To read this content please select one of the options below:

Segregation vs aggregation in the loyalty program: the role of perceived uncertainty

Youjae Yi (College of Business Administration, Seoul National University, Seoul, South Korea)
Hoseong Jeon (College of Business Administration, Hallym University, Chuncheon, South Korea)
Beomjoon Choi (College of Business Administration, California State University, Sacramento, California, USA)

European Journal of Marketing

ISSN: 0309-0566

Article publication date: 26 July 2013




The present study seeks to examine how perceived uncertainty of reward schedule and reward frame (i.e. segregated vs aggregated) affect consumers ' evaluation of loyalty programs.


The authors conducted three experiments to test the hypotheses.


Ambiguity aversion was salient when the subjects perceived low uncertainty in the schedule of a loyalty program, which led to customers ' choice of a loyalty program with an aggregated frame. In contrast, the subjects displayed ambiguity proneness when they detected a high level of uncertainty in the reward schedule; as a result, the subjects preferred a loyalty program that employed a segregated frame.

Research limitations/implications

The findings show that individuals adopt different types of attitudinal pattern and show dissimilar choice behaviors depending on reward schemes. The findings also provide insights to enhance the understanding concerning how consumers perceive the value of loyalty programs.

Practical implications

Previous research suggests the importance of random elements in relationship marketing. The present study supports this assertion by demonstrating that reward programs providing unexpected benefits can enhance the effectiveness of a loyalty program.


The results provide a more refined understanding about the relationship between perceived uncertainty and reward frame and the psychological mechanism underlying this relationship.



The authors thank Janghyuk Lee and anonymous reviewers for constructive comments on the earlier version of this paper. This research was supported by the Institute of Management Research at Seoul National University.


Yi, Y., Jeon, H. and Choi, B. (2013), "Segregation vs aggregation in the loyalty program: the role of perceived uncertainty", European Journal of Marketing, Vol. 47 No. 8, pp. 1238-1255.



Emerald Group Publishing Limited

Copyright © 2013, Emerald Group Publishing Limited

Related articles