Business Commons^™

Minimizing The Ratchet Effect: Why Reciprocity Preserves Customer Satisfaction In Service Environments, Kyle A. Huggins, Val Larsen

Association of Marketing Theory and Practice Proceedings 2023

This paper focuses on a fundamental problem for marketers: the ratchet effect. The ratchet effect occurs when actual service performance is perceived to be significantly higher than service expectations, causing dissonance and resulting consumer guilt. If left unattended, consumers relieve their guilt by increasing the perceived state of expectations for subsequent visits. Known as the ratchet effect, this causes a dilemma for the service business as they consistently strive to improve service performance. Using equity theory, our experimental study explores whether businesses can break the ratchet effect by providing mechanisms of reciprocity for consumers to respond at little or no …

Psychological Contract Breach And Customer Satisfaction: A Study Of Online Shopping, Hua Chang, Lingling Zhang

Association of Marketing Theory and Practice Proceedings 2018

Online shopping is becoming increasingly popular among customers in recent years. It offers customers numerous advantages and benefits, such as convenience in terms of time and place, better prices, and a variety of options. However, the number of customers who complain about online shopping is also increasing. Therefore, it is important for online retailers to better understand how customers respond to failures in customers’ online shopping.

Prior research on service failures and customer complaints has largely used expectation-dissatisfaction model to explain the phenomenon (e.g., McCollough, Berry, and Yadav 2000) and suggests approaches to address customer complaints (e.g., Hess, Ganesan, and …

Moderating Effects Of Service Guarantee, Service Relationship, And Perceived-Risk On Customer Satisfaction, Kungpo Tao

Association of Marketing Theory and Practice Proceedings 2014

Customer satisfaction has been one of the most frequently used terms in marketing. With the benefits of customer satisfaction, service providers can save more costs doing customer retention and advertising. Premium pricing, for example, is also the benefit derived from the service’s buffering effect. In service industry, service guarantee and building up service relationship with customers are very common and useful strategies to gain customer satisfaction. Due to the growing competitive industry, marketers have made efforts building the customer-service relationship in order to attract new customers and secure existing relationships with customers. After experienced a service delivery or consumption, customers …

Social Media In The Financial Services Industry, Nathaniel Gibbs, Perry Haan

Association of Marketing Theory and Practice Proceedings 2014

Innovative strategies set a company apart from its competitors. Lindsay and Hopkins (2010) said strategy is making the most of a current situation and devising a plan for the future. Likewise, if banks and other financial organizations want to enhance their brands, reduce costs, increase customer satisfaction, boost innovation, increase revenue, and maintain their competitive positions, they need to embrace social media. Social networks are used by marketers to connect and communicate with customers (Mangold & Faulds, 2009). Organizations must be receptive and flexible to remain relevant in the business environment (Bouckenooghe, Devos, & Van den Broeck, 2009). The environment …

The Factors That Influence Merchants’ Likeliness To Continue Business: A Study Of Georgetown, South Carolina, Monica B. Fine, Paul Clark

Association of Marketing Theory and Practice Proceedings 2013

Loss of businesses to surrounding areas has escalated in the past decade, promoting an examination of factors causing business defection from the city of Georgetown, South Carolina. Kotler (1969) warned that customer retention is more important than identifying new prospects. If the customer’s satisfaction levels fall below completely satisfied, there is a risk of customer defection. This issue is important because the “purpose of a business is to create and keep customers” (Kotler 1969, p. 2). Therefore, understanding what dissatisfies a customer is just as important as understanding what satisfies a customer. The degree to which cities are vulnerable to …

Successful Strategising Through Customer Exclusion, Edward Kasabov, Alex Warlow

Association of Marketing Theory and Practice Proceedings 2010

Marketing tends to emphasise retaining existing customers and generating customer satisfaction and loyalty. However, observation of the current practices of businesses suggests that such an over-emphasis on customer satisfaction may be misplaced. Many successful companies have developed competitive advantage by practicing ‘Exclusion Marketing’. This discussion defines Exclusion Marketing, explores its main tenets and ingredients, and demonstrates how by implementing such tactics modern businesses can reduce the cost of their products and services while offering high levels of service to ‘good’ customers, while eliminating and ‘excluding’ troublesome or non profitable clients. This discussion contributes to debates on the relationship between companies …