Talk up or criticize? Customer responses to WOM about competitors during social interactions

Popular metrics such as the Net Promoter Score (NPS) highlights many benefits of word of mouth (WOM) to firms. Is WOM all it is claimed to be? Building on social identity theory, this research develops a conceptual model of WOM exchange in social settings and tests the model with customer surveys of three service sectors. The findings show that the effects of (1) positive and negative WOM (P/NWOM) received about competitors and (2) perceived presence of critical incidents (PPCIs) on P/NWOM given about own service provider are far from intuitive. Responses to PWOM received counter the suggestions in the NPS literature. The findings also indicate that the best firms can hope for when receiving NWOM about competitors is that their customers remain silent. It is recommended that firms communicate a message that is consistent with the nuanced views expressed by friends in social circles, rather than a uniformly superior positioning

Examining the trade-off between compensation and promptness in eWOM-triggered service recovery:A restorative justice perspective

Our research examines the effectiveness of monetary compensation and the promptness of response during electronic word-of-mouth (eWOM)-triggered service recovery. Drawing upon restorative justice theories, we explore three main questions: whether the hotel’s response to negative online reviews are always beneficial; whether offering compensation or responding promptly is more efficient under different levels of service failure severity; and how the hotel’s response influences consumers’ future engagement through eWOM media. Experimental results reveal that making minimum online service recovery effort is only effective in fixing consumer attitudes for less severe service failures. Compensation is the optimal solution for less severe failures, while prompt response is optimal for more severe service failures. The hotel’s responsiveness to negative reviews and the service recovery outcome positively influence consumers’ future eWOM behaviours through the same online medium. Implications for hotels seeking cost-effective management of negative reviews and for online media owners are offered

The role of negative and positive forms of power in supporting CSR alignment and commitment between large firms and SMEs

Do large firms exert power to shape the CSR behavior of their SME partners?” We answer this question by proposing a model built on the stakeholder theory and the shareholder theory, and go on to explain how this impact influences the commitment of the SME towards their large partner. The model highlights the central role that different forms of power exercised by the large firm play in the process. A survey of 291 SMEs confirms the key hypotheses, including the mediating role of reward power. The effects of coercive power are noteworthy and they illustrate the complex and competing forces at play in influencing CSR behavioral change in SMEs. The research makes a novel contribution to practice by highlighting among other things, how power, as a negative force via coercion or positively through expert or reward benefits, support or becomes counterproductive to the change process

Former customers’ E-WOM in social media platforms: an investigation of motives, network size and social ties

Former customers can potentially be highly beneficial to firms, however, their e-WOM activity has been neglected in prior research. This research recognises the need to broaden e-WOM research, especially regarding how former customers engage in e-WOM, what motivates them to do so and the impact they have in online social networks. The results of an online survey and two experimental studies empirically establish the role of former customers in online social networks, provide insights about their motives for engaging in e-WOM about goods and services they no longer use, and their impact in online social networks, which depends on the characteristics of these networks. Former customers with small networks and strong social ties have the strongest impact on other actors, followed by those with large networks and what this paper terms utilitarian ties. From a managerial perspective, this research identifies the role of former customers in online social networks and their optimal behaviours for the firm in terms of e-WOM sharing and recommends distinct ways in which the influencing behaviour of former customers should be managed

Fostering brand engagement and value-laden trusted B2B relationships through digital content marketing : The role of brand’s helpfulness

Purpose The purpose of this paper is to explore how digital content marketing (DCM) users can be engaged with business-to-business (B2B) brands and determine how such engagement leads to value-laden trusted brand relationships. Design/methodology/approach Through an online survey, data were collected from the email marketing list of a large B2B brand, and the hypothesised research model was analysed using covariance-based structural equation modelling. Findings This paper identifies a bundle of helpful brand actions – providing relevant topics and ideas; approaching content with a problem solving orientation; as well as investing in efforts to interpret, analyse and explain topics through DCM – to foster relationship value perceptions and brand trust. Critically however, cognitive-emotional brand engagement is shown to be a necessary requirement for converting these actions into relationship value perceptions. Research limitations/implications This paper furthers the understanding of the dual role of helpful brand actions in functionally oriented DCM. Additionally, this paper offers evidence of the central role of cognitive-emotional brand engagement in influencing value-laden customer–brand relationships. Practical implications This paper introduces a bundle of helpful brand actions that forms the basis for the dual roles of a brand in enhancing customer value and in fostering brand engagement and building relationships. This approach helps practitioners to steer brand-related perceptions arising from DCM interactions towards building trusted brand relationships. Originality/value This paper contributes to the marketing literature by revealing a potential approach to DCM in managing customer relationships. Instead of focusing solely on the content benefit-usage link to support engagement, this paper reveals the potential of helpfulness as a brand-initiated DCM engagement trigger in engaging customers with the brand, vis-à-vis the content.peerReviewe

Actor Engagement: Former Customers’ Role in Online Social Networks

Although former customers can potentially be highly beneficial to firms in terms of influence value, the extant literature concentrates predominantly on current customers, while the role of former customers remains under-investigated. This research utilizes the conceptual lens of actor engagement (AE) to understand the role of former customers focusing on their influence on others in online social networks. The results of an online survey and two experimental studies demonstrate that former customers engage in actor influencing behavior (AIB) via e-WOM about products and services they no longer use, although their motives for doing so differ from those of current customers. Further, actors with small networks and strong social ties have the highest influence on other actors; followed by those with large networks and utilitarian ties. Practically, this research highlights the need to move beyond a focus on the dyadic firm–customer relationships and embrace network relationships among high influence actors

The impact of service bundles on the mechanism through which functional value and price value affect WOM intent

Purpose: The aim was to contribute towards the current limited understanding of service bundles by investigating how purchasers of combined product-service bundles (bundle customers) differ from those purchasing a product and associated service separately (non-bundle customers). Design/methodology/approach: The hypothesized effects were tested on a representative sample of mobile phone subscribers in Finland, through a multi-group moderated analysis using variance-based structural equation modeling. Findings: a) While functional value had a stronger effect on attitude for bundle customers, price value is a stronger determinant of attitude for non-bundle customers. b) There was no difference between the groups in terms of how attitude determines WOM intent. c) The total influence of functional value on positive WOM intent was stronger for bundle customers Vs non-bundle customers; in contrast, the total influence of price value on positive WOM was weaker for the bundle customers. Research limitations/implications: Two inter-related frameworks, prospect theory and mental accounting theory, are used to analyze customer response to service bundles. Results demonstrate that bundles play a powerful role in determining engagement behaviors critical to firms. Purchasing a service bundle Vs a non-bundle influences how price value and functional value determine attitude and WOM intent in fundamentally different ways. Practical implications: In devising communication strategies to maximize positive WOM, managers need to emphasize functional benefits for bundle purchasers and price benefits for nonbundle customers. The results also demonstrate that it is more important for firms to track perceived value, as value and not attitude differentiates WOM generation in the two groups. Originality/Value: This is the first study to demonstrate how bundle and non-bundle customers determine value, and how functional value and price value determine WOM generation and attitude towards SP in fundamentally different ways. The comparison of the bundle group where the firm acts as the main resource integrator to a non-bundle group where the customer is the main resource integrator in creating value helps demonstrate the need for firms to treat the two groups in distinct ways.peerReviewe

New product development capability and performance under institutional pressures : the role of the top management team

Firms invest in new product development (NPD) capability to enhance their performance. To have performance advantage, it is generally recommended that they invest in both dimensions of the NPD capability: exploitation and exploration. However, many firms fail to do so. In this study, we draw on institutional theory and upper echelon theory to conceptualize and examine: 1) how top management team (TMT) heterogeneity impacts the combination of exploration and exploitation within the firm’s NPD capability and accordingly, performance; and 2) how these relationships are moderated by coercive and mimetic institutional pressures. This offers new insights on the antecedents of NPD capability. It also provides an explanation for the past mixed findings regarding the impact of institutional pressures on performance. In addition, it provides some insights into the controversy surrounding the impact of TMT heterogeneity on performance