Title:A Model of Customer Reward Programs with Finite Expiration Terms
Speaker:Yacheng Sun,School of Economics and Management, Tsinghua University
Time:Wednesday, 29 November, 13:30-15:30
Location:Room K01, Guanghua Building 2
A little understood phenomenon of customer reward programs is the prevalent use of finite reward expiration terms. We develop a theoretical framework to investigate the economic rationale behind this phenomenon, and the tradeoff between short and long expiration terms. In our model, a monopolistic firm sets the expiration term along with the price and reward size and interacts with consumers over an infinite horizon.
Consumers are heterogeneous in shopping probabilities and product valuations, and forward-looking in making purchase decisions. We find that a customer reward program with a finite expiration term can increase firm profits when (1) the valuation difference within the consumer population in intermediate, and (2) the shopping probabilities and valuations are negatively correlated among consumers. Several model extensions confirm the robustmess of these results. Finally, we conduct an empirical investigation on the purchase frequency and use of reward program by the top 100 US retailers, which provides directional support for several key theoretical predictions.
孙亚程是清华大学经管学院营销系长聘副教授。他于2001年获得华中理工大学理学学士学位；2002年获得印第安纳大学经济学硕士学位；2008年获得印第安纳大学营销学博士学位。加入清华之前，他在美国科罗拉多大学博尔德分校任教。孙亚程教授的主要研究领域包括定价策略、顾客忠诚项目，社交网络，用户产生内容，以及车载大数据的营销问题。他的研究成果发表于Marketing Science和Journal of Consumer Research等期刊，并被Harvard Business Review, the Wall Street Journal, Fox News, Huffington Post, the Daily Mail, Times of Inida等海外媒体报道。孙亚程教授是营销科学学报(Journal of Marketing Science)的编委会成员和专业主编，并担任多家国际营销领域期刊，如Marketing Science, Management Science, International Journal of Marketing Research, Journal of Retailing, Sloan Management Review的匿名审稿专家。
Your participation is warmly welcomed!