Commitment to a friend,a service provider,or a service company—are they distinctions worth making?

In two studies, the authors examine three targets of commitment in service provider–consumer relationships and their effects on customer loyalty. The results indicate that service consumers distinguish between commitment to a service company, commitment to an individual in the role of service employee, and commitment to an individual outside of the role of service employee (e.g., a personal commitment such as a friendship). In addition, these three targets of commitment are hierarchically related and have differential effects on various customer responses. The results have implications for both customer relationship managers and researchers studying such relationships.

Managing innovation through customer coproduced knowledge in electronic services: An exploratory study

Marketing theory and practice both recognize the increasing importance of customer collaboration for service provision and innovation. As part of such customer collaboration, customers of electronic services coproduce knowledge in varying degrees. An evolving phenomenon, knowledge coproduction has yet to receive much research attention; we therefore conduct a qualitative study of the roles customers play in knowledge coproduction and their resultant influence on different innovation tasks from a service provider view. Data from three electronic service interaction channels, involving managers, engineers, and customers; case study findings; and an extensive literature review indicate the importance of knowledge coproduction by customers and its ability to improve different tasks substantially during innovation activities. The results show three different roles of customers in knowledge coproduction and explain comprehensively how each role impacts various innovation tasks.

Measuring and maximizing customer equity: a critical analysis

Customer equity, the asset value of customers, can be measured using different aggregate- and disaggregate-level approaches. The authors compare how customer equity is measured and maximized under various approaches. We find that, in the disaggregate-level approach, customer lifetime value is maximized by implementing customer-level strategies such as optimal resource allocation, purchase sequence analysis and balancing acquisition and retention spending. At the aggregate-level, improving the drivers of customer equity maximizes customer equity. A comparison of different aggregate approaches shows that, while an emphasis on retention is a common feature across approaches, conceptual differences in terms of accounting for existing customers and prospects, acquisition, and the projection period exist across the different approaches. The authors propose a hybrid approach, which addresses the issues and challenges in existing approaches and helps firms to measure and manage customer equity.

How to get lost customers back?

Most research in the field of customer relationship management has focused on keeping existing customers. However, some companies also systematically address lost customers and try to revive these relationships. This facet of customer relationship management has been largely neglected by academic research. Our study provides a theoretical discussion and an empirical analysis of factors driving the success of relationship revival activities. Drawing on equity theory, we find that the customer’s perceived interactional, procedural, and distributive justice with respect to revival activities positively affect his or her revival-specific satisfaction which in turn, has a strong impact on revival performance. Furthermore, revival performance depends on customer characteristics (variety seeking, involvement, age), and the overall customer satisfaction with the relationship.

Organizational antecedents to and consequences of service business orientations in manufacturing companies

Although various manufacturing companies have developed into total solution providers, no research addresses their service orientations. Building on the literature on organizational service climate, this study explores the organizational parameters and service business orientations that explain relative product sales and service volume of manufacturing companies. Following an exploratory study involving in-depth interviews, the authors conducted an empirical survey of 137 companies in The Netherlands, Belgium, and Denmark. The study assesses the effects of organizational parameters on the implementation of service business orientations and validates the important distinction between services in support of the client’s actions (SSC) and services in the support of the product (SSP). The findings demonstrate that services in support of the client’s action leverage relative product sales, while services in support of the product generate service volume. In addition to the main effects, the moderating effects of the organizational parameters are discussed.

Integrating service and design: the influences of organizational and communication factors on relative product and service characteristics

The aim of this study is to identify the organizational and communication antecedents, and evaluate the consequences on relative product and service characteristics, of the use of service-sourced information by product designers during new product development. An empirical study of 121 product design managers demonstrates that a firm’s market orientation is improved by a healthy working relationship between product designers and service employees. Such a relationship motivates designers to use service-sourced information disseminated to them, enhancing both product and service characteristics of the new offering. The authors discuss how communication channels and information content affect the information use of product designers. Product designers value written information most. Information use does not relate to the frequency of receiving verbal or electronic information. Information about product ergonomics positively influences product designers’ perceptions of the information, whereas information on product aesthetics negatively influences their perceptions.

---

Fundamentals of service science

Service systems are value-co-creation configurations of people, technology, value propositionsconnecting internal and external service systems, and shared information (e.g., language, laws, measures, and methods). Service science is the study of service systems, aiming to create a basis for systematicservice innovation. Service science combines organization and human understanding with business andtechnological understanding to categorize and explain the many types of service systems that exist as wellas how service systems interact and evolve to co-create value. The goal is to apply scientific understandingto advance our ability to design, improve, and scale service systems. To make progress, we think servicedominantlogic provides just the right perspective, vocabulary, and assumptions on which to build a theory ofservice systems, their configurations, and their modes of interaction. Simply put, service-dominant logicmay be the philosophical foundation of service science, and the service system may be its basic theoreticalconstruct.

The effect of market orientation and its components on innovation consequences: a meta-analysis

While there is a rich body of research on market orientation’s effect on business performance, much little attention has been given to its effect on innovation consequences. This is the first meta-analytic effort to study the independent effects of market orientation components (customer orientation, competitor orientation, interfunctional coordination) on innovation consequences. Also, it is the first meta-analysis to study the impact of contextual characteristics on the way market orientation affects innovation consequences. The study finds that market orientation components positively affect innovation consequences but that competitor orientation’s effect depends on a minimum level of customer orientation. The study also suggests that the relationship between market orientation and innovation consequences is stronger in highly competitive environments but weaker in technology turbulent ones. Finally, findings suggest that the relationship is stronger in large firms, service companies, and in countries characterized by high individualism and high power distance national cultures.

An examination of Peter Drucker's work from an institutional perspective: How institutional innovation creates value leadership

This paper uses an institutional perspective to analyze Peter Drucker's contributions to management, marketing and marketing strategy. Drucker recognizes the importance of institutions in society. Further, his work reflects a variety of institutional views from sociology, economics and marketing. Drucker uses a form of comparative institutional analysis for evaluating both management and strategy issues. At the heart of each institutional comparison is the customer and the value created for the customer by the organization. Institutional comparisons help managers understand how the organization can create customers by adjusting its customer value proposition. Drucker influences marketers by focusing on how the organization's values are used to develop the organization's customer value proposition. Further, it is shown that the organization's values and its customer value propositions are manifested in its transaction rules, termed marketing institutions. Based on Drucker's work, a framework for comparing marketing institutions is introduced: the value leadership framework.

Toward a theory of repeat purchase drivers for consumer services

The marketing discipline’s knowledge about the drivers of service customers’ repeat purchase behavior is highly fragmented. This research attempts to overcome that fragmented state of knowledge by making major advances toward a theory of repeat purchase drivers for consumer services. Drawing on means–end theory, the authors develop a hierarchical classification scheme that organizes repeat purchase drivers into an integrative and comprehensive framework. They then identify drivers on the basis of 188 face-to-face laddering interviews in two countries (USA and Germany) and assess the drivers’ importance and interrelations through a national probability sample survey of 618 service customers. In addition to presenting an exhaustive and coherent set of hierarchical repeat-purchase drivers, the authors provide theoretical explanations for how and why drivers relate to one another and to repeat purchase behavior. This research also tests the boundary conditions of the proposed framework by accounting for different service types. In addition to its theoretical contribution, the framework provides companies with specific information about how to manage long-term customer relationships successfully.

Influence of customer participation on creating and sharing of new product value

This research applies an institutional arrangement perspective to develop an end-to-end model for the interaction between customers and upstream suppliers to develop a new product to understand how new product value is created and shared. The model is empirically tested by collecting primary data from 188 manufacturers across different industries. The research demonstrates that customer participation affects new product value creation by improving the effectiveness of the new product development process by enhancing information sharing and customer–supplier coordination and by increasing the level of customer and supplier specific investments in the product development effort. In addition, increasing the formalization of the customer participation process enhances both customer and supplier relationship-specific investments in the new product development process. The impact of customer participation on the customer's share of the new product value pie is more complex then is first apparent. Based on the dependence and equity perspectives the results suggest that exchange partners' power (relative dependence) positively influences a partner's ability to capture new product value, but this power is offset by a desire of exchange partners to ensure the distribution of value is “fair” and reflects each party's contribution to the value creation.

The chain from customer satisfaction via word-of-mouth referrals to new customer acquisition

It has often been argued that word-of-mouth (WOM) can contribute significantly to a firm’s success in a variety of ways. Here, we analyze the functional linkage between customer satisfaction, WOM, and new customer acquisition. Using data from two empirical studies we conceptualize and test the direct, non-linear, and moderated relationship between satisfaction and WOM. We further explore the circumstances under which WOM leads to new customer acquisition using a logistic regression model. We do so for two groups (new customers and long-term customers) from the customer base of a large energy provider (n = 688), and for a random sample of B2B customers (n = 416) in the same market. Results indicate that the satisfaction-WOM link is non-linear and is moderated by several customer involvement dimensions. Based on our results, we demonstrate how the satisfaction-WOM-new customer acquisition link can enrich return on quality and satisfaction models. Further, we draw conclusions about how companies can make use of both the satisfaction-WOM and the WOM-new customer acquisition link for better allocating their marketing resources.

The moderating role of institutional networking in the customer orientation–trust/commitment–performance causal chain in China

This study uncovers the ignored role of institutional environment for marketing strategy and customer relationship management. Hypothesis tests in a sample of Chinese firms find support that channel networking strengthens the customer orientation–customer trust/commitment–firm performance (CTP) causal chain. In addition, the results show that government networking moderates this chain in a non-linear fashion. The CTP linkages are most salient when the firm develops a moderate level, rather than a high or low level of networking ties with government agencies.

Customer-based corporate reputation of a service firm: scale development and validation

Although corporate reputation has attracted significant attention among marketing scholars, current measures of it do not adequately capture the perceptions of the most important stakeholder group, customers, and often overlook its relationship to important customer-outcome variables. In this article, we identify dimensions of customer-based corporate reputation and develop scales to measure these dimensions (Study 1). Based on comprehensive validation procedures across three service firm types, we found support for a five-dimensional scale with the following dimensions: Customer Orientation, Good Employer, Reliable and Financially Strong Company, Product and Service Quality, and Social and Environmental Responsibility. In Study 2, using a second sample, we validate our scale and examine its relationship with important customer-outcome variables—customer satisfaction, loyalty, trust, and word of mouth. Most of the reputation dimensions were strongly associated with important outcome variables, with a few exceptions. We discuss the results with reference to the marketing implications.

See no evil,hear no evil,speak no evil: a study of defensive organizational behavior towards customer complaints

Despite substantial benefits of an effective complaint management for companies, there is ample evidence that many firms do not handle customer complaints appropriately. This paper aims at providing a theoretical explanation for this surprising phenomenon. Drawing on psychological and organizational theory, the authors introduce the concept of defensive organizational behavior towards customer complaints as well as provide a rich conceptualization and operationalization of this phenomenon. Moreover, in an empirical study, they systematically analyze how defensive organizational behavior towards customer complaints is driven by organizational antecedents and, based on a dyadic data set, how it affects customer post-complaint reactions.

Linking cause-related marketing to sales force responses and performance in a direct selling context

The influence of a firm’s cause-related marketing efforts on sales representative attitudes and behavioral performance is investigated. Results from a field study indicate that the influence of a representative’s construed customer attitude toward the cause campaign on selling behavioral performance is mediated through cognitive identification and selling confidence. Further, the influence of construed customer attitude toward the campaign on selling confidence is moderated by cognitive identification such that the effects are stronger for salespeople with lower levels of identification with the company. The authors discuss the implications of the research and offer directions for further research.

Marketing and innovation in the Drucker Management System

Peter F. Drucker is well known for stating that there is only one valid purpose of a business: to create a customer. And that there are only two basic business functions: marketing and innovation. The body of material on management that he produced contains frequent references to this purpose and these functions, but Drucker never distilled the specific tasks within his management approach that result in implementing this purpose and these functions. This paper distills the executive practices and tasks that are necessary to implement this purpose and these functions and it does so using a systems framework.

Utilization of new technologies: organizational adaptation to business environments

The practice of introducing new technologies into the corporate environment has become a well-accepted principle for sustaining or advancing competitive advantages. The current study focuses on the environmental and managerial factors associated with the successful utilization of new technologies. To this end, the suggested framework examines the efforts put forth by the two parties involved (the firm buying and the firm supplying the new technology). We use 112 matched data collected from the suppliers and buyers of the customer relationship management (CRM) system in business-to-business markets. We find that the perceived turbulence of business environments stimulates adaptive efforts from both the supplying and buying firms, which may lead to a high level of utilization of new technologies for the buying firm.

The market value impact of indirect ties within technology alliances

Researchers have typically studied the relationship between technology alliances and market value from a direct tie or dyadic perspective. Yet any given technology alliance is typically embedded in a network of indirect ties created by the alliance partners’ relationships with other firms. We argue that whether an indirect tie enhances or detracts from the market value a firm creates in a technology alliance depends upon factors related to inter-firm competencies at both an alliance- and partner-level of analysis. Empirical analysis of abnormal stock returns reveals support for the hypothesized contingent relationship between indirect ties and value creation within technology alliances. Theoretically, the paper clarifies opposing perspectives in the literature regarding the performance implications of indirect ties and identifies market value as a hitherto unrecognized effect associated with this type of tie. Managerially, the findings improve marketers’ ability to leverage the complex interactions that occur between technology alliances in a value-creating manner.

---

Spontaneous visualization and concept evaluation

This paper proposes that customers often respond to brand extension concepts by visualizing the product. We call this process spontaneous visualization and suggest that it precedes concept evaluations. In two studies, we show that spontaneous visualization is enhanced by the fit between the parent brand and the extension category and by the ease with which the product category can be imagined. The appeal of the visualized image in turn determines whether visualization enhances or decreases concept evaluations. In addition, we find a stronger link between product evaluations and delayed choice when evaluations are based on visualization; evaluations based on visualization hence appear to be more “valid” in the sense of predicting subsequent behavior. Implications of these findings and ideas for future research are discussed.