The DOI matches its Crossref record; 75 of the 75 references it cites were found in a registry or an index.
Does Customer Demotion Jeopardize Loyalty?
Abstract
Hierarchical loyalty programs award elevated customer status (e.g., “elite membership”) to consumers who meet a predefined spending level. However, if a customer subsequently falls short of the required spending level, firms commonly revoke that status. The authors investigate the impact of such customer demotion on loyalty intentions toward the firm. Building on prospect theory and emotions theory, the authors hypothesize that changes in customer status have an asymmetric negative effect, such that the negative impact of customer demotion is stronger than the positive impact of status increases. An experimental scenario study provides evidence that loyalty intentions are indeed lower for demoted customers than for those who have never been awarded a preferred status, meaning that hierarchical loyalty programs can drive otherwise loyal customers away from a firm. A field study using proprietary sales data from a different industry context demonstrates the robustness of the negative impact of customer demotion. The authors test the extent to which design variables of hierarchical loyalty programs may attenuate the negative consequences of status demotions with a second experimental scenario study and present an analytical model that links status demotion to customer equity to aid managerial decision making.
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Cites
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Cited by
Wagner, T., Lutz, R. J., & Weitz, B. A. (2009) · Journal of Marketing · doi:10.1509/jmkg.73.6.77 · Cited by 1,339
Self-citationBuilding, measuring, and profiting from customer loyalty
Watson, G. F., Beck, J. T., Henderson, C. M., & Palmatier, R. W. (2015) · Journal of the Academy of Marketing Science · doi:10.1007/s11747-015-0439-4 · Cited by 375
Individual Psychological Ownership: Concepts, Evidence, and Implications for Research in Marketing
Jussila, I., Tarkiainen, A., Sarstedt, M., & Hair, J. F. (2015) · Journal of Marketing Theory and Practice · doi:10.1080/10696679.2015.1002330 · Cited by 361
Growing Existing Customers’ Revenue Streams through Customer Referral Programs
Garnefeld, I., Eggert, A., Helm, S. V., & Tax, S. S. (2013) · Journal of Marketing · doi:10.1509/jm.11.0423 · Cited by 171
Bues, M., Steiner, M., Stafflage, M., & Krafft, M. (2017) · Psychology & Marketing · doi:10.1002/mar.20981 · Cited by 110
Metadata
- Authors
- Wagner, T., Hennig-Thurau, T., & Rudolph, T.
- Venue
- Journal of Marketing
- Publisher
- SAGE Publications
- Published
- 2009-05
- Volume
- 73
- Issue
- 3
- Pages
- 69-85
- ISSN
- 0022-2429 (ISSN-L)
- 1547-7185
- OpenAlex
- W2112045780
- Cited by
- 286
- References
- 75
- FWCI
- 29.46
- Type
- journal article
- Language
- en
- Open access
- closed
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Contains information from the Semantic Scholar Academic Graph Datasets, made available under the ODC Attribution License (ODC-BY 1.0).
Semantic Scholar’s data is described in: Kinney, R., et al. (2023). The Semantic Scholar Open Data Platform. arXiv:2301.10140.