Showing papers in "Journal of Marketing in 2001"

The Chain of Effects from Brand Trust and Brand Affect to Brand Performance: The Role of Brand Loyalty:

Abstract: The authors examine two aspects of brand loyalty, purchase loyalty and attitudinal loyalty, as linking variables in the chain of effects from brand trust and brand affect to brand performance (market share and relative price). The model includes product-level, category-related controls (hedonic value and utilitarian value) and brand-level controls (brand differentiation and share of voice). The authors compile an aggregate data set for 107 brands from three separate surveys of consumers and brand managers. The results indicate that when the product- and brand-level variables are controlled for, brand trust and brand affect combine to determine purchase loyalty and attitudinal loyalty. Purchase loyalty, in turn, leads to greater market share, and attitudinal loyalty leads to a higher relative price for the brand. The authors discuss the managerial implications of these results.

Some New Thoughts on Conceptualizing Perceived Service Quality: A Hierarchical Approach:

Abstract: Through qualitative and empirical research, the authors find that the service quality construct conforms to the structure of a third-order factor model that ties service quality perceptions to distinct and actionable dimensions: outcome, interaction, and environmental quality. In turn, each has three subdimensions that define the basis of service quality perceptions. The authors further suggest that for each of these subdimensions to contribute to improved service quality perceptions, the quality received by consumers must be perceived to be reliable, responsive, and empathetic. The authors test and support this conceptualization across four service industries. They consider the research and managerial implications of the study and its limitations.

Investments in Consumer Relationships: A Cross-Country and Cross-Industry Exploration

Abstract: This research, investigating retailer-consumer relationships, has three distinct intended contributions: (1) It shows that different relationship marketing tactics have a differential impact on consumer perceptions of a retailer’s relationship investment; (2) it demonstrates that perceived relationship investment affects relationship quality, ultimately leading to behavioral loyalty; and (3) it reveals that the effect of perceived relationship investment on relationship quality is contingent on a consumer’s product category involvement and proneness to engage in retail relationships. The authors empirically cross-validate the underlying conceptual model by studying six consumer samples in a three-country, transatlantic, comparative survey that investigates two industries.

Building Organizational Capabilities for Managing Economic Crisis: The Role of Market Orientation and Strategic Flexibility:

Abstract: Firms around the world often must manage and survive economic crises. Recent cases in Asia, Eastern Europe, and South America bear testimony to this point. As economic weak spots are integrated into the global economy, it is timely to develop an understanding of organizational capabilities that can help firms manage their way through such crises. The authors investigate the role of market orientation and strategic flexibility in helping Thai firms manage the recent Asian crisis. The results demonstrate the contingent nature of the influence of market orientation and strategic flexibility on firm performance after a crisis has occurred. As hypothesized, market orientation has an adverse effect on firm performance after a crisis. This effect is moderated by demand and technological uncertainty and is enhanced by competitive intensity. In contrast, strategic flexibility has a positive influence on firm performance after a crisis, which is enhanced by competitive intensity and moderated by demand and...

The acquisition and utilization of information in new product alliances: A strength-of-ties perspective

Abstract: In this article, the authors examine the acquisition and utilization of information in new product alliances. Drawing from research in social network theory with a focus on the strength-of-ties literature, the authors suggest that horizontal alliances have lower levels of relational embeddedness and higher levels of knowledge redundancy than vertical alliances. The authors then suggest that though embeddedness enhances both the acquisition and utilization of information in alliances, redundancy diminishes information acquisition but enhances information utilization. The authors test these ideas using a sample of 106 U.S. firms that recently have participated in new product alliances. Although the results are broadly supportive of the predictions, they are also surprising because they question key underlying assumptions of the strength-of-ties literature. For example, closely tied individual actors are typically assumed to share both high levels of embeddedness and high levels of redundancy, but t...

Pursuing the Value-Conscious Consumer: Store Brands versus National Brand Promotions:

Abstract: The objective of this article is to determine whether national brand promotions and store brands attract the same value-conscious consumers, which would aggravate channel conflict between manufacturers and retailers. The authors identify psychographic and demographic traits that potentially drive usage of store brands and national brand promotions. They then develop a framework and structural equation model to study the association of these traits with store brand and national brand promotion usage. The authors find that though demographics do not influence these behaviors directly, they have significant associations with psychographic characteristics and therefore are useful for market targeting. Most important, usage of store brands and usage of promotions, particularly out-of-store promotions, are associated with different psychographics. Store brand use correlates mainly with traits related to economic benefits and costs, whereas the use of out-of-store promotions is associated mainly with tr...

Logistics Service Quality as a Segment-Customized Process

Abstract: Logistics excellence has become a powerful source of competitive differentiation within diverse marketing offerings of world-class firms. Although researchers have suggested that logistics competencies complement marketing efforts, empirical evidence is lacking on what logistics service quality means to customers and whether it has different meanings for separate customer segments. The authors present empirical support for nine related logistics service quality constructs; demonstrate their unidimensionality, validity, and reliability across four customer segments of a large logistics organization; and provide empirical support for a logistics service quality process. Although structural equation modeling offers support for the logistics service quality process across customer segments, the authors find that the relative parameter estimates differ for each segment, which suggests that firms ought to customize their logistics services by customer segments.

Buyer-Supplier Relationships and Customer Firm Costs

Abstract: Academic literature and business practice are directing increased attention to the importance of creating value in buyer-supplier relationships. One method for creating value is to reduce costs in commercial exchange. The authors develop a model that explains how supplier behaviors and the management of suppliers affect a customer firm’s direct product, acquisition, and operations costs. The model proposes that these costs mediate the relationship between buyer-supplier relationship behaviors and the customer firm’s intentions to expand future purchases from the supplier. The model is tested on data collected from almost 500 buying organizations in the United States and Germany. The results indicate that increased communication frequency, different forms of supplier accommodation, product quality, and the geographic closeness of the supplier’s facilities to the customer’s buying location lower customer firm costs. In addition, customer firms intend to increase purchases from suppliers that provid...

The Severity of Contract Enforcement in Interfirm Channel Relationships

Abstract: Little is known about how channel members react to violations of explicit contracts. The authors develop and test an integrative conceptual framework that focuses on the severity of the enforcement response in channel relationships. The empirical results provide evidence of discerning enforcement practices by channel members, reflecting channel system, network, and dyadic concerns.

Dependence,Trust, and Relational Behavior on the Part of Foreign Subsidiary Marketing Operations: Implications for Managing Global Marketing Operations

Abstract: The authors explore how a global firm’s ability to foster successful relationships between its foreign subsidiaries’ and headquarters’ marketing operations can enhance the performance of products across markets. The results show that cooperative behaviors are positively associated with product performance in the subsidiaries’ markets. National culture in the foreign markets is also found to moderate the effect of trust on relational behaviors. In addition, the subsidiaries’ acquiescence becomes increasingly important as the firm attempts to standardize marketing programs.

Choice of Supplier in Embedded Markets: Relationship and Marketing Program Effects:

Abstract: Recent research has documented how exchanges between buyers and sellers are frequently embedded in social relationships. An unresolved question, however, is the extent to which such relationships protect incumbent suppliers from new competitors and their marketing programs. The authors develop a conceptual framework of how relationship and marketing variables influence choice of supplier and test the framework empirically in the context of business-to-business services. The results show that interpersonal relationships between buyers and suppliers serve as a switching barrier but are considerably less important than both firm-level switching costs and marketing variables. Moreover, unlike switching costs, interpersonal relationships do not play the frequently mentioned role of a buffer against price and product competition. Finally, the authors show that buyers and suppliers hold systematically different views of the determinants of switching.

An Investigation into the Antecedents of Organizational Participation in Business-to-Business Electronic Markets:

Abstract: Business-to-business electronic markets have a profound influence on the manner in which organizational buyers and sellers interact. As a result, it is important to develop an understanding of the behaviors of firms that participate in these markets. The authors develop a typology for the nature of organizational participation to explain the behaviors of user firms in business-to-business electronic markets. The proposed model hypothesizes that the nature of participation depends on organizational motivation and ability. The authors conceptualize motivational factors in terms of efficiency and legitimacy motivations and theorize that ability results from the influence of organizational learning and information technology capabilities. They test the model using organizational-level survey data from jewelry traders that conduct business in an electronic market. The results indicate that both motivation and ability are important in determining the nature of participation; however, the level of influ...

Reducing Assortment: An Attribute-Based Approach

Abstract: Most supermarket categories are cluttered with items, or stockkeeping units (SKUs), that differ very little at the attribute level Previous research has found that reductions (up to 54%) in the number of low-selling SKUs need not affect perceptions of variety and therefore sales, significantly In this research, the authors analyze data from a natural experiment conducted by an online grocer, in which 94% of the categories experienced dramatic cuts in the number of SKUs offered, particularly low-selling SKUs Sales were indeed affected dramatically, increasing an average of 11% across the 42 categories examined Sales rose in more than two-thirds of these categories, nearly half of which experienced an increase of 10% or more; 75% of households increased their overall expenditures after the cut in SKUs In turn, the authors examine how different types of SKU reductions—defined by how the cuts affect the available attributes or features of a category (eg, the number of brands)—affected purchase

The Effect of Reward Structures on the Performance of Cross-Functional Product Development Teams

Abstract: This study examines the effect of reward structures on the performance of cross-functional product development teams. Results suggest that when it is easy to evaluate individual performances, position-based differential rewards lead to greater satisfaction. For long and complex projects, process-based rewards have a negative effect and outcome-based rewards have a positive effect on performance. For risky projects and highly competitive or relatively stable industries, a nonlinear and monotonically decreasing relationship exists between outcome-based rewards and product quality.

Customer Profitability in a Supply Chain

Abstract: Estimating current profitability at the individual customer level is important to distinguish the more profitable customers from the less profitable ones. This is also a first step in developing estimates of customers’ lifetime values. This exercise, however, takes on additional complexities when applied to an intermediary in a supply chain, such as a distributor, because the costs of servicing a retail customer include not only those incurred directly in servicing this customer but also those incurred by the distributor in dealing with its own vendors for goods supplied to this customer. The authors develop a general model and measurement methodology to relate customer profitability to customer characteristics in a supply chain. The authors show how heterogeneity in customer purchasing characteristics leads to important profit implications and illustrate the implementation of the methodology using data from a large distributor that supplies to grocery and other retail businesses.

Promotion of Prescription Drugs and Its Impact on Physicians' Choice Behavior

Abstract: The authors investigate whether and how pricing and promotional activities influence prescription choice behavior using a comprehensive panel of physicians and data on competitive price and promotional activities. The authors find that physicians are characterized by fairly limited price sensitivity, detailing and samples have a mostly informative effect on physicians, and physicians with a relatively large number of Medicare or health maintenance organization patients are less influenced by promotion than other physicians are.

The Impact of Brand Extension Introduction on Choice

Abstract: This article focuses on the impact of a new brand extension introduction on choice in a behavioral context using national household scanner data involving multiple brand extensions. Particularly, the authors investigate the reciprocal impact of trial of successful and unsuccessful brand extensions on parent brand choice. In addition, the authors examine the effects of experience with the parent brand on consumers’ trial and repeat of a brand extension using household scanner data on six brand extensions from a national panel. In the case of successful brand extensions, the results show positive reciprocal effects of extension trial on parent brand choice, particularly among prior non-users of the parent brand, and consequently on market share. The authors find evidence for potential negative reciprocal effects of unsuccessful extensions. In addition, the study shows that experience with the parent brand has a significant impact on extension trial, but not on extension repeat.

Communicating the Consequences of Early Detection: The Role of Evidence and Framing:

Abstract: Despite the enormous benefits of early-detection products, consumers are reluctant to use them. The authors explore this reluctance, testing alternative approaches to communicating the consequences of detection behaviors. The results suggest that anecdotal messages are more involving than statistical messages and that positive anecdotes (about gains from screening) are less persuasive than negative anecdotes (about the losses from failing to get screened); positive anecdotes appear to cause a “boomerang” effect. The authors discuss implications for promoting consumer risk-reduction behaviors.

Market Response to a Major Policy Change in the Marketing Mix: Learning from Procter & Gamble’s Value Pricing Strategy

Abstract: Much research has focused on how consumers and competitors respond to short-term changes in advertising and promotion. In contrast, the authors use Procter & Gamble’s (P&G’s) value pricing strategy as an opportunity to study consumer and competitor response to a major, sustained change in marketing-mix strategy. They compile data across 24 categories in which P&G has a significant market share, covering the period from 1990 to 1996, during which P&G instituted major cuts in deals and coupons and substantial increases in advertising. The authors estimate an econometric model to trace how consumers and competitors react to such changes. For the average brand, the authors find that deals and coupons increase market penetration and surprisingly have little impact on customer retention as measured by share-of-category requirements and category usage. For the average brand, advertising works primarily by increasing penetration, but its effect is weaker than that of promotion. The authors find that comp...

The Impact of Category Management on Retailer Prices and Performance: Theory and Evidence

Abstract: Category management (CM) is a recent retail management initiative that aims at improving a retailer’s overall performance in a product category through more coordinated buying, merchandising, and pricing of the brands in the category than in the past. Despite tremendous retailer and manufacturer interest in the process of CM and its rapid adoption in the industry, much uncertainty exists about the consequences of CM for channel members. The present study focuses on how a shift to CM by a retailer affects its equilibrium prices, sales, and profitability in a competitive retail setting. On the basis of an analysis of a model of two competing national brand manufacturers that supply two competing common retailers, the authors find that one retailer’s adoption of CM increases its average unit price of the category and reduces its sales volume and revenues. However, this retailer can still enjoy an increase in its gross margin profits as competing manufacturers’ wholesale prices fall in the process. Also, the CM adopter’s profits are greater than those of a symmetric competing retailer that follows the traditional brand-centered management of a product category when the interbrand competition is high but interstore competition is low. Applying the intervention analysis methodology, the authors empirically test several of these analytical findings, employing a unique data set that contains information about a supermarket chain’s weekly average unit prices and sales of the laundry detergent category before and after this product category was moved to CM by the retailer. The propositions that adoption of CM will lead to higher retail prices and lower sales are upheld in this empirical study. The authors discuss the implications of these findings for practitioners and researchers, the limitations of the study, and directions for further research.

Entry Barriers: A Dull-, One-, or Two-Edged Sword for Incumbents? Unraveling the Paradox from a Contingency Perspective

Abstract: The long-held precept of equating entry barriers with sustainable incumbent advantage increasingly is met with skepticism as incidents of innovative late entrants leapfrogging over market incumbents become more pervasive across industries. Ostensibly, the reassessment of the traditional assumptions underlying entry barrier strategy has become imperative; to this end, the authors present a framework that investigates the contingent effects of incumbents’ barrier building on their own performance. Specifically, the authors examine five types of entry barriers (capital requirements, cost advantages, switching costs, distribution access, and proprietary assets) for the nature of their impact in the following presupposed yet unresolved roles: (1) as effectual versus ineffectual entry deterrents and (2) as enablers versus inhibitors of incumbents’ innovativeness. In addition, the authors take other variables into account (i.e., competitors’ innovativeness and incumbents’ market and technological orient...

Successful and Unsuccessful Sales Calls: Measuring Salesperson Attributions and Behavioral Intentions:

Abstract: Applying attribution theory to consumer behavior issues is quite common. In the managerial arena, previous research suggests that salespeople’s attribution processes affect their expectancies for success and future behavior. However, no published research has developed adequate measures that might be used to examine the full range of attributional responses for sales success or failure and the behaviors that are likely to follow such attributions. The goal of this research is to develop a complete set of attributional and behavioral scales for sales success and failure and validate such scales in a real-world context—among field sales representatives. Following Churchill’s (1979) recommended process, the authors develop a complete set of attributional and behavioral intention scales that is applicable to a field sales force setting. The authors then measure 228 financial services representatives’ performance attributions for a previous sales interaction; their intended behaviors for a future, sim...

On the Optimality of Delegating Pricing Authority to the Sales Force

Abstract: An important decision facing sales managers today is precisely how much pricing authority should be delegated to the sales force. Received theory suggests that the salesperson’s superior information about customers’ valuations will invariably make price delegation profitable for the firm. The empirical evidence, however, reveals that firms that grant full pricing authority generate lower profits than firms that limit pricing authority. Given this state of affairs, the author develops and analyzes a formal model that examines the optimality of delegating pricing authority to the sales force. The model preserves the notion of superior information assumed in the literature but considers as well a negative feature of much concern to practitioners, namely, the suboptimal substitution of selling effort by price discounting. The model reveals that providing the salesperson with full pricing authority is not always optimal. Specifically, in some environments, it is appropriate to limit pricing authority ...

Cross-Unit Competition for a Market Charter: The Enduring Influence of Structure:

Abstract: Marketing strategists who operate in turbulent markets face a competitive landscape marked by volatility and evolving market structures. As customer requirements change, an organization that stays in alignment with its markets will form new business units or alter the market charters of existing business units. In a longitudinal study, the authors traced the structural realignments that accompanied a Fortune-500 firm’s entry into the Internet market. As the charter moved from a freshly created unit to an established business unit, the authors found support for the prediction that the former organizational structure will continue to shape the identity, beliefs, and social ties of managers. The study highlights the structural, social, and cognitive factors that must be managed as corporate decision makers search for the best strategy-structure fit for an emerging market opportunity.

Strategic Interdependence in Organizations: Deconglomeration and Marketing Strategy

Abstract: Although strategy exists at multiple levels in a firm (corporate, business, and functional), there is a dearth of research in marketing literature that focuses on the dependency among strategy at different levels. The authors address this issue by examining the relationship between deconglomeration and marketing strategy. Deconglomeration refers to the divestiture behavior of a conglomerate firm and the transformation of its business portfolio from one that is largely composed of several unrelated businesses to one composed of fewer and related businesses. Drawing on multiple theoretical perspectives, the authors propose a conceptual model delineating the environmental and organizational drivers of deconglomeration and its outcomes for marketing. The authors suggest that after deconglomeration, (1) a firm can be expected to be more competitor and customer oriented, (2) multimarket contact with competing firms and seller concentration will increase, (3) businesses retained by the firm will be more...

Book Reviews Featuring a Special Essay by Susan P. Douglas

Abstract: Early Explorations: Learning from the Past My passion for exploring new worlds began as a child with books and a very eclectic education. An insatiable curiosity and a penchant for asking questions led me to constantly challenge the limits of my own knowledge and seek to broaden my horizons. By the age of seven I was a voracious reader, and being very shortsighted, fat, and poor at games, I escaped the world by retreating to the apple tree with my nose in a book. From my lofty perch, I enjoyed the magical company of fictitious characters. I remember reading Alice in Wonderland and Alice Through the Looking Glass and being totally fascinated by the curiosities that Alice encountered. In particular, I was struck by the practical philosophies of the creatures she met—the White Rabbit who was always late, the Red Queen always running to stay in the same place—how all familiar today! Like many children, I enjoyed reading about travel and adventure, from fictitious accounts such as Gulliver’s Travels, Treasure Island, or Rudyard Kipling’s stories of India to the travels of Hester Stanhope in the Middle East and her encounters with the populations in these countries. I immediately resolved that I too wanted to travel when I was older. At boarding school, I had plenty of time to read. Whenever possible, I would avoid playing the mandatory afternoon games and go to read in the library, curled up in a comfortable leather chair. I set myself the task of reading through the entire fiction section from A to Z, but abandoned the project after D. Dickens proved entirely too much for me! During this time, I became particularly interested in military history and read Churchill’s History of MarlborBook Reviews