Exploring Consumer Behavior With Respect to Memberships

ABSTRACT - Marketing organizations utilize membership based programs extensively. However, little is known about how or why consumers obtain, use, and feel about these memberships. This paper conducts an exploratory look at consumer behavior toward memberships. Some of the groundwork for further research provided here is an examination and delineation of consumers' needs and values that are related to membership, development of a categorization of membership types, identification of relevant theories that can be applied to predict consumer behavior with respect to memberships, and two preliminary examinations of consumer behavior with respect to memberships.



Citation:

Thomas W. Gruen (1994) ,"Exploring Consumer Behavior With Respect to Memberships", in AP - Asia Pacific Advances in Consumer Research Volume 1, eds. Joseph A. Cote and Siew Meng Leong, Provo, UT : Association for Consumer Research, Pages: 265-272.

Asia Pacific Advances in Consumer Research Volume 1, 1994      Pages 265-272

EXPLORING CONSUMER BEHAVIOR WITH RESPECT TO MEMBERSHIPS

Thomas W. Gruen, Indiana University

ABSTRACT -

Marketing organizations utilize membership based programs extensively. However, little is known about how or why consumers obtain, use, and feel about these memberships. This paper conducts an exploratory look at consumer behavior toward memberships. Some of the groundwork for further research provided here is an examination and delineation of consumers' needs and values that are related to membership, development of a categorization of membership types, identification of relevant theories that can be applied to predict consumer behavior with respect to memberships, and two preliminary examinations of consumer behavior with respect to memberships.

INTRODUCTION

Consumers are barraged almost daily with an array of "membership" opportunities. In the past few years, the number of clubs, memberships, and other types of frequency or loyalty based programs have mushroomed as marketers have sought to gain a greater "share of the customer" in addition to greater share of the market (Barlow 1992). These programs are heavily utilized by retailers (frequent shopper programs) and services (frequent user programs). In addition there are more than 60 packaged goods companies running one to fifteen loyalty programs (Miller 1993).

Some of these membership-format programs amount to little more than bribery to entice customers to keep buying, and other so-called "customer loyalty programs" cannot be distinguished from short-term sales promotions (Levin 1993). From the consumers' perspective some of these offer price-related deals that cannot be rationally avoided, while others offer genuinely endearing value that draws consumers into a closer relationship and bonds them with the sponsoring organization.

While some of these programs are successful, others are disastrous. For example, with great success in the United Kingdom since 1988, the membership-based Air Miles awards program was exported to the U.S. in 1992 only to quickly fail. Mitch Kurz, president of Wunderman Cato Johnson (a loyalty ad agency) states, "...with 58 sponsors, what are consumers loyal to? It's like people are being rewarded for being alive, for being a consumer" (Miller 1993).

Clearly consumers respond to some types of membership-format marketing programs, but are less responsive to others. Consumers become members of a wide variety of organizations-religious, civic, business, trade, recreational, hobby, political, and so forth. As the number of successful customer loyalty programs would indicate, consumers also enjoy affiliating with organizations they do business with. But the question remains, what is it fundamentally that drives someone towards membership? When an organization genuinely provides a choice of simply continuing to purchase goods on a transactions basis or to purchase goods on a relationship basis through a membership, which does the consumer choose? Given the amount of marketing attention and the huge associated expenditures toward customer membership programs, research that examines the consumers' processes of joining and remaining with a program should be extremely valuable to marketers.

The concept of membership has been addressed in the sociology literature, the economics literature, and the social-psychology literature. With this background, it is surprising that the consumer behavior field has neglected this topic-especially in light of the intense interest of marketers in developing customer loyalty and the rampant use of marketing programs that include the term "member."

Outline And Objective Of This Paper

The purpose of this paper is to explore the question, why do consumers join organizations that are designed to affect their consumption? Fundamentally, what do consumers look for and find in memberships? The work here is designed to provide an initial foundation for further research of these research questions, to define the boundaries of the membership questions, and raise important issues that can be investigated in future research activities.

To accomplish the above, this paper follows the following outline. It begins by showing how a consumer behavior perspective of membership can contribute to the current perspective offered in the marketing literature. It then constructs three essential building blocks for studying consumer behavior with respect to memberships: 1) consumers' needs and values that are likely to influence membership decisions, 2) a proposed typology of memberships, and 3) motivational theories surrounding membership. The basic components are summarized in the Figure.

These three building blocks are used to evaluate two exploratory studies. The first of these studies involves the assessment of the responses of a group of undergraduate consumer behavior students who reported their organizational affiliations and general motivations for joining organizations. The second study reviews the recent popular business literature that discusses membership programs instituted by marketers and/or consumer groups. This review examines the common consumer needs that these programs seek to satisfy. By combining the preliminary discussions with the exploratory research, directions for future research are identified.

TWO PERSPECTIVES OF MEMBERSHIP

In his classification scheme of service businesses, Lovelock (1983) proposes that continuous delivery of services versus discrete transactions can be viewed in light of the type of relationship between the service organization and its customers. This dimension has poles of "membership" relationship on one end and no formal relationship on the other. Continuous purchases from a single source, Lovelock suggests, can represent a "membership" relationship. The Lovelock perspective assumes that a membership is developed whenever there is an ongoing purchase relationship that is generated when the consumer makes a decision to "contract" for services for some advance period. This agreement may be based on either an implied or formal contract (e.g., subscriptions) or by perceived or actual switching costs (e.g., banking).

Such a descriptive view of membership fails to consider the other side of the relationship: the consumer's entry into a "membership" relationship with the organization. Simply placing a label on a relationship that is defined by the consumers' contract for future goods [Throughout the paper, the term goods denotes commercially available products and services.], there is no explanation provided as to why, if, or for how long the consumer will choose to enter into and continue in relationship. These answers require a consumer behavior perspective to the membership relationship.

FIGURE

COMPONENTS OF EXPLORING CONSUMER BEHAVIOR WITH RESPECT TO MEMBERSHIPS

A framework used to study memberships must incorporate multiple aspects of consumer behavior. First consumers must obtain a membership where the membership is a good in its own right, i.e. "should I purchase the membership or not?" The relevant questions here concern the consumers' desire for and acquisition of the membership. The second aspect the framework must explain is the actual "consumption" of the membership that involves the consumers' behavior toward the good(s) the membership is associated with, i.e. "now that I have the membership, how am I going to use it?" In this case the framework examines behaviors across multiple episodes.

THREE COMPONENTS OF THE CONSUMER PERSPECTIVE

Needs And Values Delineation

Determining the possible needs that a consumer could fulfill through a membership is a necessary prerequisite for research on the consumer behavior in this area. In the Olshavsky (1985) model of consumer choice, consumer behavior with respect to goods normally requires that the consumer hold some type of need that will be satisfied by a good (membership in this case) and that the membership be consistent within the consumer's value system.

According to the Olshavsky model, if the need doesn't exist, the desire for membership will never enter the consumer's goal formation process at all. Gutman's (1982) means-end chain model clarifies this discussion. The means-end chain model seeks to explain how goods (as means) are linked to ends (described as a person's values). Values are defined as enduring beliefs that specific modes of conduct or end-states of existence are personally or socially preferable to opposite or converse modes of conduct or end-state of existence (Rokeach 1973). When considering a membership the consumer decides on the basis of values whether or not the process of obtaining the membership will be pursued further. Understanding values is therefore critical to understanding consumer behavior with respect to memberships.

Several lists of needs and values have been utilized in the consumer behavior literature and have relevance to explaining consumer behavior with respect to memberships. These include the Maslow (1943) hierarchy of needs, Engel, et al.'s (1993) classification of consumer needs, and Rokeach's (1973) list of 20 terminal values. Examining each of the various lists of needs and values, the Kahle (1983) list of values (LOVs) appears to be the most relevant to the study at hand. Each of these can be related to the Maslow Hierarchy of Needs and thus can serve in place of that list. Further, the LOVs are derived from and incorporate the Rokeach (1973) terminal value list. The LOVs overlap with the five needs noted from the Engel et al. (1993) list except for power. A list of four value combinations derived from the LOVs and proposed by Kamakura and Novak (1992) was also examined but considered too abstract and limited for the exploratory nature of the studies in this paper. As a result, use of the Kahle LOVs with the addition of the power need provide the set of values associated with membership that will be examined in this paper. This list includes: sense of belonging, fun-enjoyment-excitement, warm relationships with others, self-fulfillment, being well-respected, security, self-respect, sense of accomplishment, and power.

When examining the reasons that someone would want to join an organization (club, frequency buying program, etc.), one or more of these values are being recognized by the consumer. This study attempts to see if membership can be defined in terms of the specific value combination.

Classification Of Membership

The type of membership offered to the consumer needs some classification with respect to the objectives of this paper. Because memberships exist in a variety of shapes and forms, a segmentation of memberships based on the extent and type of choice available to the consumer provides a meaningful categorization by which the consumer behavior with respect to memberships can be explored. This choice segmentation of membership types can be generalized into four basic categories: full-choice membership, price-driven membership, earned membership, and access membership.

Full-choice membership. As the description implies, in a full-choice membership consumers have a true choice based on their needs and values as whether or not they will become members. The good is available to the consumer regardless of whether or not s/he becomes a member. If and when the consumer decides to become a member, this type of membership requires some sort of initiationCnormally some sort of time or monetary resource investment. The Walden Books Preferred Reader Program is a good example of a full-choice membership for a frequent customer program (Barlow 1992). A Walden customer can choose to purchase the $10.00 membership and receive discounts, rebates, and special information, or s/he can simply purchase goods (books) at the regular price.

A key question regarding full-choice memberships is whether or not the choice of membership is simply a function of use. There should be some correlation between the two. In the Walden example, the pricing rationality (based on a 10 percent discount) would suggest that those who expect to spend over $100.00 per year at Walden should become Preferred Reader members. On the other hand there are several reasons why the economic pricing rationale will be violated. The consumer may not want to hassle with another card for relatively nominal annual net savings, not want to have more information about his/her household on yet another round of mailing lists, or may even simply make a poor estimate of future spending at Walden for the next year.

The rationale for membership cannot be strictly viewed as participation as some theories-like exchange theory-would suggest (Homans 1976). Besides the obvious nature of the exchange involved, an alternative reason for individuals to join an organization is that they choose to identify with the organization. Such a relationship provides the individual with a social identity: membership allows one to identify with a specific social group (Tajfel 1981; Turner 1984). For example, in Protestant churches, many members seldom if ever attend Sunday morning services, while most of these churches have a core group of non-member "regular attenders." The point this discussion makes is that participating in and identifying with an organization are often two different things.

Price-driven membership. The second broad category of membership is one where consumers can choose whether or not to join, but there is little reason not to join. Generally the consumer is not required to put forth any effort or money to obtain the membership. This describes a consumer behavior proposed by Olshavsky and Granbois (1979) where no choice process occurs. The marketer offers the consumer the promise of attractive future benefits, but the consumer offers nothing in exchange for the membership. Examples of this type of membership include frequent flier programs and other frequency of use programs that reward consumers for reaching a certain level of usage.

Frequent buying programs make the assumption that members and non-members can be placed on a single continuum with members normally being more actively involved in purchasing and use of the associated goods than non-members. Marketing managers assume that consumers that purchase more regularly from their company will want to join the membership program, and these marketers hope to retain or increase their share of their better customers through the use of these membership programs. Similarly, managers hope that there is also a segment of less loyal users that will become more loyal through their affiliation with the program.

Earned membership. This type of membership is derived from the price-driven membership, but is reserved for the very best users of the organization's goods. Often these are "clubs within clubs" and are aimed at ensuring the loyalty of the organization's most profitable segment (Raphel 1993). These are commonly found with rental cars agencies, hotels, and airlines. These provide privileges to those who earn them by purchasing a certain level of goods, and there is no other way to obtain membership. For example, Hyatt Hotels offer a Gold-Passport club for their top 1,000 customers where members never have to make a reservation and a room is always available (Raphel 1993).

One assumption these programs make is that once individuals reach a level where they are admitted into the club, they will want to remain in the club. The main purpose is to ensure consistent purchasing across episodes where the length of an episode can be stretched from a single use to the remaining length of the membership. If a member decides to portion business among several competitors, the member risks losing her/his status and privileges of the earned membership club. Further, the member may be more forgiving of the sponsoring organization when there is a quality failure because switching to a competitor may mean loss of desired benefits from the exclusive membership club.

From a marketer's perspective, earned memberships are often used in conjunction with a price-driven membership when many competitors (e.g., airlines' frequent flier programs) offer the same membership (Gruen and Ferguson 1994). The earned membership forces the consumer to commit her/his business to a single competitor.

Access membership. The fourth category of membership is one where membership is required in order to obtain access to the organization's goods. The access membership can be further sub-categorized as "inclusive memberships"-those which offer access to all who are willing to pay-and "exclusive memberships"-those that restrict potential members on the basis of certain requirements.

A primary example of an inclusive club is the recent retail phenomenon of the warehouse membership clubs (Cotter, Arnold, and Tigert 1992). For an annual fee, members can take advantage of the presumed price savings offered by these low-overhead retailers. Other examples would be associations like the American Automobile Association. Most major airlines offer clubs (e.g., American's Admirals Club, Delta's Crown Club) at their hub cities which have special rooms and services available at airports for travelers that choose to purchase memberships for an annual fee (or exchange frequent flier miles for membership). Financial advisory services are also offered in a membership context as are other subscription based services particularly in the not-for profit arena. Examples of these are Consumers Union and National Geographic Society.

In summary, there are four membership categories relevant to this study. Each membership category represents a different choice process on the part of the consumer when joining, and each has different implications resulting from the membership.

Theories Of Consumers' Membership Choice

This section describes existing theoretical frameworks that can help uncover the driving forces behind consumers and their membership choices.

Social Identity Theory. A theory that offers great explanatory potential is social identity theory (SIT) (Tajfel 1981; Turner 1984, 1987). According to SIT, people classify themselves through a process termed self-categorization into social categories using characteristics such as organizational membership, religious affiliation, age, race, and status (Turner 1987; Ashforth and Mael 1989). These categories permit an individual to define her/himself in terms of a social identity. This social classification permits the individual to cognitively segment and order the social environment. The individual can define her/himself and also has a convenient means for defining others.

An important concept of SIT is that self-image is tied to the individual's perception of the group's image. The group's image is seen in reference to other groups. One's own group would be an in-group, while other competing groups would be considered as out-groups. When an individual becomes a member, the member would perceive the other members as part of the in-group while the non-members would be considered an out-group. The person's perception of the strength of the differences between one's in-group and the relevant out-groups indicates the level of the person's social identification with the in-group (Ashforth and Mael 1989). A basic premise of SIT is that people are motivated to establish a distinctiveness for a group they wish to identify with from relevant out-groups.

SIT includes the notion of a psychological group (Turner 1984). An important characteristic of a psychological group is that individuals can identify with the group and derive self-identity without necessarily engaging in interpersonal interaction with members of that group (Tsui, Egan, and O'Reilly 1992). This aspect of SIT helps explain consumer behavior in situations such as when frequency of use doesn't necessarily predict membership in full-choice memberships .

The implications of SIT to the four types of memberships described in the earlier section are relatively straightforward. According to SIT, when offered a membership, the consumer will determine the extent to which s/he can identify with the group. Since the group is rather abstract (often the other members remain anonymous to the potential member) the consumer will examine the potential distinctiveness offered by the membership. Non-members become the relevant out-group. The benefits need to provide the consumer enough distinction from the benefits that could be obtained as a non-member in order for the membership to be sought or accepted. Further, while the benefits need to offer distinction, a favorable cost-benefit ratio is not required (Turner 1987).

Exchange Theory. A more utilitarian perspective that focuses on the consumer's perceived rewards of the membership is exchange theory. From a social-psychology perspective, Homans (1976) suggests that provided that a reward satisfies an important need of the individual, the individual will invest in roles that provide a favorable balance of rewards to costs (Loebel 1991). Homans states that the degree of reward received from an activity is judged in relation to an alternative reward from an alternative activity. From an economic perspective, a consumer would be expected to join an organization as long as the value of the perceived benefits exceeds the opportunity costs (Ulbrich and Wallace 1989).

From a marketing perspective, Houston and Grassenheimer (1987) define the exchange relationship as exchanging value for value. When at the point of enrollment the member pays a fee (dues) in exchange for perceived future benefits (over the period the dues are to cover), the parties are on unequal footing (Ferguson and Brown 1991). The consumer behavior of the member toward the marketing organization when the exchange is unbalanced may then be viewed as trying to utilize benefits in order to "balance the scale." Marketers can be pretty well assured that if the scales are not balanced by the end of the membership period, the member will not renew.

Desire for Information. Groups may have access to information sources that are not available to the individual, and the individual may find it worthwhile to associate with the organization (become a member if that is required) to have access to this information. Depending on one's perspective, this information could be considered a good (as an end in itself) or information as a sub-goal (means to an end).

Need for Protection. The consumer's need for protection is the basis that many groups are founded upon (Kantor 1991). In the consumer area, membership groups have been started in self-defense to the selling organizations' power or unwillingness (or lack of ability) to provide adequate information. The self-defense response to selling organizations' power and the inadequate information response are similar, although the antecedents and consequences of each are distinguishable.

An exemplar that may be created from either of the above two responses is the formation of computer users groups. While individuals may have some desire for social identity through the user group, a better explanation for their membership is the need to protect their investment and insure the promised productivity gains. Some of these groups are started because the users perceive the vendor as being indifferent to their after-sale needs and/or unwilling to provide an acceptable level of service. This self-defense response creates an adversary relationship between the user group with the vendor.

However, other user groups help members make connections with other members to answer their questions (Kantor 1991). Many of these are formed by the vendor to assist the vendor in prioritizing upgrades and offering solutions that the user groups deem marketable. A common thread for both responses is the need for information caused by the consumption of the good (Olshavsky 1985). The user group was formed because the members could not count on the vendor to answer their questions or otherwise fulfill their need for information.

Simplification. The simplification "theory" of consumer behavior toward memberships suggests that the membership provides the member rationale to say no to certain opportunities and yes to others. The possibilities become fewer and life gets simplified. In this case, one can hypothesize that a driving force to become a member is to simplify subsequent choice processes-once one determines a membership, subsequent decisions in the area covered by that membership become more manageable. The concept here is that the consumer will seek to not have to make a choice in subsequent episodes. Such a situation could occur where a choice process is extremely difficult. One way that the choice process becomes simplified is through attribution of the decision. When a choice process is very difficult, a person may find solace in being able to justify the decision by attributing it externally. For example a voter's membership in a political party provides a justification for simply voting the "ticket" rather than admitting that the choice process for selecting most candidates is beyond the person's ability and/or desire.

In summary, five basic rationales for becoming a member have been presented. Each provides a plausible explanation for consumer behavior toward memberships. The next section presents some preliminary research which examines these rationales in combination with the values toward and the categories of membership.

INITIAL EXPLORATION

Students' View Of Memberships

The initial foray into research of consumer behavior with respect to memberships was developed as a take-home assignment for undergraduate students taking a Consumer Behavior course during the summer of 1993. [The course was taught by the author and specific class time was spent teaching students about memberships prior to completion of the assignment. Since the primary focus of the assignment was the learning experience of the students (they were graded on the assignment), the research element had to be sacrificed to some extent. Nevertheless, given the exploratory nature of this paper, the information provided by the students sheds considerable light on the topic at hand. Copies of the assignment are available from the author.] Eighteen students completed the assignment. Five of the eighteen were international students and the remainder American students. Since the students were being graded on the assignment, each provided thorough answers to each of the questions. The students were asked to list in detail the various memberships they currently held. In order to stimulate their thinking further about memberships, they were also required to ask a non-student adult for their list of membership affiliations. The critical question for this study was one that asked the students to identify the needs and values specifically related to memberships. In order to avoid the demand effects associated with a question that directly asked the students for their rationale for joining organizations, the question contained three sections where they could reveal their thoughts without personal bias. Specifically the question read: What is the driving force behind businesses (or non-profits) to use the membership concept? Do consumers behave differently when they consider themselves "members?" How?

TABLE 1

SUMMARY OF IDENTIFIED CONSUMER NEEDS AND RELATED VALUES

Each student wrote about one-half of a typewritten page on the question. The question successfully elicited the intended values-related needs and on average each student listed two or three usable responses. A summary of the identified needs, the frequency of identification, and the related values appears in Table 1.

A two-stage content analysis approach was used obtain and assign the data (Kasserjian 1977). First, the specific phrases (one to four words) which indicated an expressed need were extracted from each of the assignments and listed on a spreadsheet. Those which overlapped were combined and their frequency was noted. To the greatest extent possible, exact or near exact wording appears in Table 1, however in a few instances the listing of the expressed needs by the students was subject to minor interpretation. Second, the linking of needs to values was made by the author by systematically comparing the phrases' wording and intent in relation to the descriptions of the LOVs (plus power) as presented by Kahle (1983). In most cases the need related specifically to one LOV, while others covered multiple LOVs.

Following this linkage of the needs to the LOVs, the total number of phrases mentioned was multiplied by the number of associated LOVs. For example, sharing similar interests with other members counted as four for # 2 and four for # 3. These computations were summed for each of the nine values. This analysis provides several interesting findings. First, sense of belonging/affiliation was mentioned by more that half of the students. After sense of belonging, the next most frequently mentioned needs dealt with prestige and exclusivity. These relate to the two "respect" values (# 5 and # 7). Another frequently mentioned need was that of gaining a closer relationship with the sponsoring organization. More than half of the students listed increased loyalty as a consequence of membership programs. Based on the earlier discussion where some membership programs (particularly price-driven) apparently fail to link members to the sponsoring organization, this finding holds considerable research interest. For example, in the relationship marketing literature, membership has been suggested as one means to building and maintaining relationships (Gruen and Ferguson 1994).

Three students stated that exclusivity could be a negative factor where non-members would shy away from the sponsors' goods. The least mentioned associated values were security and power. This may be due to the nature of the student sample that may be less concerned with security and power issues. A similar caveat needs to considered for other findings due to the sample's relative homogeneity.

While this initial study examined students' overall view of consumer behavior with respect to memberships, it did not examine their specific reasons and motivations for joining (or for not joining) each specific organization. A follow-up study which explores these specific linkages will be helpful in gaining further understanding of consumer behavior with respect to membership.

Review Of Marketers' Membership Programs

In order to gain additional insight into consumer behavior with respect to membership as well as provide a context for the theories and membership categories developed in this paper, a content analysis of business publication articles from 1991 to mid-1993 about membership programs was made. The method was similar to the content analysis in the student assignment study except that this analysis searched for three types of phrases: those indicating the membership type category, those indicating the associated theory, and (as in the previous study) those indicating the values. In the cases listed in Table 2, the memberships offered to consumers are the result of a program generated by the sponsoring organization. In order to provide some boundaries to the articles used in the content analysis, some categories of memberships available to consumers-such as association memberships where the membership tends to be more of an end in itself-are not considered here.

TABLE 2

MEMBERSHIP PROGRAM, CATEGORY, THEORY, AND ASSOCIATED VALUE(S)

This exploration into determining the driving forces behind consumers' behavior toward memberships is based on two assumptions. The first assumes that marketers have a fairly good idea of the needs of their customers when designing a loyalty or membership program. The second assumes that only the better (or major failures) membership programs will receive press coverage. These assumptions governed a search of the recent popular business literature which reported these programs. Table 2 lists the various clubs, the most likely theoretical explanation for consumer behavior toward the club, the category of the membership, and the associated value of the consumer. [Sources which reference each of the clubs are available from the author. They are not listed in the Bibliography unless mentioned in the paper elsewhere. UMI database was used to locate publications.]

The specific theory, membership category, and associated value is listed according to the sponsoring organization's intention as ascertained from the context. Nothing is included that judges the marketer's ability to execute the intention. For example, the now defunct Air Miles program intended to create an in-group based on SIT, but it obviously failed to do so. In some cases the text was unclear or incomplete so that an identification could not be easily made. These are indicated by question marks. There were also several categories where similar or competing organizations offered the same basic program. These are grouped into a single row.

Category. Access seems to be the most dominant with marketers attempting to develop something exclusive for its customers in about 40 percent of the programs. Price-driven is the second most popular type utilized by more than 25 percent of the programs. Full-choice and earned are each used in less than 20 percent of the categories.

Theory. Both SIT and Exchange theory appear to explain at least a portion of all of the programs. The other three explanations each work in conjunction with either exchange theory or SIT. One of the most pervasive desires of the marketers when designing their membership programs was to develop some sense of consumer loyalty through a sense of belonging or affiliation. Such a desire requires incorporation of elements of SIT.

Values. Similar to the student study, sense of belonging and respect appear as the most common values that marketers seek to reach through their programs. Marketers appear to be neglecting, for the most part, the values of warm relationships and self-fulfillment. It may simply be very difficult to design membership programs that address these values.

Summary and Proposed Research Directions

Some of the groundwork that has been provided here is the proposition that a consumer behavior model such as Olshavsky's (1985) consumer choice model contributes to the existing marketing perspective of membership, an examination and delineation of consumers' needs and values that are related to membership, development of a categorization of membership types, identification of relevant theories that can be applied to predict consumer behavior with respect to memberships, and two preliminary examinations of consumer behavior with respect to memberships. Using these as a foundation, several additional research directions are possible.

Extension of the student assignment. The student assignment discussed in this paper examined only overall opinions of consumer values and their link to memberships. The study did not examine the individual's specific links of their values to memberships. In order to obtain a better understanding of consumers' drive to become a member, these specific linkages need to be examined. This can be accomplished in two ways. The first is to simply modify the assignment and ask the students to identify specific memberships and their specific reasons for joining. The analysis of these responses should provide richer results.

The second method is to use laddering (Gutman 1982; Reynolds and Gutman 1988). Laddering is a research method that is designed to link concrete attributes to abstract values. A laddering study needs to be conducted in two phases. The first would be a student subject phase where students are interviewed and laddering is used by the researcher to examine the linkages of each student's memberships to specific values. The second phase would be to examine a more diverse population since the homogeneity of student subjects could produce a preponderance of certain values being expressed while other values may not be expressed at all.

Extension of the Marketers Membership Study. A few of the programs noted in the second study that were discussed in this paper (see Table 2) seem to offer good potential for examining the members and their motivation to join. The Walden Books Preferred Reader Program, the ITT Sheraton Club International, and the Egghead Software club each offer their members a full-choice membership. Research involving the members of any or all of these three programs would help uncover the values that drive these customers to obtaining the membership when a genuine choice is presented.

Refinement of categorization types. The four categories presented here represent a starting place for the study of memberships. However, some of the difficulty encountered in classifying the various programs in the Marketers Membership Study indicates that further and potentially greater difficulty will be encountered in larger studies. This difficulty in categorization suggests that additional research needs to develop a more refined classification system of membership programs that includes relevant and descriptive subcategories.

Consumers' membership behavior patterns. Are some consumers simply more prone to join than others? Are there any factors that predict this? It would appear that there is a strong likelihood that the answers to both of these questions is "yes."

This research could reveal that there are specific segments that respond to memberships differently. For example, one study of users of hotel frequent guest programs found that there is a segment of "hard-core" frequent guest program users whose loyalty is attached to the deals derived from the programs (McCleary and Weaver 1991). Elimination of these programs by one hotel would mean certain loss of this segment's business to competitors.

Determining the impact of membership on choice across episodes. While most of the focus in this paper has been on obtaining the membership, the question remains as to the effect of the membership on choice across episodes. For example, according to exchange theory, the amount of dues paid would positively impact future use as the members would seek to "get their money's worth." Five dependent variables could be examined in this research. The first four include repeat purchases, purchasing across product and service lines, giving referrals, and demonstrating immunity to competition (Stum and Thiry 1991). Retention rates of the membership itself could be an additional dependent measure. A composite of these five dependent variables could be used to construct a summary measure of "membership equity."

CONCLUSION

Research in the area of consumer behavior with respect to memberships is interesting, difficult, and worthwhile. The interest comes because every new piece of evidence often contains some new twist or innovation that might impact consumers differently. The difficulty comes in the sheer pervasiveness of the membership issue and need to find a portion that researchers can adequately get their hands around. The research is worthwhile from both consumer behavior and a managerial marketing perspectives. Consumers are definitely affected by memberships and marketers are pouring substantial sums of money and effort into membership programs.

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----------------------------------------

Authors

Thomas W. Gruen, Indiana University



Volume

AP - Asia Pacific Advances in Consumer Research Volume 1 | 1994



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