• The Journal of the Korea Contents Association
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• v.16 no.7
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• pp.760-770
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• 2016

This study aims to investigate and measure the effectiveness between the value of the reward program and loyalty of the reward program as well as its influential transference effect of the loyalty of the entity (theater or exhibition) via investigating both its behavioral loyalty and attitudinal loyalty effectiveness. As a result, higher value of reward program increases the level of loyalty of the reward program. Key results were found that the behavioral loyalty positively influences the loyalty of the theatre/exhibition -the operator the loyalty program since the behavior loyalty requires participatory engagement, the reward program becoming a stimulator acting as a valuable component to drive consumer's revisit. However the attitudinal loyalty effectiveness was not as effectives as the behavioral loyalty since consumers tend to perceive a reward program as an informative beneficial tool rather than an emotionally engaging platform.

• The Journal of the Korea Contents Association
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• v.11 no.8
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• pp.321-330
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• 2011

This study focuses on the moderating effect of sex role on the relationship between perceived values on the reward program of tele-communication firms and customer satisfaction. To test moderating effect, Difference test for distinct parameters in Amos 18.0 program was used. Results show that both kind of perceived values(utilitarian value and hedonic value) have a significant effect on customer satisfaction. And the moderating effect of sex variable was verified. For male, hedonic value has influenced on the customer satisfaction more than utilitarian value. And for female, reversely, utilitarian value has influenced on the customer satisfaction more than female value.

• Asia Marketing Journal
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• v.7 no.2
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• pp.123-139
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• 2005

Until now, There are many studies of reward program effect about retaining current customers. But main goal of this study is acquiring new customer in competitive environment. We also reveal strategic framework for maximizing acquisition of new customer. For increasing customer loyalty of non-use brand, we'd better to give Out My Own reward non-user immediately and for increasing customer loyalty of use brand we'd better to give In My own Brand user accumulatively. Implication of the results for markets and future research are discussed

• Journal of Distribution Science
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• v.10 no.1
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• pp.5-10
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• 2012

Currently, the rewards programs offered by many companies to strengthen customer relationships have been working quite well. In addition, many companies' rewards programs, designed for stabilizing revenue, are recognized to be effective. However, these rewards programs are not significantly differentiated between companies and there are no accurate conclusions currently, which can be made about their effects. Because of this, a company with a customer rewards program may not comprehend the true level of active participation. In this environment some companies' rewards programs inadvertently hinder business profitability as a side effect while attempting to increase customer loyalty. In fact, airline and oil companies pass on the financial cost of their programs to the customer, and as a result, they have been criticized publicly. The result of this is that the corporations with bad rewards programs tend to get a bad image. In this study of stores' rewards programs, we centered our focus on the design of the program. The main problem in this study is to recognize the financial value of the rewards program and whether it can create a competitive edge for the companies despite the cost issues experienced by them. Customers receiving financial rewards for their business may be just as satisfied with a particular company or store versus those who are not, and the program, perhaps, does not form a distinctive competitive advantage. When the customer is deciding between competing companies to secure their product needs with, we wanted to figure out how much of an affect a valuable reward program had on their decision making. To evaluate this, we set the first hypothesis as, "based on the level of involvement of the customers, there is a difference between customers' preferences for rewards programs." In the results of Experiment 1 we saw that in a financial compensation program for high-involvement groups and low-involvement groups, significant differences appeared and Hypothesis 1 was partially supported. As for the second hypothesis that "customers will have different preferences between a financial rewards programs (SE) and a joint rewards programs (JE)," the analysis showed that the preference for JE was significantly higher than that for other programs. In addition, through Experiment 2, we were able to find meaningful results, which revealed that consumers have shown a significant difference in their preferences between SE and JE. The purpose of these experiments was to enable the designing of a rewards program by learning how to enhance service information distribution and strengthen customer relationships. From the results, there should be a great amount of value for future service-related endeavors and academic research programs. The research is significant, because the results can be found to have a positive effect on reward program designs however, it does have the following limitations. First, this study was performed using an experiment, and all experiments have limitations. Second, although there was an individual evaluation and a joint evaluation, setting a proper evaluation criteria was difficult. In this study, 1,000 Korean won (KRW) in the individual evaluation had a value of 2 points, and, in the joint evaluation, 1,000 KRW had a value of 1 point. There may have been alternative ways to differentiate the evaluations to obtain the proper results. In this study, since there was no funding, the experiments were performed orally however, this was complementary to the study. Third, the subjects who participated in this experiment were students. Conducting this study through experimentation was unavoidable for us, and future research should be conducted using an actual program with the target customers.

• Management & Information Systems Review
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• v.30 no.3
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• pp.133-151
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• 2011

This study investigates the moderating effect of customer type(deal prone/promotion insensitives) on the relationship between perceived values on the reward program of tele-communication firms and customer satisfaction. To test moderating effect, Difference test for distinct parameters in Amos 18.0 program was used. Results show that there is no the moderating effect of customer variable. But both kind of perceived values(utilitarian value and hedonic value) have a significant effect on customer satisfaction. For all customer, utilitarian reward has influenced on the customer satisfaction more than hedonic reward. And for utilitarian reward, promotion insensitives customer has influenced on the customer satisfaction more than deal prone customer.

• Asia Marketing Journal
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• v.14 no.2
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• pp.39-63
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• 2012

Previous studies of reward programs have generally focused on designing the best programs for consumers and suggested that consumers' perception of the value of reward programs can vary according to the type of reward program (e.g., hedonic vs. utilitarian and direct vs. indirect) and its timing (e.g., immediate vs. delayed). These studies have typically assumed that consumers' preference for reward programs has a positive effect on brand loyalty. However, Dowling and Uncles (1997) pointed out that this preference does not necessarily foster brand loyalty. In this regard, the present study verifies this assumption by examining the effects of consumers' perception of the value of reward programs on their brand loyalty. Although reward programs are widely used by online shopping malls, most studies have examined the conditions under which consumers are most likely to value loyalty programs in the context of offline shopping. In the context of online shopping, however, consumers' preferences may have little effect on their brand loyalty because they have more opportunities for comparing diverse reward programs offered by many online shopping malls. That is, in online shopping, finding attractive reward programs may require little effort on the part of consumers, who are likely to switch to other online shopping malls. Accordingly, this study empirically examines whether consumers' perception of the value of reward programs influences their brand loyalty in the context of online shopping. Meanwhile, consumers seek utilitarian and/or hedonic value from their online shopping activity(Jones et al., 2006; Barbin et al., 1994). They visit online shopping malls to buy something necessary (utilitarian value) and/or enjoy the process of shopping itself (hedonic value). In this sense, reward programs may reinforce utilitarian as well as hedonic value, and their effect may vary according to the type of reward (utilitarian vs. hedonic). According to Chaudhuri and Holbrook (2001), consumers' perception of the value of a brand can influence their brand loyalty through brand trust and affect. Utilitarian value influences brand loyalty through brand trust, whereas hedonic value influences it through brand affect. This indicates that the effect of this perception on brand trust or affect may be moderated by the type of reward program. Specifically, this perception may have a greater effect on brand trust for utilitarian reward programs than for hedonic ones, whereas the opposite may be true for brand affect. Given the above discussion, the present study is conducted with three objectives in order to provide practical implications for online shopping malls to strategically use reward program for establishing profitable relationship with customers. First, the present study examines whether reward programs can be an effective marketing tool for increasing brand loyalty in the context of online shopping. Second, it investigates the paths through which consumers' perception of the value of reward programs influences their brand loyalty. Third, it analyzes the effects of this perception on brand trust and affect by considering the type of reward program as a moderator. This study suggests and empirically analyzes a new research model for examining how consumers' perception of the value of reward programs influences their brand loyalty in the context of online shopping. The model postulates the following 10 hypotheses about the structural relationships between five constructs: (H1) Consumers' perception of the value of reward programs has a positive effect on their program loyalty; (H2) Program loyalty has a positive effect on brand loyalty; (H3) Consumers' perception of the value of reward programs has a positive effect on their brand trust; (H4) Consumers' perception of the value of reward programs has a positive effect on their brand affect; (H5) Brand trust has a positive effect on program loyalty; (H6) Brand affect has a positive effect on program loyalty; (H7) Brand trust has a positive effect on brand loyalty; (H8) Brand affect has a positive effect on brand loyalty; (H9) Consumers' perception of the value of reward programs is more likely to influence their brand trust for utilitarian reward programs than for hedonic ones; and (H10) Consumers' perception of the value of reward programs is more likely to influence their brand affect for hedonic reward programs than for utilitarian ones. To test the hypotheses, we considered a sample of 220 undergraduate students in Korea (male:113). We randomly assigned these participants to one of two groups based on the type of reward program (utilitarian: transportation card, hedonic: movie ticket). We instructed the participants to imagine that they were offered these reward programs while visiting an online shopping mall. We then asked them to answer some questions about their perception of the value of the reward programs, program loyalty, brand loyalty, brand trust, and brand affect, in that order. We also asked some questions about their demographic backgrounds and then debriefed them. We employed the structural equation modeling (SEM) method with AMOS 18.0. The results provide support for some hypotheses (H1, H3, H4, H7, H8, and H9) while providing no support for others (H2, H5, H6, H10) (see Figure 1). Noteworthy is that the path proposed by previous studies, "value perception → program loyalty → brand loyalty," was not significant in the context of online shopping, whereas this study's proposed path, "value perception → brand trust/brand affect → brand loyalty," was significant. In addition, the results indicate that the type of reward program moderated the relationship between consumers' value perception and brand trust but not the relationship between their value perception and brand affect. These results have some important implications. First, this study is one of the first to examine how consumers' perception of the value of reward programs influences their brand loyalty in the context of online shopping. In particular, the results indicate that the proposed path, "value perception → brand trust/brand affect → brand loyalty," can better explain the effects of reward programs on brand loyalty than existing paths. Furthermore, these results suggest that online shopping malls should place greater emphasis on the type of reward program when devising reward programs. To foster brand loyalty, they should reinforce the type of shopping value that consumers emphasize by providing them with appropriate reward programs. If consumers prefer utilitarian value to hedonic value, then online shopping malls should offer utilitarian reward programs and vice versa.

• (The) Korean Journal of Advertising
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• v.28 no.6
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• pp.35-54
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• 2017

The importance of utilizing an effective reward program has been emphasized as a tool for promotional strategies to acquire and retain customers. When consumers participate in a reward frequency program, they tend to focus more on points or mileage than the actual reward itself. This phenomenon is what Hsee, Yu, Zhang, and Zhang (2003) called "medium maximization." In this article, we hypopthesize that the medium effect may disappear when there is a close relationship between the product and the reward as it evokes the correlation of the two directly. The results of the current research show that the medium effect disappears in a strong relation condition while it does exist in a weak relation condition. Furthermore, we found that these results cannot be explained under an alternative "evaluability hypothesis" as Hsee, Loewenstein, Blount, and Bazerman (1999) and Hsee (1996) claimed. Even when we provided price range information as well as medium information, the medium effect still occurred. In this article, we explored boundary conditions for the medium effect and demonstrated the moderating effect of the relationship between products and rewards. Practical implications of the findings were also discussed for designing separate reward programs.

• Asia Marketing Journal
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• v.13 no.3
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• pp.25-53
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• 2011

This study probes the effect of loyalty program on the customer retention based on the real transaction data(n=2,892) acquired from education service industry. We try to figure out the outcomes of reward program through more than 1 year-long data gathered and analyzed according to quasi-experimental design(i.e., before and after design). We adopt this kinds of research scheme in regard that previous studies measured the effect of loyalty program by dividing the customers into two group(i.e., members vs. non-members) after the firms or stores had started the program. We believe that it might not avoid the self-selection bias. The research questions of this study could be explained such as: First, most research said that the loyalty programs could increase the customer loyalty and contribute to the sustainable growth of company. But there are little confirmation that this promotional tool could be justified in terms of financial perspective. Thus, we are interested in both the retention rate and financial outcomes caused by the introduction of loyalty programs. Second, reward programs target mainly current customer. Especially CRM(customer relationship management) said that it is more profitable for company to build positive relationship with current customer instead of pursuing new customer. And it claims that reward program is excellent means to achieve this goal. For this purpose, we check in this study whether there is a interaction effect between loyalty program and customer type in retaining customer. Third, it is said that dis-satisfied customers are more likely to leave the company than satisfied customers. While, Bolton, Kannan and Bramlett(2000) claimed that reward program could contribute to minimize the effect of negative service by building emotional link with customer, it is not empirically confirmed. This point of view explained that the loyalty programs might work as exit barrier to current customer. Thus, this study tries to identify whether there is a interaction effect between loyalty program and service experience in keeping customer. To achieve this purpose, this study adopt both Kaplan-Meier survival analysis and Cox proportional hazard model. The research outcomes show that the average retention period is 179 days before introducing loyalty program but it is increased to 227 days after reward is given to the customers. Since this difference is statistically significant, it could be said that H1 is supported. In addition, the contribution margin coming from increased transaction period is bigger than the cost for administering loyalty programs. To address other research questions, we probe the interaction effect between loyalty program and other factors(i.e., customer type and service experience) affecting it. The analysis of Cox proportional hazard model said that the current customer is more likely to engage in building relationship with company compared to new customer. In addition, retention rate of satisfied customer is significantly increased in relation to dis-satisfied customer. Interestingly, the transaction period of dis-satisfied customer is notably increased after introducing loyalty programs. Thus, it could be said that H2, H3, and H4 are also supported. In summary, we found that the loyalty programs have values as a promotional tool in forming positive relationship with customer and building exit barrier.

• Culinary science and hospitality research
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• v.15 no.4
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• pp.313-330
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• 2009

This study aimed at inquiring into the effect of the reward program in an online web homepage, which is most widely applied as a sales promotion tool for the foodservice industry, on customer trust, commitment and loyalty. The result is summarized as follows. The effect of the reward characteristics within a reward program on their trust and commitment showed that first, for the reward time, both compensation for delaying time and immediate time has a significantly positive effect on their trust and commitment, suggesting that the reward type as well as the reward time of a reward program is an important factor for improving their trust and commitment. In particular, indirect reward was a significant in raising their commitment or loyalty continuously, and for the reward attribute, economic reward was a significant attribute in building their trust.

• Journal of Navigation and Port Research
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• v.36 no.8
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• pp.673-681
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• 2012

As competition increases among ports, new marketing strategies and differentiated means in addition to the existing core services are needed to prevent existing container shipping companies from escaping and to attract new customers. The additional services and reward programs are investigated. How these variables affect relational commitment in terms of customer retention is examined. Customers of the container terminals are examined in terms of psychological behavior. This study presents the structural equation model that shows the connection among benefits, rewards, switching costs and relational commitment. The empirical analysis is done with the subject of the container terminal users and the implications are derived.