Hotels usually offer rewards to customers in form of economic or social benefits. Researchers in Hong Kong have recently conducted a study to explore how customers perceive different types of rewards and how those perceptions influence customer loyalty.
Results showed that participants who were presented with the "social reward" scenario perceived that the hotel put more efforts in building customer relationship whereas those presented with the "economic reward" scenario had opposite perception. These findings demonstrated that providing social rewards increases customers' emotional attachment and affective commitment to a hotel. According to researchers' explication, economic rewards are attractive to customers and promote loyalty, but they alone are not sufficient to prevent customers from switching to other programmes. On the contrary, social benefits generate more loyalty from customers as personal services facilitate them to become emotionally attached and committed to a hotel.
In sum, the researchers suggested hotels to consider offering just-sufficient financial incentives to meet but not exceed customers' expectations. At the same time, hotels are recommended to offer social rewards with more customised offerings to instill a sense of belonging and emotional attachment in customers. The study findings were published in the International Journal of Hospitality Management.