Executive Summary
Non-members and lower-status members resent receiving lower quality service when customer loyalty programs reward elite members with preferential treatment (such as exclusive, faster lines at hotel receptions desks.)
However, results from this study suggest that a CSR loyalty program which rewards guests’ green behaviors can benefit from a CSR halo effect (Gürhan-Canli and Batra, 2004; Klein and Dawar, 2004; Lusch et al., 2010) and improve non-members’ satisfaction with their own service experience.
Rewarding guests for their eco-friendly behaviors offers an easy justification for customer prioritization, which makes non-members more accepting of elite member prioritization at the reception desk.
Moreover, the findings of this study indicate that preferential treatment associated with a “go green” loyalty reward program is as effective as traditional programs in enabling elite members to signal their status. This can be accomplished by creating a priority check-in counter for GreenRewards members or by using other tangibles such as special room keys to communicate program membership.
Taken together, the findings of this study demonstrate the advantages of a green loyalty reward program in enhancing customer satisfaction of both members and non-members.
Many hotels with CSR practices call themselves “Green Hotels”, but they don’t truly reward customers’ green behaviors. A CSR-focused loyalty program is a good example of aligning the firm’s prosocial values with its customer reward system. A green loyalty program may increase customer participation in environmental conservation and as well as enhance customer loyalty via rewards.
Research Notes
This study used a 2 x 2 x 2 between-subjects experimental design:
- loyalty program: green vs. standard
- customer type: member vs. bystander
- observability of preferential treatment: low vs. high
Respondents were asked to read a hotel check-in scenario and then completed scales that measured their perceptions and evaluations of the service encounter.
The experiment was conducted online with MTurk’s consumer panel. Compensation for participation was US$0.50. A total of 297 usable responses were received.
Full Report
Instructions to access the full report of: The Influence of a “Green” Loyalty Program on Service-Encounter Satisfaction
Publication Date
2016/09/12
Publication
Journal of Services Marketing
Author(s)
Stephanie Q. Liu, Anna S. Mattila