Defensive strategies for managing satisfaction and loyalty in the service industry

✍ Scribed by Laurette Dubé; Manfred F. Maute

• Publisher: John Wiley and Sons
• Year: 1998
• Tongue: English
• Weight: 162 KB
• Volume: 15
• Category: Article
• ISSN: 0742-6046
• DOI: 10.1002/(sici)1520-6793(199812)15:8<775::aid-mar4>3.0.co;2-#

✦ Synopsis

The investment model is used to predict customer responses to defensive value-added and value-recovery strategies. The two strategies were manipulated under different competitive environments with airline services scenarios in a controlled experiment. Hypotheses were affirmed as value-added and valuerecovery strategies influenced customer satisfaction and loyalty with varying sensitivities to the competitive environment and different mechanisms consistent with prediction derived from the investment model. Regardless of value-added strategy and competitive environment, value-recovery strategy strongly and positively influenced customer satisfaction, situational loyalty, and enduring loyalty. Value-added strategy also had a positive effect on customer satisfaction and loyalty, but these effects emerged primarily when a value-recovery strategy was already present, and under conditions of less intense competition. Satisfaction was found to mediate strategic effects on loyalty, with more pronounced effects observed for value-recovery strategy and situational loyalty.