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Loyalty program rewards and their impact on perceived justice, customer satisfaction, and repatronize intentions

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  • Söderlund, Magnus
  • Colliander, Jonas

Abstract

This study examines three types of rewards in a retail loyalty program context (under-reward, equity-reward, and over-reward) and their impact on perceived distributive justice, customer satisfaction, and repatronize intentions. The results from a between-subjects experiment showed that equity-reward produced higher levels of perceived distributive justice than both under-reward and over-reward. Moreover, equity-reward and over-reward produced higher levels of both customer satisfaction and repatronize intentions than did under-reward. Yet there were no differences in satisfaction and repatronize intentions for equity-reward and over-reward. These outcomes suggest that loyalty programs have the potential of not boosting members' loyalty, at the same time as they may reduce loyalty among non-members.

Suggested Citation

  • Söderlund, Magnus & Colliander, Jonas, 2015. "Loyalty program rewards and their impact on perceived justice, customer satisfaction, and repatronize intentions," Journal of Retailing and Consumer Services, Elsevier, vol. 25(C), pages 47-57.
    • Handle: RePEc:eee:joreco:v:25:y:2015:i:c:p:47-57
    DOI: 10.1016/j.jretconser.2015.03.005
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    4. Chen, Yanyan & Mandler, Timo & Meyer-Waarden, Lars, 2021. "Three decades of research on loyalty programs: A literature review and future research agenda," Journal of Business Research, Elsevier, vol. 124(C), pages 179-197.
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    7. Gabel, Sebastian & Guhl, Daniel, 2022. "Comparing the effectiveness of rewards and individually targeted coupons in loyalty programs," Journal of Retailing, Elsevier, vol. 98(3), pages 395-411.
    8. Chang, Woojung & Song, Ji Hee & Lee, Sungho, 2020. "Observation of other's preferential treatment as a constructive catalyst for improved repatronize intentions," Journal of Retailing and Consumer Services, Elsevier, vol. 57(C).
    9. Cavdar Aksoy, Nilsah & Yazici, Nihal, 2023. "Does justice affect brand advocacy? Online brand advocacy behaviors as a response to hotel customers’ justice perceptions," Journal of Retailing and Consumer Services, Elsevier, vol. 73(C).
    10. Bahri-Ammari, Nedra & Bilgihan, Anil, 2017. "The effects of distributive, procedural, and interactional justice on customer retention: An empirical investigation in the mobile telecom industry in Tunisia," Journal of Retailing and Consumer Services, Elsevier, vol. 37(C), pages 89-100.
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