus on the Republic of Croatia. In the context of this effect, the author has analyzed the retail sales in Croatia, and the historical, political and economic influences that preceded and influenced the development of retail sales and the inclusion of the same in foreign flows and trends. She watched the developments in the last twenty years, and ordered the two socio-economic phases (phase of transition and phase of the European Union) that have shaped today's retailers. She analyzed the current state of retail sales which is mainly characterized by the entry of foreign investors, strengthening the range of products and services, changes in consumption and the protection of consumers, which is one of the key factors of the accession of Croatia to the European Union. Author logically defined the concept of loyalty and explained how and in what way it affects retailers. She investigated and stated what kind of loyalty programs are there and ultimately the aims of these programs. Finally, she explained the mesaurment system of loyalty in retail and explained how and in what way we can measure the success of implemented loyalty programs. After approaching the loyalty she took for example the most successful Croatian retail chain, Konzum, to which the quality of the example showed retail trends in Croatia. She described briefly the structure, leadership and financially situation and income of the above companies. She analyzed the competition in the regional market and compared the revenue and earnings of Konzum with the competition. Author also analyzed their most successful loyalty program, named MultiPlusCard program and explain when it started, how it is implemented and in what way didi Konzum implemented it in Croatia and abroad. At the end of the paper she brought out her conclusions on the development of retail trade in the Republic of Croatia and the effect of loyalty and its importance in retail.