Managing Service Consumer Behavior and Relationship Dynamics in Asia

Managing Service Consumer Behavior and Relationship Dynamics in Asia

Nelson Oly Ndubisi (Griffith Business School, Australia & Covenant Business School, Nigeria) and Siti Haryati Shaikh Ali (University Technology MARA, Malaysia)
Copyright: © 2015 |Pages: 13
DOI: 10.4018/978-1-4666-6547-7.ch021
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Abstract

Organizations, especially those in Asia, are increasingly appreciating the value of establishing closer and lasting relationship with customers. With greater access to information from research findings, industry practitioners are implementing different strategies for achieving this goal. This chapter evaluates dual strategies firms in Asia have been using in trying to build lasting relationship with customers, namely respect and rapport. The purpose of this chapter is to examine the concepts of respect and rapport and the effects on the quality of firm-customer relationship and customer loyalty. The chapter draws from existing literature and surveys customers of two service sectors in Asia. The research propositions connecting the two dimensions of interpersonal relationship (i.e. respect and rapport) with relationship quality and customer loyalty are tested and confirmed using standard data analysis procedure. The findings lead to research and managerial implications that conclude the chapter.
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Theory, Conceptual Framework, And Propositions

The link between respect and rapport on one hand, perceived relationship quality and customer loyalty on the other can be better understood from the perspective of justice or fairness theory. Research on organizational justice shows that perceived organizational fairness enhances commitment to the organization (Folger & Konovsky, 1989). When customers have difficulty in collecting information about the fairness of the organization as a whole; they tend to rely on perceptions of distributive, procedural and/or interactional justice to infer about overall organizational fairness. The fairness theory suggests that customers expect a certain level of distributive, procedural and/or interactional fairness in exchange relationship (Adams, 1963; Anderson and Patterson, 2008). Perceived fairness is thought to have important implication on customer satisfaction or dissatisfaction (e.g., Anderson and Patterson, 2008); customer value and perceived relationship quality, (Nasution, Mavondo, Matanda & Ndubisi, 2011; Ndubisi 2014), commitment (Ndubisi, 2011), and customer loyalty (Ndubisi, 2007a; 2012). Against this background, we reason that if employees of service organizations respect and build rapport with customers, they (customers) will perceive interactional fairness, leading to quality relationship and loyalty. Similarly, they will increase their loyalty if they perceived distributive or procedural fairness in the outcome or process of the service encounter respectively. Because the focus of this research is on interpersonal relationship dynamics, we focus on interactional justice in the analysis. We thus argue that if service providers apply respect and rapport in their interactions with customers, such gestures are often reciprocated through favorable relationship quality perceptions and greater commitment or loyalty to the service provider. Such reciprocal behavior is the underlying argument of other social science theories such as the social exchange theory and equity theory. On the flip side, if one party (the customer) feels s/he has not received a fair interactional outcome or, in equity theory terms, her/his input-output ratio is inferior to that of the service provider or other social actors (Anderson and Patterson, 2008), the result will be poor relationship quality and a lack of commitment and greater likelihood of defection. Thus, justice theory provides a succinct and compelling lens for viewing key aspects of interpersonal relationship dynamics, and can be used to understand the influences of respect and rapport on relationship quality and customer loyalty.

Key Terms in this Chapter

Relationship Dynamics: The evolution or development of service provider-customer relationship, the outcome/s, and the influential factors.

Loyalty: The service that first comes to the user’s mind when making a purchase decision as well as the service that is her/his first choice among alternatives.

Justice Theory: A management theory which suggests that individuals (service provider and consumer in this instance) expect a certain level of fairness in the distribution of benefits/rewards, in the procedures, and/or in interactions in (an exchange) relationship.

Rapport: The presence of a personal connection, an enjoyable or “feel good” interaction due to right chemistry between a service provider and a consumer.

Relationship Quality: A party’s (either the service provider or service consumer) overall perception or judgement of the quality of an exchange relationship.

Respect: The act of paying attention to and valuing each individual customer, showing understanding and responsibility.

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