Restaurant membership fee and customer choice: The effects of sunk cost and feelings of regret

Dongsuk Jang, Anna S. Mattila, Billy Bai

Research output: Contribution to journalArticle

16 Citations (Scopus)

Abstract

Membership marketing is highly prevalent in today's restaurant industry. The purpose of the study was to examine the joint effects of membership fees and competition on customer choice, willingness to join other programs and feelings of regret in a restaurant setting. Using a 2 × 2 × 2 experimental design, the study found that the effect of sunk cost and mental accounting do exist. Moreover, high levels of regret were detected when a higher membership fee was paid and when the competition provided superior service or a lower membership fee. However, when the membership fee was low, customers were more reluctant to go to another restaurant that offered a membership program. Marketing implications for restaurateurs are discussed.

Original languageEnglish (US)
Pages (from-to)687-697
Number of pages11
JournalInternational Journal of Hospitality Management
Volume26
Issue number3
DOIs
StatePublished - Sep 1 2007

Fingerprint

cost
marketing
experimental design
fee
effect
Customer choice
Fees
Restaurants
Sunk costs
industry
programme
Marketing
services
accounting
Mental accounting
Experimental design
Cost accounting
Willingness
Join
Restaurant industry

All Science Journal Classification (ASJC) codes

  • Tourism, Leisure and Hospitality Management
  • Strategy and Management

Cite this

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Restaurant membership fee and customer choice : The effects of sunk cost and feelings of regret. / Jang, Dongsuk; Mattila, Anna S.; Bai, Billy.

In: International Journal of Hospitality Management, Vol. 26, No. 3, 01.09.2007, p. 687-697.

Research output: Contribution to journalArticle

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