Effective Promotions for Membership.discount vs. Bonus

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    Effective promotions for membership subscriptions and renewals

    to tourist attractions: Discount vs. bonus

     Jaemun Byun  1, SooCheong (Shawn) Jang*

    School of Hospitality and Tourism Management, Purdue University, Marriott Hall, 900 W. State Street, West Lafayette, IN, 47907, USA

    h i g h l i g h t s

    We investigated the effective promotions for tourist attraction membership.

    Bonus was more effective than discount for new membership subscriptions.

    Tourists who had previously renewed memberships did not distinguish between discount and bonus for renewal promotions.

    Tourists who had never renewed memberships preferred bonus at hedonic attractions but discount at utilitarian attractions.

    a r t i c l e i n f o

     Article history:

    Received 15 September 2014

    Accepted 4 February 2015

    Available online 24 February 2015

    Keywords:

    Tourist attraction

    Membership

    SubscriptionRenewal

    Promotion

    Discount

    Bonus

    a b s t r a c t

    Tourist attractions actively promote membership subscriptions and renewals. Although discount pro-

    motions are commonly utilized in practice, the literature review suggested that bonus promotions, such

    as an   “extra three months,”   could be more effective. Two experiments were conducted to identify

    effective promotions for membership subscriptions and renewals. Bonus promotions were found to be

    more effective than discount promotions at generating more positive tourist attitudes and behavioral

    intentions toward new subscriptions. In contrast, neither bonus nor discount renewal promotions were

    more effective for tourists who had previously renewed membership. However, tourists who had never

    renewed memberships to utilitarian attractions, such as botanic gardens, preferred discount promotions,

    whereas tourists who had never renewed membership to hedonic attractions, such as theme parks,

    preferred bonus promotions. This implies that attraction managers should offer tailored promotions to

    encourage membership subscriptions and renewals.

    © 2015 Elsevier Ltd. All rights reserved.

    1. Introduction

    Tourist attractions, such as theme parks, museums, botanic

    gardens, and aquariums, are one of the most crucial businesses in

    tourism (Leask, 2010; Swarbrooke, 2001). There were more than

    400 theme parks and similar attractions in the United States withapproximately 290 million annual visitors in 2010 (International

    Association of Amusement Parks and Attractions, 2012). Even

    though each tourist attraction provides diverse services ranging

    from entertainment, food, and beverages to hotels, shopping, and

    education, admission fees are their single largest source of income.

    In fact, admission fees account for approximately half of tourist

    attractions' total revenues (Milman  &  Kaak, 2013).

    Admission fees are generally collected in two forms: tickets and

    membership. A ticket allows a visitor to access the attraction a

    certain number of times, commonly once, whereas a membership

    allows unlimited access during a certain period of time, usually ayear. Even though most tourist attractions utilize both forms, the

    price of an annual membership is generally only 3e7 times more

    expensive than that of a daily ticket. This can thus add up to a huge

    discount considering the number of possible admissions.

    Membership plays an important role for tourist attractions. It

    promotes more frequent visits by members and, accordingly,

    contributes to cross-sales by restaurants and retail shops. Mem-

    bership also helps tourist attractions optimize the number of daily

    visitors, which allows facilities   (e.g., rides or shows)   to ef ciently

    operate and manage staf ng. Financial stability can also be*   Corresponding author. Tel.: þ1 765 496 3610; fax:  þ1 765 494 0327.

    E-mail addresses:   [email protected] (J. Byun),   [email protected] (S. Jang).1 Tel.:  þ 1 765 631 4093.

    Contents lists available at  ScienceDirect

    Tourism Management

    j o u r n a l h o m e p a g e :   w w w . e l s e v i e r . c o m/ l o c a t e / t o u r m a n

    http://dx.doi.org/10.1016/j.tourman.2015.02.002

    0261-5177/©

     2015 Elsevier Ltd. All rights reserved.

    Tourism Management 50 (2015) 194e203

    mailto:[email protected]:[email protected]://www.sciencedirect.com/science/journal/02615177http://www.elsevier.com/locate/tourmanhttp://dx.doi.org/10.1016/j.tourman.2015.02.002http://dx.doi.org/10.1016/j.tourman.2015.02.002http://dx.doi.org/10.1016/j.tourman.2015.02.002http://dx.doi.org/10.1016/j.tourman.2015.02.002http://dx.doi.org/10.1016/j.tourman.2015.02.002http://dx.doi.org/10.1016/j.tourman.2015.02.002http://www.elsevier.com/locate/tourmanhttp://www.sciencedirect.com/science/journal/02615177http://crossmark.crossref.org/dialog/?doi=10.1016/j.tourman.2015.02.002&domain=pdfmailto:[email protected]:[email protected]

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    strengthened by collecting membership fees upfront. In sum, suc-

    cessfully managing membership is benecial for tourist attractions.

    Tourist attractions actively promote both membership sub-

    scriptions and renewals. They often provide additional benets for

    members, such as free parking, designated entrances, or free

    magazines. Further, membership fee discount promotions are

    commonly witnessed at many tourist attractions. For example, Six

    Flags offered a New Year's promotion with a 46% discount on its

    season passes (Six Flags Magic Mountain, 2014). Likewise, Walt

    Disney World provided a 15% discount for annual pass renewals,

    Universal Studios Hollywood offered an 11% discount, and LEGO

    Land offered a 25% discount (from   LEGO Land, 2014; Universal

    Studios Hollywood, 2014; Walt Disney World, 2014).

    While discount promotions are popular with tourist attractions,

    bonus promotions, such as an   “extra free three months,” are also

    commonly utilized in other industries, such as cable TV, Internet

    services, rental businesses, magazines and newspapers. Further,

    among tourist attractions, SeaWorld started to offer a bonus pro-

    motion for its annual pass  e   “Buy 1 Year and Get the 2 nd Year

    Free!” (SeaWorld, 2014). The attractiveness of discount and bonus

    promotions might appear similar when the associated benets and

    costs are the same. For example, a 10% price discount promotion

    seems more or less similar to a 10% quantity bonus promotion interms of savings and costs. However, the extant research in mar-

    keting indicates that the effectiveness of such promotions can differ

    based on product type and customer characteristics (e.g., Diamond,

    1992; Diamond   &   Campbell, 1989; Hardesty   &   Bearden, 2003;

    Kamins, Folkes,  & Fedorikhin, 2009; Mishra  &  Mishra, 2011).

    There is little empirical evidence on the effectiveness of dis-

    count promotions, which have conventionally been used by tourist

    attractions. In general, there are few studies on marketing or pro-

    motions for tourist attractions (Leask, 2010). This study intends to

    ll this gap by investigating the effectiveness of membership fee

    discount promotions on customers' attitudes and behavioral in-

    tentions in comparison with extra membership period bonus pro-

    motions. This study will help tourist attractions to identify

    appropriate promotions to attract new visitors and maintain cur-rent members. Managers of tourist attractions can offer tailored

    promotions for their visitors and members.

    To achieve these objectives, this study  rst reviewed the liter-

    ature to identify diverse factors that might inuence customers'

    preferences between the two types of promotions (i.e., discount and

    bonus). Then, hypotheses on effective promotions for tourist at-

    tractions were developed by applying the above factors to both

    membership subscriptions and renewals. Two experimental de-

    signs employing the survey method, one examining new member

    subscriptions and the other focusing on renewals, were used to test

    the hypotheses. Finally, the results of the ANOVA analysis and the

    implications were discussed.

    2. Literature review 

    Prospect theory (Kahneman  & Tversky, 1979, 1984; Tversky  &

    Kahneman, 1992) is the theoretical foundation for the argument

    that bonus promotions are preferred over discount promotions

    (e.g.,   Chandran   &   Morwitz, 2006; Diamond, 1992; Diamond   &

    Sanyal, 1990). Prospect theory describes decision making under

    risks and indicates that choosing between risky alternatives is

    inuenced by how the choices are framed. The option framed as a

    gain is perceived as better than an alternative framed as reduced

    losses (Kahneman   &  Tversky, 1979, 1984; Tversky   &  Kahneman,

    1992). Prospect theory has been widely conrmed in diverse situ-

    ations (Diamond  &  Sanyal, 1990; Thaler, 1985). On the other hand,

    researchers have also argued that customers' preferences toward

    discount or bonus promotions can be affected by other factors, such

    as product stack-ability or customers' familiarity with the product

    (e.g., Hardesty & Bearden, 2003; Mishra & Mishra, 2011; Ong, Ho, &

    Tripp, 1997; Smith   &   Sinha, 200 0). Thus, some customers may

    prefer discount promotions rather than bonus promotions.

    Section   2.1  below investigates diverse factors that inuence

    customers' preferences between discount and bonus promotions.

    Then, these factors are applied to identify effective promotions for

    membership subscriptions and renewals in Section 2.2.

     2.1. Preferences between discount and bonus promotions

    Customers generally prefer bonus promotions rather than dis-

    count promotions. First,  Diamond and Sanyal (1990)  claimed that

    bonus promotions are preferred based on prospect theory

    (Kahneman   &   Tversky, 1979, 1984; Tversky   &   Kahneman, 1992)

    because customers tend to consider a quantity bonus as an extra

    gain but a price discount as reduced losses (refer to Diamond, 1992

    as well). Second, Chandran and Morwitz (2006) argued that bonus

    promotions are preferred because a quantity bonus is viewed as

     free  from negative contextual information such as quality issues.

    Their experiment showed that   “free shipping”   yields signicantly

    higher purchase intentions for used books than price discount

    promotions, even when both offers amount to the same economic

    benets (Chandran  &  Morwitz, 2006). Lastly, Chen, Marmorstein,

    Tsiros, and Rao (2012)   argued that bonus promotions are

    preferred because customers do not pay much attention to the base

    value of a product or service and, consequently, prefer the nomi-

    nally higher percentage of the bonus promotion rather than the

    lower percentage of the economically equivalent price discount

    promotion. For example, a 50% bonus promotion was considered as

    superior to a 35% price discount promotion even though they were

    similar in terms of dollar per unit value  (i.e., [email protected] for bonus vs.

    [email protected] for discount) (Chen et al., 2012).

    However, researchers have also identied several circumstances

    where customers' preferences can be moderated in favor of dis-

    count promotions. The  ndings on these moderators are summa-

    rized in Table 1. First, Smith and Sinha (2000) found that customersprefer price discounts for expensive products but bonus pro-

    motions for inexpensive products (refer to Chen et al., 2012 as well).

    For example, when the price is high, a 33% off promotion is

    signicantly preferred over a 33% more promotion (Chen et al.,

    2012). Second,   Smith and Sinha (2000)   also claimed that price

    discounts are generally preferred for non-stackable goods, such as

    perishables. For example, their experiment (Smith  & Sinha, 2000)

    found that a discount promotion is more effective for bread and

    cheese than bath tissue and detergent. Third,  Mishra and Mishra

    (2011) found that a price discount is more effective for vice foods,

    such as chocolate chip cookies, while a bonus pack is more effective

     Table 1Moderators on preference toward bonus vs. discount promotion.

    Category Moderator Preference toward

    promotionType Level/Condition

    Product Price High Discount

    Low Bonus

    Stack-ability High Bonus

    Low Discount

    Guilty Feeling Vice Goods Discount

    Virtue Goods Bonus

    Customer Familiarity with

    products and services

    High Bonus/Indifferent

    Low Discount

    Usage Frequency High Bonus

    Low Discount

    Promotion Size of Promotion Large Discount

    Small Bonus/Indifferent

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    for virtue foods, such as fruit salad. To explain this phenomenon,

    they argued that a discount promotion makes it easier for cus-

    tomers to justify the consumption of vice goods by alleviating

    associated feelings of guilt. In contrast, consumers are willing to

    consume more virtue goods with a bonus promotion because it is

    considered an extra benet with no associated psychological con-

    ict or guilt (Mishra  &  Mishra, 2011). Fourth,   Chen et al. (2012)

    found that customers prefer discount promotions for unfamiliar

    products whereas they are indifferent regarding the type of pro-

    motion for familiar products. In their experiment (Chen et al.,

    2012), participants showed greater preferences toward discount

    promotions rather than bonus promotions for new coffee brands.

    Yet, they did not distinguish between the two types of promotions

    for familiar coffee brands. Fifth, Ong et al. (1997) claimed that usage

    frequency acts as a moderator. Light users prefer discount pro-

    motions, while heavy users prefer bonus promotions. In their

    experiment, light users showed stronger preferences toward dis-

    counted lotion than extra free lotion, compared with heavy users

    (Ong et al., 1997). Lastly, Hardesty and Bearden (2003) argued that

    customers prefer discount promotions when the size of the pro-

    motion is large. For instance, when a promotion level is high  (e.g.,

    50%)  customers evaluate a price discount more favorably than a

    quantity bonus, whereas they tend to be indifferent when a pro-motion levels is moderate (e.g., 25%)  (Hardesty &  Bearden, 2003).

     2.2. Tourist attractions and promotion preferences

    Even though tourist attractions are dened slightly differently

    by various researchers (Hede & Hall, 2006; Hu  & Wall, 2005; Leask,

    2010; Pearce,1991), it is generally acceptedthat they include theme

    parks or amusement parks, museums and galleries, natural land-

    scapes, heritage sites, religious sites, cultural and industrial visitor

    centers, and animal facilities (Leask, 2010). Most tourist attractions

    are regarded as services for hedonic consumption (Milman, 2001)

    and utilize similar business models and marketing strategies as

    commercial products and services. By analyzing whether the

    moderators in Table 1  can be applied to membership promotions

    for tourist attractions, this study developed the following

    hypotheses.

    There appear to be no moderators that favor discount pro-

    motions for new membership subscriptions, as summarized in

    Table 2. (1) Even though the absolute price of the membership may

    be expensive, the relative price compared with a daily ticket would

    still be considered moderate or inexpensive. For example, although

    the price of Walt Disney World's annual pass is around $630, it is

    only around 2.3 times more expensive than a 3-day ticket and 6.4

    times more expensive than a daily ticket (Walt Disney World, 2014).

    It is likely that tourists who consider a membership will recognize

    that the price per visit is much less expensive than a daily pass and

    therefore prefer a bonus promotion. (2) The high stack-ability of 

    membership works in favor of bonus promotions as well. (3)

    Tourists are not likely to feel guilty because the feeling of guilt

    which results from violating one's own moral and internal stan-

    dards, such as wasting time or money, will not occur ( Burnett  &

    Lunsford, 1994). Rather, members may feel guiltless because they

    can spend more time with their family (Burnett &  Lunsford, 1994),

    which usually serves as the main   ‘guest unit’ for tourist attractions

    (Milman, 2001). However, it is still possible that members of 

    extremely hedonic tourist attractions, such as theme parks with

    extreme rides, might feel guilty because hedonic consumption is

    commonly associated with guilt (Dhar & Wertenbroch, 2000). Thus,

    this paper classied tourist attractions into relatively hedonic and

    utilitarian tourist attractions to conrm the moderating effect of 

    guilt. (4) It is reasonable to assume that individuals who consider

    purchasing a membership are familiar with a tourist attraction

    enough to prefera bonus promotion or not distinguish between the

    two promotions. (5) It would be reasonable to assume that in-

    dividuals considering a membership expect to visit the attraction

    frequently enough to prefer a bonus promotion. Otherwise, they

    would not subscribe to a membership. (6) Membership promotions

    for tourist attractions generally range from 10% to 25% bonus or

    discount, which is a small or moderate size. This suggests thattourists would prefer a bonus promotion (Hardesty   &  Bearden,

    2003). In sum, almost all of the moderators indicate that tourists

    would show positive attitudes toward bonus promotions. Greater

    positive attitudes toward bonus promotions are expected to lead to

    stronger subscription intentions and recommendation intentions

    (Ajzen, 1985). Therefore, the following specic hypotheses are

    proposed:

    H1.   Bonus promotions  are more effective than discount promotions

    in inducing positive attitudes (H 1-1), subscriptions intentions (H 1-2)

    and recommendation intentions (H 1-3) for new membership sub-

    scriptions to tourist attractions; whereas

    H2.   discount promotions are more effective than bonus promotions

    in inducing positive attitudes (H  2-1), subscriptions intentions (H  2-2)and recommendation intentions (H  2-3) for extremely hedonic tourist 

    attractions.

    In the case of membership renewal promotions, usage fre-

    quency would act as a moderator in favor of discount promotions

    for tourists who realize they visit infrequently. The other conditions

    of the moderators remain more or less unchanged, as summarized

    in Table 2. (1) Annual or seasonal membership prices are not ex-

    pected to change much, although economic or strategic conditions

    might require a slight price increase or decrease. Thus, there is no

    reason to assume preferences toward a bonus promotion will

    change. (2) The high stack-ability of memberships will continue to

    work in favor of bonus promotions as well. (3) It is unlikely that

     Table 2

    Rationales for hypotheses development.

    No. Potential

    Moderator

    Membership promotion

    New subscription Renewal

    Level of Moderator Preference toward promotion Level of Moderator Preference toward promotion

    (1) Price (Relatively) Low Bonus (Relatively) Low Bonus

    (2) Stack-ability Very High Bonus Very High Bonus

    (3) Guilty Feeling Low Bonus Low Bonus

    Can be high in extremely

    hedonic tourist attractions

    Discount Can be high in extremely

    hedonic tourist attractions

    Discount

    (4) Familiarity Moderate or High Bonus/Indifferent High Bonus/Indifferent

    ( 5) Expec ted Usage

    Frequency

    High Bonus High or Low Bonus/Discount

    (6) Size of Promotion Small or Moderate Bonus/Indifferent Small or Moderate Bonus/Indifferent

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    tourists would suddenly feel guilty about membership renewals

    because they can spend more time with their family without

    violating their moral standards (Burnett   &   Lunsford, 1994). In

    contrast, it is likely that members of extremely hedonic tourist

    attractions would continue to feel guilty regarding their hedonic

    consumption (Dhar  &  Wertenbroch, 2000). (4) Tourists' familiarity

    with the tourist attraction would be enhanced and their preference

    toward bonus promotions would continue. (5) It is plausible that

    some tourists would realize that they do not visit the tourist

    attraction as frequently as they originally expected. Indeed, this is

    one of the most commonly cited reasons for not purchasing or

    renewing tourist attraction membership. For example, for tourists

    who visit Walt Disney World no more than 6 days a year it is

    economically more reasonable to purchase daily tickets. Therefore,

    individuals who realize they infrequently use the membership will

    not renew it. Further, they will prefer a membership fee discount

    promotion because the extra membership period would not really

    matter to them since they would not benet from it. On the other

    hand, tourists who use their membership frequently are likely to

    renew the membership and continue to prefer a bonus promotion.

    (6) The size of most renewal promotions is generally small or

    moderate enough for tourists to continue to prefer a bonus pro-

    motion. In conclusion, almost all of the moderators continue toencourage tourists to show greater positive attitudes, and conse-

    quently stronger renewal and recommendation intentions, toward

    bonus promotions. However, usage frequency would act as a

    moderator for tourists who choose not to renew a membership due

    to infrequent usage. They would show greater positive attitudes

    and stronger renewal and recommendation intentions toward

    discount promotions. The specic hypotheses are proposed as

    follows:

    H3.   Bonus promotions are more effective than discount promotions

    in inducing positive attitudes (H  3-1), renewals intentions (H  3-2) and

    recommendation intentions (H  3-3) for membership renewals; whereas

    H4.   discount promotions are more effective than bonus promotions

    in inducing positive attitudes (H 4-1), renewals intentions (H 4-2), andrecommendation intentions (H 4-3) for membership renewals for 

    tourists who choose not to renew their membership.

    H5.   Discount promotions are more effective than bonus promotions

    in inducing positive attitudes (H 5-1), renewals intentions (H 5-2), and

    recommendation intentions (H 5-3) for membership renewals to

    extremely hedonic tourist attractions.

    3. Methods

    This study employedan experiment with a tourist attraction and

    promotion between-subject design to analyze new subscription

    promotions: Study 1e

    2   (attraction: hedonic vs. utilitarian)     2(promotion: discount vs. bonus). The survey questionnaire   rst

    asked participants to imagine that they were considering sub-

    scribing to a membership at either a theme park or a botanic gar-

    den. Only respondents who have never subscribed to membership

    of tourist attractions were recruited and randomly assigned to one

    of the four promotions, as presented in the Appendix: (1) theme

    park and discount promotion, (2) theme park and bonus promo-

    tion, (3) botanic garden and discount promotion, and (4) botanic

    garden and bonus promotion. Then, they answered questions about

    their attitudes and behavioral intentions toward the assigned

    promotion.

    Next, this study employed a three-way ANOVA experiment

    including a tourist attraction, renewal experience, and promotion

    between-subject design to analyze renewal promotions: Study 2e

    2

    (attraction: hedonic vs. utilitarian) 2 (renewal: ever vs. never) 2

    (promotion: discount vs. bonus). The survey recruited respondents

    who have previously subscribed to membership at either a theme

    park or botanic garden. The tourist attraction was assigned ac-

    cording to participants' previous membership. For example, in-

    dividuals who had been a member of a theme park were randomly

    assigned to either the discount or bonus promotion for member-

    ship renewal at a theme park. They were asked to remember their

    experience with a previous membership and imagine that they had

    seen the renewal promotion included in the  Appendix. Then, they

    answered the same questions included in the new subscription

    promotion survey. In addition, they were asked whether they had

    ever renewed their real membership. A manipulation question was

    included to verify whether members of theme parks and botanic

    gardens as groups were similar in terms of satisfaction.

    Since this study employed random assignment experimental

    design, which facilitates causal inference (Shadish, Cook,   &

    Campbell, 2002), the validity of the experiment is established.

    The advertisements as a treatment were designed to reect realistic

    and plausible promotions as seen in the Appendix. Further, alter-

    native plausible explanations for differences in travelers' attitudes

    and behavioral intentions, such as satisfaction with previous ex-

    periences at each tourist attraction and the plausibility and credi-bility of the promotions, were also examined. The reliability of the

    measures was conrmed with Cronbach's alphas. In addition, the

    reliability of the tourist attractions selection   (i.e., theme park and

    botanic garden)   was conrmed with the hedonic/utilitarian attri-

    bute manipulation questions.

     3.1. Tourist attraction selection

    Through a panel discussion including industry experts and

    tourism professors, a theme park was selected as a hedonic tourist

    attraction, whereas a botanic garden was selected for a utilitarian

    tourist attraction. They represent not only hedonic or utilitarian

    tourist attractions but also major tourist attractions in terms of 

    market size and number of visitors (Dong & Siu, 2013; InternationalAssociation of Amusement Parks and Attractions, 2012). Each sur-

    vey included manipulation questions regarding the hedonic or

    utilitarian attributes of the assigned tourist attraction.

     3.2. Promotion design

    Two promotional advertisements were created for each tourist

    attraction: theme park and botanic garden. The advertisements

    differ only in terms of the promotion. A 15% discount rate and two

    extra months of bonus were employed. Monthly membership fees

    for both promotions are more or less economically equivalent. For

    example, when the regular membership fee is $100 a year, the price

    per month for discount and bonus promotions is 7.08   (¼$85@12)

    and 7.14  ( ¼$100@14), respectively. In addition, it was deliberatelystated that two extra months are equivalent to a 15% price discount

    in the bonus promotion advertisement. The percentage term of the

    bonus promotion, 16.7% (¼ 2 months/12 months), was not stated to

    prevent preferences for a nominally higher percentage (Chen et al.,

    2012). The   nal promotional advertisements are provided in the

    Appendix.

     3.3. Data collection

    For data collection, two separate nationwide web-based surveys

    were conducted by an online research  rm. The   rst survey was

    randomly distributed to its survey panels who had never sub-

    scribed to a membership fora tourist attraction in the United States.

    Respondents were randomly assigned to one of the four

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    promotions. After eliminating unusable responses, 165 out of 186

    returned responses were used for analysis. Next, a second survey

    was distributed to individuals who have been a member of either a

    theme park or a botanic garden in the United States. They were

    randomly assigned to one of the discount or bonus promotions for

    the tourist attraction they had previously subscribed to. A total of 

    222 responses were collected, and after eliminating 13 unusable

    responses 209 responses were used for analysis.

     3.4. Variables and measures

    The questionnaire for the new subscription promotion survey

    consisted of three sections. The  rst section assessed attitudes and

    behavioral intentions. To assess attitudes toward the promotion,

    the most frequently cited 8-item, 7-point Likert bipolar scales (e.g.,

    bad/good, dislike/like, negative/positive, unfavorable/favorable,

    unpleasant/pleasant, undesirable/desirable, awful/nice, and inef-

    fective/effective) were employed. Next, behavioral intentions were

    assessed based on subscription intentions and willingness to

    recommend. Frequently cited scales were adopted with modica-

    tions for the current experiment setting. Subscription intentions

    were measured by four statements on a 7-point Likert scale:   “I

    would like/am willing to subscribe to an annual pass (or mem-bership),” “If everything goes as I think, I plan to subscribe to an

    annual pass in the future,” and   “I will make an effort to subscribe to

    an annual pass.”   Recommendation intentions were measured by

    the following two statements:   “I would like to recommend sub-

    scribing to an annual pass to others”  and   “I would like to spread

    positive things about this subscription policy to others.”

    The second section included several questions to conrm the

    manipulation and identify potential moderators. First, the hedonic/

    utilitarian attributes of theme parks and botanic gardens were each

    measured with 6 item, 7-point Likert scales (e.g., pleasant, exciting,

    and fun for hedonic attributes vs. practical, useful, and valuable for

    utilitarian attributes). The scales were adopted from a previous

    study on the hedonic and utilitarian meanings of tourism attrac-

    tions by   Snepenger, Murphy, Snepenger, and Anderson (2004).Second, guilt as a potential moderator was measured with 3 item,

    7-point Likert scales adopted from previous studies (Basil, Ridgway,

    & Basil, 2008; Burnett  & Lunsford,1994; Mishra  & Mishra, 2011):   “I

    would feel guilty if I subscribed to an annual pass (or member-

    ship),” “If I subscribe to an annual pass, I will feel guilty that I might

    spend more time there,” and   “It will cost me a regretful amount of 

    money to subscribe to an annual pass.”  Finally, participants were

    asked to rate the plausibility of the promotions with 3 item, 7-point

    Likert scales (Drolet, Williams, & Lau-Gesk, 2007):   “This promotion

    is believable/realistic/credible.” The last section included questions

    about demographic information such as gender, age, race, educa-

    tion, and marital status.

    The renewal promotion survey included all of the above ques-

    tions with some modications for the renewal experiment setting.For instance, the items for renewal intentions were revised as fol-

    lows:   “I would like to  renew the annual pass (or membership).” In

    addition, satisfaction with the previous membership experience

    was measured with 3 item, 7-point Likert scales (Bigne, Andreu,  &

    Gnoth, 2005) (e.g., I am satis ed with my decision to subscribe to the

    annual pass).

    4. Results

    4.1. Sample pro les

    Table 3 shows the demographic statistics of the participants in

    each survey. In the survey on newsubscription promotions,51.5% of 

    the participants (n¼

    85) were male and 48.5% (n¼

    80) were female.

    The participants were 32 years old on average and the majority was

    Caucasian   (70.9%). More than half   (60.0%)   were single, while a

    majority of the respondents (82.7%) graduated from at least a 2-year

    college. In the survey on membership renewal promotions, 61.7%(n ¼ 129) of participants were male and 38.3% (n ¼ 80) were female,

    implying that men tend to subscribe to tourist attraction

    membership more than women. The participants were 31 years old

    on average and 71.3% were Caucasian. 58.4% were single, and 72.3%

    were graduates of a 2-year college or higher.

    4.2. Results for new subscription promotions (study 1)

    The results of the manipulation analysis were conrmed to be

    successful as expected. The hedonic/utilitarian index, which was

    computed by subtracting the mean score on the 3-item hedonic

    attribute scale (Cronbach's alpha ¼ 0.88) from the mean score of the

    3-item utilitarian attribute scale   (Cronbach's alpha   ¼   0.92),

    conrmed that theme parks and botanic gardens are viewed assignicantly more hedonic and utilitarian, respectively   (M Theme

     park   ¼ 1.56 vs. M Botanic Garden   ¼  0.10, t(163)   ¼ 10.71, p  <   0.001).

    Nonetheless, no signicant differences were conrmed in terms of 

    feelings of guilt regarding subscriptions to theme parks or botanic

    gardens  (Cronbach's alpha   ¼   0.77, t(163)   ¼  0.37, p   ¼  0.71). More

    importantly both mean scores were low, which (M Theme park ¼  2.80

    and M Botanic Garden ¼ 2.71) conrmed that guilt is not expected to act

    as a moderator to encourage a preference toward discount pro-

    motions. Lastly, both promotions were viewed as realistic and

    credible   (Cronbach's alpha   ¼   0.95, M Discount    ¼   5.27 and

    M Bonus   ¼   5.55), and no signicant difference was found

    (t(163) ¼ 1.50, p ¼ 0.14).

    After the manipulation conrmation, the effects of discount and

    bonus promotions on tourists' attitudes were examined. The results

     Table 3

    Sample proles.

    Variable New subscription

    promotion

    Membership renewal

    promotion

    Frequency

    (n ¼ 165)

    Percentage

    (%)

    Frequency

    (n ¼  209)

    Percentage

    (%)

    Gender

    Male 85 51.5 129 61.7

    Female 80 48.5 80 38.3

    Age

    19e29 years 90 54.6 121 57.9

    30e39 years 50 30.3 56 26.8

    40e49 years 11 6.6 19 9.1

    50e59 years 8 4.8 10 4.8

    Over 60 years 6 3.6 3 1.5

    Ethnicity

    White/Caucasian 117 70.9 149 71.3

    African American 14 8.5 14 6.7

    Hispanic 12 7.3 18 8.6

    Asian 16 9.7 19 9.1

    Native American 2 1.2 2 1.0

    Pacic Islander 2 1.2 2 1.0

    Other 2 1.2 5 2.4

    EducationLess than High School 1 0.6

    High School/GED 44 26.7 58 27.8

    2-year College 37 22.4 43 20.6

    4-year University 68 41.2 96 45.9

    Master's or above 15 9.1 12 5.8

    Marital Status

    Single, never married 99 60.0 122 58.4

    Married 53 32.1 78 37.3

    Divorced/Separated 13 7.9 9 4.3

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    of 2   (attraction: theme park vs. botanic garden)     2   (promotion:

    discount vs. bonus) ANOVA on the mean scores of the attitude scales

    (Cronbach's alpha   ¼  0.96)  yielded a signicant effect only for the

    promotion   (F(1,161)   ¼   5.82, p   <   0.05). As expected, participants

    showed greater positive attitudes toward the bonus promotion

    than the discount promotion (M Discount  ¼ 4.70 vs. M Bonus ¼ 5.17). In

    other words, the result conrmed that potential moderators, such

    as price and familiarity, favor discount promotions. Therefore, H1-1is supported. Likewise, no interaction effect was conrmed for the

    inuence of guilt, even for extremely hedonic tourist attractions.

    Therefore, H2-1 is not supported. The statistical details are listed in

    Table 4.

    Next, the effects of discount and bonus promotions on tourists'behavioral intentions were examined. The result of another ANOVA

    on the mean scores of the subscription intention scales (Cronbach's

    alpha   ¼  0.97)   also yielded a signicant main effect only for the

    promotion  (F(1,161)   ¼ 4.39, p  

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    (F(1,201)   ¼  8.54, p  <  0.01), and a signicant three-way interaction

    effect for tourist attraction     renewal     promotion

    (F(1,201)   ¼   6.23, p   <   0.05). The contrast analyses presented in

    Table 8   reveal that participants who had previously renewed a

    membership showed no difference in attitudes between the dis-

    count and bonus promotions for the theme park  (F(1,201)   ¼  1.64,

     p   ¼   0.20)   or the botanic garden   (F(1,201)   ¼   0.13, p   ¼   0.72).   In

    contrast, participants who had not previously renewed a mem-

    bership showed a signicant difference in attitudes between thetheme park   (F(1,201)   ¼   6.30, p   <   0.05)   and the botanic garden

    (F(1,201)   ¼ 7.31, p  <  0.01). Since we hypothesized greater positive

    attitudes toward the bonus promotion among those who renewed

    a membership, H3-1 is not supported. However, as expected, those

    who had not renewed a membership to a botanic garden showed

    greater positive attitudes toward the discount promotion  (M Botanic 

    Garden-Never Renew-Discount    ¼   5 .59 vs. M  Botanic Garden-Never Renew-

    Bonus   ¼   4.47). On the other hand, those who had not renewed a

    membership to a theme park surprisingly showed greater positive

    attitudes toward the bonus promotion than the discount promo-

    tion  (M Theme park-Never Renew-Discount   ¼ 5.21 vs. M Theme park-Never Renew-

    Bonus   ¼   5.79). Therefore, it is concluded that H4-1   is partially

    supported.

    Next, the effects of discount and bonus promotions on tour-ists' behavioral intentions were examined. The results of another

    ANOVA on the mean scores of the renewal intention scales

    (Cronbach's alpha ¼ 0.95) also yielded a signicant main effect for

    tourist attraction  (F(1,201)   ¼  4.81, p  <  0.05)  and renewal experi-

    ence   (F(1,201)   ¼  66.40, p   <   0.001), a signicant two-way inter-

    action effect for tourist attraction    promotion  (F(1,201)   ¼  4.03,

     p < 0.05), and a signicant three-way interaction effect for tourist

    attraction    renewal experience     promotion  (F(1,201)   ¼   7.44,

     p  <  0.01), as shown in Table 9. The contrast analysis revealed that

    participants who had previously renewed a membership showed

    no difference in renewal intentions between discount and bonus

    promotions for the theme park  (F(1,201)   ¼  0.15, p   ¼  0.70)  or the

    botanic garden  (F(1,201)   ¼  0.73, p   ¼  0.39). Therefore, H3-2   is not

    supported. Likewise, participants who had never previouslyrenewed a botanic garden membership showed no signicant

    difference in renewal intentions  (F(1,201)   ¼  1.76, p   ¼  0.18), even

    though they showed greater positive renewal intentions toward

    the discount promotion   (M Botanic Garden-Non Renewal-Discount   ¼   4.31

    vs. M Botanic Garden-Non Renewal-Bonus   ¼   3.59). However, individuals

    who had never renewed a theme park membership showed

    signicantly different renewal intentions   (F(1,201)   ¼   16.192,

     p  <  0.001)  and, surprisingly, greater positive renewal intentions

    toward the bonus promotion  (M Theme park-Non Renewal-Discount  ¼  3.77 

    vs. M Theme park-Non Renewal-Bonus   ¼   4.99). Therefore, H4-2   is not

    supported. The statistical details of the contrast analysis are lis-

    ted in Table 10.

    Finally, Table 11 shows that the results of the other ANOVA on

    the mean scores of the recommendation intention scales (Cron-

    bach's alpha   ¼  0.93)   are similar to those for renewal intentions.

    A signicant three-way interaction effect for tourist

    attraction     renewal experience     promotion   (F(1,201)   ¼   3.99, p   <  0.05)  was again conrmed. The contrast analysis in Table 12

    reveals that participants who previously renewed a membership

    showed no difference in recommendation intentions between the

    discount and bonus promotions for either the theme park

    (F(1,201)   ¼  1.66, p   ¼  0.20)  or the botanic garden  (F(1,201)   ¼  0.04,

     p   ¼  0.85). Therefore, H3-3 is not supported. Participants who had

    never renewed a membership for a theme park showed signi-

    cantly different recommendation intentions   (F(1,201)   ¼   11.34,

     p < 0.001), whereas botanic garden subscribers had only marginally

    different recommendation intentions  (F(1,201)   ¼  3.78, p  <  0.1). As

    expected, participants who had never renewed a botanic garden

    membership showed greater positive recommendation intentions

    toward the discount promotion   (M Botanic Garden-Non Renewal-

    Discount  ¼ 4.34 vs. M Botanic Garden-Non Renewal-Bonus ¼  3.19). On the other

     Table 9

    ANOVA for renewal intention (Study 2  e   Renewal Promotion).

    Sum of squares df Mean squares   F    Sig.

    Tourist attraction 7.429 1 7.429 4.814 0.029

    Renewal 102.486 1 102.486 66.401 0.000

    Promotion 2.282 1 2.282 1.479 0.225

    Attraction Renewal 0.017 1 0.017 0.011 0.917

    Attraction Promotion 6.221 1 6.221 4.031 0.046

    Renewal Promotion 0.000 1 0.000 0.000 0.996Attraction Renewal

    Promotion

    11.486 1 11.486 7.442 0.007

    Error 310.233 201 1.543

    Total 483.923 208

     Table 10

    Contrast analysis for renewal intention (Study 2  e   Renewal Promotion).

    Renewal experience Tourist attraction Promotion   F    Sig.

    Discount Bonus

    Ever Theme Park 6.012 6.144 0.147 0.702

    Botanic Garden 5.396 5.792 0.731 0.394

    Never Theme Park 3.773 4.986 16.192 0.000

    Botanic Garden 4.313 3.594 1.785 0.183

     Table 11

    ANOVA for recommendation intention (Study 2  e  Renewal Promotion).

    Sum of squares df Mean squares   F    Sig.

    Tourist attraction 6.309 1 6.309 3.346 0.069

    Renewal 64.068 1 64.068 33.978 0.000

    Promotion 0.143 1 0.143 0.076 0.783

    Attraction Renewal 2.258 1 2.258 1.197 0.275

    Attraction Promotion 17.601 1 17.601 9.335 0.003

    Renewal Promotion 0.232 1 0.232 0.123 0.726Attraction Renewal

    Promotion

    7.527 1 7.527 3.992 0.047

    Error 378.996 201 1.886

    Total 481.722 208

     Table 12

    Contrast analysis for recommendation intention (Study 2 e  Renewal Promotion).

    Renewal experience Tourist attraction Promotion   F    Sig.

    Discount Bonus

    Ever Theme Park 5.302 5.682 1.661 0.199

    Botanic Garden 5.375 5.278 0.036 0.850

    Never Theme Park 3.864 4.986 11.342 0.001

    Botanic Garden 4.344 3.187 3.781 0.053

     Table 13

    Results of hypothesis tests.

    Hypotheses

    Number Attitudes

    (HX-1)

    Behavioral intentions

    Subscription/

    Renewal (HX-2)

    Recommendation

    (HX-3)

    New

    subscription

    H1   Support ed Supporte d S uppor ted

    H2   Not supported Not supported Not supported

    Renewal   H3   Not supported Not supported Not supported

    H4   Partially

    supported

    Not supported Partially

    supported

    H5   Not supported Not supported Not supported

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    hand, those who had never renewed a theme park membership

    showed greater positive recommendation intentions toward the

    bonus promotion   (M Theme park-Non Renewal-Discount   ¼  3.86 vs. M Theme

     park-Non Renewal-Bonus   ¼   4.99). Therefore, H4-3   is marginally and

    partially supported.

    5. Conclusion

    5.1. Summary and discussion

    This study attempted to investigate effective promotions to

    encourage membership subscriptions and renewals for tourist at-

    tractions. The results of the hypothesis tests are summarized in

    Table 13.

    The bonus promotion was more effective than the discount

    promotion in arousing greater positive attitudes and stronger

    behavioral intentions for new membership subscriptions,

    whereas individuals who had previously renewed their

    membership tended to show no difference in attitudes and

    behavioral intentions toward the renewal promotions. On the

    other hand, individuals who had never renewed a theme park

    membership tended to prefer the bonus promotion, whereas

    those who had never renewed a botanic garden membershiptended to prefer the discount promotion. Likewise, individuals

    who had never renewed a theme park membership showed

    stronger renewal and recommendation intentions toward the

    bonus promotion, whereas those who had never renewed a

    botanic garden membership showed stronger recommendation

    intentions but no difference in renewal intentions. Finally, it was

    also conrmed that feelings of guilt do not act as a moderator for

    either new subscriptions or renewal promotions. The bonus

    promotion was not preferred even for extremely hedonic tourist

    attractions.

    In the experiment on renewal promotions, individuals who

    had previously renewed their membership revealed no signi-

    cant difference in attitudes or behavioral intentions between

    the discount and bonus promotions. Even though this was nothypothesized in the paper, the result conrmed previous   nd-

    ings that customers are indifferent regarding the type of pro-

    motion for familiar products and services (Chen et al., 2012).

    Those who have previously renewed membership would be so

    familiar with the tourist attraction that they would not distin-

    guish between the promotions as long as they could reap the

    benets.

    On the other hand, it is interesting that individuals who have

    never renewed a membership to either a theme park or a botanic

    garden showed different attitudes and behavioral intentions. The

    members of botanic gardens preferred the discount promotion as

    expected. It seems that they did not use the membership as often

    as they initially expected and, consequently, preferred the dis-

    count promotion rather than the bonus promotion that theymight not benet from. On the contrary, members of a theme

    park preferred the bonus promotion even though they had

    already experienced that they might not visit the park as often as

    they thought. One possible explanation may be that the hedonic

    attributes of the theme park encourage members to   feel   rather

    than think rationally  about whether they can visit the park more

    often than the previous year and, thus, prefer the bonus

    promotion.

    5.2. Implications

    This study contributes several important and interesting theo-

    retical implications. First, this paper conrmed previous   ndings

    that bonus promotions are generally more effective than discount

    promotions. Even though the nominal rates of bonus promotions

    are not revealed, participants still prefer it to discount promotions.

    Second, it conrmed that the preference toward bonus promotions

    over discount promotions for commercial products and services is

    applicable to tourist attractions or tourism settings as well. Third,

    this paper identied that the preference toward bonus promotions

    can change in the case of membership renewals. Specically, dis-

    count promotions can be more effective for individuals who do

    not intend to renew their memberships to relatively utilitarian

    tourist attractions such as botanic gardens. In contrast, bonus

    promotions continue to be more effective for individuals who do

    notintend to renewtheir memberships to relatively hedonic tourist

    attractions such as theme parks and amusement parks. Lastly, this

    paper suggested that the effectiveness of a promotion can differ

    according to the characteristics of tourist attractions and potential

    visitors.

    This study also contributes several important practical im-

    plications for attraction managers. First, managers of tourist at-

    tractions should consider utilizing bonus promotions to attract

    new members, not just relying on discount promotions. Second,

    managers should understand that the effectiveness of discount

    and bonus promotions can differ in encouraging membership

    renewals. For example, for members who did not frequently visitthe botanic garden, discount promotions would be more effec-

    tive. However, for members who visited often, bonus promotions

    would be more effective than discount promotions. On the other

    hand, individuals who intended to renew their memberships to

    both hedonic and utilitarian tourist attractions are indifferent

    about the type of promotion. Third, managers should understand

    the characteristics of their tourist attractions and potential visi-

    tors and try to develop tailored promotions for each group of 

    visitors.

    5.3. Limitations and suggestions for future research

    Even though this study provides important theoretical and

    managerial implications, a few limitations still exist. For instance,

    the online samples used in this study might not reect the

    true population distributions at tourist attractions. It would

    be more realistic and practical to analyze the preferences of 

    actual members in cooperation with actual tourist attractions next

    time.

    Nonetheless, this research is a pioneering study that investi-

    gated effective promotions for tourist attractions to encourage

    new subscriptions and renewals from visitors' perspectives.

    There are still lots of areas for further studies to contribute to the

    marketing and promotions of tourist attractions. For example, a

    study on how rate fencing or different pricing in both daily

    tickets and membership fees inuence tourists' behaviors would

    help managers develop optimal pricing policies. Research

    investigating promotional strategies that appeal to individuals

    who have previously renewed their memberships will also be

    helpful for attraction managers because this segment of tourists

    was indifferent regarding the type of promotion in this study.

    Given the importance of tourist attractions in the tourism in-

    dustry, continuous future research on effective management

    strategies and techniques for tourist attractions will make a

    meaningful contribution to both academia and the industry

    alike.

     Appendix 

    1. Experiment for new subscription promotion: Study 1e2

    (Attraction)

    2 (Promotion).

     J. Byun, S. Jang / Tourism Management 50 (2015) 194e 203   201

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    2. Experiment for renewal promotion: Study 2e2

    (Attraction) 2 (Renewal) 2 (Promotion).

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     Jaemun Byun, M.B.A. is Doctoral student in the School of Hospitality and Tourism Management, Purdue Universityin USA. His research interests include tourism marketingand destination management.

    SooCheong (Shawn) Jang , Ph.D. is Professor in the Schoolof Hospitality and Tourism Management, Purdue Univer-sity in USA. His research interests are twofold: hospitalitynance/strategic management and hospitality/tourismmarketing. Dr. Jang has more than 150 published articles inrefereed top-tier HTM and business journals and hasreceived numerous accolades including the  W. BradfordWiley Memorial Best Research Paper of the Year Award2009 and the Michael D. Olsen Research Achievement Award

     2015. In addition, he was recognized as the top-rankedauthor in HTM academia during the past decade (Journalof Hospitality and Tourism Research (2011), 35(3)). Dr.

     Jan g is fre que ntl y inv ite d as a sp eak er for aca dem icresearch or interdisciplinary research by many universities

    as well as international conferences.

     J. Byun, S. Jang / Tourism Management 50 (2015) 194e 203   203

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