Award Date

12-2011

Degree Type

Dissertation

Degree Name

Doctor of Philosophy in Hospitality Administration

First Committee Member

Xicheng Bai, Chair

Second Committee Member

Ashok Singh

Third Committee Member

Grace Chatfield

Graduate Faculty Representative

Robert Chatfield

Number of Pages

151

Abstract

Loyalty programs are popular marketing strategies intended to attract, maintain, and enhance customer relationships. Despite the widespread usage of loyalty programs across various businesses, its effectiveness has not been well validated. Few empirical studies attempted to evaluate the value of loyalty programs but the findings have been conflicting with each other. Given the competitive climate of such a highly saturated competitive market of the hospitality industry, it is meaningful for hospitality marketers to evaluate the effectiveness of loyalty programs to increase customer retention and profitability. Therefore, the main purpose of this study was to examine the effectiveness of a hospitality loyalty program from a longitudinal perspective.

The literature review is separated in four sections. The first section is the theory building section, which examined social exchange theory, equity theory, and the relationship marketing theory to understand the development of customer loyalty. The second section describes the definition of loyalty and the factors that affect customer loyalty. It gives an understanding about loyalty marketing from a general perspective. The third section describes the purpose of loyalty programs, and finally the last section summarized the investigation of loyalty programs from previous studies. Overall, the literature review section suggested that despite the prevailing usage and attention on loyalty programs, the effectiveness from the customers' behavioral standpoint has not been well understood. For this reason, this study aims to find out the effectiveness of loyalty programs from a longitudinal perspective and study hypotheses were advanced.

This study obtained secondary data from a Las Vegas casino hotel and performed time series ARIMA modeling to test the study hypotheses. Results of this study supported the research hypotheses and indicated that loyalty programs do have a positive impact on customers' behavioral loyalty. The findings are expected to provide valuable insights for casino marketers to understand the impact of loyalty programs and develop marketing tactics to maintain loyal customers and maximize profitability as well.

Keywords

Casino hotel; Casinos; Consumer behavior; Customer loyalty; Customer loyalty programs; Loyalty marketing; Loyalty programs; Marketing strategy; Nevada – Las Vegas; Rewards program; Social sciences; Time series analysis

Disciplines

Behavioral Economics | Gaming and Casino Operations Management | Hospitality Administration and Management | Marketing

Language

English


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