Turning dissatisfied into satisfied customers: How referral reward programs affect the referrer׳s attitude and loyalty toward the recommended service provider

• This study investigates the impact of opportunistic referral behaviour.
• Giving counterattitudinal referrals enhances recommenders׳ attitude and loyalty.
• The positive effect depends on the reward size of the referral reward program.
• Small incentives strengthen recommenders׳ attitude and loyalty toward the provider.
• Large rewards are ineffective to improve customers׳ attitude and loyalty.

Referral reward programs are becoming a popular tool for acquiring new customers and bonding existing ones. Yet their benefits are contentious, since such campaigns are prone to the opportunistic behaviour of customers who merely want to reap the reward. This paper examines how participating in a referral campaign affects opportunistic recommenders. By conducting two experimental studies, this article shows that giving counterattitudinal referrals enhances the communicator׳s attitude and loyalty toward the recommended provider. However, the positive effect depends on the reward size. While referral reward programs with small incentives strengthen the recommender׳s attitude and loyalty, no impact was found for referrals with large rewards. The results show that a stronger focus on reward programs is worth considering, since service providers can benefit from opportunistic customers with regards to the bonding effect.