Assessing the effects of multichannel service provider corporate reputation on customer new product adoption and RFM value

Abstract

Purpose Service providers leverage their corporate reputation management efforts to increase revenues by shaping customer attitudes and behaviours, yet the effects on customer innovation adoption and customer value remain unclear. In an extended conceptualisation of customer-based corporate reputation (CBR), the purpose of this paper is to propose that customer perceived risk, perceived value, and service separation are contingencies of the relationship between CBR and two key customer outcomes: customer new product adoption proneness (CPA) and recency-frequency-monetary (RFM) value. Design/methodology/approach Using a predictive survey approach, 1,001 service customers assess the online or offline operations of six multichannel retailers. The hypothesised model is tested using structural equation modelling and multigroup analysis. Findings The analysis reveals significant linkages of CBR with perceived risk and perceived value, as well as between perceived risk and perceived value and from perceived value to CPA and RFM value. These linkages vary in strength across unseparated (offline) and separated (online) services. Research limitations/implications This study uses cross-sectional data to contribute to literature that relates CBR to relevant customer outcomes by considering CPA and RFM value and investigating contingent factors. It provides conceptual and empirical evidence that price appropriateness represents a new CBR dimension. Practical implications The results reveal that CBR reduces customers’ perceived risk and positively affects their perceived value, which drives CPA and RFM value. Multichannel retailers can create rewarding customer relationships by building and nurturing good reputations. Originality/value This study is the first to link CBR with customer product adoption proneness and value, two important customer measures. It proposes and tests an extended conceptualisation of CBR.

Discriminant validity of the customer-based corporate reputation scale: some causes for concern

“…The Fornell and Larcker (1981) criterion does not indicate discriminant validity problems between any of the ten possible pairs of constructs per sample. In line with previous findings in the literature (Swoboda et al , 2016; Walsh et al , 2018), these results show that the CBR short scale exhibits good psychometric properties with regard to the distinctiveness (i.e. discriminant validity) of the five corporate reputation dimensions.…”

Buffering the service failure-induced effect of anger on revenge

“…We also demonstrate that a good corporate reputation can buffer the effect of anger on revenge intentions. This finding is consistent with the notion that a good reputation provides a goodwill reservoir and causes customers to think that service failures are the exception rather than the rule (Sengupta et al, 2015;Walsh et al, 2018). Finally, we show that when customers endure silently, the link between their anger and their revenge intentions is weaker than it is for other customers.…”

“…In other words, a good reputation convinces the customer to think "that the service failure is an aberration" (Sengupta et al, 2015, p. 668). Moreover, firms with a good reputation can create a goodwill reservoir for themselves (Walsh and Beatty, 2007;Walsh et al, 2018), which may make customers more forgiving of service failures. In this sense, CBR should insulate the firm against failure-induced negative consequences (Hess, 2008):…”

Moderating effects of service separation on customer relationships with service firms

“…Given the importance of these new technologies to the service operation a body of research investigating the potential effects of service separation that accompanies SSTs has begun to emerge (e.g. Keh and Pang, 2010;Paluch and Blut, 2013;Green, Hartley and Gillespie, 2016;Hartley and Green 2017;Walsh, Schaarschmidt and Ivens, 2018). Keh and Pang (2010) examine the effects of spatial separation (i.e.…”

“…The limited research shows service separation to play a moderating role during the service encounter (e.g. Walsh, Schaarschmidt and Ivens, 2018;Zhou et al, 2014) and a promising avenue to pursue as much of the empirical RM literature that has been grounded in social exchange (SE) (e.g. Kingshott and Pecotich, 2007;Morgan and Hunt, 1994) signifies that successful relationships are largely a function of the personal interactions between service employees and customers.…”