The Effect of Customer Demotion on Consumer Affective and Behavioral Response in Restaurant Loyalty Programs
Keywords:Customer demotion, restaurant, loyalty programs, experimental design, regret and disappointment, affective responses, behavioral responses
This study aims to investigate customers' specific affective and behavioural responses following a demotion decision by a firm in the context of loyalty programs of the food service industry (i.e., the restaurant industry). More specifically, it examines whether ways to demote customers impact how the customers feel and behave. A scenario-based, experimental study with single-factor, between-subjects design was used in this research. Results show that the absence of information and reminder message prior to demotion lead to feelings of disappointment, whereas the presence of information and reminder lead to customers’ feeling of regret. Furthermore, regret prompts customers to recover their lost status through repurchase intention, while disappointment does not. Disappointment, however, leads to switching intentions but not to negative word-of-mouth and complaining behaviour.
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