An emerging theory of loyalty program dynamics Kim, Jisu J.; Steinhoff, Lena; Palmatier, Robert W.
Journal of the Academy of Marketing Science,
01/2021, Volume:
49, Issue:
1
Journal Article
Peer reviewed
As exemplary instruments of relationship marketing, loyalty programs are being implemented and studied at an unprecedented rate. Yet real-world efforts often fail—or at least do not live up to ...expectations—and despite the growing richness of loyalty program literature, the field remains fragmented. Thus, a comprehensive perspective is required. To guide further research and suggest ways that managers might improve loyalty program effectiveness, this article synthesizes insights on loyalty programs from empirical research and underlying psychological theories. The proposed conceptual model of loyalty program effectiveness consists of psychological, design, and operational elements; in turn, it suggests a set of 12 propositions that account for differential effects across customer acquisition, onboarding, expansion, and retention stages. With an evolving theory of loyalty programs across relationship dynamics, this propositional inventory parsimoniously delineates the trade-offs associated with relationship stage–based management of these programs. The proposed comprehensive foundation can guide loyalty program practice and research.
Service frontline encounters between customers and service providers have been subject to fundamental changes in recent years. As two major change agents, technology infusion and data privacy ...regulations are inextricably linked and constitute a critical ethical and societal issue. Specifically, service frontlines—as represented by human or technological agents, or some hybrid form—rely on customer data for service provision, which subjects them to privacy regulations governing the collection, submission, access, and use of any customer data thus captured. However, scant research outlines the significant implications of evolving data privacy regulations for service frontline encounters. To advance knowledge in this domain, this research distills six key dimensions of global data privacy regulations (fairness, data limits, transparency, control, consent, and recourse). Employing an intelligences theoretical lens, the authors theorize how these dimensions might become differentially manifest across three service frontline interface types (human-based, technology-based, and hybrid). Carefully intersecting the need for varying intelligences across data privacy regulatory dimensions with the abilities of service frontline interfaces to harness each intelligence type, this study offers a novel conceptual framework that advances research and practice. Theoretical, managerial, and policy implications unfold from the proposed framework, which also can inform a future research agenda.
Customer inertia marketing Henderson, Conor M.; Steinhoff, Lena; Harmeling, Colleen M. ...
Journal of the Academy of Marketing Science,
03/2021, Volume:
49, Issue:
2
Journal Article
Peer reviewed
Open access
Inertia might secure consumers’ continued patronage, but it also can stunt potential expansion. By examining the psychology underlying inertia, this research informs managers about whether to engage ...inertial consumers proactively. In the proposed conceptual model, an inertia mindset orients a customer toward status quo consumption. This mindset emerges from dual sources, and each source consists of a behavioral and a psychological component. Specifically, the behavioral consistency of prior consumption activates an inertia mindset by prompting a psychological inclination to minimize thinking; the magnitude of prior consumption leads to inertia by evoking an inclination to minimize regret. Complementary survey and field studies offer support for the proposed model and reveal that a proactive loyalty reward can reinforce inertia based on regret minimization but disrupt inertia based on thinking minimization. Even well-intentioned marketing initiatives thus might be ineffective or detrimental, depending on the source and strength of inertia already present in the customer.
Customer Engagement in International Markets Steinhoff, Lena; Liu, Juanyi (Sunny); Li, Xiaoling ...
Journal of international marketing (East Lansing, Mich.),
03/2023, Volume:
31, Issue:
1
Journal Article
Peer reviewed
Relationship marketing managers around the world actively try to stimulate customer engagement because of its performance-enhancing effects. Research insights into how to engage customers, such that ...they voluntarily contribute their resources to support companies’ marketing efforts, almost exclusively pertain to individual, domestic markets. However, the prerequisites of customer engagement strategies naturally differ across country-specific market environments. Therefore, the authors develop a conceptual, comprehensive battery of cultural, institutional, societal, and economic country-level contingency factors (CISE indicators) as well as between-country psychic distances on those indicators. A set of 11 high-level research propositions aims to enhance marketing researchers’ and managers’ understanding of the contingencies of international customer engagement strategy effectiveness and customer engagement's performance ramifications. The analysis reflects the richness and complexity of potential contingency effects across the four CISE categories and encourages empirical research on their separate and joint effects.
Customer misbehavior poses a major risk in the sharing economy. For example, property damage to shared accommodations imposes burdens on both sharing platforms and hosts, especially if misbehaving ...guests purposefully, not coincidentally conceal, or fail to report damages. Such misbehavior might be facilitated by remote listing management and the lack of face-to-face interactions between hosts and guests. Therefore, this study investigated the effects of host–guest interaction modes (face-to-face, online-only) and frequency on guests’ misbehavior concealment intentions. Social identification and irritation emerged as bright- and dark side mediators, respectively. Guests who interacted face-to-face (vs. online-only) with hosts exhibited weaker intentions to conceal their misbehavior due to increased social identification. Platforms can elicit social identification by engaging guests in virtual communities. However, when face-to-face interactions become excessive, guests experience irritation and are more likely to conceal their misbehavior. These insights offer practical implications for both peer-to-peer sharing platforms and hosts.
Online relationship marketing Steinhoff, Lena; Arli, Denni; Weaven, Scott ...
Journal of the Academy of Marketing Science,
15/5, Volume:
47, Issue:
3
Journal Article
Peer reviewed
Online interactions have emerged as a dominant exchange mode for companies and customers. Cultivating online relationships—defined as relational exchanges that are mediated by Internet-based ...channels—presents firms with challenges and opportunities. In lockstep with exponential advancements in computing technology, a rich and ever-evolving toolbox is available to relationship marketers to manage customer relationships online, in settings including e-commerce, social media, online communities, mobile, big data, artificial intelligence, and augmented reality. To advance academic knowledge and guide managerial decision making, this study offers a comprehensive analysis of online relationship marketing in terms of its conceptual foundations, evolution in business practice, and empirical insights from academic research. The authors propose an evolving theory of online relationship marketing, characterizing online relationships as uniquely seamless, networked, omnichannel, personalized, and anthropomorphized. Based on these five essential features, six tenets and 11 corresponding propositions parsimoniously predict the performance effects of the manifold online relationship marketing strategies.
Loyalty programs are a ubiquitous marketing tactic, yet many of them perform poorly and the reasons for loyalty program failure remain unclear to both marketing managers and researchers. This article ...presents three studies—two experiments and one survey—in support of the notion that a greater understanding of loyalty program performance demands an expanded theoretical framework. Specifically, researchers and managers must account for loyalty programs’ effects on both target and bystander customers in the firm’s portfolio, the simultaneous effects of three performance-relevant mediating mechanisms (gratitude, status, unfairness), and the contingent effects of program delivery (rule clarity, reward exclusivity, reward visibility) on specific mediating linkages. The results provide insights into why and when loyalty programs fail and into the complex trade-offs managers face. Loyalty programs have opposing effects on target and bystander customers’ loyalty and sales. While rule clarity suppresses both negative bystander as well as positive target effects, reward visibility enhances both types of effects. Exclusive rewards offer a means to alleviate negative bystander effects without affecting targets. The article both conceptually and empirically establishes a comprehensive analysis framework that can help marketing managers and researchers evaluate and improve loyalty program effectiveness.
Gift giving is an effective means to strengthen interpersonal relationships; it also may initiate and enhance customer–brand relationships. Through a field study conducted with an international ...monobrand retailer of beauty products, a combination of propensity score matching with difference-in-differences estimations, and two experimental scenario studies, this research demonstrates that gift buyers spend 63% more in the year following a gift purchase than a matched sample of customers who purchase for their personal use. Specifically, gift buyers increase their purchase frequency (25%), spend more per shopping trip (41%), and engage in more cross-buying (49%). The sales lift is particularly pronounced among new customers. Identity theory suggests customer gratitude and public commitment as mediating mechanisms. Gift purchase design characteristics (i.e., assistance during gift purchase and branded gift wrapping) influence the strength of the mediating mechanisms.
Value propositions (VPs) can play a major role for the strategy development and implementation process in B2B markets. While being recognized as one of the firm's most important organizing ...principles, the VP concept is still poorly understood and executed in many B2B firms and scholarly research provides limited guidance on how to develop and implement VPs in B2B markets. This article re-assesses the VP in the context of both strategy and implementation. It undertakes a review of extant conceptual frameworks and identifies key elements that are overlooked and/or not addressed. A new conceptual framework for addressing VP design and development is offered, which incorporates five key interrelated phases of implementation that need to be comprehensively addressed. This research provides a theoretically sound and practically applicable VP development framework, integrating the firm's strategic considerations, ensuring a fit between its business model and customers' needs, and reflecting the nature of B2B markets through its dynamic perspective. In addressing key implementation issues, the article provides firms with a robust approach to addressing the dynamic competitive environment, as well as taking into account changing customer needs.
•Value propositions (VPs) can play a major role for the strategy development and implementation process.•This research provides a theoretically sound and practically applicable VP development framework, integrating the firm's strategic considerations and customers' needs.•Our framework also addresses implementation issues, providing firms with a robust approach to addressing the dynamic competitive environment.
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