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PurposeThe purpose of this study is to examine the concept of customer value and its role in building switching costs perceptions. The current research develops scales and empirically validates a typology of customer value for business services.Design/methodolgy/approachThrough an extensive literature review, qualitative interviews, and an empirical investigation, the current study identifies three facets of customer value for business services (i.e. economic value, relational value, and core value) and investigates their relationships with buyers' perceptions of switching costs. Structural equation modeling techniques were used to evaluate a measurement model and structural relationships.FindingsThe findings show that economic value and the value obtained from relational and support aspects of a service exert strong positive impact on customers' perceptions of switching costs and thus serve as barriers to exit. Although core service does not seem to have positive impact on switching costs, core value maybe a “hygiene” factor that may promote customers' switching if not properly managed.Research limitations/implicationsThe results of this study are generated from a single industry; additional studies in other industries may strengthen the generalizability of the proposed constructs and framework.Practical implicationsBusiness suppliers need to build exit barriers through co‐creating relational value. Through communications, suppliers may be able to monitor customers' desired value as a proactive action to anticipate changes and to influence positive changes in customer value.Originality/valueThe current study sheds some light on how supplier firms can enhance switching costs, and consequently raise exit barriers by better managing various aspects of customer value perceptions.

Purpose This study examines the potential of foreign business-to-business (B2B) firms to select high-status local partners in emerging markets to achieve positive relationship outcomes. Because a domestic firm’s high status may also promote opportunism, the study also examines if the foreign B2B firms may mitigate such behavior through either or both transaction-specific investments (TSIs) and socialization. Design/methodology/approach The research is conducted via a model that suggests a positive correlation between high local partner status and the focal relationship outcomes and the moderating effects of structural TSIs and social governance systems. The model was developed and empirically tested using data collected from 96 foreign firms operating in China. Findings Using multiple regressions, the findings suggest that foreign B2B firms are likely to achieve more beneficial relationship outcomes with high-status local partners. Standing alone, foreign B2B firms’ TSIs mitigate the positive relationship outcomes, whereas their socialization with the high-status partners enhances the beneficial outcomes. Most importantly, combining socialization with TSIs increases beneficial outcomes. Research limitations/implications This study adds to B2B marketing, status theory and the application of transaction cost economics (TCE) and social exchange theory to foreign-local B2B exchange relationships in emerging markets. The findings confirm the attractiveness of high status in emerging markets by exploring how the selection, formation and chosen B2B governance processes may lead to competing outcomes of opportunism or success. Future research will benefit from simultaneously securing data from both sides of the dyad. Practical implications The paper suggests that foreign B2B firms consider high status as a key criterion in selecting local partners in emerging markets and the importance of managing high-status partners’ potential opportunism by effective governance mechanisms. Originality/value This study is one of the first to apply and explore the workings of status theory in the foreign-local B2B partner selection process and relationship outcomes in emerging markets and thereby contributes to B2B marketing, status theory and both TCE and social exchange theories in the focal foreign-local B2B context.

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