Study Of The Impact Of Paid Referral Reward Programs On Referral Intention

Paid referral reward programs of group shopping website provide rewards toexisting customers to encourage them to make recommendations to others, and areuseful for the promotion of website. It is the emerging WOM management tools, andgets close attention of practitioners and theorists. The existing research results tendscheck for the effect of referral reward program and communication medium on thereferral likelihood.The purpose of this study is to explore how paid referral reward programs andtie strength influences customers’ referral likelihood, and the mediating effect of theperceived social risk, the moderating effect of tie strength and regulatory focus.Based on the content and purpose of research, taking a combination of researchmethods of theoretical research and empirical research, this study take to explore therelationship of paid referral reward programs, referral likelihood, tie strength andregulatory focus. This study reviews and summarizes the relative theories of paidreferral reward programs, perceived social risk, regulatory focus and so on. With theexperimental methods of psychology, this study gets the2*2*2*2*2between subjectsexperimental design. By the method of ANOVA and regression analysis, we draw themain research conclusion as follows:This study confirms that perceived social risk has a mediate effect on rewardamount, reward types, reward distribution, quantitative restrictions influenecustomers’ referral likelihood.“Real product”,“giver and recipient”,“one” couldreduce the perceived social risk. Besides perceived social risk has a mediate effecton tie strength influene customers’ referral likelihood. There is trust mechanismbetween strong ties, so its perceived social risk is lower, and its referral intention ishigher.Reward intensity is greater, perceived social risk is higher, but also morerewards", they cancel each other, and leading to the effect is not obvious.The moderating effect of regulatory focus has three aspects: Tie strength’s effecttoward referral intention, reward distribution’s effect toward referral intention, andreward types’ effect toward referral intention. Finding indicates that apromotion-focused giver intend to select cash, reward giver and recipient. Besides, apromotion-focused giver is sensitive to positive outcomes, so he is willing to referralWOM toward strong ties. The conclusions of this study have theoretical contribution in online paid Paidreferral reward programs research，and also have practical meanings for the WOMreferrals management of online group shopping website and others.