Freedom restriction and non-member customers’ response to loyalty programs

In loyalty program (LP) literature, research on how non-loyalty program members would react to preferential treatment is scarce. Nested within reactance theory, this paper suggests that negative customer responses arise due to the perceived threat to freedom and that the effects are moderated by the importance of freedom and relationship norms. Through two 2 × 2 between-subjects-design experiments, our results indicate that when the perceived threat to freedom of receiving LP benefits is high, non-member customers show increased anger, decreased attitude towards the company, and decreased intention to revisit. Similar results are observed when a company presents the image of building a communal relationship with its customers and when non-member customers perceive a high threat to freedom in terms of receiving the LP benefits. Both studies indicate that the interaction effects are less pronounced when non-member customers perceive a low threat to freedom of receiving the LP benefits.