Sabrina Helm

Viral Marketing - Establishing Customer Relationships by 'Word-of-mouse'

Newcomers to electronic markets are forced to accumulate customers as rapidly as possible. One strategy to fulfil this aim is so called viral marketing, which seems an appropriate term for describing the pattern in which Internet companies spread by making use of customer referrals. The aim of this article is to describe and explain common features of viral marketing strategies and to outline chances and risks associated with using Internet word-of-mouth in consumer settings.

One reputation or many?: Comparing stakeholders' perceptions of corporate reputation

Purpose – The firms reputation is one of its most valued intangible assets. Scientific and managerial interest in corporate reputation grows steadily. Reputation management – one of the cornerstones of corporate communications – seeks to align communication with stakeholder groups as to prevent a fragmented reputation. As yet, little is known about the perception of corporate reputation amongst the different stakeholders of a firm. Comparative empirical evidence has remained scarce. The aim of this paper is therefore to raise fundamental questions about reputation: how it may or may not differ between stakeholder groups and how firms can take these differences into account when measuring and managing corporate reputation.Design/methodology/approach – A single‐case, but very substantial, quantitative empirical study among German consumers, employees, and private investors of a consumer goods producer. Methods of data analysis include cluster analysis, ANOVA, and structural equation modelling using partial...

Modeling the Impact of Corporate Reputation on Customer Satisfaction and Loyalty Using Partial Least Squares

Reputation is one of the most important intangible assets of a firm. For the most part, recent articles have investigated its impact on firm profitability whereas its effects on individual customers have been neglected. Using data from consumers of an international consumer goods producer, this paper (1) focuses on measuring and discussing the relationships between corporate reputation, consumer satisfaction, and consumer loyalty and (2) examines possible moderating and mediating effects among the constructs. We find that reputation is an antecedent of satisfaction and loyalty that has hitherto been neglected by management. Furthermore, we find that more than half of the effect of reputation onto loyalty is mediated by satisfaction. This means that reputation can only partially be considered a substitute for a consumer’s own experiences with a firm. In order to achieve consumer loyalty, organizations need to create both, a good reputation and high satisfaction.

Exploring the impact of relationship transparency on business relationships: A cross-sectional study among purchasing managers in Germany

Abstract This paper introduces the notion of relationship transparency. It delineates this new concept from the interaction model of business relationships. We define relationship transparency as an individuals subjective perception of being informed about the relevant actions and properties of the other party in the interaction. Empirical data gathered in a cross-sectional survey among purchasing managers in Germany provide evidence that relationship transparency contributes to the overall success of a business relationship. According to our conceptual model and structural equation estimates, transparency delivers value to the customer, increases customer satisfaction and ultimately leads to favorable behavioral intentions.

Growing Existing Customers' Revenue Streams Through Customer Referral Programs

Customer referral programs are an effective means of customer acquisition. By assessing a large-scale customer data set from a global cellular telecommunications provider, the authors show that participation in a referral program also increases existing customers’ loyalty. In a field experiment, recommenders’ defection rates fell from 19% to 7% within a year, and their average monthly revenue grew by 11.4% compared with a matched control group. A negative interaction between referral program participation and customer tenure reveals that the loyalty effect of voicing a recommendation is particularly pronounced for newer customer–firm relationships. A laboratory experiment further demonstrates that referral programs with larger rewards strengthen attitudinal and behavioral loyalty, whereas smaller rewards affect only the behavioral dimension. This article contributes to our theoretical understanding of the roles played by the commitment–consistency principle and positive reinforcement theory as mechanisms underlying the effectiveness of customer referral programs.

Calculating the value of customers’ referrals

Word‐of‐mouth is a rarely quantified phenomenon, in spite of its importance for service firms. Therefore, referrals remain a neglected determinant of customer lifetime valuation, although some authors claim them to be the astronomical part of customer equity. The paper discusses different approaches to the calculation of positive word‐of‐mouth, leading to a monetary referral value of a company’s customers.

Walk Your Talk: An Experimental Investigation of the Relationship Between Word of Mouth and Communicators’ Loyalty

Research provides ample evidence regarding the impact of word-of-mouth (WOM) communication on recipients. Service providers increasingly attempt to harness this power of WOM by introducing referral reward programs and other marketing instruments that aim to stimulate positive WOM. However, scholars have neglected to research the possibility that providing WOM also has consequences for the sender. Building on self-perception theory, this article argues that recommending a service provider improves the current customers’ loyalty to the provider and that positive WOM is not only effective for gaining but also for keeping customers. By conducting experiments in two different service settings, it is demonstrated that providing a recommendation influences the senders’ attitudinal and behavioral loyalty. The effect is found to be stronger for customers with low expertise in the service category and little experience with the provider. This means that encouraging customers in the early stages of their customer life cycle to give recommendations is specifically effective in increasing loyalty to the provider. Managers should consider using positive WOM as a loyalty-enhancing instrument and take the additional value from increased loyalty of their customer base into account for return-on-marketing calculations regarding WOM marketing campaigns, as well as customer equity calculations.

How Does Corporate Reputation Affect Customer Loyalty in a Corporate Crisis

It is widely accepted that corporate reputation plays an important role in determining the impact of crises on firms. Crises may erode corporate reputation. However, reputation may also attenuate the negative effects of crises. This study investigates how corporate reputation moderates the relationship between crisis occurrence and customer loyalty which is expected to decrease given a crisis. Drawing on opposing theories, namely dissonance theory and expectancy‐violation, we conduct a scenario experiment set in the airline industry. Results demonstrate that the moderating effect is weaker in the case of a favourable corporate reputation. This may indicate that a pre‐existing favourable reputation does not shield the firm from the negative effects of the crisis, but may rather present a liability because customers have higher expectations with regard to well‐reputed firms. Contrary to that, ill‐reputed firms have less to lose in the case of a crisis and suffer comparatively smaller decreases in customer loyalty. Marketing management might take into account the role of crisis and reputation management for customer bonding strategies while crisis management should recognize the importance of reputation effects in crises given their impact on customer loyalty and firm profitability.

Kundenbewertung im Rahmen des CRM

Neben der Forderung, effektive Verbesserungen der Leistungsangebote fur Kunden zu realisieren, wird das praktische Marketing von Unternehmen in einer Wettbewerbswirtschaft mit dem Gebot konfrontiert, Geschaftsbeziehungen mit Kunden auch effizient zu gestalten (Cornelsen 2000, S. 2). Schlieslich lohnen sich aus Anbieterperspektive Investitionen in die Zufriedenstellung und Bindung von Kunden nur dann, wenn hierdurch langerfristig profitable Kundenbeziehungen aufgebaut werden konnen (Scheiter/Binder 1992, S. 18; Blattberg/Deighton 1997, S. 29). Aus unternehmerischer Perspektive ist es in erwerbswirtschaftlich ausgerichteten Betrieben sinnlos, „ein Fullhorn an Wohltaten undifferenziert uber alle Kunden auszuschutten“ (Pepels 2002, S. 261) oder anders ausgedruckt: „Not all customers are worth attracting and keeping.“ (Rust et al. 2000, S. 187). Die Messung des Kundenwerts aus der Sicht von Anbieterunternehmen sowie Masnahmen zur wertorientierten Steuerung von Kundenbeziehungen sind damit zu aktuellen Herausforderungen fur das Marketing geworden.

Corporate Reputation: An Introduction to a Complex Construct

Demonstrating and providing evidence for what corporate reputation contributes to the value creation of companies are the main objectives of this book. Helm starts out with looking at definitions of corporate reputation, that form the basis for approaches to building and protecting this intangible. She elaborates on utilitarian and deontological drivers for companies to attain and evolve reputation. Helm stresses that the value of reputation is much more than the monetary value attributable to it and, therefore, is more than a corporate asset. In fact, the ability and willingness of a firm to act in line with stakeholder expectations and needs is the qualitative shape reputation takes. This refers to the past, present, and future handling of stakeholder relationships. Furthermore, Helm outlines the differences between corporate image, corporate brand, and corporate reputation. Sources of reputational perceptions and status are discussed. Helm concludes that reputation determines corporate stability.