Showing papers in "Journal of Marketing in 2002"

Consumer Trust, Value, and Loyalty in Relational Exchanges:

Abstract: The authors develop a framework for understanding the behaviors and practices of service providers that build or deplete consumer trust and the mechanisms that convert consumer trust into value and loyalty in relational exchanges. The proposed framework (1) uses a multidimensional conceptualization for the trustworthiness construct; (2) incorporates two distinct facets of consumer trust, namely, frontline employees and management policies and practices; and (3) specifies value as a key mediator of the trust–loyalty relationship. The authors test the proposed model using data from two service contexts—retail clothing (N = 264) and nonbusiness airline travel (N = 113). The results support a tripartite view of trustworthiness evaluations along operational competence, operational benevolence, and problem-solving orientation dimensions. Moreover, the authors find evidence of contingent asymmetric relationships between trustworthiness dimensions and consumer trust. For frontline employees, benevolent b...

Building brand community

Abstract: A brand community from a customer-experiential perspective is a fabric of relationships in which the customer is situated. Crucial relationships include those between the customer and the brand, between the customer and the firm, between the customer and the product in use, and among fellow customers. The authors delve ethnographically into a brand community and test key findings through quantitative methods. Conceptually, the study reveals insights that differ from prior research in four important ways: First, it expands the definition of a brand community to entities and relationships neglected by previous research. Second, it treats vital characteristics of brand communities, such as geotemporal concentrations and the richness of social context, as dynamic rather than static phenomena. Third, it demonstrates that marketers can strengthen brand communities by facilitating shared customer experiences in ways that alter those dynamic characteristics. Fourth, it yields a new and richer conceptuali...

The Influence of Multiple Store Environment Cues on Perceived Merchandise Value and Patronage Intentions

Abstract: Research on how store environment cues influence consumers’ store choice decision criteria, such as perceived merchandise value and shopping experience costs, is sparse. Especially absent is research on the simultaneous impact of multiple store environment cues. The authors propose a comprehensive store choice model that includes (1) three types of store environment cues (social, design, and ambient) as exogenous constructs, (2) various store choice criteria (including shopping experience costs that heretofore have not been included in store choice models) as mediating constructs, and (3) store patronage intentions as the endogenous construct. They then empirically examine the extent to which environmental cues influence consumers’ assessments of a store on various store choice criteria and how those assessments, in turn, influence patronage intentions. The results of two different studies provide support for the model. The authors conclude by discussing the results to develop an agenda for addit...

Understanding Service Convenience

Abstract: The subject of service convenience is important in service economies, yet little is known about this topic. The consumer convenience literature—strong in certain respects, underdeveloped in other respects—gives insufficient attention to service convenience. The prevailing pattern is either to treat service convenience generally or to lump services and goods together into an overall convenience construct. The authors seek to stimulate a higher level of research activity and dialogue by proposing a more comprehensive and multidimensional conceptualization of service convenience and a model delineating its antecedents and consequences. The authors build their case by systematically examining the convenience literature, explicating the dimensions and types of service convenience, developing the overall model and related research propositions, and presenting directions for further research.

A Longitudinal Study of Complaining Customers' Evaluations of Multiple Service Failures and Recovery Efforts

Abstract: The authors report a repeated measures field study that captures complaining customers’ perceptions of their overall satisfaction with the firm, likelihood of word-of-mouth recommendations, and repurchase intent during a 20-month span that includes two service failures and recovery attempts. The findings suggest that though satisfactory recoveries can produce a “recovery paradox” after one failure, they do not trigger such paradoxical increases after two failures. Furthermore, “double deviations” can occur following two consecutive unsatisfactory recoveries or following an unsatisfactory recovery in response to a second failure. The findings indicate that customers reporting an unsatisfactory recovery followed by a satisfactory recovery reported significantly higher ratings at the second postrecovery period than did customers reporting the opposite recovery sequence. The outcome of the second recovery also demonstrated a significant influence on customer ratings (positively if the recovery was sa...

The Effects of Entrepreneurial Proclivity and Market Orientation on Business Performance

Abstract: The recent literature suggests a potential tension between market orientation and entrepreneurial proclivity in achieving superior business performance. This is unsettling for marketers, because it could mean that being market oriented is detrimental to a firm that is also trying to be entrepreneurial and successful. To examine this unnerving potential, the authors investigate structural influences (both direct and indirect) of entrepreneurial proclivity and market orientation on business performance. The results indicate that entrepreneurial proclivity has not only a positive and direct relationship on market orientation but also an indirect and positive effect on market orientation through the reduction of departmentalization. The results also suggest that entrepreneurial proclivity’s performance influence is positive when mediated by market orientation but negative or nonsignificant when not mediated by market orientation. The authors also provide a discussion and future research implications.

Market Orientation and Alternative Strategic Orientations: A Longitudinal Assessment of Performance Implications

Abstract: Although the merits of maintaining a market orientation have been extensively discussed in the literature, studies examining the empirical link between market orientation and performance have shown mixed results. The authors explore the relative performance effects of various dimensions of market orientation using a longitudinal approach based on letters to shareholders in corporate annual reports. Furthermore, the authors examine the relative effects of alternative strategic orientations that reflect different managerial priorities for the firm. The authors also extend previous work by considering the mediating effects of organizational learning and innovativeness on the orientation-performance relationship. The results show that firms possessing higher levels of competitor orientation, national brand focus, and selling orientation exhibit superior performance.

Exploring the Phenomenon of Customers' Desired Value Change in a Business-to-Business Context

Abstract: Increasingly, organizations are pushed to adopt customer value strategies in order to grow profits and ensure long-term survival. Yet little is known about the dynamic nature of how customers perceive value from suppliers. The authors present findings from a grounded theory study conducted in a business-to-business context that sheds light on the nature of customers’ desired value change and related contextual conditions. The authors discover that the phenomenon of customers’ desired value change typically occurs in an emotional context, as managers try to cope with feelings of tension. The phenomenon extends well past the change itself into strategies customers use to motivate suppliers to meet their changed needs. Customers’ value change provides a reason for customers to seek, maintain, or move away from relationships with suppliers.

The GMS: A Broad Conceptualization of Global Marketing Strategy and Its Effect on Firm Performance

Abstract: Despite the strong interest in global marketing, there is no consensus in the literature about what constitutes global marketing strategy and whether it affects a firm’s global market performance. The authors develop a broad conceptualization of global marketing strategy, the GMS, that integrates three major perspectives—namely, the standardization, configuration–coordination, and integration perspectives—of global marketing strategy. They also develop a conceptual model that links the GMS to a firm’s global market performance. On the basis of a survey of business units competing in global industries, the authors find support for the broad GMS perspective and the fundamental relationship between the GMS and firms’ global market performance. The authors also discuss theoretical and managerial implications of their findings.

Getting Return on Quality: Revenue Expansion, Cost Reduction, or Both?

Abstract: Financial benefits from quality may be derived from revenue expansion, cost reduction, or both simultaneously. The literature on both market orientation and customer satisfaction provides considerable support for the effectiveness of the revenue expansion perspective, whereas the literature on both quality and operations provides equally impressive support for the effectiveness of the cost reduction perspective. There is, however, little evidence for the effectiveness of attempting both revenue expansion and cost reduction simultaneously, and some of what little empirical and theoretical literature is available suggests that emphasizing both simultaneously may not work. In a study of managers in firms seeking to obtain a financial return from quality improvements, the authors address the issue of which quality profitability emphasis (revenue expansion, cost reduction, or both) is most effective. The authors examine firm performance using managers’ reports of firm performance and longitudinal seco...

Strategic Bundling of Products and Prices: A New Synthesis for Marketing

Abstract: Bundling is pervasive in today’s markets. However, the bundling literature contains inconsistencies in the use of terms and ambiguity about basic principles underlying the phenomenon. The literature also lacks an encompassing classification of the various strategies, clear rules to evaluate the legality of each strategy, and a unifying framework to indicate when each is optimal. Based on a review of the marketing, economics, and law literature, this article develops a new synthesis of the field of bundling, which provides three important benefits. First, the article clearly and consistently defines bundling terms and identifies two key dimensions that enable a comprehensive classification of bundling strategies. Second, it formulates clear rules for evaluating the legality of each of these strategies. Third, it proposes a framework of 12 propositions that suggest which bundling strategy is optimal in various contexts. The synthesis provides managers with a framework with which to understand and c...

The Market Valuation of Internet Channel Additions

Abstract: The emergence of the Internet has pushed many established companies to explore this radically new distribution channel Like all market discontinuities, the Internet creates opportunities as well as threats—it can be performance-enhancing as readily as it can be performance-destroying Making use of event-study methodology, the authors assess the net impact of adding an Internet channel on a firm’s stock market return, a measure of the change in expected future cash flows The authors find that, on average, Internet channel investments are positive net-present-value investments The authors then identify firm, introduction strategy, and marketplace characteristics that influence the direction and magnitude of the stock market reaction The results indicate that powerful firms with a few direct channels are expected to achieve greater gains in financial performance than are less powerful firms with a broader direct channel offering In terms of order of entry, early followers have a competitive ad

Dynamic Customer Relationship Management: Incorporating Future Considerations into the Service Retention Decision

Abstract: The authors examine the influence of customer future-focused considerations, over and above the effects of satisfaction, on the customer’s decision to discontinue a service relationship. The authors find that expected future use and anticipated regret influence this decision. Understanding and managing these future-focused considerations is critical to successful dynamic customer relationship management.

Technological Opportunism and Radical Technology Adoption: An Application to E-Business

Abstract: Using the resource-based view of the firm, the authors hypothesize that differences in adoption of radical technologies among firms can be attributed to a sense-and-respond capability of firms with respect to new technologies, which is termed technological opportunism. Using survey data from senior managers in business-to-business firms, the authors study the adoption of e-business, a radical technology with the potential to alter business models. The authors first establish the distinctiveness of technological opportunism from related constructs, such as organizational innovativeness, and show that it offers a significantly better explanation of technology adoption than existing constructs do. In a follow-up survey of senior managers, the authors investigate the antecedents of technological opportunism and find that organizations can develop technological opportunism by taking specific actions such as focusing on the future, by having top management advocate new technologies, and by becoming mor...

How Firms Relate to Their Markets: An Empirical Examination of Contemporary Marketing Practices

Abstract: The authors examine 308 firms in the United States and four other Western countries to understand how different types of firms relate to their markets. Comparative analysis shows that though there is some support for consumer and goods firms being more transactional and business and service firms being more relational, there are many exceptions. The results also show that firms can be grouped into those whose marketing practices are predominantly transactional, predominantly relational, or a transactional/relational hybrid. Each group constitutes approximately one-third of the sample and includes all types of firms (consumer goods, consumer services, business-to-business goods, and business-to-business services). This suggests that marketing practices are pluralistic and managerial practice has not shifted from transactional to relational approaches per se.

Service Orientation of a Retailer’s Business Strategy: Dimensions, Antecedents, and Performance Outcomes

Abstract: Augmenting products with services is a major way retailers have of gaining differentiation in today’s competitive market. Despite its importance, this topic has received relatively little research attention. Unlike previous research, this study adopts a more comprehensive perspective on retail services by examining three important research gaps related to a service-oriented business strategy: First, the authors elaborate on the dimensions of a service-oriented business strategy and introduce a new measure of this strategy. Second, the authors examine the antecedents of a service-oriented business strategy. In practice, there appears to be considerable variability in terms of the extent to which retailers demonstrate a service orientation, but there is a major gap in the understanding of what factors influence this orientation. Third, the authors investigate the neglected link between a service-oriented business strategy and performance outcomes. To examine these three important areas, the authors...

The Hidden Minefields in the Adoption of Sales Force Automation Technologies

Abstract: Sales force automation technologies are increasingly used to support customer relationship management strategies; however, commentary in the practitioner press suggests high failure rates. The authors use identity theory as a lens to better understand salesperson perceptions associated with technology rejection. They collected survey data from 454 salespeople across two firms that had implemented sales force automation tools. The results indicate that immediately after training, salespeople had positive perceptions of the technology. However, six months after implementation, the technology had been widely rejected, and salesperson absenteeism and voluntary turnover had significantly increased. There were also significant decreases in perceptions of organizational commitment, job satisfaction, person-organization fit, and person-job fit across both firms. Finally, salespeople with stronger professional commitment indicated more negative job-related perceptions as experience with the technology inc...

The Role of the Institutional Environment in Marketing Channels

Abstract: Set within the political economy framework, marketing channels literature predominantly has used an efficiency-based task environment perspective and largely overlooked a legitimacy-based institutional environment approach in studying channel attitudes, behaviors, processes, and structures. The purpose of this article is to highlight the importance of the institutional environment and develop a comprehensive conceptual framework that incorporates the institutional environment into current marketing channels research. The institutional environment perspective relies on the primacy of (1) regulatory institutions (e.g., laws), (2) normative institutions (e.g., professions), and (3) cognitive institutions (e.g., habitual actions) in influencing the legitimacy of channel members. Using institutional theory, the authors augment the current task environment approach by developing three institutional processes and their underlying mechanisms and elaborating on how these institutions might influence chann...

A Configurational Perspective on Key Account Management

Abstract: Most firms struggle with the challenge of managing their key customer accounts. There is a significant gap between the importance of this organizational design problem in practice and the research attention paid to it. Sound academic research on key account management (KAM) is limited and fragmented. Drawing on research on KAM and team selling, the authors develop an integrative conceptualization of KAM and define key constructs in four areas: (1) activities, (2) actors, (3) resources, and (4) approach formalization. Adopting a configurational perspective to organizational research, the authors then use numerical taxonomy to empirically identify eight prototypical KAM approaches on the basis of a cross-industry, cross-national study. The results show significant performance differences among the approaches. Overall, the article builds a bridge between marketing organization research and relationship marketing research.

When Does Trust Matter? Antecedents and Contingent Effects of Supervisee Trust on Performance in Selling New Products in China and the United States:

Abstract: There is a strong normative bias toward the inherent value of trust among both marketing researchers and practitioners. Yet there is little empirical evidence of a positive impact of trust on performance. Indeed, scholars suggest that the sources of trust may provide opportunities for its abuse. Following this line of thinking, the authors investigate the dual roles of sales controls and supervisor behaviors as antecedents of salespeople’s belief in the benevolence of the supervisor (i.e., supervisee trust). The authors then examine these antecedents as moderators of the relationship between supervisee trust and sales performance in the context of selling new products. Data on field salespeople from high-technology firms in China and the United States suggest that factors such as supervisor accessibility engender supervisee trust but do not necessarily enhance its impact on sales performance. In the Chinese sample, supervisee trust enhances sales performance when output control is adopted, when t...

The Effects of Ingredient Branding Strategies on Host Brand Extendibility

Abstract: A decision of increasing importance is how ingredient attributes that make up a product should be labeled or branded, if at all. The authors conduct a laboratory experiment to consider how ingredient branding affects consumer acceptance of a novel line extension (or one that has not been introduced before) as well as the ability of the brand to leverage that ingredient to introduce future category extensions. The authors study two particular types of novel line extensions or brand expansions: (1) slot-filler expansions, in which the level of one existing product attribute changes (e.g., a scent in Tide detergent that is new to the laundry detergent category) and (2) new attribute expansions, in which an entirely new attribute or characteristic is added to the product (e.g., cough relief liquid added to Life Savers candy). The authors examine two types of ingredient branding strategies by branding the target attribute ingredient for the brand expansion with either a new name as a self-branded ingr...

Passing the Torch: Intergenerational Influences as a Source of Brand Equity

Abstract: In today’s competitive battleground, the concept of brand equity has proved to be an important source of strategic insights for marketers. However, one potentially valuable source of brand equity—the operation of intergenerational influences—has generally been overlooked in the marketing literature. This article reports the findings of two studies that show intergenerational impacts on brand equity to be persistent and powerful across an array of consumer packaged goods. However, as a strategic challenge, these effects seem to apply strongly for some brands but not for others—they are selective. In Study 1, the authors use parallel surveys of mother–daughter dyads to isolate and quantify intergenerational impacts, and the surveys reveal a differential range of effects at both the product category and the brand level. In Study 2, the authors use interpretivist methods to delve more deeply into these effects—the forms they take, the way they have developed, and factors that sustain or disrupt them....

Consumers' Search and Use of Nutrition Information: The Challenge and Promise of the Nutrition Labeling and Education Act:

Abstract: Four studies investigate the Nutrition Labeling and Education Act’s (NLEA’s) impact on how consumers use nutrition information. Field and laboratory studies compare, but do not detect any changes in, consumers’ search for nutrition information or their recall of this information in the pre- and post-NLEA periods. However, the search activities of a select group (highly motivated and less knowledgeable consumers) benefited more from the NLEA than did other groups. Additional results from the field and lab studies indicate that the NLEA changed attention to negative nutrition attributes (such as fat and sodium, of which less is better) more than it changed attention to positive attributes such as calcium and vitamins. Analyses of scanner databases confirm this trend (with the exception of calories). Focus group results also reflect these findings. The authors discuss implications for public policy, management, academic research, and consumer welfare.

Managing Business-to-Business Customer Relationships following Key Contact Employee Turnover in a Vendor Firm:

Abstract: Customers form relationships with the employees who serve them as well as with the vendor firms these employees represent. In many cases, a customer’s relationship with an employee who is closest to them, a key contact employee, may be stronger than the customer’s relationship with the vendor firm. If the key contact employee is no longer available to serve that customer, the vendor firm’s relationship with the customer may become vulnerable. In this article, the authors present the results of two studies that examine what business-to-business customers value in their relationships with key contact employees, what customers’ concerns are when a favored key contact employee is no longer available to serve them, and what vendor firms can do to alleviate these concerns and to retain employee knowledge even if they cannot retain the employee in that position. The studies are based on a discovery-oriented approach and integrate input from business-to-business customers, key contact employees, and mana...

Measuring the Price Knowledge Shoppers Bring to the Store

Abstract: Reference price research suggests that consumers memorize and recall price information when selecting brands for frequently purchased products. Previous price-knowledge surveys, however, indicate that memory for prices is lower than expected. In this study, the authors show that these price-knowledge surveys provide imperfect estimates of price knowledge, because they focus only on recall and short-term memory. The authors propose, instead, to use a combination of price recall, price recognition, and deal recognition to measure the degree to which consumers use auditory verbal, visual Arabic, or analogue magnitude representations to memorize prices. The authors show how the combination of these three measures provides a much richer understanding of consumers’ knowledge of prices. The results suggest that the price knowledge involved in reference prices may often not be accessible to recall but shows up in price recognition and deal recognition. In addition, the authors identify consumer and produ...

Riding the Saddle: How Cross-Market Communications Can Create a Major Slump in Sales

Abstract: Using data on a large number of innovative products in the consumer electronics industry, the authors find that between one-third and one-half of the sales cases involved the following pattern: an initial peak, then a trough of sufficient depth and duration to exclude random fluctuations, and eventually sales levels that exceeded the initial peak. This newly identified pattern, which the authors call a “saddle,” is explained by the dual-market phenomenon that differentiates between early market adopters and main market adopters as two separate markets. If these two segments—the early market and the main market—adopt at different rates, and if this difference is pronounced, then the overall sales to the two markets will exhibit a temporary decline at the intermediate stage. The authors employ both empirical analysis and cellular automata, an individual-level, complex system modeling technique for generating and analyzing data, to investigate the conditions under which a saddle occurs. The model hi...

Role Stress and Effectiveness in Horizontal Alliances

Abstract: Horizontal arrangements are increasingly deployed in organizational networks, yet research has rarely examined the effectiveness of these alliances. The coalition of disparate corporate cultures yields appreciable levels of role stress for people in boundary-spanning positions. Dedicated assets and communication modality are factors that influence the level of role ambiguity and conflict. The authors implicate these facets of role stress as antecedents to four forms of effectiveness drawn from the competing values framework. The authors present alternative perspectives that examine the relationship between stress and performance. The received view frames role stressors as linear, negative antecedents to organizational outcomes. The authors contrast this perspective with theories that espouse triphasic, parabolic, and interactive influences of stressors on organizational outcomes. Data gathered with 218 managers of dual-branded retail oil outlets indicate that the relevance of these alternative pe...

Free Cash Flow, Agency Costs, and the Affordability Method of Advertising Budgeting

Abstract: The allocation of excess cash has long been recognized in the finance literature as an important aspect of the basic agency conflict between managers and owners. In the advertising budgeting context, marketing scholars report that firms possessing high levels of cash tend to spend more on advertising than what seems necessary or desirable. Indeed, this positive link between excess cash and advertising expenditures constitutes a part of what is commonly referred to as the affordability method of advertising budgeting. Surprisingly, there has been little research that attempts to view this association as a manifestation of agency costs. Therefore, in this article, the authors examine whether agency costs, as measured by managerial ownership, moderate the relationship between excess cash and advertising expenditures. On the basis of received theory, the authors conceptualize that agency costs will first decrease, then increase, and then decrease again with the level of managerial ownership. Accordin...

Getting Published: Reflections of an Old Editor:

Abstract: David W. Stewart is Robert E. Brooker Professor of Marketing and Deputy Dean, Gordon Marshall School of Business, University of Southern California. My time as editor has been a dynamic period for the marketing community. It has witnessed the maturing of information technology, the Internet boom and bust, and the collapse of some of the most widely recognized and trusted of brands, including Andersen, Sunbeam, Oldsmobile, and Firestone. Even such seemingly powerful brands as Disney, McDonald’s, AT&T, and CocaCola have struggled. At the same time, the attention of the popular business press and the public at large has become increasingly focused on markets and marketing practices. Issues of intellectual property, consumer privacy, and fair business practices have become part of the daily business headlines. The celebrity attorney has been replaced by the celebrity chief executive officer. The locus of economic growth and new organizational forms has increasingly shifted westward from Europe, the East Coast, and the Midwest to the West Coast and Asia. The only exception to these broad shifts appears to be Japan, once feared as an economic powerhouse and now reduced to a troubled economy. Change is evitable and is what sustains the need for research and scholarship. Paradigms, assumptions, and even “facts” that dominate thought and practice at one point give way to new facts and modes of thought. In my editorial statement at the beginning of my term as editor (Stewart 1999), I discussed the role of Journal of Marketing (JM) as a tangible artifact of an intellectual community. This intellectual community is very much alive and responsive to change. It is again time for a change in the stewardship of the Journal. This change will, no doubt, bring new energy, new perspectives, and new directions to the Journal. However, editors merely manage in a modest way the real changes that occur in the intellectual discipline. Most of the articles to be published by the new editor during her first year are already written and in the review process. The problems and topics on which scholars within marketing’s intellectual community are working and will work reflect the broader social and economic environment of which marketing is a part. An editor has little, if any, influence on this environment. However, an editor plays an especially important role in ensuring that the scholarship that derives from response to change is captured and published on a timely basis. I discuss three things in my last editorial as editor: First, I describe the changes that have occurred in the Journal over the past three years. These changes suggest a great deal about the nature of the changes in markets and marketing practices that have taken place. Second, I share my perspective as an editor on what is most likely to be valuable to the discipline and find its way into the pages of the Journal. This will be a brief treatise on how to get published. Third, I acknowledge the contributions of the many people who have contributed to the Journal’s success.

Book Reviews Featuring a Special Essay by William L. Wilkie

Abstract: William L. Wilkie is the Aloysius and Eleanor Nathe Professor of Marketing Strategy, University of Notre Dame. humor. So came my hoped-for solution for this essay. To assist with structure, I’ve arranged the essay in three basic sections: (1) reflections on books during my path into marketing academia, (2) reflections on the role of institutional initiatives in sustaining the search for scholarship in our field, and (3) a few gentle reflections on personal motivations in seeking scholarship in the marketing field and the challenges we face together in this quest. Thus, though I make no effort to emulate Mr. Vonnegut directly (and with no suitable substitute for his frequent narrator, Kilgore Trout), please join me in hopping from one brief topic to another, searching for insights, occasionally with humor.]