Essay Nick Bombaij accepted in the International Journal of Research in Marketing
The 1st essay of PhD candidate Nick Bombaij on “When do loyalty programs work? The moderating role of design, retailer-strategy, and country characteristics”, a study together with his advisor Marnik Dekimpe has been accepted for publication in the International Journal of Research in Marketing.
Abstract: Many grocery retailers carry a loyalty program (LP). However, little is known under what conditions these programs are more or less effective. We provide a contingency framework that considers various design, retailer, and country characteristics that can moderate an LP’s impact on a retailer’s sales productivity. We test the framework across a large sample of 358 grocery banners from a broad cross-section of 27 western and eastern European countries. We find a positive effect of the more basic LP variant that offers direct and immediate rewards. This positive effect, however, disappears when retailers operate a more complex progressive-reward system and when they are part of a multivendor program. An LP’s impact also differs between retailers and countries: it is lower when operated by discounters, and higher in countries that are more individualistic and long-term oriented, and where fewer competitors also carry a loyalty program.