Peter J. Danaher

How Firms Relate to Their Markets: An Empirical Examination of Contemporary Marketing Practices

The authors examine 308 firms in the United States and four other Western countries to understand how different types of firms relate to their markets. Comparative analysis shows that though there is some support for consumer and goods firms being more transactional and business and service firms being more relational, there are many exceptions. The results also show that firms can be grouped into those whose marketing practices are predominantly transactional, predominantly relational, or a transactional/relational hybrid. Each group constitutes approximately one-third of the sample and includes all types of firms (consumer goods, consumer services, business-to-business goods, and business-to-business services). This suggests that marketing practices are pluralistic and managerial practice has not shifted from transactional to relational approaches per se.

Implementing a Customer Relationship Strategy: The Asymmetric Impact of Poor versus Excellent Execution

The benefits of developing customer relationships are well established. However, a well-intentioned relationship marketing strategy may fail because of poor implementation. In this study, the authors look at the effects of implementing a customer relationship strategy. Specifically, they examine the implementation of a personal-banker strategy as a means to developing customer relationships in the retail banking industry. The authors show that an “excellent” personal banker can increase overall customer satisfaction and loyalty compared to customers who do not have a personal banker. However, a poorly performing personal banker can result in lower overall customer satisfaction and loyalty than if no personal banker had been available. Moreover, the effects seem to be asymmetric, with the negative effects of a poor relationship strategy exceeding the positive benefits ofan “excellent” strategy.

A comparison of question scales used for measuring customer satisfaction

Many different scales have been used to measure customer satisfaction. These scales can be divided into three main groups, being those measuring performance, disconfirmation and satisfaction. Reports on the design and execution of a study of hotel guests in which they were asked to rate the key service attributes of their stay using all three of these measurement scales. Repurchase intention and word‐of‐mouth effects were also measured. Compares the scales on the basis of reliability, convergent and discriminant validity, predictive validity, skewness, face validity and managerial value for directing a quality improvement programme. Shows the disconfirmation scale to be superior to both the performance and satisfaction scales on all these criteria except for predictive validity. In addition, the performance scale was generally better than the satisfaction scale on a number of these criteria.

Customer Satisfaction during the Service Delivery Process

Prior studies of how service quality evolves during the service delivery process have used aggregate case data in retrospect or have not obtained objective measures of the actual dimensions of the service encounter on an individual basis. Reports on a study of an actual hotel service delivery process partitioned into five distinct service encounters; check‐in, the room, the restaurant, the breakfast and check‐out. The aim was to investigate how quality factors were related to their respective encounters and how cumulative satisfaction levels impact on each other and over time. Average satisfaction levels for each of the five encounters were found to be significantly different. Moreover, there was a clear trend in the cumulative satisfaction results. Check‐in resulted in high satisfaction, the room was not so satisfying and the restaurant rated the worst. Satisfaction scores rose after the breakfast experience and rose again after check‐out. A factor analysis of all the questions, for a hypothesized five‐f...

Factors Affecting Online Advertising Recall: A Study of Students

In this article we examine factors that might impact on web advertising recall and recognition. These factors include the viewing mode, duration of page viewing, and web page context factors, including text and page background complexity and the style of the banner advertisement. Via an experimental design conducted on a student sample, we manipulate these factors over several levels. The key finding is that the longer a person is exposed to a web page containing a banner advertisement, the more likely they are to remember that banner advertisement. We also find that recognition scores are much higher than both unaided and aided recall scores. Finally, web users in a goal-directed mode are much less likely to recall and recognize banner advertisements than users who are surfing a site.

Marketing-Mix Variables and the Diffusion of Successive Generations of a Technological Innovation

Research addressing the diffusion of successive generations of technological innovations has generally ignored the impact of marketing-mix variables. As a result, there have been several calls for the development of multiple-generation models that incorporate marketing-mix variables. The authors develop a model of first-time sales and subscriptions for successive generations of a technological innovation, which explicitly captures the effects of marketing-mix variables through a proportional hazards framework. The empirical analysis estimates the impact of price for two generations of cellular telephones in a European country. The results suggest that there are important substantive insights to be gained from the parameter estimates for this marketing-mix variable when intergenerational interdependencies are considered. For example, although the time path of the estimated price elasticities in a multiple-generation setting closely follows those reported previously for single generations, the authors find evidence of an important interaction in price response across generations. Therefore, empirical estimates in single-generation models may be missing an important part of the pricing equation.

Using conjoint analysis to determine the relative importance of service attributes measured in customer satisfaction surveys

Abstract Determining the relative importance of service attributes is one of the most important objectives of customer satisfaction measurement. Two popular methods that are currently used are “gap analysis” of expectations minus performance and linear regression of the overall satisfaction rating on the ratings for the attributes. Unfortunately, both these methods have shortcomings, so we develop a new method which is based on a conjoint analysis of nine hypothetical service scenarios. This information is used to fit a satisfaction response model as a function of the component service attributes. In turn, the current service level is plotted on the response surface and the “path of steepest ascent” in the direction of maximum customer satisfaction gives the best “direction” for management to plan a quality improvement program. We compare the proposed method with those currently being used and find it is more responsive to changes in attribute performance as a firms quality improvement strategy evolves.

Indirect Financial Benefits from Service Quality

Improving service quality can increase revenues through (1) retaining a higher percentage of existing customers, (2) attracting more customers through positive word of mouth, and (3) increasing the usage rates of existing customers. While the direct ben..

Factors Affecting Web Site Visit Duration: A Cross-Domain Analysis

In this study, the authors examine factors that affect Web site visit duration, including user demographics, text and graphics content, type of site, presence of functionality features, advertising content, and the number of previous visits. The authors use a random effects model to determine the impact of these factors on site duration and the number of pages viewed. The proposed method accounts for three distinct sources of heterogeneity that arise from differences among people, Web sites, and visit occasions to the same Web site by the same person. The model is fit using one month of user-centric panel data, and it encompasses the 50 most popular sites in a market. The results show that, in general, older people and women visit Web sites for a longer period. Some surprising results are revealed in an examination of interactions between these demographic and site characteristic variables. For example, sites with higher levels of advertising usually result in lower visit duration, but this is not the case for older people. The model also yields insights into the relative importance of different sources of heterogeneity in visit duration; heterogeneity in visit occasions dominates over individual-level and Web site-specific heterogeneity.

The effect of competitive advertising interference on sales for packaged goods

Competitive advertising interference can occur when viewers of advertising for a focal brand are also exposed to advertising messages for competing brands within a short period (e.g., one week for television advertising). Although competitive advertising interference has been shown to reduce advertising recall and recognition and brand evaluation measures, no studies have examined its impact on brand sales. In this research, the authors use a market response model of sales for two grocery categories for a large grocery chain in the Chicago area to study the extent to which competitive advertising interference influences sales. The model enables the authors to capture the “pure” own-brand advertising elasticities that would arise if there were no competitive interference. The results show that competitive interference effects on sales are strong. When one or more competing brands advertise in the same week as the focal brand, the advertising elasticity diminishes for the focal brand. The decrease depends on the number of competing brands advertising in a particular week and their total advertising volume. The authors find that having one more competitor advertise is often more harmful to a focal brands advertising effectiveness than if the current number of advertising brands increase their total advertising volume.