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    Status Demotion in Hierarchical Loyalty Programs: Effects of Payment Source

    240740_240740.pdf (293.0Kb)
    Access Status
    Open access
    Authors
    Ramaseshan, Balasubramani
    Stein, Alisha
    Rabbanee, Fazlul
    Date
    2016
    Type
    Journal Article
    
    Metadata
    Show full item record
    Citation
    Ramaseshan, B. and Stein, A. and Rabbanee, F. 2016. Status Demotion in Hierarchical Loyalty Programs: Effects of Payment Source. The Service Industries Journal. 36 (9-10): pp. 75-395.
    Source Title
    The Service Industries Journal
    DOI
    10.1080/02642069.2016.1219721
    ISSN
    0264-2069
    School
    School of Marketing
    Remarks

    This is an Author's Original Manuscript of an article published by Taylor & Francis in The Service Industries Journal on 22/08/2016 available online at http://www.tandfonline.com/ 10.1080/02642069.2016.1219721

    URI
    http://hdl.handle.net/20.500.11937/4026
    Collection
    • Curtin Research Publications
    Abstract

    Hierarchical loyalty programs are being operated currently by many firms to improve customer relationships. While past work has demonstrated the negative effects of status demotion in such programs, research on how these effects may vary across different customer group based on payment source is almost nonexistent. This paper examines the moderating role of payment source (‘own money’ versus ‘others money’) on the effects of status demotion on customer attitudes and behavior in hierarchical loyalty programs. Analysis of data collected from members of airline loyalty programs show that the negative effects of status demotion on customer attitudes, loyalty intentions, and share-of-wallet are stronger for demoted ‘own money’ customers than for demoted ‘others money’ customers. The study provides a deeper insight about the effects of status demotion and points out that firms could possibly be endangering the loyalty of many potentially valuable customers, in particular among the ‘own money’ customer group.

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