The role of brand communications on front line service employee beliefs,behaviors, and performance

Frontline service employees often vary in their delivery of the brand promise, leaving service firms with less direct control on other stakeholders’ brand perceptions. Internal branding efforts have been suggested as a way to improve employee performance. With this in mind, we develop a two-process model based on identification and internalization theories to explain how internally disseminating brand-relevant information to frontline employees enhances performance. Using multi-source data from the employees, managers, and customers of a business-to-business firm in the hospitality industry, we find that providing brand-specific information directly to frontline employees increases their identification with the brand (as evidenced in perceptions of firm authenticity) and enhances their internalization of brand values. Additional results suggest that firms should make an extra effort to communicate brand-specific information to frontline employees if they desire brand-consistent performance that is observable to managers and customers alike.     

When one bad apple spoils consumers’ judgment of the brand: exposure to an employee’s non-workplace transgression and potential remedies

Four experiments investigate consumers’ moral judgments of a firm’s brand reputation when given information about an employee’s non-workplace transgression. To the extent that the employee is perceived to have power in the firm (i.e., control over resources and decisions), the employee’s offensive action damages the firm’s reputation and decreases consumers’ purchase intentions. These effects occur even though the action occurs in the employee’s private life and is unrelated to product quality. The results replicate for three types of products and three types of offenses. The employee’s perceived power in the firm provides the most consistent explanation of customers’ negative responses and is a better predictor than the alternative explanations tested (e.g., perceived status). Results also show that after an offense comes to light, firm reactions that decrease or eliminate the employee’s power in the organization—such as reducing decision-making responsibilities or firing the employee—can help restore the firm’s reputation.     

“Greening” the marketing mix: do firms do it and does it pay off?

Growing concern about the sustainability of the natural environment is rapidly transforming the competitive landscape and forcing companies to explore the costs and benefits of “greening” their marketing mix. We develop and test a theoretical model that predicts (1) the role of green marketing programs in influencing firm performance, (2) the impact of slack resources and top management risk aversion on the deployment of such programs, and (3) the conditioning effects that underpin these relationships. Our analyses show that green marketing programs are being implemented by firms, and we find evidence of significant performance payoffs. Specifically the results indicate that green product and distribution programs positively affect firms’ product-market performance, while green pricing and promotion practices are directly positively related to firms’ return on assets. In addition, industry-level environmental reputation moderates the links between green marketing program components and firms’ product-market and financial performance. Finally, we find that slack resources and top management risk aversion are independently conducive to the adoption of green marketing programs—but operate as substitutes for each other.     

Are conservative approaches to new product selling a blessing in disguise?

A new product’s success in the marketplace largely depends on salesforce actions. Many B2B salespeople display conservatism when confronted with new products in their portfolio, such that they maximize their efforts to sell existing products before engaging in efforts to sell the new product. So far, it is unclear whether this conservative selling behavior (CSB) is harmful to new product selling performance, and how this behavior can be managed. Building on perceived risk processing theory, and employing multi-level structural equation modeling on a multi-source dataset, the authors empirically substantiate that salespeople’s CSB makes their effort to sell new products more effective. Remarkably, such effort is then valued less by sales managers. The authors also find that CSB is a result of a risk assessment and evaluation process, in which internal marketing efforts (i.e., providing salespeople with information on the new product) determine the weight of perceived performance risk (i.e., new product radicalness), social risk (i.e., managerial new product orientation), and financial risk (i.e., long-term rewards). Managers looking to control the levels of CSB in their salesforce should carefully align their information support activities with the perceived risk dimensions of the new product selling situation.     

The evolving role of managerial ties and firm capabilities in an emerging economy: evidence from China

As emerging economies experience unprecedented market and institutional changes, where should firms focus their attention to address new marketing challenges: network-based resources (e.g., managerial ties) or market-based capabilities? Building on institutional theory, this study examines the evolving roles of managerial ties and firm capabilities, as well as their interplay, in China. A longitudinal survey of 166 Chinese firms reveals that over time, the positive role of ties with the government (i.e., political ties) declines, whereas the positive effect of ties with the business partners (i.e., business ties) persists; marketing capability has a persistent effect, and technology capability exerts a stronger impact on performance. Moreover, as market development progresses, marketing capability positively interacts with business ties, whereas technology capability positively interacts with political ties, in fostering performance.     

Multiple emotional contagions in service encounters

This paper investigates the dynamic impact of multiple sequential emotional displays by employees on customers’ negative emotions. Using video-based stimuli to manipulate emotional displays by employees, this study shows the sequential occurrences of negative and positive emotional contagions in service failure and recovery encounters. The results suggest that higher levels of employees’ negative emotional displays lead to a greater increase in customers’ negative emotions through the process of negative emotional contagion during service failure. More importantly, we find that positive emotional displays by employees can decrease customers’ negative emotions through the process of positive emotional contagion during service recovery, i.e., higher levels of employee positive emotional displays lead to a greater decrease in customers’ negative emotions. In addition, no matter whether customers experience higher or lower levels of employee positive emotional displays during service recovery, their final negative emotions cannot fully return to their emotional levels prior to service failure. However, for customers experiencing higher levels of employee positive emotional displays, their final negative emotions can be greatly mitigated and are closer to their initial emotional levels, as compared to customers experiencing lower levels of employee positive emotional displays. The results further indicate that susceptibility to emotional contagion increases the effect of employees’ negative (positive) emotional displays on customers’ negative emotions during service failure (recovery). The findings of this study suggest that service firms should provide effective training to their frontline service employees so that they can display proper positive emotions during service encounters.     

Unlocking the power of marketing: understanding the links between customer mindset metrics,behavior, and profitability

Recent evidence about the central role played by perceptual constructs in driving performance outcomes has produced a renewed interest in studying customer mindset metrics (CMMs; e.g., satisfaction, service quality, and loyalty intentions). However, we still lack a proper understanding of how (i.e., process) and to what extent (i.e., magnitude) these CMMs ultimately translate into profitability at the customer level. In this study, we integrate CMMs into an individual-level framework of customer behavior and profitability and provide a conceptual understanding of the process through which these metrics influence customer profitability. Specifically, we propose three mechanisms through which CMMs affect customer behavior and profitability: behavioral effect, marketing effectiveness effect, and marketing efficiency effect. We empirically test this framework across two distinct contexts, a B2B high-tech firm and a B2C telecommunications firm. The results demonstrate that these unobservable CMMs have a significant and multi-dimensional impact on customer behavior and customer profitability. Furthermore, we compute the increases in customer behavior and customer profitability that each firm can expect due to increases in CMMs to help firms improve resource allocation and make better decisions about how much (and when) to invest in CMMs.     

Building an innovation base: exploring the role of acquisition behavior

Innovation serves as a foundation for sustainable competitive advantage. Therefore, it is no surprise that firms seek to build an innovation base—a reservoir of inventions, ideas, and discoveries that serve as a platform for their innovation efforts. One approach for building an innovation base is acquisitions, though extant research reveals an equivocal verdict on whether acquisitions influence post-acquisition inventions. In this research, the authors focus on type of acquisition, acquisition behavior over time, and invention characteristics to investigate how acquisition behavior influences post-acquisition inventions. Analysis of 352 firms across five industries and 17 years reveals that firms who make acquisitions produce a stronger innovation base than those who make no acquisitions. Moreover, comparing effects across vertical and horizontal acquisitions, results indicate that the acquiring firm’s knowledge breadth plays an important role in determining which type of acquisition behavior generates the strongest influence on a firm’s innovation base.     

The effects of customer equity drivers on loyalty across services industries and firms

Customer equity drivers (CEDs)—value equity, brand equity, and relationship equity—positively affect loyalty intentions, but this effect varies across industries and firms. We empirically examine potential industry and firm characteristics that explain why the CEDs–loyalty link varies across services industries and firms in the Netherlands. The results show that (1) some previously assumed industry and firm characteristics have moderating effects while others do not and (2) firm-level advertising expenditures constitute the most crucial moderator because they influence all three loyalty strategies (significant for value equity and brand equity; marginally significant for relationship equity), while three industry contexts (i.e., innovative markets, visibility to others, and complexity of purchase decisions) each influence two of the three loyalty strategies. Our results clearly show that specific industry and firm characteristics affect the effectiveness of specific loyalty strategies.     

The impact of a sales team’s perceived entitativity on customer satisfaction

This research investigates the impact of a sales team’s entitativity—the extent to which a group of individuals is perceived as a unified single entity—on customer satisfaction. Four studies demonstrate that a sales team entitativity cue, either based on appearance (e.g., wearing the same outfit) or based on behavior (e.g., explicit coordination in service), leads to heightened perceptions of service quality, which subsequently enhances customer satisfaction. Further, these two entitativity cues are shown to have interactive effects. Specifically, when both cues indicate high entitativity, customer satisfaction with the sales team exceeds the average evaluation of individual team members. However, if at least one cue suggests low entitativity (e.g., different outfits or no explicit coordination), the positive influence of the entitativity cue is undermined and customer satisfaction with the team’s service is mitigated. Product category is identified as an important moderator of the main effect.     

Consumer reliance on intangible versus tangible attributes in service evaluation: the role of construal level

The services marketing literature has traditionally characterized intangibility as the most critical distinction between services and goods, but in practice service production and consumption often involve both intangible and tangible elements. While prior research has examined and debated service intangibility from the firm’s perspective, what is missing is an understanding of how consumers weigh the relative importance of intangible versus tangible attributes in their service evaluation. Drawing on construal level theory, the authors propose that consumers with a high (vs. low) construal level rely more on intangible (vs. tangible) attributes in service evaluation. Furthermore, the effect of construal level on service evaluation is mediated by imagery vividness, with service type (e.g., experience vs. credence services) serving as a boundary condition. The authors conduct two field studies and two lab experiments and find that under a high construal level, consumers rely more on intangible attributes in their service evaluation and choice formation; under a low construal level, consumers rely more on tangible attributes in their service evaluation and choice. The findings not only offer new insights to help reconcile the disparate perspectives on service intangibility in the literature but also have practical implications on service firms’ positioning strategies that vary across time (e.g., advance selling vs. on-site selling) and space (e.g., near vs. distant outlet), as well as which attributes to emphasize in their marketing communications.     

Don’t just fix it, make it better! Using frontline service employees to improve recovery performance

This study examines how frontline service employees (FSEs) can learn from recovery services and improve their performance accordingly. While research recognizes that FSEs can fulfill an innovation role by sourcing customer knowledge and developing ideas for performance improvement, it remains unclear whether such a role benefits or impairs the FSE’s primary recovery service role of providing efficient and thorough solutions to customer problems. This research models both FSE roles and explores under which conditions it is beneficial for FSEs to engage in an additional innovation role. The model is tested using survey and objective data from 134 FSEs. PLS results reveal that the innovation role is detrimental because sourcing knowledge from customers takes time and effort, but also beneficial because knowledge sourcing triggers FSEs to develop ideas for improvement, which positively influence their recovery speed and recovery quality. Managers can strengthen these positive effects of knowledge sourcing by optimizing an FSE’s service portfolio (i.e., the combination of products, customers, and failures an employee is responsible for), which leverages the effects of knowledge sourcing on ideas for improvement.     

The influence of organic organizational cultures, market responsiveness, and product strategy on firm performance in an emerging market

Organizational culture is a strategic resource that influences a range of activities within firms, and empirical evidence from management and marketing demonstrates that it impacts performance. In this study, we investigate how organic types of organizational culture (i.e., adhocracy and clan) serve as a strategic resource to influence marketing effectiveness and performance in an emerging economy, using an extended form of the resource-based view as our theoretical framework. We posit that organic cultures, which are relatively dominant in emerging-nation firms, serve as antecedents of competitive advantage and superior performance. We selected China as the context to test the veracity of our model and use multiple informants and archival performance data to minimize common method variance. Our results support the proposed model and demonstrate that organic cultures impact market responsiveness, while confirming the critical roles of market responsiveness and product strategy change in producing superior performance. We further demonstrate a direct effect between clan culture and product strategy change, in addition to its indirect effect. Importantly, our results uncover that, although individually either adhocracy or clan culture can significantly improve the firm’s responsiveness, their combined effect does not enhance market responsiveness; that is, their interaction yields a negative coefficient. Additionally, the influence of organic cultures on market responsiveness varies across different industry types. These important differences, along with theoretical contributions and managerial implications of our findings, are discussed, and several avenues for future research are proposed.     

Do institutional investors pay attention to customer satisfaction and why?

Extant marketing, accounting, and finance research has neglected to examine the relevance of customer satisfaction information for institutional investors, despite their potential importance. This study develops and supports a framework suggesting that firms with positive changes in customer satisfaction are more attractive to transient institutional investors than to non-transient institutional investors. We also find that the impact of customer satisfaction on transient institutional investor holdings is contingent upon firm intangible asset intensity, product-market demand uncertainty, and financial market volatility. In addition, transient institutional investor holdings at least partially mediate the effects of changes in customer satisfaction on firm abnormal return and idiosyncratic risk. Thus, transient institutional investor investments represent a mechanism through which customer satisfaction affects firm value.     

How the frequency and amount of corporate donations affect consumer perception and behavioral responses

This article proposes two new donation strategies that focus on either the amount or the frequency of corporate donations, and verifies that consumers have very different perceptions of and behavioral responses to firms that adopt these different donation strategies. Through three lab experiments and two field studies with adult consumers, the authors show that an amount-focused donation strategy leads consumers to generate more resource- and capability-related associations about the firm’s endeavor in helping charities, whereas a frequency-focused donation strategy leads consumers to generate more commitment- and persistence-related associations about a firm’s endeavor in helping charities. Furthermore, consumers tend to perceive a donation as more instrumental in helping charities and are more likely to purchase from the donor firm, pay a higher price for the donor firm’s products, and make referrals when the firm adopts a frequency-focused (vs. amount-focused) donation strategy to support an approach-oriented (vs. avoidance-oriented) charitable goal. The findings hold important implications for corporate donation strategies regarding how firms should allocate their philanthropic budgets and strategically communicate their donation efforts.     

The role of climate: implications for service employee engagement and customer service performance

This research attempts to challenge the resource–engagement and engagement–performance linkage of the job demands–resources model by testing these links under the moderating role of two climates: performance-focused and service failure recovery. Two studies test a model on the boundary conditions of the linkages across four service industries. The results suggest that whether a resource (i.e., self-efficacy and job autonomy) positively or negatively affects engagement depends on whether (1) a climate is appraised as a challenge or hindrance demand and (2) a climate is deemed a complementary or compensatory resource. Using multi-respondent data from customer service employees and their supervisors in the health care industry, Study 1 conceptualizes climate as organizational climate and finds that performance-focused climate strengthens (weakens) the positive effect of self-efficacy (job autonomy) on engagement while service failure recovery climate weakens the positive impact of self-efficacy on engagement. Study 2 generalizes the findings from Study 1 and provides broad support by testing the model using psychological climate in the financial services, tourism and hospitality, and retailing industries. This study closes with a configuration approach to climate research by discussing when multiple climates can co-exist under different types of resources.     

Demand-side inertia factors and their benefits for innovativeness

Inertia reflects a firm’s inability to change or innovate and may be fostered by many sources. Though researchers have focused on internal inertia factors, we examine inertia factors within a firm’s customer base: switching costs, customer preference stability, and network externalities. New products at 279 firms are examined to assess the role of these demand-side inertia factors in determining innovativeness and, ultimately, financial performance. The inertia factors are hypothesized to have differential innovativeness effects for early and late entrants. Overall, demand-side factors affect innovativeness positively, contrasting with firm-based factors (e.g., routines or assets), which typically inhibit innovativeness. Consumer preference stability is the only factor negatively related to innovativeness, though only for early entrants. Network externalities and switching costs increase innovativeness (particularly for early entrants). Demand-side inertia factors are critical determinants of innovativeness and may now be placed within the previously internally focused set of factors engendering early mover advantage.     

速度为王:国际化扩张速度与企业绩效的元分析

国际化扩张速度如何影响企业绩效是国际商务领域的一个新兴话题.本文收集整理了1990-2020年的38篇独立研究文献,采用元分析方法探讨国际化扩张速度及其子维度与企业绩效之间的关系,以及影响这一关系的边界条件.研究结果表明,国际化扩张速度会提升企业绩效,但这一关系受到特定的边界条件的制约.当跨国公司来自新兴市场国家时,基...     

Offshoring and international competitiveness: antecedents of offshoring advanced tasks

During the past decade, offshoring has become an established business practice. Yet it is still more common to offshore less advanced tasks compared with offshoring more advanced tasks, i.e., tasks closer to the core activities of the firm. The latter is a new phenomenon which raises many new issues on the boundaries of the firm. More or less advanced tasks can be found within all activities, e.g., in sales and marketing where telesales is on the less advanced end of the scale while branding and identity building are on the advanced end of the scale. This article focuses on the antecedents of advanced offshoring, exploring what causes firms to offshore some of their more advanced tasks. Our findings indicate that while the lower cost of unskilled, labor-intensive processes is the main driver for firms that offshore less advanced tasks, the offshoring of advanced tasks is part of firms’ strategy to achieve international competitiveness through access to cross-border knowledge flows and foreign knowledge resources. Furthermore, offshoring of advanced manufacturing tasks seems to be more widespread and experience-based than the offshoring of advanced service tasks.     

Do managers know what their customers think and why?

The ability of a firm’s managers to understand how its customers view the firm’s offerings and the drivers of those customer perceptions is fundamental in determining the success of marketing efforts. We investigate the extent to which managers’ perceptions of the levels and drivers of their customers’ satisfaction and loyalty align with that of their actual customers (along with customers’ expectations, quality, value, and complaints). From 70,000 American Customer Satisfaction Index (ACSI) customer surveys and 1068 firm (manager) responses from the ACSI-measured companies, our analyses suggest that managers generally fail to understand their firms’ customers in two important ways. First, managers systematically overestimate the levels of customer satisfaction and attitudinal loyalty, as well as the levels of key antecedent constructs such as expectations and perceived value. Second, managers’ understanding of the drivers of their customers’ satisfaction and loyalty are disconnected from those of their actual customers. Among the most significant “disconnects,” managers underestimate the importance of customer perceptions of quality in driving their satisfaction and of satisfaction in driving customers’ loyalty and complaint behavior. Our results indicate that firms must do more to ensure that managers understand how their customers perceive the firm’s products and services and why.