Consumer psychological reactance to coalition loyalty program: price-consciousness as a moderator

Loyalty programs have been widely adopted by firms in service industries, which have led to the popularity of coalition loyalty programs. However, loyalty programs may prevent consumers from buying from an attractive firm as a result in increases in psychological reactance toward such programs. This study mainly focuses on how consumers evaluate the information of a coalition loyalty program based on perceived advantage, perceived complexity, and perceived risk, which expect to lead consumer psychological reactance. If consumer psychological reactance can be mitigated, consumers are predicted to be more loyal to such programs. Moreover, price-consciousness is expected to play a moderating role in the model. 395 valid questionnaires were collected and analyzed using SEM techniques. The results showed significance in all direct effects in the model, but only two moderating effects were supported by the competing model, e.g., the effects of perceived advantage on psychological reactance, and psychological reactance on coalition program loyalty. The study suggested that service firm managers should put more attention to the information about consumer buying habits, the advantages of program activities, as well as product price in order to attract consumers and enhance both the program and firm competitiveness, ultimately reducing consumer psychological reactance and retaining their loyalty to the program.