Casino Loyalty: The Influence of Loyalty Program, Switching Costs, and Trust

Abstract

Customer loyalty has become a strategic goal to increase brand value and profitability. This study develops and tests a model of loyalty to understand the relative effects of loyalty program benefits (as positive barriers) and switching costs (as negative barriers) on emotional commitment and loyalty behaviors in the casino context. The findings showed that trust, perceived switching cost, and emotional commitment to the casino are more likely to influence relational or emotional outcomes such as word of mouth and voluntary partnership whereas the loyalty program is more likely to influence transactional outcomes such as repeat visitation and time spent in the casino. The emotional commitment served as a partial mediator in the model. The study has theoretical implications for understanding the loyalty process and practical implications for improving loyalty program effectiveness.