The degree of the uncertain reward and customer engagement: An explanation mechanism based on optimistic estimation

Abstract

Purpose

As value co-creation has become a critical strategy for companies to gain competitive advantage, the purpose of this paper is to investigate the degree of the uncertain reward (DUR) and its impact on customer engagement (CE), particularly in the promotion stage, which has not been sufficiently explored. Further, optimistic estimation (OE) is examined as an underlying mechanism of the uncertain reward effect, as well as the impact of combining this with other marketing strategies: the controllable lottery and the delayed reward.

Design/methodology/approach

Three studies were conducted to examine the influence of DUR on CE, which included online experiments and a laboratory experiment. In total, 337 participants were recruited from China and the USA to enhance the study’s reliability and validity.

Findings

The research demonstrated that a high-degree uncertain reward led to less OE than a low-degree uncertain reward (LDUR), which subsequently decreased CE (Study 1). However, when other marketing strategies were combined – the controllable lottery (Study 2) and time-delay reward strategy (Study 3) – the uncertain reward effect was reversed (Study 2) or attenuated (Study 3).

Research limitations/implications

The current research only presents two possible reward amounts and independently explores the influence of two popular marketing strategies. Future research can explore customers’ responses to engagement when they face multiple rewards and thoroughly investigate the influence of other social or psychological factors.

Practical implications

Firms could apply an LDUR to enhance CE effects. Furthermore, this could be done at a low cost by empowering customers’ controllability. Nonetheless, firms should be cautious with trade-offs when using time-delay reward strategies.

Social implications

The research contributes to establishing networks of customer–company and interpersonal relationships, as well as fostering closer social ties and social harmony.

Originality/value

This research offers not only initial research on CE in the promotion stage, but also a novel psychological perspective in CE literature. Meanwhile, the study provides substantial value in guiding managers to effectively transform customers into value co-creators.

Citation

Guo, Z., Zhang, Y., Zhang, Y. and Ke, X. (2020), "The degree of the uncertain reward and customer engagement: An explanation mechanism based on optimistic estimation", Asia Pacific Journal of Marketing and Logistics, Vol. 32 No. 4, pp. 879-898. https://doi.org/10.1108/APJML-03-2019-0185