Do managers know what their customers think and why?

Abstract

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). With 70,000 customer surveys from the American Customer Satisfaction Index (ACSI) and 1,068 firm (manager) responses from the ACSI-measured companies, we were able to match, on average, 250 customers and 11 senior managers for each of the n=97 firms studied that had matching data. 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.

Experiential tourist shopping value: Adding causality to value dimensions and testing their subjectivity

“…Second, the literature recognizes PLS as being a good method for estimating measurement models that include reflective indicators (Leroi‐Werelds et al, ; Martín‐Ruiz et al, ), as does our model. Third, PLS relies on ordinary least squares estimation, thereby relaxing the assumption of multivariate normality underlying covariance‐based methods (Hair, Sarstedt, Ringle, & Mena, ; Hult, Morgeson, Morgan, Mithas, & Fornell, ). It is therefore considered as a “soft technique,” but as Lohmoeller (), p. 64) himself noted, “it is not the concepts nor the models nor the estimation techniques which are ‘soft,’ only the distributional assumptions.” Its suitability for avoiding colinearity problems such as the nonassumption of the hypothesis on variable distribution makes it a good alternative to the more common LISREL or EQS programs (Geladi, ; Geladi & Kowalski, ).…”

“…A nonprobabilistic purposeful sample (Teddlie & Yu, 2007) was obtained from the population of interest in this study: shopping tourists in Valencia. As in the previous works on retailing mentioned in Table 1 (e.g., Guo et al, 2006;Sullivan, Kang, et al, 2012b;Yüksel, 2007), the mall intercept method was used to collect data, providing a systematic means of interviewing respondents (Frechtling, 2006 (Hair, Sarstedt, Ringle, & Mena, 2012;Hult, Morgeson, Morgan, Mithas, & Fornell, 2017). It is therefore considered as a "soft technique," but as Lohmoeller (1989), p. 64) himself noted, "it is not the concepts nor the models nor the estimation techniques which are 'soft,' only the distributional assumptions."…”

Critical reflections on the marketing concept and consumer sovereignty

“…Fournier, 1998). They are less satisfied with the services being provided by firms and exhibit far less loyalty than management desire (Hult et al, 2017). People, in other words, do not envisage themselves having relationships with most organisations in the vivid terms practitioners fetishize (O'Malley & Prothero, 2004).…”

“…Was the product a financially viable proposition for the firm? Marketers sometimes get these questions badly wrong (Hult et al, 2017).…”

Making the Customer Orientation of Salespeople Unsustainable—The Moderating Effect of Emotional Exhaustion

“…Highly diverse customer demand drives managers that are eager to know what customers think and want. Customer orientation is an effective way to gain sustainable profit for the company [1,2]. Contrary to selling orientation, customer orientation emphasizes meeting the customers' needs and avoids sacrificing customer benefit for long-term customer relationships [3], which usually leads to high job performance in a sustainable way [4,5].…”