Revisiting the Satisfaction-Loyalty Relationship: Empirical Generalizations and Directions for Future Research
TL;DR: In this article, an extensive literature review highlights the state of the art regarding the relationship between customer satisfaction and loyalty, both attitudinal and behavioral, and brings to light several issues that should be carefully considered in analyzing the efficacy of customer satisfaction in explaining and predicting customer loyalty.
About: This article is published in Journal of Retailing.The article was published on 2013-09-01. It has received 418 citations till now. The article focuses on the topics: Loyalty business model & Customer delight.
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01 Jan 1997
TL;DR: Heskett, Sasser, and Schlesinger as mentioned in this paper show how managers at American Express, Southwest Airlines, Banc One, Waste Management, USAA, MBNA, Intuit, British Airways, Taco Bell, Fairfield Inns, Ritz-Carlton Hotel, and the Merry Maids subsidiary of ServiceMaster employ a quantifiable set of relationships that directly link profit and growth to not only customer loyalty and satisfaction, but to employee loyalty, satisfaction, and productivity.
Abstract: Why are a select few service firms better at what they do - year in and year out - than their competitors? For most senior managers, the profusion of anecdotal "service excellence" books fails to address this key question. In this pathbreaking book, world-renowned Harvard Business School service firm experts James L. Heskett, W. Earl Sasser, Jr. and Leonard A. Schlesinger reveal that leading companies stay on top by managing the service profit chain. Based on five years of painstaking research, the authors show how managers at American Express, Southwest Airlines, Banc One, Waste Management, USAA, MBNA, Intuit, British Airways, Taco Bell, Fairfield Inns, Ritz-Carlton Hotel, and the Merry Maids subsidiary of ServiceMaster employ a quantifiable set of relationships that directly links profit and growth to not only customer loyalty and satisfaction, but to employee loyalty, satisfaction, and productivity. The strongest relationships the authors discovered are those between (1) profit and customer loyalty; (2) employee loyalty and customer loyalty; and (3) employee satisfaction and customer satisfaction. Moreover, these relationships are mutually reinforcing; that is, satisfied customers contribute to employee satisfaction and vice versa. Here, finally, is the foundation for a powerful strategic service vision, a model on which any manager can build more focused operations and marketing capabilities. For example, the authors demonstrate how, in Banc One's operating divisions, a direct relationship between customer loyalty measured by the "depth" of a relationship, the number of banking services a customer utilizes, and profitability led the bank to encourage existing customers to further extend the bank services they use. Taco Bell has found that their stores in the top quadrant of customer satisfaction ratings outperform their other stores on all measures. At American Express Travel Services, offices that ticket quickly and accurately are more profitable than those which don't. With hundreds of examples like these, the authors show how to manage the customer-employee "satisfaction mirror" and the customer value equation to achieve a "customer's eye view" of goods and services. They describe how companies in any service industry can (1) measure service profit chain relationships across operating units; (2) communicate the resulting self-appraisal; (3) develop a "balanced scorecard" of performance; (4) develop a recognitions and rewards system tied to established measures; (5) communicate results company-wide; (6) develop an internal "best practice" information exchange; and (7) improve overall service profit chain performance. What difference can service profit chain management make? A lot. Between 1986 and 1995, the common stock prices of the companies studied by the authors increased 147%, nearly twice as fast as the price of the stocks of their closest competitors. The proven success and high-yielding results from these high-achieving companies will make The Service Profit Chain required reading for senior, division, and business unit managers in all service companies, as well as for students of service management.
862 citations
TL;DR: In this paper, the duality of consumer engagement with two engagement foci (brand and community) and seven sub-dimensions of engagement is discussed. But the focus of this paper is on consumer engagement objects.
Abstract: This study advances the conceptualisation and operationalisation of consumer engagement in the context of online brand communities (OBCs). Past scholarship has only partially addressed the dimensionality of engagement and the different engagement foci, and these oversights have important theoretical and empirical consequences. This study contributes to the nascent stream of research that aims to theoretically refine and operationalise engagement by espousing the duality of engagement with two engagement foci (brand and community) and seven sub-dimensions of consumer engagement. Using qualitative data from consumers and experts, three survey data sets based on English and French samples, and two pools of mirrored items (one for each engagement focus), the study develops and validates a dual-focus 22-item scale of consumer engagement that can be used to operationalise engagement with various consumer engagement objects.
343 citations
Journal Article•
TL;DR: In this paper, the differences between customer satisfaction and customer satisfaction are examined, and the benefits of satisfying customers rather than merely satisfying customers are discussed, as well as the potential pitfalls of doing so.
Abstract: While many researchers have made contributions to the now extensive literature on service quality, there is much less research on what constitutes delight in service quality and how organizations can delight customers. This article examines the differences between customer satisfaction and customer delight, notably the benefits of delighting rather than merely satisfying customers. It describes how to delight customers, outlines how to implement a successful customer delight program, shows how to measure customer delight, and discusses the potential pitfalls of doing so.
306 citations
TL;DR: In this paper, the authors examined the extent to which service quality, perceived price and fairness and service convenience influence customer satisfaction and customer loyalty for Indian retail banking sector, and further explored the role of customer satisfaction as mediating variable between service quality dimensions.
Abstract: Purpose – The purpose of this paper is to examine the extent to which service quality, perceived price and fairness and service convenience influence customer satisfaction and customer loyalty for Indian retail banking sector. It further explores the role of customer satisfaction as mediating variable between service quality dimensions, perceived price and fairness, service convenience dimensions and customer loyalty. Design/methodology/approach – A cross-sectional research on 445 retail banking customers through questionnaire is conducted. Population of study is valued retail urban customers of banks in Rajasthan, India, who frequently visit bank premises for transactions, have accounts in at least two banks and have availed of at least one information technology-based services. Responses are analyzed using factor analyses and regression analyses. Findings – Results reveal that service quality dimensions, perceived price and fairness and service convenience dimensions have positive impact on customer sat...
306 citations
TL;DR: In this paper, the authors developed an integrated framework to analyse the roles of standardization and customization on service quality, and found that integration of standardisation and customization of service offerings is critical for improved service quality.
293 citations
Cites background from "Revisiting the Satisfaction-Loyalty..."
...There is ample evidence in the literature to support links between service quality, customer satisfaction and customer loyalty (Olsen, 2002; Kang et al., 2004; Kumar et al., 2013; Söderlund and Öhman, 2005)....
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...A considerable amount of service management literature has shown the link between customer satisfaction and customer loyalty (Chen, 2012; Kumar et al., 2013; Suh and Yi, 2006)....
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...Although there are ample studies on service quality as a major construct and its relationship with customer satisfaction and loyalty (Söderlund and Öhman, 2005; Kumar et al., 2013), there are only a few studies that examine the relationship between technical quality, functional quality and customer satisfaction (De Keyser and Lariviere, 2014; Lien and Kao, 2008)....
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...Service quality dimensions vs customer satisfaction and customer loyalty There is ample evidence in the literature to support links between service quality, customer satisfaction and customer loyalty (Olsen, 2002; Kang et al., 2004; Kumar et al., 2013; Söderlund and Öhman, 2005)....
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...…are ample studies on service quality as a major construct and its relationship with customer satisfaction and loyalty (Söderlund and Öhman, 2005; Kumar et al., 2013), there are only a few studies that examine the relationship between technical quality, functional quality and customer…...
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References
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TL;DR: This article seeks to make theorists and researchers aware of the importance of not using the terms moderator and mediator interchangeably by carefully elaborating the many ways in which moderators and mediators differ, and delineates the conceptual and strategic implications of making use of such distinctions with regard to a wide range of phenomena.
Abstract: In this article, we attempt to distinguish between the properties of moderator and mediator variables at a number of levels. First, we seek to make theorists and researchers aware of the importance of not using the terms moderator and mediator interchangeably by carefully elaborating, both conceptually and strategically, the many ways in which moderators and mediators differ. We then go beyond this largely pedagogical function and delineate the conceptual and strategic implications of making use of such distinctions with regard to a wide range of phenomena, including control and stress, attitudes, and personality traits. We also provide a specific compendium of analytic procedures appropriate for making the most effective use of the moderator and mediator distinction, both separately and in terms of a broader causal system that includes both moderators and mediators.
80,095 citations
TL;DR: In this paper, customer loyalty is viewed as the strength of the relationship between an individual's relative attitude and repeat patronage, and the relationship is mediated by social norms and situational factors.
Abstract: Customer loyalty is viewed as the strength of the relationship between an individual’s relative attitude and repeat patronage. The relationship is seen as mediated by social norms and situational factors. Cognitive, affective, and conative antecedents of relative attitude are identified as contributing to loyalty, along with motivational, perceptual, and behavioral consequences. Implications for research and for the management of loyalty are derived.
6,255 citations
TL;DR: In this paper, the authors report an empirical assessment of a model of service encounters that simultaneously considers the direct effects of quality, satisfaction, and value on consumers' behavioral intentions, and further suggest that indirect effects of the service quality and value constructs enhanced their impact on behavioral intentions.
6,176 citations
TL;DR: The Personal In-volvement Inventory was developed over four data sets of 268 undergraduate psychology students, two data set of 49 MBA students, and two data sets with 57 clerical and administrative staff members as mentioned in this paper.
Abstract: SUMMARY The purpose of the study was to develop a scale tomeasure the construct of involvement. Hence, a se-mantic differential scale was developed to capture theconcept of involvement for products. This Personal In-volvement Inventory was developed over four data setsof 268 undergraduate psychology students; two data setswith 49 MBA students; and two data sets with 57 clericaland administrative staflf members. The scale was dem-onstrated to have content validity by expert judges attwo phases of the scale development: first, for the se-lection of items, and second, through classification ofopen-ended responses from subjects. The reliability orstability of the scale over time was checked over twosubject populations for an average test-retest correlationof 0.90. The criterion-related validity of the scale waschecked by demonstrating agreement with the order ofvarious products as found in previous studies. The con-struct validity—the test ofthe scale to theoretical prop-ositions—was then carried out. The scale was admin-istered to clerical and administrative staff and coveredthree different product categories and several statementsof behavior proposed to be representative of involve-ment. Over all three product categories there was a pos-itive relationship between the scale scores and the sub-jects' responses to the statements of theoretical prop-ositions pertaining to involvement.
5,489 citations
TL;DR: Swedish companies and some industries monitor customer satisfaction on a continual basis, but Sweden is the first country to do so on a national level as mentioned in this paper. And the annual Customer Satisfaction Baro...
Abstract: Many individual companies and some industries monitor customer satisfaction on a continual basis, but Sweden is the first country to do so on a national level. The annual Customer Satisfaction Baro...
5,404 citations