You said they were trustworthy: when elite status on sharing platforms backfires

Purpose It has become common practice for sharing economy platforms such as Airbnb and Uber to endow certain providers (e.g. hosts, drivers) with elite status (e.g. Premier Partner, Superhost) to signal trustworthiness. Drawing from sharing economy research, this paper aims to examine whether consumers are more likely to generate more negative word of mouth (NWOM) about the platform after receiving a negative review from an elite provider (vs. one with no elite status). The authors argue that this effect is driven by perceived betrayal by the platform, stemming from beliefs that the platform has breached promises in their psychological contract. Design/methodology/approach Two between-subjects experiments tested the effect of provider's elite status (i.e. endowed vs not endowed with elite status by the platform) on NWOM about the platform when consumers receive a negative (vs. a positive) review from the provider. Findings The authors find that elite status intensifies NWOM about the platform when consumers receive a negative review from a provider. This effect is explained by perceived betrayal by the platform resulting from a psychological contract breach. Practical implications This study illustrates that designating providers with elite status can have unforeseen consequences when providers’ reviews of consumers are considered. Originality/value To the best of the authors’ knowledge, this study is the first empirical examination of consumer behaviors within sharing economy elite programs. Furthermore, it represents the first empirical investigation of breaches of psychological contracts and their impact on feelings of betrayal and NWOM in marketing exchanges, thereby contributing to the emerging work on psychological contracts in buyer–seller relationships.