Saving Face While Earning Rewards: Reward-Both Referral Programs More Effectively Elicit Referrals for Experiential Purchases than Reward-Me Programs

Hyunkyu Jang, Assistant Professor of Marketing, Graduate School of International Studies, Ewha Womans University, Seoul, KoreaFollow
Raj Raghunathan, Professor of Marketing, McCombs School of Business, University of Texas at Austin, Texas, U.S.Follow

Abstract

Companies offer rewards when an existing customer invites a new customer to try their product, but the recipient of the reward varies depending on the type of referral program. In Reward-Me programs, only the recommending customer is rewarded, while in Reward-Both programs, both the recommender and the recipient who acts on the recommendation are rewarded. We examined whether purchase type (material vs. experiential) moderates the impact of a reward program on referral likelihood. The results reveal that purchase type does moderate referral likelihood across the two types of reward programs: for material purchases, referral likelihood does not differ between the two referral programs, whereas for experiential purchases, referral likelihood is greater under Reward-Both programs than under Reward-Me programs.

Recommended Citation

Jang, Hyunkyu and Raghunathan, Raj (2025) "Saving Face While Earning Rewards: Reward-Both Referral Programs More Effectively Elicit Referrals for Experiential Purchases than Reward-Me Programs," Asia Marketing Journal: Vol. 27 : Iss. 3 , Article 3.
Available at: https://doi.org/10.53728/2765-6500.1658