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Can economic bonus programs jeopardize service relationships?

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  • Thorsten Hennig-Thurau
  • Michael Paul

Abstract

Research findings on the impact of economic bonus programs on service relationships are contradictory. While some studies find positive effects of economic bonus programs on customer’s relational behavior, other studies demonstrate negative effects. Building on self-determination theory, Dholakia (J Market Res 43(2):109–120, 2006 ) points at a possible explanation for these conflicting results, arguing that economic marketing programs have negative effects on self-determined customers when the program is perceived as controlling by them. By testing the effect of four different kinds of economic bonus programs on loyalty in an experimental setting using a nationwide representative sample of 768 participants, this research is the first that provides empirical evidence that economic bonus programs can indeed endanger service relationships by reducing customer’s self-determination. Implications of our findings for the abundance of economic bonus programs offered to service customers these days are highlighted. Copyright Springer-Verlag 2007

Suggested Citation

  • Thorsten Hennig-Thurau & Michael Paul, 2007. "Can economic bonus programs jeopardize service relationships?," Service Business, Springer;Pan-Pacific Business Association, vol. 1(2), pages 159-175, June.
    • Handle: RePEc:spr:svcbiz:v:1:y:2007:i:2:p:159-175
    DOI: 10.1007/s11628-006-0012-9
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    References listed on IDEAS

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    1. Geyskens, I. & Steenkamp, J.E.B.M. & Scheer, L.K. & Kumar, N., 1996. "The effects of trust and interdependence on relationship commitment : A trans-Atlantic study," Other publications TiSEM ef7c8d6c-963d-4ee7-8576-9, Tilburg University, School of Economics and Management.
    2. Steven M. Shugan, 2005. "Brand Loyalty Programs: Are They Shams?," Marketing Science, INFORMS, vol. 24(2), pages 185-193.
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    Cited by:

    1. Brahim Idir, 2018. "« Je suis fidèle mais pas fidèle a la marque, je suis fidèle à la réduction » : les motivations économiques des participants aux programmes de fidélisation en retail," Working Papers hal-01904416, HAL.
    2. Brahim Idir, 2018. "« Je suis fidèle mais pas fidèle a la marque, je suis fidèle à la réduction » : les motivations économiques des participants aux programmes de fidélisation en retail," CEPN Working Papers hal-01904416, HAL.
    3. Brahim Idir, 2018. "« Je suis fidèle mais pas fidèle a la marque, je suis fidèle à la réduction » : les motivations économiques des participants aux programmes de fidélisation en retail," CEPN Working Papers 2018-04, Centre d'Economie de l'Université de Paris Nord.
    4. Alex Belli & Anne-Maree O’Rourke & François A. Carrillat & Ljubomir Pupovac & Valentyna Melnyk & Ekaterina Napolova, 2022. "40 years of loyalty programs: how effective are they? Generalizations from a meta-analysis," Journal of the Academy of Marketing Science, Springer, vol. 50(1), pages 147-173, January.
    5. Yu-Hsin Chen & Ching-Jui Keng, 2023. "The effect of subscription relational bond on customer engagement and stickiness in podcast: the moderating role of social connectedness," Service Business, Springer;Pan-Pacific Business Association, vol. 17(3), pages 723-745, September.
    6. Teng Teng & Shengliang Zhang & Xiaodong Li & Yuan Chen, 2020. "Customer compliance with employee fuzzy requests in service encounters: a self-determination theory perspective," Service Business, Springer;Pan-Pacific Business Association, vol. 14(2), pages 217-240, June.

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