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Price fairness perceptions and customer loyalty in a retail context

William C. Martin, Nicole Ponder and Jason E. Lueg

Journal of Business Research, 2009, vol. 62, issue 6, 588-593

Abstract: Loyalty and fairness are major research topics in the marketing literature. However, research examining how customer loyalty and fairness perceptions affect each other is lacking. This study examines these two topics in the context of a retailer increasing its prices, develops hypotheses, and tests these hypotheses using an experimental design approach. Results indicate that loyalty has a positive effect on fairness perceptions when price increases are low, though no such effect is found when price increases are high. Also, justifiable reasons for price increases lead to increased fairness perceptions when price increases are low, but any reason offered when price increases are high increases fairness perceptions. Whether distributive or procedural fairness influences post customer loyalty in the presence of price increases is dependent on both the level of the price increase and the reason offered for the price increase. This research provides implications for retailers and directions for future research.

Keywords: Price; perceptions; Fairness; Justice; Customer; loyalty (search for similar items in EconPapers)
Date: 2009
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (49)

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