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Article
Publication date: 27 November 2020

Minjung Shin, Ki-Joon Back, Choong-Ki Lee and Young-Sub Lee

This study aims to investigate ways in which hotel loyalty programs can be designed to enhance customer’s identification with a hotel brand and develop a sustainable…

Abstract

Purpose

This study aims to investigate ways in which hotel loyalty programs can be designed to enhance customer’s identification with a hotel brand and develop a sustainable customer-brand relationship.

Design/methodology/approach

The study adopted a cross-sectional design survey questionnaire for data collection and used structural equation modeling data analysis to test the conceptual model.

Findings

The three loyalty program experiences proposed (member-to-member similarity, memorable loyalty program experience and loyalty program social benefits) exerted significant positive effects on customer-brand identification (CBI), which, in turn, influences customer-brand relationship elements, including trust, commitment and switching resistance.

Originality/value

This study expands the scope of CBI literature, which previously focused substantially on brand level experiences, by being the first to explore a new set of CBI antecedents with a focus on loyalty program experiences. Furthermore, the current study’s findings delineate specific strategies to uphold the social and experiential aspects of loyalty programs that can develop sustainable customer-brand relationships.

Details

International Journal of Contemporary Hospitality Management, vol. 32 no. 12
Type: Research Article
ISSN: 0959-6119

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Article
Publication date: 30 May 2020

Melissa A. Baker and Tiffany S. Legendre

Loyalty programs are pervasive across service industries. However, the examination of cross-customer effects represents a critical gap in the loyalty literature. To…

Abstract

Purpose

Loyalty programs are pervasive across service industries. However, the examination of cross-customer effects represents a critical gap in the loyalty literature. To address this gap, this research conducts two between-subjects experimental design studies to examine traditional versus endowed loyalty status earner attitudinal loyalty intention toward the company, switching intentions and perceived unfairness.

Design/methodology/approach

Study 1 conducts a 2 (self: earned vs endowed) × 2 (others: earned vs endowed) between-subjects experimental design on the direct effects of attitudinal loyalty intention toward the company and switching intentions. Study 2 builds upon these findings by examining the mediation effect of perceived unfairness on the attitudinal loyalty intention toward the company and switching intentions.

Findings

Results from Study 1 find that cross-customer comparisons exist, and traditional loyalty members have negative attitudinal loyalty intention toward the company and switching intentions when comparing their rewards to endowed earner rewards. Study 2 examines an airline context and finds that unfairness mediates the relationship.

Originality/value

The research builds upon the literature surrounding cross-customer comparisons, loyalty programs, equity theory and endowed status and discusses the unintended negative consequences related to endowed loyalty rewards on other customer intentions that have critical managerial implications.

Details

Journal of Services Marketing, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 0887-6045

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Article
Publication date: 10 February 2020

Frauke Mattison Thompson and Sven Tuzovic

The purpose of this study is to investigate the extent to which loyalty programs can prevent switching, and how individual level cultural values impact this. Loyalty

Abstract

Purpose

The purpose of this study is to investigate the extent to which loyalty programs can prevent switching, and how individual level cultural values impact this. Loyalty programs are designed to create switching costs, which reduce customers’ desire to leave. However, in practice, these programs are often misapplied; that is, most companies inadvertently treat all customers as equal. While ample research has examined the role of loyalty reward programs in facilitating customer loyalty, little is known about the extent to which individual-level cultural values moderate customer loyalty measures of trust and affective commitment and how this impacts the effectiveness of loyalty programs; that is, consumers’ intentions to “stick” with the program or to switch.

Design/methodology/approach

This study uses a quasi-experiment combined with an extensive survey to collect the data.

Findings

Based on data collected from one industrial country and four emerging countries, the results show that loyalty programs do not universally prevent switching behavior. Instead, this study finds that individual-level uncertainty avoidance and collectivist values significantly moderate the effects.

Originality/value

This study helps advance the understanding of how international retailers can increase their loyalty program effectiveness and reduce customer switching to competitors.

Details

Journal of Services Marketing, vol. 34 no. 2
Type: Research Article
ISSN: 0887-6045

Keywords

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Article
Publication date: 4 September 2019

Wu He, Xin Tian and Feng-Kwei Wang

Few academic studies specifically investigate how businesses can use social media to innovate customer loyalty programs. The purpose of this paper is to present an…

Abstract

Purpose

Few academic studies specifically investigate how businesses can use social media to innovate customer loyalty programs. The purpose of this paper is to present an in-depth case study of the Shop Your Way (SYW) program, which is regarded as one of the most successful customer loyalty programs with social media.

Design/methodology/approach

This paper uses case study research as the methodology to uncover innovative features associated with the SYW customer loyalty program. The authors collected the data from SYW’s social media forums and tweets. The data set was analyzed using social media analytics tools including the R package and Lexicon.

Findings

Based on the research results, the authors summarize innovative social media features identified from SYW. The authors also provide insights and recommendations for businesses that are seeking to innovate their customer loyalty programs using social media technologies.

Originality/value

The results of this case study set a good example for businesses which want to innovate and improve their customer loyalty programs using social media technologies. This is the first in-depth case study on the SYW program, one of the most successful customer loyalty programs with social media. The results shed light on how social media can innovate customer loyalty programs in both theory and practice.

Details

Journal of Enterprise Information Management, vol. 32 no. 5
Type: Research Article
ISSN: 1741-0398

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Article
Publication date: 26 July 2013

Youjae Yi, Hoseong Jeon and Beomjoon Choi

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

Abstract

Purpose

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.

Design/methodology/approach

The authors conducted three experiments to test the hypotheses.

Findings

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.

Originality/value

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

Details

European Journal of Marketing, vol. 47 no. 8
Type: Research Article
ISSN: 0309-0566

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Article
Publication date: 6 July 2010

John D. Hansen, George D. Deitz and Robert M. Morgan

This study aims to present a taxonomic framework that categorizes hotel loyalty program members on the basis of involvement and a mix of behavioral outcome variables.

Abstract

Purpose

This study aims to present a taxonomic framework that categorizes hotel loyalty program members on the basis of involvement and a mix of behavioral outcome variables.

Design/methodology/approach

The taxonomy is derived through mixture modeling from a sample of 1,395 loyalty program members of two global hotel chains.

Findings

Study results suggest the presence of four classes of program members across both hotels. Class members differ with respect to the attitudes they hold, the behaviors they exhibit, and the motivations they have for maintaining membership in the program.

Practical implications

First, the study enhances understanding of member differences that exist within loyalty programs. Second, the study advances understanding of the ways through which loyalty programs can best be managed. Third, the study illustrates the usefulness of mixture modeling as a classificatory tool.

Research limitations/implications

Study results are not generalizable beyond the sample used in deriving them. Further, decisions pertaining to what variables to include in developing a taxonomic framework are critical to its usefulness. The choice to include certain variables as well as their related measures, to the exclusion of others, represents a second limitation.

Originality/value

The study is but the second to empirically categorize loyalty program members, and the first to do so in a services context. Two classes of high‐involvement customers emerge, each with contrasting attitudes and behaviors. Thus, our findings suggest that high levels of involvement invoke the most extreme of customer attitudes and behaviors.

Details

Journal of Services Marketing, vol. 24 no. 4
Type: Research Article
ISSN: 0887-6045

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Article
Publication date: 14 May 2018

Baolong Ma, Xiaofei Li and Lin Zhang

This paper aims to demonstrate both the positive and negative effects of loyalty programs. The study proposes a model to demonstrate why and how loyalty program strategies…

Abstract

Purpose

This paper aims to demonstrate both the positive and negative effects of loyalty programs. The study proposes a model to demonstrate why and how loyalty program strategies can result in good customer relationships and customer entitlement behaviors. Various configurations of three different loyalty program strategies are analyzed – tangible rewards, preferential treatment and perceived status.

Design/methodology/approach

The authors’ hypotheses were tested by analyzing the survey data of 152 frequent flyer program members in China through partial least squares-structural equation modeling. Fuzzy-set qualitative comparative analysis (fsQCA) was used to test different configurations of the three loyalty program strategies.

Findings

A net effects analysis demonstrates that loyalty programs are a double-edged sword. While loyalty programs can improve customer relationships, strategies based on perceived status have a positive relationship to customer entitlement, which may lead customers to expect extraordinary efforts from companies, such as greater discounts and extra privileges. Using fsQCA, the authors determined four sufficient configurations of high level of relationship quality and high level of customer entitlement, which also support their findings.

Originality/value

First, this study expands the research on loyalty programs by providing an examination of their positive and negative consequences. Second, by proposing the configuration paths that lead to high level of relationship quality and high level of customer entitlement using fsQCA, this research enriches research on the net effects of loyalty programs, providing researchers and practitioners with a more comprehensive understanding of loyalty programs. Third, this research extends the concept of customer entitlement to the context of buyer–seller relationships by introducing perceived status as an important antecedent of customer entitlement and by identifying four sufficient configurations.

Details

Journal of Services Marketing, vol. 32 no. 3
Type: Research Article
ISSN: 0887-6045

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Article
Publication date: 15 August 2016

Sreejesh S., Abhigyan Sarkar and Sudeepta Pradhan

This study aims to investigate how the influences of store loyalty programs on store loyalty and store relations can be mediated by the store satisfaction-love framework.

Abstract

Purpose

This study aims to investigate how the influences of store loyalty programs on store loyalty and store relations can be mediated by the store satisfaction-love framework.

Design/methodology/approach

The survey data were collected from selected retail stores using stratified random sampling. The hypotheses were tested using structural equation modeling.

Findings

The results indicate that the impacts of store loyalty programs on store loyalty and store relations are mediated both by store love and store satisfaction.

Practical implications

This study’s findings help practitioners by empirically demonstrating that the combined cognitive satisfaction of consumers with store loyalty programs and affective store love mediate the influences of loyalty programs on consumer loyalty toward the store and on the consumer–store relation. Therefore, cognitive satisfaction with loyalty programs alone cannot create strong loyalty and a customer relationship. Cognitive satisfaction with various loyalty programs must be converted into affective store love for the mediation to be significant and effective.

Originality/value

This research adds value to the domain of store loyalty research by empirically establishing the mediating role played by the cognitive satisfaction-affective love framework in shaping the influences of loyalty programs designed by store management on the final store loyalty and customer–store relationship.

Details

Management Research Review, vol. 39 no. 8
Type: Research Article
ISSN: 2040-8269

Keywords

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Article
Publication date: 8 April 2019

Nan Hua, Stephen Hight, Wei Wei, Ahmet Bulent Ozturk, Xinyuan (Roy) Zhao, Khaldoon Nusair and Agnes DeFranco

This paper aims to offer empirical insights on how investing in e-commerce capabilities affects the relationship between loyalty programs and hotel operating performance…

Abstract

Purpose

This paper aims to offer empirical insights on how investing in e-commerce capabilities affects the relationship between loyalty programs and hotel operating performance so as to aid in identifying proper resource allocation strategies.

Design/methodology/approach

This study extended the model in Hua et al. (2015) by testing the interaction of e-commerce and loyalty programs.

Findings

The findings illustrate that proper allocation of company financial resources to e-commerce initiatives can help improve the impact of loyalty programs on hotel operating performance.

Practical implications

The results of this study illustrate that hotel performance can be improved by the synergy between loyalty program and e-commerce initiatives. Thus, hotel managers and owners can use results from this study to improve the efficiency of their asset allocation strategies, with five practical implications offered.

Originality/value

Theoretically, this study adapted and extended an integrative model of hotel operating performance (Hua et al., 2015) by identifying critical factors that elucidate the variance in firm performance. In addition, the moderating role of e-commerce provides a new conceptualization of information technology. Practically, this study makes several important contributions as well.

Details

International Journal of Contemporary Hospitality Management, vol. 31 no. 4
Type: Research Article
ISSN: 0959-6119

Keywords

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Article
Publication date: 9 January 2017

Ada S. Lo, Holly Hyunjung Im, Yong Chen and Hailin Qu

This study aims to investigate the impact of the loyalty program members’ satisfaction toward the hotel loyalty program benefits and the customer management relationship…

Abstract

Purpose

This study aims to investigate the impact of the loyalty program members’ satisfaction toward the hotel loyalty program benefits and the customer management relationship initiatives of individual hotels on the brand relationship quality (BRQ), i.e. their relationship quality with the hotel brand, and its outcomes. The moderating impact of membership level on the hypothesized relationships was also investigated.

Design/methodology/approach

A usable sample of 920 active members of a hotel loyalty program was obtained. Structural equation modeling with partial least squares method was used to estimate the structural relationships and to investigate the moderating effect of membership level.

Findings

Employee’s customer orientation, membership communication and hotel stay-related benefits are determinants of the loyalty program members’ BRQ. BRQ is also confirmed as a higher-order construct of three latent variables which include trust, satisfaction and commitment. Moderating effects of the membership were partially supported in this study. The strongest effect of BRQ is on members’ word of mouth followed by shares of purchase. BRQ is found to have negative relationship with members’ willingness to serve as marketing resource, but the impact was small.

Research limitations/implications

This is a cross-sectional study with a population of active loyalty program members of only one luxury hotel group. The sample size of the top-tier members is also smaller in comparison to the other two groups.

Practical implications

This study contributes to the understanding of the antecedents and consequences of BRQ and the body of knowledge about loyalty program for hotel industry.

Originality/value

This is one of the few studies investigating the effectiveness of hotel loyalty programs from the active members’ perspective and the moderating effect of membership level on the relationships among BRQ, its antecedents and its outcomes.

Details

International Journal of Contemporary Hospitality Management, vol. 29 no. 1
Type: Research Article
ISSN: 0959-6119

Keywords

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