Volume 18, Issue 1

A third-order composite model of brand love prototype is tested using Partial Least Squares (PLS) in a service consumption business: branded coffee outlets. Notable differences are found between the brand love prototype for products reported in literature and a service. The differences reside in the self-brand integration dimension, long-term relationship, and attitude valence. The self-brand integration dimension appears to carry little weight, compared to all the other dimensions of the brand love prototype, in the service. Consumers purchase products that self-enhance their own image, but for services, the self-brand integration may be more challenging to be perceived as relevant.

This article strives to clarify the importance and the effects of cultural differences on consumer satisfaction after a service failure in an individualistic society (Canada) vs. a collectivistic society (Japan). We focus on young, educated consumers to analyze if the contrasts shown in the extant literature between these two cultures are still relevant in the case of young consumers of both cultures when confronted with a service failure and service recovery. We used 150 questionnaires from Japan and Canada, the design of which reflects our theoretical model. Respondents were asked to recall one of their own negative service experience and the service recovery that may have followed. Our statistical analysis is based on Hayes’s PROCESS that allows to test complex moderated and mediated relations. We find that Anger mediates the relation between failure severity and consumer behavioral responses (EXIT and NWOM) similarly for both Japanese and Canadian consumers. Importantly, compensation, involving procedural and distributive justice (i. e. time – speedy service recovery and money) both reduced consumer anger, more so for individualistic consumers. Surprisingly, interactional justice (e. g. courteousness, politeness, and signs of respect) had no impact on neither individualistic nor collectivistic consumers. Our findings suggest that service providers should first fix the negative emotional reactions as a result of service failure. They may reduce this emotional reaction offering monetary compensation to both Individualistic and Collectivistic consumers. Younger collectivistic consumers are not more sensitive to signs of respect and politeness than individualistic consumers, which may show that the younger generation of Japanese consumers is getting closer to the individualistic culture.

Reviewing and rating are important features of many social media websites, but they are found on many e-commerce sites too. The combination of social interaction and e-commerce is sometimes referred to as social commerce to indicate that people are supporting each other in the process of buying goods and services. Rgeviews of other consumers have a significant effect on consumer choice because they are usually considered authentic and more trustworthy than information presented by a vendor. The collaborative effort of consumers helps to make the right purchase decision (or prevent from a wrong one). The effect of reviews has often been researched in terms of helpfulness as indicated by their readers. Images are an important factor of helpfulness in reviews of experience goods where personal tastes and use play an important role. We extend this research to search goods where objective characteristics seem to prevail. In addition, we analyze potential interaction with other variables. The empirical study is performed with regression analyses on 3,483 search good reviews from Amazon.com followed by a matched pair analysis of 186 review pairs. We find that images have a significant positive effect on helpfulness of reviews of search goods too. This is especially true in case of short and ambiguous reviews.

This study examines the impact of contextual factors on brand trust, brand loyalty and cross-buying from the perspective of the bottom of pyramid rural consumers in India. Two important contextual factors – distribution intensity and outshopping orientation – were used as the contextual factors. Effects of distribution intensity in the initiation and maintenance of consumer–brand relationships are first examined. Further, it explores the moderating role of in versus outshopping orientation in the formation and maintenance of long-term relationships between consumers and brands in bottom of pyramid markets. Data collected from 478 consumers in three villages in Gujarat, India, were analysed using structural equation modelling technique to test the hypothesized relationships using IBM AMOS 23 software. Distribution Intensity was found to positively influence brand trust. Brand trust was found to mediate the relationships between distribution intensity and brand loyalty and distribution intensity and cross buying. The importance of distribution intensity in relationship initiation was more pronounced for consumers who shopped from local retailers than those who did not. The study underlines the importance of distribution intensity of brands a relationship-based marketing strategy, especially in those products, where the switching costs are low. This study establishes the role of contextual factors in the formation and maintenance of consumer–brand relationships in the bottom of pyramid markets.

In some markets consumers seek exclusive consumption experiences, yet in these markets businesses sometimes market their goods widely and at low prices during an introduction period. We use a two-period game-theoretic model to provide a signaling explanation for this phenomenon. In our model, exclusivity-seeking consumers must infer product quality from its price and level of exclusivity in the initial stage. After purchase consumers communicate the true learned quality through word-of-mouth (WOM) so that the entire market becomes informed, including a group of new consumers whose size depends on the number of introductory purchasers and the strength of WOM. We show that a high-quality seller signals by marketing widely when the desire for exclusivity is intermediate and WOM is strong.

This paper aims to introduce loyalty as a relevant mediator construct on the relation between relationship marketing and intangible resources. This study tests a hypothesized model using partial least squares structural equation modeling on data from a survey conducted with Portuguese footwear industry companies based in Portugal. Findings provides evidence that in the perception of top managers, (1) relationship marketing positively influences customer loyalty, (2) customer loyalty positively influences the company’s intangible resources and (3) customer loyalty has a mediating effect between relationship marketing and intangible resources. Generally, managers can use this research to rethink their corporate relationship marketing strategies: companies may acquire meaningful market benefits through a systematic reconfiguration of their intangible resources, combined with measures that empower loyalty. This study contributes to marketing theory by conceptualizing loyalty as a mediator variable on the relations between relationship marketing and intangible resources, comprising a pioneering application to the footwear industry.

Despite the widely acknowledged existence in practice, the theoretical literature on persuasive advertising is generally vague about exactly how such advertising could affect consumer preferences, except for the general assumption that persuasive advertising affects consumer willingness to pay or simply “shifts demand.” This paper proposes a theoretical framework for characterizing different ways that persuasive advertising may affect consumer utility in a vertically differentiated marketplace. Firstly, persuasive advertising could simply raise consumers’ reservation price for the product category. Secondly, persuasive advertising could enhance consumers’ perception about the product quality offered by the advertising firm. Thirdly, persuasive advertising could increase consumers’ willingness to pay for quality increment. Preliminary evidences from lab studies are presented to support the existences of the proposed effects. Using a game-theoretic approach, we study two firms’ decision in the adoption of persuasive advertising of a particular effect and the associated price competition. Findings from the theoretical model analyses indicate that factors influencing a firm’s decision in persuasive advertising include consumer heterogeneity, degree of product differentiation, the effectiveness and the cost of such advertising. In a vertically differentiated competitive marketplace, persuasive adverting is a more desirable strategic tool for firms of higher-quality products to further establish a competitive advantage.