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Introduction
Loyalty programs comprise a commonly practiced marketing strategy to maintain customer relationships and generate return business ([36] Hoffman and Lowitt, 2008; [49] McCall and Voorhees, 2010). Despite the proliferation of loyalty programs over the past three decades, some industry observers criticize these programs for not accomplishing enough ([41] Kim et al. , 2009; [74] Sharp and Sharp, 1997; [78] Skogland and Siguaw, 2004); moreover, their profitability is questionable ([9] Berman, 2006; [26] Dowling and Uncles, 1997). Many researchers have posited doubt on whether loyalty programs actually work (e.g. [26] Dowling and Uncles, 1997; [57] O'Brien and Jones, 1995). They argue that many of the establishments of loyalty programs are, in fact, copying behaviors and that loyalty programs in marketplaces generally fail to understand customer behaviors and expectations ([74] Sharp and Sharp, 1997; [86] Wansink, 2003).
In the hospitality industry today, major hotels such as Hilton, Marriot, InterContinental and Best Western together have more than ten million loyalty program members ([22] Dekay et al. , 2009). However, a large portion of the member base is comprised of deal-seeking customers who cross-hold a membership status at multiple hotels but do not necessarily remain loyal to one specific chain. According to the 2006 Colloquy loyalty marketing census, the average US household belongs to approximately 12 loyalty programs ([29] Ferguson and Hlavinka, 2007). Aiming for customer retention, rather than one-time spot shopping, hotels make concerted efforts to craft loyalty programs with sophisticated reward structures ([55] Nunes and Dreze, 2006), design of membership tiers ([49] McCall and Voorhees, 2010) and customer segmentation ([66] Prentice, 2013; [84] Voorhees et al. , 2011).
Recent research has identified perceived value as an important variable affecting consumer loyalty in several contexts, such as supermarket retail environments ([77] Sirohi et al. , 1998; [81] Sweeney et al. , 1999), destination branding ([17] Chen and Tsai, 2007), golf course operation ([63], [64] Petrick and Bachman, 2002a, b), and leisure service ([85] Wakefield and Barnes, 1996). Given these findings, the same variable may also be important in a hotel loyalty program context. However, little is known from the customers' perspectives about the essential values affecting their decisions to enroll, and then continually engage in a hotel loyalty program.
To be successful in the industry, hoteliers must...