Arbeitspapier
Loyalty Programs and Consumer Behaviour: The Impact of FFPs on Consumer Surplus
Frequent Flier Programs (FFPs) are said to impact airline consumer behaviour such that revenue of sponsoring airlines increases. Prior research relies on aggregate industry data to study FFPs. We examine the impact of FFPs on individual consumer behaviour in a quasi-natural experimental set-up using a combined discrete choice and count data model. We exploit an unanticipated change in the FFP to avoid self-selection bias. We derive the causal effect of redesigning a frequency reward program into a customer tier program on average transaction size, purchase frequency, revenues of the sponsoring airline, and compensating variation. We find that, on average, revenues increased by 8$ per member over a 16 month period. The welfare impact is small but positive. We find that, on average, consumer surplus increased by 5$ per member over a 16 month period. The results vary su bstantially across individuals. In line with previous studies, our results suggest that moderate buyers increase their average transaction size and purchase frequency most due to the introduction of the customer tier program.
- Sprache
-
Englisch
- Erschienen in
-
Series: Tinbergen Institute Discussion Paper ; No. 15-048/VIII
- Klassifikation
-
Wirtschaft
Consumer Economics: Empirical Analysis
Production, Pricing, and Market Structure; Size Distribution of Firms
Transportation: Demand, Supply, and Congestion; Travel Time; Safety and Accidents; Transportation Noise
Air Transportation
- Thema
-
Loyalty programs
Frequent Flier Programs
Two-stage budgeting model
Longitudinal demand models
Airline pricing
- Ereignis
-
Geistige Schöpfung
- (wer)
-
Behrens, Christiaan
McCaughey, Nathalie
- Ereignis
-
Veröffentlichung
- (wer)
-
Tinbergen Institute
- (wo)
-
Amsterdam and Rotterdam
- (wann)
-
2015
- Handle
- Letzte Aktualisierung
-
10.03.2025, 11:45 MEZ
Datenpartner
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.
Objekttyp
- Arbeitspapier
Beteiligte
- Behrens, Christiaan
- McCaughey, Nathalie
- Tinbergen Institute
Entstanden
- 2015
Ähnliche Objekte (12)
Consumer reactance against loyalty programs
Two extensions of consumer surplus
Consumer's surplus : review, critique, and extension
A Consumer Surplus Defense in Merger Control
Verbraucherrecht und Verbraucherverhalten : = Consumer law and consumer behaviour
A small firm leads to curious outcomes: Social surplus, consumer surplus
Chinese-Japanese Relations in Consumer Perception and Consumer Behaviour
Increasing consumer surplus through a novel product testing mechanism
Consumer Surplus as the Appropriate Standard for Antitrust Enforcement
Competitiveness Through Consumer Loyalty: The Influence of Switching Costs
Consumer behaviour : Skriptum ; V 2.0 (20.05.2003)
The behaviour of consumer prices across provinces
Consumer reactance against loyalty programs
Two extensions of consumer surplus
Consumer's surplus : review, critique, and extension
A Consumer Surplus Defense in Merger Control
Verbraucherrecht und Verbraucherverhalten : = Consumer law and consumer behaviour
A small firm leads to curious outcomes: Social surplus, consumer surplus
Chinese-Japanese Relations in Consumer Perception and Consumer Behaviour
Increasing consumer surplus through a novel product testing mechanism
Consumer Surplus as the Appropriate Standard for Antitrust Enforcement
Competitiveness Through Consumer Loyalty: The Influence of Switching Costs
Consumer behaviour : Skriptum ; V 2.0 (20.05.2003)
The behaviour of consumer prices across provinces
Consumer reactance against loyalty programs
Two extensions of consumer surplus
Consumer's surplus : review, critique, and extension
A Consumer Surplus Defense in Merger Control
Verbraucherrecht und Verbraucherverhalten : = Consumer law and consumer behaviour
A small firm leads to curious outcomes: Social surplus, consumer surplus
Chinese-Japanese Relations in Consumer Perception and Consumer Behaviour
Increasing consumer surplus through a novel product testing mechanism
Consumer Surplus as the Appropriate Standard for Antitrust Enforcement
Competitiveness Through Consumer Loyalty: The Influence of Switching Costs
Consumer behaviour : Skriptum ; V 2.0 (20.05.2003)