qut digital repository: towards the firm as consequences. ... [colgate and danaher, 2000]. not only...
TRANSCRIPT
QUT Digital Repository: http://eprints.qut.edu.au/
Beatson, Amanda T. and Lings, Ian and Gudergan, Siegfried (2008) Employee behaviour and relationship quality : impact on customers. The Service Industries Journal, 28(2). pp. 211-223.
© Copyright 2008 Routledge
1
EMPLOYEE BEHAVIOUR AND RELATIONSHIP QUALITY: IMPACT ON
CUSTOMERS
AMANDA BEATSON
IAN LINGS
SIEGFRIED GUDERGAN
2
EMPLOYEE BEHAVIOUR AND RELATIONSHIP QUALITY: IMPACT ON
CUSTOMERS
Summary
This paper examines relationship quality as a multidimensional metaconstruct
comprising three dimensions; satisfaction, trust and commitment. The role of
relationship quality in its nomological network with service orientation as an
antecedent construct and consumers’ positive behavioural intentions, perceived
switching costs and activism as the consequences is explored. Survey data from 728
travellers are used employing structural equations modelling to test this
conceptualisation. We find that service orientation affects relationship satisfaction
and trust, and that the latter influences satisfaction and commitment. In turn,
satisfaction, trust and commitment have a positive impact on positive behavioural
intentions, trust a negative one on activism, and commitment a positive one on
perceived switching costs. The implications of this conceptual and empirical
understanding of relationship quality are discussed and directions for future research
presented.
Keywords: Services, Relationship Quality, Trust, Satisfaction, Commitment, Service
Orientation, Behavioural Intentions
3
EMPLOYEE BEHAVIOUR AND RELATIONSHIP QUALITY: IMPACT ON
CUSTOMERS
1. INTRODUCTION
Relationship marketing is well recognised as being at the forefront of marketing practice and
academic marketing research [Berry, 1995; Hennig-Thurau, Langer and Hansen, 2001]. This
is even more so in the area of services marketing as consumers may seek on-going
relationships with service providers to reduce the perceived risk associated with the
consumption of services such as intangibility and credence factors [Hennig-Thurau et al.,
2001; Wong and Sohal, 2002]. Successful relationship marketing is well established as a
strategy for increasing customer retention, and implementing such a strategy provides firms
with a sustainable competitive advantage [Anderson and Narus, 1990; Roberts, Varki and
Brodie, 2003]. There has been less work examining the nature and impact of relationship
marketing, its organisational antecedents and consequences for consumer behaviour in the
context of consumer markets compared with business to business markets [Beatty, Mayer,
Coleman, Reynolds and Lee, 1996; De Wulf, Odekerken-Schroder and Iacobucci, 2001].
Understanding the relationship from the customer’s perspective, however, has been identified
as an important area of marketing research and given the importance of relationships in a
service context, this paper aims to investigate the quality of the relationship between the
customer and the service organisation from the customer’s perspective within the travel
industry [De Wulf et al., 2001; Gwinner, Gremler and Bitner, 1998; Hennig-Thurau, Gwinner
and Gremler, 2002].
Cross sea passenger transport was chosen as the research context, as this segment of the travel
industry market offers essentially undifferentiated core service benefits (transport between
4
ports at similar prices) with no contractual or incentive obligation such as frequent flyer
points, for customers to remain with the service provider. Consequently, variations in repeat
purchase are expected to arise from relationship quality rather than price competition, or
contractual obligation [see for example Roberts et al., 2003]. To more fully understand the
role of relationship quality in this context, we investigate a wider nomological network with
service orientation as an antecedent to relationship quality and consumers’ attitudes and
behaviours towards the firm as consequences.
2. CONCEPTUAL FRAMEWORK
Retaining customers has become an important goal for organisations. This has increased
academic interest in relationship marketing [Colgate and Danaher, 2000]. Not only can
customer retention result in long run benefits for the firm, it also offers certain psychological,
social and economic benefits for customers [Gwinner et al., 1998]. In a consumer market
context, the interaction of consumers with front line staff becomes paramount in determining
the quality of the relationship as consumers often do not differentiate between the person
providing the service and the organisation [Bitner, 1990]. In order for service organisations to
compete more effectively it behoves them to better understand the nature of service
relationships from the consumers’ perspective [De Wulf et al., 2001; Gwinner et al., 1998].
Key questions to be answered are: how are consumers’ perceptions of the quality of their
relationships with service providers formed, and what are the consequences of high quality
relationships for the firm?
Roberts et al. [2003] define relationship quality as ‘a measure of the extent to which
consumers want to maintain relationships with their service providers’ [p. 191]. Relationship
5
quality focuses on the overall nature of the relationship between the consumer and the firm
and views fulfilling consumers’ needs as central to relationship success [Hennig-Thurau et al.,
2002].
Previous investigations have variously conceptualised relationship quality as either a higher
order construct or as a metaconstruct [See for example, De Wulf et al., 2001; Hennig-Thurau
et al., 2002]. Although there is no clear consensus on the most appropriate conceptualisation,
of relationship quality, there is general agreement that satisfaction, trust and commitment are
key dimensions of relationship quality [See for example, Crosby, Evans and Cowles, 1990;
De Wulf et al., 2001; Dorsch, Swanson and Kelley, 1998; Hennig-Thurau and Klee, 1997;
Hennig-Tharau et al., 2002; Roberts et al., 2003]. In other words, high quality relationships
are defined by high levels of satisfaction, trust and commitment [De Wulf et al., 2001]. One
major advantage of conceptualising relationship quality as a multidimensional metaconstruct
(rather than a higher order construct) is the opportunity that this provides to gain a deeper
understanding of the construct and relationships between its dimensions. Furthermore, such a
multidimensional conceptualisation, provides an opportunity to explore the relative impact of
each dimension on the outcomes of the relationship. Consequently, in this research we adopt
the conceptual approach proposed by Hennig-Thurau et al. [2002] who regard relationship
quality as a metaconstruct composed of three interrelated core dimensions (satisfaction, trust
and commitment).
In this study relationship-satisfaction is defined as consumers’ overall affect based evaluation
of the relationship with the provider. It is cumulative in that it develops over the course of the
relationship (as opposed to specific to each transaction) and is based on an evaluation of
interactions with a range of service staff and systems [Anderson, Fornell and Rust, 1997; De
6
Wulf et al., 2001]. Relationship-trust is defined as consumers’ confidence in the service
provider’s reliability and integrity and has similarities with the concept of trustworthiness [De
Wulf et al., 2001; Morgan and Hunt, 1994]. Relationship-commitment is conceptualised as
the consumer’s enduring desire to continue a relationship with a service provider because of a
liking or positive attitude, accompanied by this consumer’s willingness to make efforts at
maintaining the relationship [De Wulf et al., 2001; Morgan and Hunt, 1994]. Relationship-
commitment, in this context, represents the attitudinal element of consumer loyalty. These
three dimensions (satisfaction, trust and commitment) tap into the key facets of a successful
relationship.
Antecedents to Relationship Quality
It is well recognised in services marketing research that a link exists between employee
behaviours and consumer behaviour [see for example Bienstock, DeMoranville and Smith,
2003]. Employee behaviours such as organisational citizenship behaviour [Bienstock et al.,
2003], prosocial service behaviour [Bettencourt and Brown, 1997], customer orientation
[Bettencourt and Brown, 2003] and service orientation [Kelley, 1992; Lytle, Hom and
Mokwa, 1998] have all been related to positive consumer evaluations of the service
encounter. It is likely (given this association between employee behaviours and consumers’
evaluations of service encounters) that similar behaviours will also influence relationship
quality. Despite some research examining antecedents to relationship quality, such as
relationship investment [De Wulf et al., 2001], relational selling behaviour [Crosby et al.,
1990], and customer orientation [Wray, Palmer and Bejou, 1994], further research in this area
is necessary [Roberts et al., 2003]. Understanding the antecedents to positive relationships
7
will enable organisations to develop and implement strategies aimed at securing better
relationships with customers and developing and maintaining customer loyalty.
As an extension of previous studies, this research examines the impact of service orientation
on the dimensions of relationship quality. Service orientation captures customers’ perception
of the organisation’s service related policies and practices, as enacted by employees. It has its
conceptual grounding in the notion of organisational climate [Schneider and Bowen, 1985].
Service orientation is thought of as the organisation’s ‘climate for service’ [Kelley, 1992], and
exists when the organisation’s policies and practices are directed towards the delivery of
exceptional customer service [Lytle et al., 1998]. Service orientated policies and practices
will affect the attitudes and behaviours that service employees display towards customers. It is
the customers’ perceptions of these employee attitudes and behaviours that represent the
organisation’s service orientation in this context. These perceptions of service orientation
will, in turn, influence customers’ evaluations of their service experience. Consequently, if an
organisation has a high degree of service orientation, it will be committed to delivering
excellent service. Customers will then perceive this service orientation and will recognise
that the firm is trying to serve them well, this, in turn, will increase the likelihood that they
will trust the firm, develop a positive affect to the firm, and will be satisfied with the firm,
that is, that they will report higher levels of relationship quality. Therefore it is proposed that;
H1: Customers’ perceptions of service orientation are directly related to their
perceptions of relationship quality, (H1a satisfaction; H1b trust; H1c commitment).
Outcomes of Relationship Quality
8
Relationship quality captures the attitudinal element of consumer loyalty through relationship
commitment. However, it is also important to capture the subsequent behavioural responses
arising from relationship quality. Organisations are interested in not only the positive attitudes
to the firm through relationships, but also the behavioural outcomes from these relationships.
What do they really result in for the firm? Is there an actual benefit to the firm that can be
understood in terms of consumer behaviour? Customers typically engage in a range of
behaviours towards the organisation, ranging from positive behaviours (from the firm’s
perspective) such as repeat purchase and firm advocacy, through inertia, and negative
behaviours (from the firm’s perspective) such as reducing purchase behaviour, negative word
of mouth and complaining to third parties. It is particularly important for organisations to
understand how these positive and negative behaviours arise and how to manage them.
Two positive behavioural outcomes of relationship quality are regularly identified in the
marketing literature. These are repeat purchase behaviour and positive word of mouth
communications [Hennig-Thurau et al., 2002]. Consumers who perceive that they have a
high quality relationship with their service provider are likely to repeat purchase from that
firm [De Wulf et al., 2001] and are likely to communicate their experiences to others within
their social network ,i.e. engage in positive word of mouth [Hennig-Thurau et al., 2002;
Reichheld, 1996; Roberts et al., 2003]. Measuring these behaviours involves observation of
respondents to capture the behaviours directly. Such observations are not always practical
and, in line with other research in this area, we conceptualise these positive outcomes for the
firm as positive behavioural intentions, and assume that the relationship between consumers’
intentions and behaviours is significant. Consequently, we hypothesise that the higher the
consumer’s perceptions of relationship quality, the higher their intentions to behave positively
towards the firm.
9
H2: Higher perceptions of relationship quality, (H2a satisfaction; H2b trust; H2c
commitment) lead to a higher level of positive behavioural intentions.
In addition to these positive behaviours, customers who are committed to a relationship with
an organisation are less likely to become activists against the company [Hoyer and MacInnis,
1997]. That is, they are unlikely to demonstrate negative behaviours towards the firm, such as
complaining to other customers and complaining to external agencies [Hoyer and MacInnis,
1997: 285]. When a consumer feels they are getting their requirements met through the
service provider, why would they feel the need to act in a negative way towards that provider?
Therefore it is hypothesised:
H3: Higher perceptions of relationship quality, (H3a satisfaction; H3b trust; H3c
commitment) lead to a lower level of activism against the company.
Previous research has identified that satisfaction with services increases consumers’
perceptions of the cost of switching suppliers [Gundlach, Achrol and Mentzer, 1995;
Patterson and Smith, 2003]. Such costs may take the form of continuity-, set-up-, or sunk
costs [Patterson and Smith, 2003], and are an important determinant of the likelihood that the
consumer will terminate the relationship or seek an alternative supplier [Morgan and Hunt,
1994]. We predict (given the association between relationship quality and consumers’
evaluations of service encounters), that consumers reporting higher levels of relationship
quality are likely to perceive higher switching costs than those who report low levels of
relationship quality. In essence, for customers experiencing a service relationship with a
supplier that is characterised by trust, liking and satisfaction, leaving this relationship will
represent a level of risk to them because another supplier may not fulfil their needs in the
10
same manner. Therefore, we hypothesise that perceptions of relationship quality will
positively influence perceptions of switching costs:
H4: Higher perceptions of relationship quality, (H4a satisfaction; H4b trust; H4c
commitment) will lead to higher perceived switching costs.
Relationship between satisfaction, trust and commitment
In line with the suggestions of Hennig-Thurau et al., [2002], we also explore the structural
relationships between the three dimensions of relationship quality. Morgan and Hunt [1994]
suggest that trust is a central tenet of relationships; it is seen as reducing consumer uncertainty
and vulnerability; especially important in services contexts [Berry, 1995; Hennig-Thurau et
al., 2002]. These benefits can create relationship efficiency through decreased transaction
costs which then help foster commitment to the relationship [Garbarino and Johnson, 1999;
Hennig-Thurau et al., 2002; Morgan and Hunt, 1994]. If a customer trusts their service firm
they are more likely to have a positive attachment to the firm. This gives rise to the following
hypothesis:
H5: A higher level of relationship trust will lead to a higher level of relationship
commitment.
Trust has also been found to have a positive impact on satisfaction [Anderson and Narus,
1990]. Higher levels of trust result in lower anxiety concerning the interaction and thus
greater satisfaction [Hennig-Thurau et al., 2002]. When a consumer believes that the firm is
honest in their dealings with them it is likely to result in the customer being more satisfaction
with that firm. Consequently:
11
H6: A higher level of relationship trust will lead to a higher level of relationship
satisfaction.
A positive relationship has also been reported between satisfaction and commitment [Oliver,
1999; Singh and Sirdeshmukh, 2000; Szymanski and Henard, 2001]. That is, those
consumers who are satisfied with their interactions with the organisation are provided with
repeated positive enforcement, thus creating positive emotional commitment bonds with the
organisation [Hennig-Thurau and Klee, 1997; Hennig-Thurau et al., 2002]. If a customer is
satisfied with the interactions they have with the firm they are more likely to have a positive
attitude or attachment toward that firm. Therefore it is hypothesised that:
H7: A higher level of relationship satisfaction will lead to a higher level of relationship
commitment.
3. RESEARCH METHODOLOGY
In order to collect data to examine the relationships between the constructs of interest in this
study, a questionnaire was designed employing measures adapted from existing marketing
and psychology scales. Specifically, relationship satisfaction was measured using a five point
semantic differential scale as recommended by Yi [1990], using items drawn from Ganesan
[1994]. Examples of the items used include satisfied/dissatisfied, pleased/displeased,
happy/unhappy. Relationship commitment was measured using five items adapted from
scales published by Garbarino and Johnson [1999] and Allen and Meyer [1990]. Example
items include “I feel a sense of belonging to (firm name)”, “I am committed to my
relationship with (firm name) because I like being associated with them”, and “I am loyal to
(firm name)”. Relationship trust, consumer activism, and positive behavioural intentions
12
were all measured using items modified from Roberts et al. [2003]. Examples of the items of
relationship trust are “ (firm name) is concerned about the welfare of its customers”, “ (firm
name) tries to understand customers’ problems when they arise”, “ (firm name) is honest with
its customers about any problems with its service”. Examples of the consumer activism items
include, “I am likely to complain to external agencies, such as trading standards or the media,
if I experience problems with (firm name)”, and “I am likely to complain to other customers if
I experience problems with (firm name)”. Positive behavioural intentions items included “I
am to encourage friends and relatives to do business with (firm name)”, “I am likely to say
positive things about (firm name) to other people”, “I am likely to keep purchasing from (firm
name) for another year”, and “I am willing to provide (firm name) with more information
about myself to help them to serve me better”.
Perceived switching cost items were modified from Gundlach et al., [1995] and Morgan and
Hunt [1994], examples include; “Moving to another carrier is not worth the effort”, and “I
would have to invest a lot of time and effort to find another carrier of equal standard”.
Service orientation was measured using items adapted from Lytle et al. [1998] and Saura et
al. [2005] and referred to the firm’s staff. Example items include: ‘They provide prompt
service’, ‘They are committed to serving customers’ and ‘They view interactions with me as
opportunities to please me’. With the exception of relationship satisfaction, all scales utilised
a seven point response options anchored at strongly agree and strongly disagree. As
mentioned relationship satisfaction was measured using a semantic differential scale. A full
list of items used in the study is provided in Table 2
Data were collected using a self-completion questionnaire, administered to business and
leisure travellers on a cross channel ferry, and collected from pre-specified pick up points.
13
Respondents were chosen using a customer intercept while they were on board the ferry, and
were asked to complete the questionnaire during their voyage. In total 808 questionnaires
were administered and 728 usable responses were received (effective response rate of
approximately 90%). This research context was chosen as, typically, the service offering is
undifferentiated, in terms of price, duration and comfort, between competitors operating the
same route. In this situation, any observed consumer loyalty is likely to be driven by
consumers’ evaluations of the service orientation of the service provider and consequent
quality of the service relationship.
4. RESULTS
Confirmatory factor analysis (CFA) within a structural equation modelling approach was used
to confirm the dimensionality of the scales for all constructs in the study. At this stage,
several items were removed from the scales to assure that items only captured the construct
that they were intended to, and to improve model fit. The final set of items for each scale is
illustrated in Table. 2. A random sample of 250 respondents was chosen from the data set.
The covariance matrix of the items capturing the constructs was analysed using LISREL 8.54
[Jöreskog and Sörbom, 2003]. Following the suggestions of Sharma [1996: 151] and Hair,
Anderson, Tatham and Black [1998: 605] maximum likelihood estimation was used. Fit
indices for the measurement model were as follows: χ2 = 281.317 (p = 0.973), df = 392, GFI =
0.925, AGFI = 0.908, St RMR = 0.0389.
Discriminant validity was tested following Fornell and Larcker [1981] and Anderson and
Gerbing [1988]. Evidence of discriminant validity is provided by a low to moderate
correlation among measures that are designed to measure conceptually different but related
constructs, i.e., a phi coefficient significantly less than one offers support for discriminant
14
validity between constructs [Anderson and Gerbing, 1988]. The correlations between the
constructs in the study were all in the range 0.17-0.72, indicating that the scales discriminate
between the constructs included in the study (see Table 1 below). Additional evidence of
discriminant validity is provided if the average variance explained by a construct's items is
greater than the construct's shared variance with every other construct [i.e., the square of the
inter-factor correlations between any two constructs (φ2), Fornell and Larcker, 1981]. This
test provided further evidence of discriminant validity. The inter-factor correlations (φ),
squares of the inter-factor correlations (φ2), and average variances extracted are reported in
Table 1 below.
[Take in Table 1]
Having established that each of the scales measuring various constructs do indeed
discriminate between these constructs, the next stage in the analysis was to examine
composite reliabilities of each of the scales [Gerbing and Anderson, 1988; Hair et al., 1998:
611]. These are reported in Table 2 and all exceed the recommended standards of both
Bagozzi, Yi and Phillips [1981] and Hair et al. [1998], and provide evidence of the internal
consistency of the construct indicators. This suggests that the scale items do indeed measure
the latent constructs that they purport to.
Fornell and Larcker [1981] suggest that variance extracted is a stringent test of internal
stability and convergent validity. Anderson and Gerbing [1988] offer an alternative heuristic,
that significant t-values support the convergent validity of scale items. Both approaches were
used to test the convergent validity of the scale items.
15
1. Examining the variances extracted for each of the scales adopted (Table 2), indicates that
all scales explain more than 50 per cent of the variance in the data for each of the
constructs, and so meet the test of convergent validity set by Fornell and Larcker [1981].
2. Also, all item loadings have significant t-values > 1.96, exceeding Anderson and
Gerbing’s [1988] heuristic. This suggests that the scale items adequately represent the
constructs that they purport to measure.
Overall these tests indicate that the scales used to measure the constructs of interest in this
study possess sufficient internal stability and validity to provide confidence that they measure
what they purport to.
[Take in Table 2]
The next stage in the analysis was to assess the structural model fit. The hypothesised
relationships in the model were tested simultaneously using structural equations modelling,
employing LISREL 8.54 [Jöreskog and Sörbom, 2003]. The full data set was used to test this
model. Model fit was assessed using several heuristics commonly published in the literature.
These goodness of fit indices suggest that the model fits the data well; χ2 = 301.256 (p =
0.901), df = 334, GFI = 0.920, AGFI = 0.903, St RMR = 0.044. The standardised path
coefficients as estimated by LISREL are given in Figure 1 below. Service orientation
explains more than 50 per cent of the variation in relationship trust, 42 per cent of the
variation in relationship commitment and 22 per cent of the variation in relationship
satisfaction. The model explains more than 56 per cent of the variation in positive
behavioural intentions and 27 per cent of the variation in consumer switching costs, however
only 9 per cent of the variation in consumer activism is explained by the proposed model.
16
One partial explanation for the relationships between the constructs in this study may be the
existence of systematic measurement error arising from the use of a single instrument to
simultaneously collect data on all constructs in the study. In order to test for such common
method bias, a Harman’s [1967] one-factor test was performed following the approach
described in Podsakoff et al. [1984] and Schriesheim [1979]. All of the self-report items were
entered into a principal components factor analysis with varimax rotation. According to this
technique, if a single-factor emerges from the factor analysis or one-factor accounts for more
than 50 per cent of the variance in the variables, common method variance is present [Mattila
and Enz, 2002]. Our analysis revealed a seven-factor structure with no general factor present
(the first factor accounted for 15 per cent of the variance). Although this test does not rule out
the presence of common method bias, combined with measures taken in the questionnaire
design to minimise acquiescence bias, it does provide support for the absence of such a
general bias in the findings [Mattila and Enz, 2002].
As illustrated in Figure 1. below the impact of service orientation on relationship satisfaction
and relationship trust is positive (H1a and H1b). Additionally relationship satisfaction is seen
to have a direct effect on positive behavioural intentions (H2a) as does relationship trust
(H2b) and relationship commitment (H2c). H3b is also supported (relationship trust having a
negative effect on consumer activism). Relationship commitment is also seen to increase the
perceived switching costs of consumers (H4c). Trust emerges as the focal dimension in
relationship quality as it impacts both satisfaction and commitment (supporting H5 and H6).
[Take in Figure 1]
17
5. DISCUSSION AND SUMMARY
This research addresses the call for additional investigation into the antecedents of
relationship quality [Roberts et al., 2003], and also examines some of the consequences of
high quality relationships for the firm. Additionally, the paper also explores the relationship
between the three dimensions of satisfaction, trust and commitment in the metaconstruct of
relationship quality [Hennig-Thurau et al., 2002]. We show that service orientation does,
indeed, act to increase consumers’ perceptions of relationship satisfaction and relationship
trust. Interestingly, however, it did not appear to increase consumers’ perceptions of
relationship commitment. Perhaps given the strong link between service orientation and the
other two dimensions of relationship quality particularly trust, these mask the relationship
with commitment. It could be said though just because a consumer perceives that a service
employee had their best interest at heart, it may not necessarily result in them being
committed to the organisation. The results do indicate that consumers’ perceptions of the
level of service orientation that organisations demonstrate have a positive impact on their
likelihood to trust and be satisfied with their relationship with the organisation. This implies
that service organisations should manage their customer interface to ensure that such
perceptions are facilitated. This will include adopting policies and practices that are directed
at allowing front line staff to deliver exceptional service to customers. Such policies may
include empowering employees [Thomas, 1998], training them [Jones and Sasser, 1996] and
implementing internal marketing to motivate them to deliver service excellence [Grönroos,
1985].
Furthermore this research adds support to previous studies examining the benefits of high
quality relationships with customers. Specifically we find that all three dimensions of
18
relationship quality lead to positive behavioural outcomes. This suggests that satisfaction,
trust and commitment all result in repeat purchase and positive word of mouth toward the
service providing organisation. This strongly indicates the importance of achieving high
levels of relationship quality with consumers as it is likely to result in them continuing to
purchase in the future and also saying good things about the organisation and encouraging
friends and relatives to purchase from that organisation in the future. Trust and commitment
were also found to relate to consumer activism in that higher levels of trust and commitment
are likely to result in lower levels of consumer activism (negative behaviours towards the
firm, including complaining to other customers and complaining to external agencies which is
an important goal for organisations) [Hoyer and MacInnis, 1997: 285]. Interestingly, high
levels of relationship commitment also resulted in lower levels of switching costs. This
suggests that consumers which have an emotional attachment to the organisation are more
likely to perceive a risk associated with switching to a competing provider. This risk could be
economic or psychological.
Regarding the relationship among satisfaction, trust and commitment in the metaconstruct of
relationship quality, trust emerges as the focal dimension in this construct as it has a direct
relationship with both satisfaction and commitment. This result is consistent with Morgan
and Hunt [1994] who highlight the importance of trust in relationship marketing, and in
particular its importance for creating satisfied and committed consumers. The importance of
relationship trust is also ascertained as it also appears to affect all three behavioural outcomes
directly and indirectly: positive behavioural intentions, consumer activism and perceived
switching costs.
19
Further replications of this work are necessary to examine the stability of these results in other
service contexts. Additionally, other cultural settings would also help increase further the
generalisability of the results. The use of dyadic data should also be considered for
replicating this work. Data about employee behaviour (service orientation) could be collected
directly from front line staff and linked to data collected from service customers regarding
their attitudes and behavioural intentions. This study serves to highlight the importance of
service employees in the establishment of consumer relationships with organisations and the
flow-on effect that these relationships have on consumer behaviour.
20
REFERENCES
Anderson, E.W., C. Fornell and R.T. Rust (1997) Customer Satisfaction, Productivity, and
Profitability: Differences Between Goods and Services, Marketing Science, 16(2),
pp.129-45.
Anderson, J.C. and J.A. Narus (1990) A Model of Distributor Firm and Manufacturer Firm
Working Partnerships, Journal of Marketing, 54(January), pp.42-58.
Anderson, J.C. and D.W. Gerbing (1988) Structural Equation Modeling in Practice: A Review
and Recommended Two-Step Approach, Psychological Bulletin, 103(3), pp.411-23.
Bagozzi, R.P., Y. Yi and L.W. Phillips (1991) Assessing construct validity in organizational
research, Administrative Science Quarterly, 36, pp.421-58
Barnes, J.G., (1997) Closeness, Strength and Satisfaction: Examining the Nature of
Relationships Between Providers of Financial Services and their Retail Customers,
Psychology and Marketing, 14(8), pp.765-90.
Beatty, S.E., M. Mayer, J.E. Coleman, K.E. Reynolds and J. Lee (1996) Customer-Sales
Associate Retail Relationships, Journal of Retailing, 72(3), pp.223-48.
Berry, L.L., (1995) Relationship Marketing if Services Growing Interest, Emerging
Perspectives, Journal of the Academy of Marketing Science, 23(Fall), pp.236-45.
Bettencourt, L.A. and S.W. Brown (1997) Contact Employees: Relationship among
Workplace Fairness, Job Satisfaction and Prosocial Service Behaviours, Journal of
Retailing, 73(1), pp.39-61.
Bettencourt, L.A. and S.W. Brown (2003) Role Stressors and Customer-oriented Boundary-
Spanning Behaviours in Service Organizations, Journal of the Academy of Marketing
Science, 31(4), pp.394-408.
21
Bienstock, C.C., C.W. DeMoranville and R.K. Smith (2003) Organizational Citizenship
Behaviour and Service Quality, Journal of Services Marketing, 17(4), pp.357-78.
Bitner, M.J., (1990) Evaluating Service Encounters: The Effects of Physical Surroundings and
Employee Responses, Journal of Marketing, 54(2), pp.69-82.
Brown, T.J., J.C. Mowen, D.T. Donavan and J.W. Licata (2002) The Customer Orientation of
Service Workers: Personality Trait Determinants and Effects on Self- and Supervisor
Performance Ratings, Journal of Marketing Research, 39(Feb), pp.110–19
Colgate, M.R. and P.J. Danaher (2000) Implementing a Customer Relationship Strategy: The
Asymmetric Impact of Poor versus Excellent Execution, Journal of the Academy of
Marketing Science, 28(3), pp.375-87.
Crosby, L.A., K.R. Evans and D. Cowles (1990) Relationship Quality in Services Selling: An
Interpersonal Influence Perspective, Journal of Marketing, 54(July), pp.68-91.
De Wulf, K., G. Odekerken-Schroder and D. Iacobucci (2001) Investments in Consumer
Relationships: A Cross-country and Cross-industry Exploration, Journal of Marketing,
65(4), pp.33-50.
Donnovan D.T., T.J. Brown and J.C. Mowen (2004) Internal Benefits of Service-worker
Customer Orientation: Job Satisfaction, Commitment and Organizational Citizenship
Behaviours, Journal of Marketing, 68(Jan), pp.128-46
Dorsch, M.J., S.R. Swanson and S.W. Kelley (1998) The Role of Relationship Quality in the
Stratification of Vendors as Perceived by Customers, Journal of the Academy of
Marketing Science, 26(2), pp.128-42.
Fornell, C. and D. Larcker (1981) Evaluating Structural Equations Models with Unobserved
Variables and Measurement Error, Journal of Marketing Research, 18(February),
pp.39-50.
22
Ganesan, S., (1994) Determinants of Long-term Orientation in Buyer-Seller Relationships,
Journal of Marketing, 58(April), pp.1-19.
Garbarino, E. and M.S. Johnson (1999) The Different Roles of Satisfaction, Trust, and
Commitment in Customer Relationships, Journal of Marketing, 63(April), pp.70-87.
Gerbing, D. W. and J. C. Anderson (1988) An Updated Paradigm for Scale Development
Incorporating Unidimensionality and Its Assessment, Journal of Marketing Research,
XXV (may), pp. 186-192.
Grönroos, C., (1985) Internal Marketing: Theory and Practice, in T.M. Bloch, G.D. Upah and
V.A. Zeithaml (eds.), Services Marketing in a Changing Environment, Chicago:
American Marketing Association.
Gundlach, G.T., R.S. Achrol and J.T. Mentzer (1995) The Structure of Commitment in
Exchange, Journal of Marketing, 59(January), pp.78-92.
Gwinner, K.P., D.D. Gremler and M.J. Bitner (1998) Relational Benefits in Services
Industries: The Customer’s Perspective, Journal of the Academy of Marketing Science,
26(2), pp.101-14.
Hair, J.F., R.E. Anderson, R.L. Tatham and W.C. Black (1998) Multivariate Data Analysis,
Sydney: Prentice Hall.
Harman H.H. (1967) Modern Factor Analysis, Chicago, University of Chicago Press.
Hennig-Thurau, T., K.P. Gwinner and D.D. Gremler (2002) Understanding Relationship
Marketing Outcomes: An Integration of Relational Benefits and Relationship Quality,
Journal of Service Research, 4(3), pp.230-47.
Hennig-Thurau, T. and A. Klee (1997) The Impact of Customer Satisfaction and Relationship
Quality on Customer Retention: A Critical Reassessment and Model Development,
Psychology and Marketing, 14(8), pp.737-64.
23
Hennig-Thurau, T., M.K. Langer and U. Hansen (2001) Modeling and Managing Student
Loyalty: An Approach Based on the Concept of Relationship Quality, Journal of
Service Research, 3(4), pp.331-44.
Hogan, J., R. Hogan, and C.M. Busch (1984) How to Measure Service Orientation, Journal of
Applied Psychology, 69(1), pp.167-73.
Hoyer W.D. and D.J. MacInnis (1997) Consumer Behavior, Boston: Houghton Mifflin.
Hurley, R. F., (1998) Customer Service Behavior in Retail Settings: A Study of the Effect of
Service Provider Personality, Journal of the Academy of Marketing Science, 26
(Spring), pp.115-28.
Jones, T.O. and W.E. Sasser (1996) Why Satisfied Customers Defect, in F. Reicheld (ed.),
The Quest for Loyalty, 7th edition, Boston: Harvard Business Review Book Series.
Jöreskog, K.G. and D. Sörbom (2003) Lisrel 8.54 Chicago, IL. Scientific Software
International, Inc,
Kelley, S.W., (1992) Developing Customer Orientation Among Service Employees, Journal
of the Academy of Marketing Science, 20(1), pp.27-36.
Lytle, R.S., P.M. Hom and M.P. Mokwa (1998) SERV*OR: A Managerial Measure of
Service-Orientation, Journal of Retailing, 74(4), pp.455-89.
Matilla, A.S. and C.A. Enz (2002) The Role of Emotions in Service Encounters, Journal of
Service Research, 4(4), pp.268-77.
Morgan, R.M. and S.D. Hunt (1994) The Commitment-Trust Theory of Relationship
Marketing, Journal of Marketing, 58(October), pp.20-38.
Oliver, R.L., (1999) Whence Customer Loyalty, Journal of Marketing, 63, pp.33-44.
Patterson, P.G. and T. Smith (2003) A Cross-cultural Study of Switching Barriers and
Propensity to Stay with Service Providers, Journal of Retailing, 79, pp.107-20
24
Podsakoff, P.M., W.D. Todor, R.A. Grover. V.L. Huber (1984) Situational Moderators of
leader Support and Punishment behaviours: fact or Fiction. Organizational Behavior
and Human Decision Processes 34(1), 21-63
Reichheld, F., (1996) The Loyalty Effect: The Hidden Force Behind Growth, Profits and
Lasting Value, Boston: Harvard Business School Press.
Roberts, K., S. Varki and R. Brodie (2003) Measuring the Quality of Relationships in
Consumer Services: An Empirical Study, European Journal of Marketing, 37(1/2),
pp.169-96.
Saura, I.G., G.B. Contrí,, A. C. Taulet, and B. M. Velázquez (2005), Relationships Among
Customer Orientation, Service Orientation and Job Satisfaction in Financial Services,
International Journal of Service Industry Management, 16 (5), pp. 497-525
Schneider, B. and D.E. Bowen (1985) Employee and Customer Perceptions of Service in
Banks: Replication and Extension, Journal of Applied Psychology, 70(3), pp.423-33.
Schreisheim C.A. (1979) The Similarity of Individual Directed and Group Directed Leader
Behavior Descriptions, Academy of Management Journal, 22(2), pp.345-55
Singh, J. and D. Sirdeshmukh (2000) Agency and Trust Mechanisms in Consumer
Satisfaction and Loyalty Judgments, Journal of the Academy of Marketing Science, 28 (1), pp.
150-167.
Sharma, S (1996) Applied Multivariate Techniques, New Jersey: Wiley and Sons, Inc.
Szymanski, D.M. and D.H. Henard (2001) Customer Satisfaction: A Meta-Analysis of the
Empirical Evidence, Journal of the Academy of Marketing Science, 29(1), pp.16-35.
Thomas M.J., (1998) Marketing Performance Measurement: Adding Value and Meta-value,
in P. Andersson (ed.), Marketing Research and Practice, The Proceedings of the 27th
EMAC conference in Stockholm, May 20-23, Vol. 5, 355-374
25
Wong, A. and A. Sohal (2002) An Examination of the Relationship Between Trust,
Commitment and Relationship Quality, International Journal of Retail and Distribution
Management, 30 (1), pp. 34-50.
Wray, B., A. Palmer and D. Bejou (1994) Using Neural Network Analysis to Evaluate Buyer-
Seller Relationships, European Journal of Marketing, 28, pp.32-48.
Yi, Y., (1990) A Critical Review of Consumer Satisfaction, in V.A. Zeithaml (ed.), Review of
Marketing, Chicago: American Marketing Association.
26
TABLE 1
DISCRIMINANT VALIDITY OF SCALES
Service Orientation Trust Satisfaction Commitment
Positive BehaviouralIntentions
Activism Switching Costs
Average variance extracted
Service Orientation 0.745 0.785 0.770 0.750 0.62 0.690
Trust φ=0.720 (φ2=0.518) 0.810 0.795 0.775 0.645 0.715
Satisfaction φ=0.427 (φ2=0.182)
φ=0.461 (φ2=0.213) 0.835 0.885 0.685 0.755
Commitment φ=0.481 (φ2=0.231)
φ=0.647 (φ2=0.419)
φ=0.223 (φ2=0.050) 0.800 0.620 0.740
Positive Behavioural Intentions
φ=0.616 (φ2=0.379)
φ=0.694 (φ2=0.485)
φ=0.518 (φ2=0.268)
φ=0.573 (φ2=0.328) 0.650 0.720
Activism φ=-0.243 (φ2=0.060)
φ=-0.286 (φ2=0.082)
φ=0.-168 (φ2=0.028)
φ=-0.261 (φ2=0.068)
φ=0.-255 (φ2=0.065) 0.590
Switching Costs φ=0.322 (φ2=0.104)
φ=0.400 (φ2=0.160)
φ=0.171 (φ2=0.029)
φ=0.513 (φ2=0.263)
φ=0.335 (φ2=0.112)
φ=0.300 (φ2=0.090)
Inter-factor correlations((φ) [Square of inter-factor correlations(φ2)]
27
TABLE 2
COMPOSITE RELIABILITY AND VARIANCE EXTRACTED OF SCALES
Composite Reliability
Variance Extracted
Service Orientation They view interactions with me as opportunities to please me.
0.93 0.72 They provide a prompt service. They have a reputation for good service. They are committed to serving customers. They view serving customer as a priority. Relationship Commitment I am loyal to (firm name).
0.95 0.82
I am committed to my relationship with (firm name). because I like being associated with them. I feel strongly attached to (firm name).. I would like to develop a long term relationship with (firm name).. I feel a sense of belonging to (firm name).. Relationship Trust (Firm name). is honest with its customers about any problems with its service.
0.94 0.77
Customers can trust (firm name).. (Firm name). is concerned about the welfare of its customers. (Firm name). tries to understand customers' problems when they arise. (Firm name). tries to understand how its actions will affect its customers. Relationship Satisfaction (semantic differential) Satisfied/dissatisfied
0.95 0.85 Please/displeased Happy/unhappy Resentful/not at all resentful (R) Activism Switch to a competitor if I experience problems with the services of (firm name).
0.76 0.52 Complain to external agencies, such as trading standards or the media, if I experience problems with (firm name). Complain to other customers if I experience problems with (firm name). Positive Behavioural Intentions Say positive things about (firm name). to other people.
0.91 0.78 Encourage friends and relatives to do business with (firm name). Keep purchasing from (firm name). for another year. Perceived Switching Costs I would have to invest a lot of time and effort to find another carrier of equal standard.
0.86 066 Moving to another carrier is not worth the effort. In general it would be inconvenient to change to another carrier.
28
FIGURE 1
CONCEPTUAL MODEL DISPLAYING HYPOTHESISED PATHS
ServiceOrientation
SwitchingCosts
Activism
PositiveBehaviouralIntentions
Satisfaction
Commitment
Trust0.428
0.218
0.174
0.714
0.665
0.331
0.451
-0.193
0.259
Note: numbers are standardised coefficientsDotted line signifies non significant path (P<0.05)