[ARTICOLO] Orsingher, C. and Wirtz, J. (2018), “Psychological drivers of referral reward program effectiveness. Journal of Services Marketing”, Vol. 32, N. 3, pp. 256-268

Empirical research presents conflicting findings with regards to the effectiveness of referral reward programs (RRPs) and supports two alternative and conflicting views on the effectiveness of incentivizing recommendations. They are, first, a positive effect via perceived attractiveness of the incentive, and second, a negative effect via metaperception of the recommendation. Thus, Authors examine these two opposing psychological mechanisms to reconcile the conflicting findings.

They conducted three experiments: study 1 tests the base model, whereas studies 2 and 3 add moderators to test whether each mediating variable operates exclusively on its intended relationship.

Incentive size enhanced the attractiveness of an incentive but reduced the metaperception favorability of the recommendation. These two opposing mechanisms operated in parallel, independently, and fully mediated the effects of incentive size to likelihood of making a recommendation. Thus, the net impact of incentives on recommendation behavior depended on the relative strengths of these two opposing forces.

Authors recommend managers to design RRPs with incentives recommenders are seen as highly useful (i.e., to increase attractiveness) but have a low face value (i.e., to reduce metaperception concerns), and to target RRPs to strong rather than weak ties.

So, their work offers an integrated theoretical account of consumers' responses to incentivized recommendations and provides managerially-relevant guidelines for the design of effective RRPs.

The originality of this paper consists in the fact this study is the first one to examine and confirm two dual and opposing forces that explain customers’ intentions to recommend and help to reconcile inconsistent findings of past studies regarding the effectiveness of incentives and their size.