40 years of loyalty programs : How effective are they? Generalizations from a meta-analysis

Journal article


Belli, Alex, O’Rourke, Anne-Maree, Carrillat, François A., Pupovac, Ljubomir, Melnyk, Valentyna and Napolova, Ekaterina. (2022). 40 years of loyalty programs : How effective are they? Generalizations from a meta-analysis. Journal of the Academy of Marketing Science. 50(1), pp. 147-173. https://doi.org/10.1007/s11747-021-00804-z
AuthorsBelli, Alex, O’Rourke, Anne-Maree, Carrillat, François A., Pupovac, Ljubomir, Melnyk, Valentyna and Napolova, Ekaterina
Abstract

Despite firms’ extensive usage of loyalty programs (LPs) and decades-long academic research on their effectiveness, LPs’ effects on customer loyalty are still heavily debated. We perform a comprehensive meta-analysis of loyalty programs across various LP designs and industries and spanning different performance metrics to identify moderators of LP effectiveness. Based on a data set with 429 effect sizes, published or available between 1990 and 2020, we find strong evidence that LPs enhance customer loyalty. However, while LPs particularly enhance behavioral loyalty, shifting consumers’ attitudinal loyalty is more challenging. Further, LP effectiveness differs systematically depending on LP design characteristics (LP structure, reward content and delivery) and industry characteristics. These effects are enabled by both cognitive and affective drivers, acting sequentially, as underlying mechanisms. Despite a wide range of methodologies investigating LPs’ effectiveness, methodological choices have little impact on the substantive results. We develop a comprehensive research agenda and managerial implications.

Keywordsloyalty programs; loyalty cards; reward programs; customer loyalty; firm performance; relationship marketing; meta-analysis
Year2022
JournalJournal of the Academy of Marketing Science
Journal citation50 (1), pp. 147-173
PublisherSpringer
ISSN0092-0703
Digital Object Identifier (DOI)https://doi.org/10.1007/s11747-021-00804-z
Scopus EID2-s2.0-85114435650
Research or scholarlyResearch
Page range147-173
Publisher's version
License
All rights reserved
File Access Level
Controlled
Output statusPublished
Publication dates
Online08 Sep 2021
Publication process dates
Accepted26 Jul 2021
Deposited05 Jul 2022
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The role of customer loyalty as a brand extension purchase predictor
Martinelli, Elisa, Belli, Alex and Marchi, Gianluca. (2015). The role of customer loyalty as a brand extension purchase predictor. The International Review of Retail, Distribution and Consumer Research. 25(2), pp. 105 - 119. https://doi.org/10.1080/09593969.2014.940997