Article ID: | iaor20123902 |
Volume: | 11 |
Issue: | 3 |
Start Page Number: | 274 |
End Page Number: | 288 |
Publication Date: | May 2012 |
Journal: | Journal of Revenue and Pricing Management |
Authors: | Mathies Christine, Gudergan Siegfried P |
Keywords: | revenue management, brand choice, loyalty programs, travel industry |
This article examines the effects of loyalty programme membership, promotion and demotion across different status levels on customer brand preferences and willingness to pay (WTP). The results of a study in the travel industry show that loyalty programme members express significantly higher brand preferences for their respective airline or hotel group than do non‐members. Furthermore, consumers close to experiencing a change in their status level exhibit even stronger brand preferences, which extends to a greater WTP. The empirical findings illustrate how frequent traveller programmes affect purchase choices, especially if customers anticipate that they are about to lose or gain a higher status level.