This study explores consumer redemption behaviour in linear reward programmes – points-based, savings-type reward programmes in which points are redeemed at a fixed cash-to-points ratio and are subject to a validity period.
This study adopts dual process theory to examine how basket-related and expiration-related factors influence redemption behaviour through cognitive evaluation of the focal basket and affective responses, respectively. Specifically, we consider basket-related factors – basket size, non-points discount amount and the proportion of previously unpurchased items – and expiration-related factors – points expiration pressure and recently expired points. We analyse transaction-level purchase and point redemption data from a large-scale linear reward programme using a two-part model of whether consumers redeem points and how much they redeem.
Consumers redeem points strategically in response to both basket-related and expiration-related factors. Basket-related factors influence redemption through cognitive evaluation of perceived savings, perceived goal progress and perceived risk in the focal basket, whereas expiration-related factors influence redemption through affective responses associated with anticipated and experienced regret.
This study refines the understanding of point redemption in linear reward programmes by showing that redemption is shaped jointly by basket-related and expiration-related factors at the transaction level. By integrating these factors within a dual process perspective, it offers new insight into strategic consumer behaviour in point redemption.
