An Analysis of “Buy X, Get One Free” Reward Programs

References

• Aviv Y, Pazgal A (2008) Optimal pricing of seasonal products in the presence of forward-looking consumers. Manufacturing Service Oper. Management 10(3):339–359.Link, Google Scholar
• Aviv Y, Wei MM (2015) Innovative dynamic pricing: The potential benefits of early-purchase reward programs. Working paper, Olin School of Business, Washington University in St. Louis, St. Louis.Google Scholar
• Berman B (2006) Developing an effective customer loyalty program. Calif. Management Rev. 49(1):123–148.Crossref, Google Scholar
• Besbes O, Lobel I (2015) Intertemporal price discrimination: Structure and computation of optimal policies. Management Sci. 61(1):92–110.Link, Google Scholar
• Blattberg RC, Kim B-D, Neslin SA (2008) Why database marketing? Database Marketing: Analyzing and Managing Customers (Springer, Berlin), 13–46.Crossref, Google Scholar
• Bonezzi A, Brendl CM, De Angelis M (2011) Stuck in the middle: The psychophysics of goal pursuit. Psych. Sci. 22(5):607–612.Crossref, Google Scholar
• Breugelmans E, Bijmolt THA, Zhang J, Basso LJ, Dorotic M, Kopalle P, Minnema A, Mijnlieff WJ, Wünderlich NV (2015) Advancing research on loyalty programs: A future research agenda. Marketing Lett. 26(2):127–139.Crossref, Google Scholar
• Chun SY, Ovchinnikov A (2019) Strategic consumers, revenue management, and the design of loyalty programs. Management Sci. 65(9):3969–3987.Google Scholar
• Chun SY, Iancu DA, Trichakis N (2020) Loyalty program liabilities and point values. Manufacturing Service Oper. Management 22(2):257–272.Google Scholar
• Chung H, Ahn HS, Chun SY (2019) Dynamic pricing with point redemption. KAIST College of Business Working Paper Series, (2019-013).Google Scholar
• Dorotic M, Verhoef PC, Fok D, Bijmolt THA (2014) Reward redemption effects in a loyalty program when customers choose how much and when to redeem. Internat. J. Res. Marketing 31(4):339–355.Crossref, Google Scholar
• Friedman J (2003) Loyalty points: Do customer rewards programs deliver? Incentive 177(7):9.Google Scholar
• Gallego G, van Ryzin GJ (1994) Optimal dynamic pricing of inventories with stochastic demand over finite horizons. Management Sci. 40(8):999–1020.Link, Google Scholar
• Gönül F, Srinivasan K (1996) Estimating the impact of consumer expectations of coupons on purchase behavior: A dynamic structural model. Marketing Sci. 15(3):262–279.Link, Google Scholar
• Hartmann WR, Viard VB (2008) Do frequency reward programs create switching costs? A dynamic structural analysis of demand in a reward program. Quant. Marketing Econom. 6(2):109–137.Crossref, Google Scholar
• Hlavinka K, Sullivan J (2011) The billion member march: The 2011 colloquy loyalty census: Growth and trends in loyalty program membership and activity. White paper, COLLOQUY, Toronto.Google Scholar
• Inman JJ, McAlister L (1994) Do coupon expiration dates affect consumer behavior? J. Marketing Res. 31(3):423–428.Crossref, Google Scholar
• Kim B-D, Shi M, Srinivasan K (2001) Reward programs and tacit collusion. Marketing Sci. 20(2):99–120.Link, Google Scholar
• Kivetz R, Simonson (2002) Earning the right to indulge: effort as a determinant of customer preferences toward frequency program rewards. J. Marketing Res. 39(2):155–170.Google Scholar
• Kivetz R, Urminsky O, Zheng Y (2006) The goal-gradient hypothesis resurrected: Purchase acceleration, illusionary goal progress, and customer retention. J. Marketing Res. 43(1):39–58.Crossref, Google Scholar
• Kopalle PK, Neslin SA (2003) The economic viability of frequency reward programs in a strategic competitive environment. Rev. Marketing Sci. 1(1):1–39.Crossref, Google Scholar
• Kopalle PK, Sun Y, Neslin SA, Sun B, Swaminathan V (2012) The joint sales impact of frequency reward and customer tier components of loyalty programs. Marketing Sci. 31(2):216–235.Link, Google Scholar
• Lal R, Bell DE (2003) The impact of frequent shopper programs in grocery retailing. Quant. Marketing Econom. 1(2):179–202.Crossref, Google Scholar
• Lewis M (2004) The influence of loyalty programs and short-term promotions on customer retention. J. Marketing Res. 41(3):281–292.Crossref, Google Scholar
• Littlewood K (1972) Forecasting and control of passenger bookings. AGIFORS Sympos. Proc., vol. 12, 95–117.Google Scholar
• Liu Y (2007) The long-term impact of loyalty programs on consumer purchase behavior and loyalty. J. Marketing 71(4):19–35.Crossref, Google Scholar
• Lu X, Su X (2015) Revenue management with loyalty programs. Working paper, Wharton School, University of Pennsylvania, Philadelphia.Google Scholar
• McAlister L, Pessemier E (1982) Variety seeking behavior: An interdisciplinary review. J. Consumer Res. 9(3):311–322.Crossref, Google Scholar
• Nicolau JL, Sellers R (2012) The free breakfast effect: An experimental approach to the zero price model in tourism. J. Travel Res. 51(3):243–249.Crossref, Google Scholar
• Puterman ML (2014) Markov Decision Processes: Discrete Stochastic Dynamic Programming (John Wiley & Sons).Google Scholar
• Shampanier K, Mazar N, Ariely D (2007) Zero as a special price: The true value of free products. Marketing Sci. 26(6):742–757.Link, Google Scholar
• Sharp B, Sharp A (1997) Loyalty programs and their impact on repeat-purchase loyalty patterns. Internat. J. Res. Marketing 14(5):473–486.Crossref, Google Scholar
• Shu SB, Gneezy A (2010) Procrastination of enjoyable experiences. J. Marketing Res. 47(5):933–944.Crossref, Google Scholar
• Stauss B, Schmidt M, Schoeler A (2005) Customer frustration in loyalty programs. Internat. J. Service Indust. Management 16(3):229–252.Crossref, Google Scholar
• Su X (2007) Inter-temporal pricing with strategic customer behavior. Management Sci. 53(5):726–741.Link, Google Scholar
• Su X (2010) Intertemporal pricing and consumer stockpiling. Oper. Res. 58(4):1133–1147.Link, Google Scholar
• Su X, Zhang F (2008) Strategic customer behavior, commitment, and supply chain performance. Management Sci. 54(10):1759–1773.Link, Google Scholar
• Su X, Zhang F (2009) On the value of commitment and availability guarantees when selling to strategic consumers. Management Sci. 55(5):713–726.Link, Google Scholar
• Sun Y, Zhang D (2019) A model of customer reward programs with finite expiration terms. Management Sci. 8(65):3889–3903.Link, Google Scholar
• Thaler R (1983) Transaction utility theory. Adv. Consumer Res. 10(1983):229–232.Google Scholar
• Yin R, Aviv Y, Pazgal A, Tang C (2009) Optimal markdown pricing: Implications of inventory display formats in the presence of strategic customers. Management Sci. 55(8):1391–1408.Link, Google Scholar