International Journal of Retail & Distribution Management

Effect of consumer relationship proneness on perceived loyalty program attributes and

resistance to change
Hye-Young Kim Ju-Young M. Kang Kim K.P. Johnson

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Hye-Young Kim Ju-Young M. Kang Kim K.P. Johnson, (2012),"Effect of consumer relationship proneness on
perceived loyalty program attributes and resistance to change", International Journal of Retail & Distribution
Management, Vol. 40 Iss 5 pp. 376 - 387
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IJRDM
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376

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Received 30 March 2011

Revised 7 September 2011
Accepted 15 October 2011

Effect of consumer relationship

proneness on perceived loyalty
program attributes and resistance
to change
Hye-Young Kim, Ju-Young M. Kang and Kim K.P. Johnson
Department of Retail Merchandising, University of Minnesota, St Paul,
Minnesota, USA
Abstract
Purpose The purpose of this study is to examine the interrelationships among consumer
relationship proneness (CRP), three perceived loyalty program attributes (i.e. perceived complexity,
advantage, and risk), and resistance to change with participants in apparel retailers loyalty programs.
Design/methodology/approach Data were collected using an online survey with the assistance
of a marketing research company. Participants were 294 members of apparel retailers loyalty
programs. Participants indicated one apparel retailers loyalty program in which they took part. After
that, they completed a questionnaire making reference to the program they had identified. To reduce
measurement artifacts, dependent variables were assessed prior to their predictors.
Findings CRP was found to have a significant effect on perceived advantage and resistance to
change. In turn, perceived advantage revealed a significant positive effect on resistance to change. The
results not only verify theoretical conceptions regarding CRP and its effect on perceived loyalty
program attributes and resistance to change, but also provide insights into the implementation and
development of apparel retail loyalty programs as well as customer relationship management.
Originality/value The contributions of the research are twofold. First, it critically examines CRP
with loyalty program members fulfilling an identified gap in the literature and testing CRP as a critical
factor to the effectiveness of loyalty programs. Second, on a managerial level, it generates beneficial
insight for apparel retailers to fine-tune their loyalty programs.
Keywords Consumer relationship proneness, Customer relations, Customer loyalty, Loyalty programs,
Loyalty program attributes, Resistance to change, Apparel retailing, US consumers, Retailing,
Buyer-seller relationships
Paper type Research paper

International Journal of Retail

& Distribution Management
Vol. 40 No. 5, 2012
pp. 376-387
q Emerald Group Publishing Limited
0959-0552
DOI 10.1108/09590551211222358

Introduction
Consumers who are inclined to engage in relationships with retailers (i.e.
relationship-prone consumers) develop higher levels of trust and commitment
(Hedrick et al., 2007), allocate higher customer share, and show greater adherence to
marketing requests and policies as compared to those who are not (see Parish and
Holloway, 2010). From a profitability perspective, it is not surprising that retailers
want to attract and retain relationship prone consumers. To identify this category of
consumers researchers have examined consumer relationship proneness (CRP) as one
trait affecting the relationship marketing outcomes that retailers strive to achieve (e.g.
De Wulf et al., 2001; Odekerken-Schroder et al., 2003; Parish and Holloway, 2010).
As some individuals have questioned whether customer loyalty actually results
from participation in loyalty programs (Wright and Sparks, 1999) and others have
found both weak ties between loyalty programs and customer loyalty (Cedrola and

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Memmo, 2010) and other predictors of loyalty (e.g. merchandise quality, interaction with
associates) (Yavas and Babakus, 2009), the importance of CRP for the investigation of
customer loyalty is clear; given that if customers are not prone to retain relationships
with retailers it is difficult, if not impossible, to obtain their loyalty. While CRP is
believed to affect the success of customer retention strategies (Sheth and Parvatiyar,
1995), there is only a very small body of academic literature dealing with the potential
impact of CRP on loyalty program outcomes (see Parish and Holloway, 2010). With these
issues in mind, we examined CRP as an important individual difference variable that
explains variation among loyalty program members. Specifically, we investigated the
interrelationships among CRP, perceived loyalty program attributes (i.e. advantage,
complexity, risk), and resistance to change. Our objective was to examine how CRP
affects the perceived loyalty program attributes and resistance to change and how the
perceived loyalty program attributes affect resistance to change.
The contributions of our research are twofold. First, we critically examined CRP
with loyalty program members, fulfilling an identified gap in the literature and testing
CRP as a critical factor influencing the effectiveness of loyalty programs. Second, on a
managerial level we generate beneficial insights for retailers interested in fine-tuning
their loyalty programs.

Effect of CRP on
loyalty

377

Theoretical background and hypotheses

Our conceptual model (depicted in Figure 1) is consistent with the work of Demoulin
and Zidda (2009) who recognized that:
.
the successful implementation of loyalty programs partially depends on
individual customer characteristics; and
.
perceived loyalty program attributes contribute to relationship formation and
decision-making.

Figure 1.
Hypothesized model

IJRDM
40,5

Demoulin and Zidda (2009), developing their conceptual framework on the basis of the
diffusion of innovations theory (Rogers, 2003), postulated that the likelihood of
adoption of a new loyalty program could be explained by customers perceptions of the
program attributes (i.e. advantages, complexity, and risk). We applied these principles
in the context of apparel retail loyalty programs. In the sections that follow, we discuss
each of the constructs and describe their expected effects.

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378
Perceived loyalty program attributes and consumer relationship proneness (CRP)
Customer loyalty programs are one strategy used to retain existing customers and can
provide benefits to both the retailers and their customers (Gabel et al., 2008). Consistent
with Demoulin and Zidda (2009), we conceptualized loyalty program attributes into
three specific factors: perceived complexity, perceived advantage, and perceived risk.
Perceived complexity refers to the degree to which the loyalty program system is
perceived as difficult to understand and to use. Perceived advantage of the loyalty
program refers to the degree to which the loyalty program provides benefits customers
can earn and appreciate. Perceived risk is defined as the degree of risk associated with
privacy invasion issues that may occur while participating in the loyalty program.
Perceived complexity. Some consumers are more psychologically predisposed to
cultivating relationships with retailers than others (Christy et al., 1996, p. 180).
Researchers suggest that relationship-prone consumers may perceive lower levels of
anxiety and frustration when they participate in retail loyalty programs, more easily
develop commercial friendships, and reciprocate a retailers relational efforts more
strongly and favorably than non-relationship prone consumers (e.g. Berry, 1995;
Bitner, 1995; Hennig-Thurau et al., 2002; Reynolds and Beatty, 1999). Further,
relationship-prone consumers may find it easy to grasp how a loyalty scheme works,
how points are awarded, and how and when they will receive tangible benefits because
by definition, they are likely to develop relationships through loyalty programs and
thus have their experiences to draw from (Berry et al., 2002). Because consumer-retailer
relationships are sought by some consumers but avoided by others, we propose CRP as
an important exogenous construct influencing perceived complexity of a loyalty
program. Therefore, the following hypothesis was formulated:
H1. Consumer relationship proneness has a negative effect on perceived
complexity of a loyalty program.
Perceived advantage. Understanding exactly what the rewards and advantages offered
by participation in the loyalty program and how easy the program is to actually use are
two of the important aspects of loyalty programs. Vazquez-Carrasco and Foxall (2006)
demonstrated that consumer relationship proneness directly and positively affected
consumer perceptions of relational benefits. Their finding implies that relationship
prone consumers and non-relationship prone consumers perceive the loyalty programs
advantages in different ways and those relationship prone consumers are more likely
to recognize relational benefits because of their greater openness toward any efforts
retailers expend to keep customers (Bloemer et al., 2003). Thus, the second hypothesis
was formulated:
H2. Consumer relationship proneness has a positive effect on perceived advantage
of a loyalty program.

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Perceived risk. One of the factors impeding loyalty program participation was found to
be privacy concerns (Noble and Phillips, 2004; Van Doorn et al., 2007). Relationship
marketing tactics generally ask the shoppers to divulge personal information such as
their name, address, and often a social security number. Privacy issues can result from
losing anonymity when a relationship with a retailer is created. Consumers with low
CRP may be unwilling to take part in loyalty programs because they do not like giving
up their anonymity and privacy by offering personal information and having
companies monitor which items they buy (Noble and Phillips, 2004). In contrast,
relationship-prone consumers may be less reluctant to provide personal information or
to question the retailers use of their personal data (Smith et al., 2003). Therefore, the
following hypothesis was developed:
H3. Consumer relationship proneness has a negative effect on perceived risk of a
loyalty program.
Resistance to change and consumer relationship proneness
Resistance to change was conceptualized based on two facets (Crosby and Taylor,
1983; Pritchard et al., 1999):
(1) preference stability; and
(2) resistance to counter persuasion.
Preference stability, in this research, is concerned with how consistent and particular
an individual is in his or her allegiance to a certain loyalty program. Crosby and Taylor
(1983) demonstrated that two systems of preference stability exist. One is functional
and consists of selective perceptions to safeguard preferences and decrease conflict.
The other consists of a biased post-decision evaluative process to protect original
decisions. Resistance to counter persuasion deals with how strongly an individual
resists counter-arguments which might highlight the positive aspects of opposing
selections (Dick and Basu, 1994; Kiesler, 1971).
Consumer relationship proneness may be related to loyalty program members
resistance to change. A shoppers overall tendency to seek relationships has an
influence on the level of commitment to that relationship (Storbacka et al., 1994). For
example, Odekerken-Schroder et al. (2003) demonstrated there is a relationship
between CRP and commitment in the context of beauty retailers. In addition, when it
comes to relationship investment, a higher level of consumer relationship proneness
was found to reinforce the effect of perceived relationship investment on relationship
quality (De Wulf et al., 2001). In a similar manner, consumer relationship proneness
was found to be positively associated with intention to remain in a business
relationship (Vazquez-Carrasco and Foxall, 2006). Collectively, these findings led to our
prediction that a high level of consumer relationship proneness leads to a high level of
resistance to change. Therefore, the following hypothesis was developed:
H4. Consumer relationship proneness has a positive effect on resistance to change.
Perceived loyalty program attributes and resistance to change
Perceived complexity. Most of an individuals resistance to change can be caused by the
desire to avoid the stress that new conflicting information can cause within an
individuals mind and the disorganization of thoughts and attitudes that can follow

Effect of CRP on
loyalty

379

IJRDM
40,5

380

(Festinger, 1957). Research on loyalty cards suggests that customers perceptions

about loyalty card attributes influence their decisions (Demoulin and Zidda, 2009) such
that:
.
the complexity of a new loyalty card has a negative effect on consumers
probability of adoption of the card; and
.
complexity was also found to have a significant effect on the adoption likelihood
of a new loyalty card.

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Thus, the following hypothesis was formulated:

H5. Perceived complexity of a loyalty program has a negative effect on loyalty
program members resistance to change.
Perceived advantage. In Vazquez-Carrasco and Foxalls (2006) study, relational benefits
were directly and positively associated with such desirable outcomes as satisfaction
and loyalty. Further, consumers perceptions of the advantages of a new loyalty card
had an impact on their likelihood of adoption (Demoulin and Zidda, 2009). Based on
these research findings, we developed the following hypothesis:
H6. Perceived advantage of a loyalty program has a positive effect on loyalty
program members resistance to change.
Perceived risk. As noted previously, privacy issues are one of the dominant risks to
consumers adoption and use of loyalty cards (Demoulin and Zidda, 2009). Some
customers may be reluctant to divulge information especially when it comes to unique,
identifying information (Phelps et al., 2000). Although not directly related to loyalty
programs per se, previous researchers have shown that perceived privacy and
perceived security with regard to the handling of consumers personal data were
antecedents of relationship stability (Flavian and Guinalu, 2006). Customers may
consider privacy breaches by loyalty programs as a non-economic cost, resulting in
diminished adoption of loyalty programs (Noble and Phillips, 2004). In particular, this
connection between cost and privacy may place shoppers sense of privacy, sense of
modesty, and sense of self at risk (Noble and Phillips, 2004). Leenheer et al. (2007)
demonstrated that privacy-related concerns were a deciding factor in dividing loyalty
card members from nonmembers and showed that privacy concerns negatively
affected loyalty card membership. In addition, Demoulin and Zidda (2009) found that
perceived risk negatively affected adoption of loyalty card programs. Based on these
research findings, we developed our final hypothesis:
H7. Perceived risk of a loyalty program has a negative effect on loyalty program
members resistance to change.
Methods
Data collection
Data were collected using an online survey with the assistance of a marketing research
company. Participants were 294 members of apparel retailers loyalty programs.
Participants were asked to indicate one apparel retailers loyalty program that they
took part in. Next, they completed a questionnaire making reference to that loyalty

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program. To reduce measurement artifacts, dependent variables were assessed prior to

their predictors.

Effect of CRP on
loyalty

Participant characteristics
Participants ages ranged from 18 to 73 with 65.6 percent of the respondents falling
between 18 and 45 years of age. Slightly more than half of the participants were female
(51.4 percent). With regard to ethnicity, 78.6 percent were Caucasian. All income
categories were represented by participants with $60,000-$69,999 as the median
income. Additionally, 61.2 percent of our participants had a four-year college degree
and 65.3 percent were married or lived with a partner.

381

Measurement model evaluation

The measurement items were selected based on a review of the literature. The
measurement items for consumer relationship proneness were adopted from De Wulf
et al. (2001). Measurement items for perceived complexity and advantage were adopted
from Taylor and Todd (1995) and measures for perceived risk were adopted from
Leenheer et al. (2007). Measures for resistance to change construct originated from
Pritchard et al. (1999).
Confirmatory factor analysis was conducted to assess the measurement model.
Indicators such as offending estimates, squared multiple correlations, standardized
residual covariances, and modification indices were examined to determine whether
modification was needed. Two items were dropped to ensure scale reliability and
construct validity (see Table I).
Table II provides an overview of construct means, standard deviations, and
correlations for the measurement model. Convergent validity was supported by the
following (Hair et al., 1998):
.
all loadings were significant ( p , 0.001);
.
the composite reliability for each construct exceeded the recommended level of
0.70, and
.
the average variance extracted (AVE) for each construct fulfills the
recommended benchmark of 0.50.
As evidence of discriminant validity of the scales, none of the confidence intervals of
the phi estimates included 1.00.
Results
A structural analysis was conducted using the maximum likelihood estimation
method. The results from the structural model are presented in Table III. Error
variances among three perceived loyalty program attributes were allowed to be
correlated because there might be some other common factors that may affect
perceived program attributes (e.g. economic shopping orientation) (see Demoulin and
Zidda, 2009). The structural model exhibited a good fit with the data x 2 125:89 with
54 df, x2 =df 2:33; CFI 0:96; NNFI 0:94; RMSEA 0:067; and SRMR 0:052:
Table III illustrates the findings of the study. Regarding H1-H3, the effect of CRP
on loyalty program attributes was significant ( p , 0.001): perceived complexity
b 20:31; t 24:17; perceived advantage b 0:30; t 4:64 and perceived
risk b 20:29; t 24:47: CRP had a negative effect on both perceived

IJRDM
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Construct: Cronbachs a reported,

source

Items

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382

Table I.
Summary of measures

Relationship proneness : a 0.85, (1) Generally, I am someone who likes to be a regular customer of
an apparel store
Bloemer and Odekerken-Schroder
(2) Generally, I am someone who wants to be a steady customer of
(2006)
the same apparel store
(3) Generally, I am someone who is willing to go the extra mile
to buy at the same apparel store
Perceived loyalty program attribute
Perceived complexitya : a 0:73; (1) It is easy to use this loyalty program (inverted)
Demoulin and Zidda (2009)
(2) It is not difficult for me to understand this loyalty program
(dropped)
(3) I understand well the advantages offered by this loyalty
program (inverted)
Perceived advantagea : a 0:75; (1) I greatly appreciate the advantages offered by this loyalty
Taylor and Todd (1995)
program
(2) This loyalty program doesnt bring me any advantage
(inverted)
Perceived riska : a 0:85;
(1) I dread that the loyalty program is used to gather and use my
Demoulin and Zidda (2009)
personal information (dropped)
(2) I fear that the store uses my personal data for commercial
reasons
(3) Im confident about how the store uses my personal
information (inverted)
Resistance to changea : a 0:81; (1) My preference to use this loyalty program would not willingly
Pritchard et al. (1999)
change
(2) It would be difficult to change my beliefs about this loyalty
program
(3) Even if close friends recommended another loyalty program, I
would not change my preference for this loyalty program
(4) To change my preference from this loyalty program would
require major rethinking
Note: aAnchored with five-point Likert-type scale descriptors, from 1 Strongly disagree to
5 Strongly agree.

Correlations
1. Relationship proneness
2. Perceived complexity
3. Perceived advantage
4. Perceived risk
5. Resistance to change
Mean
SD
Composite reliabilitya
Variance extractedb
Table II.
Results: measurement
model

1.00
2 0.31
1.00
0.30
20.82
1.00
2 0.29
0.50
20.42
1.00
0.48
20.52
0.64
2 0.35
1.00
3.15
3.24
3.63
2.60
3.24
0.81
0.84
0.88
0.78
0.84
0.77
0.76
0.78
0.75
0.84
0.63
0.61
0.65
0.63
0.73
P
a
2 P
2 P
standardized
loading) /(
standardized
loading) +
Notes: Composite reliability
P
P
measurement error; bVariance extracted
(standardized loading)2/
(standardized loading)2+
P
measurement error

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Endogenous constructs
Perceived complexity (R 2 0:09
H1 Relationship proneness
Perceived advantage (R 2 0:09
H2a Relationship proneness
Perceived risk (R 2 0:08
H3 Relationship proneness
Resistance to change (R 2 0:51
H4 Relationship proneness
H5 Perceived complexity
H6 Perceived advantage
H7 Perceived risk

SE

t-value

20.31

2 4.19 *

0.30

4.64 *

20.29

2 4.47 *

0.32
20.09
0.60
20.05

5.28 *
2 0.53
3.50 *
2 0.78

Notes: Fit statistics: n 294; x2 df 125:89 (54); x2/df 2:33; CFI 0:96; NNFI 0:94;
RMSEA 0:067; SRMR 0:052: SE, Standardized estimate. *p , 0.001

complexity and risk. CRP had a positive effect on the perceived advantage of a
loyalty program. For H4, the effect of CRP on resistance to change b 0:32;
t 5:28 was significant ( p , 0.01). CRP positively impacted loyalty program
members resistance to change. Thus, H1-H4 was supported.
For H5-H7, only perceived advantage was found to be a significant predictor of
resistance to change b 0:60; t 3:50; p , 0.001). The perceived complexity and
risk of a loyalty program did not negatively affect loyalty program members
resistance to change. Thus, H6 was supported, while H5 and H7 were not.
Discussion and managerial implications
The purpose of our study was to examine the interrelationships among consumer
relationship proneness, three perceived loyalty program attributes (i.e. perceived
complexity, advantage, and risk), and resistance to change with consumers who were
participants in apparel retailers loyalty programs. Our results not only verify
theoretical conceptions regarding consumer relationship proneness and its effect on
perceived loyalty program attributes and resistance to change but also provide
insights into the implementation and development of apparel retail loyalty programs
as well as customer relationship management.
Relationship proneness exerted a significant influence on resistance to change
directly and indirectly through perceived advantage of loyalty programs. In other
words, consumers who prefer to be regular and steady consumers of an apparel store
were likely to associate advantages to the loyalty program and were resistant to
changing their preference for the loyalty program. In addition, consistent with findings
of prior researchers (i.e. Bloemer et al., 2003; Hennig-Thurau et al., 2002; Smith et al.,
2003), we found that relationship-prone consumers were likely to associate low levels of
perceived complexity and risk and high levels of perceived advantage with apparel
loyalty programs. Although observing the fact that maintaining relationships with
customers is not always considered as a desirable strategy from a retailers viewpoint
(Berry, 1995; Sheth and Parvatiyar, 1995) because not all types of shoppers are prone to
engage in relationships with retailers, we demonstrated that a loyalty members
proneness to a relationship impacts resistance to change. Measurement of customers

Effect of CRP on
loyalty

383

Table III.
Results: structural model

IJRDM
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384

relationship proneness may allow retailers to improve strategies to target the right
customers for their loyalty programs, as well as to segment their customers (Parish and
Holloway, 2010). Thus, our findings suggest that, if retailers get relationship-prone
consumers into their loyalty programs, they will maximize the effectiveness of these
programs.
Our findings suggest that apparel retailers interested in loyalty programs as a
customer retention strategy may want to emphasize the various advantages or benefits
of their program. In relationship marketing tactics, advantages or benefits provided to
shoppers for relational exchanges may consist of price offs, special services,
personalization, customized products (Noble and Phillips, 2004), frequent shopper
programs, and community among customers. For example, as a special customer
service advantage, some retailers offer free clothing storage, complementary private
dinner parties, and fashion shows. As a personalization advantage, customers can
receive the opportunity to personalize websites and email communication (Parish and
Holloway, 2010) with their prior purchasing history and wish lists. Additionally, as a
community advantage, customers can exchange product-related information or
reviews and develop personal relationship with retailers via an online community
channel. These benefits when highlighted as part of a loyalty program and offered to
relationship-prone members may lead to high levels of resistance to change.
Contrary to our hypothesis, the perceived risk and complexity members associated
with their apparel loyalty program did not mediate the link between relationship
proneness and resistance to change. Members resistance to change was not influenced
by the perceived risk and complexity of an apparel loyalty program. Perceived risk and
complexity may not have mediated the link because our apparel loyalty program
members may have placed less emphasis on the complexity and the risk they linked to
their apparel loyalty program than on the perceived advantages. However, in terms of
perceived risk, our finding is consistent with that of previous researchers who studied
perceived risk and new loyalty card adoption (Demoulin and Zidda, 2009; Van Doorn
et al., 2007) as well as those researchers who found that perceived risk did not influence
the probability of adoption (Demoulin and Zidda, 2009). Van Doorn et al. (2007) also
found that the association between privacy concerns and enrollment in loyalty
programs was rather weak. We believe that further research is required to extend our
understanding of antecedents and outcomes of the risk and complexity customers
associate with loyalty programs.
Limitations and suggestions for future research
Like all research our study has certain limitations. Our results were obtained at one
point in time so a longitudinal study might provide an enhanced understanding of the
interrelationships among the variables and how they might change over time. In
particular, keeping track of shifts in customer relational behavior regarding loyalty
programs, examining consumers perceptions after one year and again after two years
of participation in a loyalty program would offer empirical evidence related to loyalty
program participants relational behavior and attitudinal loyalty.
Future research is needed to apply our proposed model to other retailing contexts
and to extend the model. Our conceptual model does not include antecedents of
relationship proneness. For instance, fashion/product involvement, peer/media
influence, price/product or service quality consciousness, and brand image

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consciousness shopping orientation could be added as antecedents of relationship

proneness. In addition, examining the social situational or personal moderator effects
of relationship proneness on loyalty program attributes as well as resistance to change
could be addressed in future research.

Effect of CRP on
loyalty

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Hye-Young Kim can be contacted at: hykim@umn.edu

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