SUBSCRIPTION VERSUS POINTS-BASED LOYALTY PROGRAMS: A TWO -STUDY COMPARISON OF CONSUMER ENGAGEMENT

Abstract

Loyalty programs are moving away from points accumulation toward paid subscription models such as Amazon Prime, but no study has directly compared the two formats on consumer engagement. Study 1 surveyed 448 Indian urban consumers (221 subscription members, 227 points-program members) and tested a structural model linking program type to cognitive, emotional, and behavioural engagement through psychological ownership, perceived value certainty, and social identity, using PLS-SEM and multi-group analysis. Study 2 used a 2 (program type) × 2 (reward certainty) vignette experiment (n = 186) with Hayes' PROCESS Model 8 to test moderated mediation. Subscription members reported significantly higher psychological ownership, value certainty, and social identity salience than points-program members, and emotional engagement carried most of the subscription advantage into program commitment and advocacy. Five of six focal structural paths differed significantly by program type; the largest group difference was in perceived value certainty (Cohen's d = 1.198). Study 2 confirmed that value certainty mediates the program-type effect, and that this mediation strengthens when rewards are certain (index of moderated mediation = 0.107). Points-program operators should redesign around certainty and ownership rather than accumulation mechanics; subscription operators should keep reinforcing members' sense of already owning their benefits.