Research Article
Hierarchical Loyalty Programs and Consumer Tiers: The Effect of Perceived Envy and Fairness on Corporate Attitude
1 Kyungpook National University, 2 Chung-Ang University
Published: January 2019 · Vol. 48 No. 6 · pp. 1545-1568
DOI: https://doi.org/10.17287/kmr.2019.48.6.1545
Full Text
Abstract
Loyalty programs are effective tools in marketing and in managing relationships with consumers; however, the financial impact of many loyalty programs rarely meets expectations. In this regard, recent studies have pointed out that prior studies describing the positive effects of loyalty programs had focused on consumers who receive benefits from such programs. Furthermore, existing studies have not sufficiently examined whether the effect of loyalty programs can be influenced by various consumer tiers. This research investigates the impact of lower-tier consumers’ relative status in loyalty programs and the “benefit gap” among tiered levels on attitudinal and behavioral loyalty, by presenting two studies. Study 1 shows that the benefit gap between two groups with a large status difference does not significantly affect the attitude of lower-tier consumers and does so positively as the gap reduces. The mediating effects of benign and malicious envy are confirmed. Study 2 shows that the results of study 1 are affected by lower-tier consumers’ perceived fairness regarding their status in a loyalty program. Finally, we discuss the implications of this study. The results of this study show that the differences in benefits provided by loyalty programs and in consumer tiers affect the attitudes of consumers in the lower tier. Furthermore, this study provides practical implications to management for improving efficiency and effectiveness of loyalty programs.
