Receivers' Responses To Referral Reward Program In Social Networks

As a sociological phenomenon, word of mouth is considered as an increasingly key marketing tool in propaganda. Recently some campaigns have begun to utilize formal programs where existing customers are incentivized to make recommendations. To attract a new customer,incentives can be various type of reward, such as member points, gifts and coupons, which is referral reward program.Furthermore, online social networking services have become increasingly popular, such as MySpace, Facebook and Wechat, which have received more and more attention. Because online circumstances allow communication remotely and out of sync, and a better communication capacity, online RRP in social networking may have different characteristics compared to traditional RRP. Therefore, this paper mainly studied the effects of reward allocation, tie strength and brand relationships on received likelihood in programs and confirmed the mediating effects of social cost.Existing studies focus mainly on rewarded referral, optimaling RRP designs for increasing the effectiveness of referrals. However, there have been few studies of the effects of reward referrals from the perspectives of social norm and market norms and other work has focused on the conditions that make consumers more likely to transmit a rewarded referral and those under which consumers respond positively or negatively to such referrals.Therefore, this paper followed the logic which researched the interaction between market norm and social norm. Study 1 and 2 involved the market factors as reward allocation, social factors as tie strength and a factor both in market norm and social norm as brand relationships, where studied the interaction between market norm and social norm preliminary.And study 3 would study the interaction deeply.Based on 3 studies, this paper found that people with strong ties tended to accept RRPs more often than those with weak ties because people with strong ties gave their friends' benefit more consideration, which was driven by internal incentive.As for research limitations and implications, at the most basic level,this paper extends the theory on effect of reward on received likelihood in online RRPs. We further verify that social cost is the psychological mechanism that causes reward to strengthen received intentions under market norms or social norms. For practical implications, this paper researched how social norm and social norm affected consumers'behaviors differently, which helped company design RRP.Despite the implications of our findings, we realize that the present research has certain limitations that may provide a broad area for future research. This paper concentrated on the effect of reward, tie strength, and brand relationship on perceived social costs and received likelihood but did not study mechanism how social or market norm works in decision making accurately. Furthermore, regarding the social norm and market norm, we limited our attention to reward, tie strength, and brand relationships, which are main factors in online RRP. In reality, social and market factors are involved in a wider range, especially in online circumstances. Therefore, a deeper examination of the impacts of various factors within the scope of social and market norm on acceptance success could constitute an interesting avenue for future research.