27
Journal of Marketing
Vol.72 (January 2008),27–45
©2008,American Marketing Association
ISSN:0022-2429 (print),1547-7185 (electronic)
Girish Ramani & V .Kumar
Interaction Orientation and Firm
美术老师简历
Performance
Marketing managers are being required to demonstrate the profitability of their marketing actions down to the level of their individual customers and on an ongoing basis.At the same time, customers expect firms to increasingly customize their products and rvices to meet their demands.Firms still need to produce superior products, ll smarter, and understand the markets as a whole, but the ability of firms
to orient themlves to interact successfully with their individual customers will differentiate them in the future.Advances in technology have resulted in increasing opportunities for interactions between firms and customers, between customers, and between firms.An interaction orientation reflects a firm’s ability to interact with its individual customers and to take advantage of information obtained from them through successive interactions to achieve profitable customer relationships.First,the authors identify the components of interaction orientation:(1) customer concept, (2) interaction respon capacity, (3) customer empowerment, and (4) customer value management.Second, they relate interaction orientation to both customer-level and aggregate-level performance measures.Third, they identify the antecedents of interaction orientation.Fourth, they examine the moderating effects of customer-initiated contacts and competitive intensity on the interaction orientation–performance linkage.The results are bad on a survey of top marketing managers.The commonly held view that customer-bad relational performance is related to customer-bad profit performance is not supported.However, both customer-bad relational performance and customer-bad profit performance affect aggregate business-level action orientation is a
phenomenon obrved in both business-to-business and business-to-consumer firms.The extent of customer-initiated contacts moderates the interaction orientation–performance relationship.
Keywords :interaction orientation, structural equation modeling, customer value management, organization
capabilities, firm performance
吸毒的案例Girish Ramani is an assistant professor, LeBow College of Business, Mar-keting Department, Drexel University (e-mail:girish.ramani@drexel.edu).V .Kumar is ING Chair Professor and Executive Director, ING Center for Financial Services, School of Business Administration, Department of Marketing, University of Connecticut (e-mail:Vk@business.uconn.edu).The authors thank the three anonymous JM reviewers for their valuable comments on a previous version of this article.They thank the Marketing Science Institute for providing access to the marketing executives in vari-ous companies to obtain the necessary data for conducting this rearch study.The authors also benefited from interacting with the executives in the American Marketing Association, the Rearch Board, and the Con-ference Board conferences in obtaining the data for the study.They also thank Ajay Kohli, John Hulland, Stan Slater, and Christine Moorman as well as the participants at the 2006 American Marketing Association Win-ter Educators’Conference and the 2006 Marketing Science Conference.Finally, they thank the Marketing Science I nstitute for supporting this study with financial assistance.
M
arketing managers are being required to demon-strate the profitability of their marketing actions down to the level of their individual customers and
on an ongoing basis. At the same time, customers expect firms to increasingly customize their products and rvices to meet their demands. Technological advances have height-ened interactivity between customers and firms, customers and customers, and firms and firms (Yadav and Varadarajan 2005). Thus, increasing profit pressures, customer demand heterogeneity, and advances in technology all suggest that
firms need to develop an orientation that is appropriate for survival and success in increasingly interactive market envi-ronments. Interactions help firms refine their knowledge about customer tastes and preferences (Srinivasan, Ander-son, and Ponnavolu 2002). The effective and efficient man-agement of interactions and the interfaces at which the interactions occur are increasingly being recognized as sources of lasting competitive advantage (Rayport and Jaworski 2005).
We believe that an interaction orientation reflects a firm’s ability to interact with its individual customers and to take advantage of information obtained from them through successive interactions
to achieve profitable customer rela-tionships. However, no comprehensive construct exists in the literature that captures the key elements of an inter-action orientation. We address this rearch gap. We develop interaction orientation as a composite construct that consists of an organization’s fundamental belief (the cus-tomer concept) and the relevant process (interaction respon capacity) and practices (customer empowerment and customer value management) that supplement this fun-damental belief. Thus, at the core of interaction orientation is the specific notion of the customer concept—the belief that the unit of analysis of every marketing action and reac-tion should be the individual customer.
We examine two composite customer-centric perfor-mance measures: (1) customer-bad relational perfor-mance, which consists of customer satisfaction, customer
ownership, and positive word of mouth, and (2) customer-bad profit performance, which consists of the successful identification of profitable customers, efficiency of the acquisition and retention process, and conversion of unprof-itable customers to profitable ones. Our hypothes posit a positive primary impact of interaction orientation on the two customer-bad performance measures and a positive relationship between customer-bad relational perfor-mance and customer-bad profit performance. We also hypothesize five antecedents of interaction orientation: the extent of dep
endence on patents and trademarks for suc-cess, the extent of institutional pressures to adopt interactive technologies, the extent to which an employee reward sys-tem is bad on customer-centric performance measures, the degree of outsourcing experti possd by the firm, and whether the firm operates in the business-to-business industry. Finally, we hypothesize moderating effects of customer-initiated contacts and competitive intensity on the two interaction orientation–customer-bad performance links.
We develop new scale items and adapt existing scales to ascertain a firm’s level of interaction orientation and customer- and aggregate-level performance, as well as where the firm stands on the hypothesized antecedent fac-tors. We describe the survey-bad data collection process and analyze the data using confirmatory factor analysis (CFA), structural equation modeling, and moderator regres-sion analys. We compare the hypothesized model with a rival model. We also analyze the effects of customer-bad relational performance and customer-bad profit perfor-mance on aggregate business-level performance. We offer managerial implications for firms that adopt and do not adopt an interaction orientation. Our study establishes that an interaction orientation generates value for a firm, is rare, and therefore is a marketing resource that leads to a position of competitive advantage (cf. Hunt and Morgan 1995).
Interaction Orientation:
Development of the Construct
We conducted exploratory interviews with 48 managers from 26 business-to-business and 18 business-to-consumer firms. There were 2 respondents from 4 firms and 1 respon-dent each from the remaining 40 firms. The choice of both types of firms is in line with contemporary marketing thought that interactive marketing is now relevant to all types of organizations (Coviello et al. 2002; Day and Mont-gomery 1999; Grönroos 1994).
We now summarize the respons to the two key ques-tions asked during the interviews: (1) Is marketing more about interactions with individual customers than before? and (2) What are the capabilities that firms require to offer superior interactions? Most managers voiced the need to move away from a market gment to an individual cus-tomer approach when analyzing the effect of marketing actions. We term this belief the “customer concept.” Some managers believed that managing individual customers entails using sophisticated databa systems. Others believed that customer-facing employees need to adapt to individual customer needs. This suggested that the belief in the customer concept must be supplemented with appropri-ate systems. Thus, we termed th
e process and systems the firm adopts to interact with and respond to its customers “interaction respon capacity.” Managers also believed that individual customers should be allowed a greater say in t-ting the terms of interactions with the firm and with each other. Thus, a firm should demonstrate that customers are important partners when they interact with the firm and even when they interact with each other. We term this prac-tice “customer empowerment.” Managers also believed that there is a growing understanding among customers that the firm has the right to treat individual customers differently according to their value to the firm. Therefore, firms should develop the ability to break down the revenues and costs related to each firm–customer interaction. We term this practice “customer value management.”
Thus, on the basis of the feedback from our interviews, we propo interaction orientation as a composite construct that captures (1) a firm’s belief in the customer concept, (2) a firm’s interaction respon capacity that reflects its ability to u dynamic databa systems and process, (3) a firm’s customer empowerment practices that help shape customer–firm interactions and customer–customer interactions, and (4) a firm’s customer value management practices that guide its marketing resource allocation decisions. Whereas most conceptualizations of a market orientation limit them-lves to either a behavioral or a cultural perspective, we take the view that a comprehens
ive construct of interaction orientation should capture the basic underlying belief and also the process and practices that supplement this belief (e Homburg and Pflesr 2000). We now draw from extant literature and offer preci definitions for the four elements of interaction orientation.
螃蟹画The Customer Concept
The customer concept is characterized by the individual customer as the starting point for marketing activities (Hoekstra, Leeflang, and Wittink 1999). We define the cus-tomer concept as the belief that prescribes the unit of analy-sis of every marketing action and reaction to be the individ-ual customer.
Interaction Respon Capacity
Interaction respon capacity reprents the degree to which the firm offers successive products, rvices, and relation-ship experiences to each customer by dynamically incorpo-rating feedback from previous behavioral respons of that specific customer and of other customers collectively. Thus, it reflects the ability of a firm’s systems to respond to heterogeneous customers differently and also to each indi-vidual customer differently at different points in time by pooling information from multiple sources and points in time.
Customer Empowerment
A theory gaining credence is that firms cannot think and act unilaterally, and in this new paradigm of marketing, the consumer and the firm cocreate value at various points of interaction (Prahalad and Ramaswamy 2004). Customer
28/ Journal of Marketing,January 2008
嬎蛋
empowerment reflects the extent to which a firm provides its customers avenues to (1) connect with the firm and actively shape the nature of transactions and (2) connect and collaborate with each other by sharing information; prai; criticism; suggestions; and ideas about its products, rvices, and policies.
Customer Value Management
To reap the economic benefits of available customer data, firms need to develop the practice of aligning resources spent on customers in proportion to the revenues or profits derived from them (Mulhern 1999; Reinartz, Krafft, and Hoyer 2004). Data-analytic techniques that enable the mea-surement and prediction of customer-bad revenues and profits (e.g., the recency, frequency, and
monetary value; past customer value; customer lifetime value) are already emerging as key topics in marketing textbooks (e.g., Kumar and Reinartz 2006). Relationship management bad on customer value involves providing differentially tailored treatment according to the expected respon from each customer to available marketing initiatives, such that the contribution from each customer to overall profitability is maximized (Kumar, Ramani, and Bohling 2004). In other words, customer value management reprents the extent to which the firm can define and dynamically measure individ-ual customer value and u it as its guiding metric for mar-keting resource allocation decisions.
We now examine interaction orientation with respect to related concepts available in the literature, such as relation-ship orientation and customer-relating capability. The term “relationship orientation” has been conceptualized as being the opposite of a transaction mentality (Day 1999, 2000); it “reflects relevant values, behavioral norms, the shared men-tal modes ud to make n out of patterns of customer loyalty and defection, and decision criteria” (Day and Van den Bulte 2002, pp. 7–8). In contrast, interaction orientation is precily defined in terms of its four specific compo-nents. Interaction orientation is also different from the broader concept of customer-relating capability (e Day and Van den Bulte 2002) in that interaction orientation is specific and actionable and can be adopted by firms to achieve superior performance.
The Conquences of Interaction
Orientation
The conquences of firm-level strategic orientations, such as market orientation, lling orientation, and production orientation, have been typically evaluated in terms of aggre-gate business-level performance measures, such as return on sales and return on asts (Noble, Sinha, and Kumar 2002), as well as sales, profits, and market shares (V oss and V oss 2000). However, customer-centric organizations have different methodologies, vocabulary, metrics, and evalua-tion criteria than product-centric organizations (Sheth, Siso-dia, and Sharma 2000). Rearchers have recently begun to examine the impact of marketing efforts in terms of customer-centric measures (e.g., Jayachandran et al. 2005). Becau interaction orientation is bad on the belief that the individual customer should be the unit of analysis, it would be logical to examine whether firms that are inter-action oriented indeed exhibit superior performance in terms of customer-centric measures. We examine the con-quences of an interaction orientation on two groups of customer-centric performance measures: (1) customer-bad relational performance and (2) customer-bad profit performance (e Figure 1). Customer-bad relational per-formance asss performance on attitudinal parameters, whereas customer-bad profit performance asss per-formance on beha
vioral parameters.
Customer-Bad Relational Performance
We specify a measure of customer-bad relational perfor-mance in terms of three indicators: (1) customer satisfac-tion, (2) customer ownership, and (3) positive word of mouth. Satisfaction indexes provide an indication of the strength of the relationship between a firm and its cus-tomers. A superior interaction respon capacity and consis-tent customer empowerment practices are likely to result in greater customer satisfaction. Customer ownership refers to the degree to which customers feel accountable to a firm and actively ek the firm’s financial well-being. Firms that resist the growth of power in the hands of their customers risk distancing themlves from their source of business. A successful business strategy is likely to be one that empow-ers individual customers by allowing them to develop expe-riences with the company on their terms (Newell 2003; Prahalad and Ramaswamy 2004). Customers who are empowered and rewarded according to their individual experti and needs develop a greater n of belonging to the firm and are likely to protect the well-being of the firm. In other words, conscious efforts by a firm to develop and enhance an interaction orientation will result in greater cus-tomer ownership of the firm. Word of mouth refers to the spread of information about products, rvices, stores, com-panies, sales, or customer manager
s from one customer to another (Brown et al. 2005). Customers who make a per-sonal referral must not only believe that a company offers superior economic value but also feel good about their rela-tionship with the company (Reichheld 2006). An interaction orientation increas positive word of mouth by encourag-ing and enabling customers to refer the firm to new cus-tomers and new customers to the firm.
Thus, we propo that an interaction orientation leads to superior customer-bad relational performance, which is measured in terms of customer satisfaction, customer own-ership, and positive word of mouth. Formally,
H1: The greater the interaction orientation of a firm, the greater is its customer-bad relational performance. Customer-Bad Profit Performance
最好看的多肉
We specify a measure of customer-bad profit performance in terms of three indicators: (1) identification of profitable customers, (2) acquisition and retention of profitable cus-tomers, and (3) conversion of unprofitable customers to profitable ones. An interaction orientation facilitates the analysis of transaction data obtained from various interfaces and, conquently, the u of this information to relate indi-vidual customer revenues to marketing investments. Mea-suring customer-level profits ensures marketing managers’
Interaction Orientation and Firm Performance / 29
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indulging in positive word of mouth are of great importance to the firm (Kumar, Petern, and Leone 2006; Reichheld 2006). In other words, measures of customer-bad rela-tional performance, such as satisfaction and word of mouth, are positively related to measures of customer-bad prof-itability. Thus, on the basis of the generally accepted notion that superior relational performance leads to superior profit performance, we offer the following hypothesis:
H3: The greater a firm’s customer-bad relational perfor-mance, the greater is its customer-bad profit
performance.
The Antecedents of Interaction
Orientation
The notion of interaction orientation resonates with the managers contacted in our exploratory interviews, but the managers also believed that veral factors could affect the level of interaction orientation a firm exhibits—for exam-ple, the outlook and prior experience of its top manage-ment, th
e nature of the firm’s existing business, and the prevalent industry and competitive practices. Therefore, we classify our antecedents in terms of management-level, firm-level, and industry-level characteristics. The employee reward system is a management-level factor that has been examined for its effect on market orientation (Jaworski and Kohli 1993) and on marketing strategy comprehensiveness (Atuahene-Gima and Murray 2004), and it is also likely to affect the firm’s interaction orientation. Firm characteristics and industry characteristics have been examined in contin-gency models for their effect on competitive strategy (Varadarajan and Yadav 2002) and competitive positional advantage (Bharadwaj, Varadarajan, and Fahy 1993). In increasingly interactive market environments, dependence on patents and experti in outsourcing are firm-level char-acteristics that influence the firm’s interaction orientation, and institutional pressures and industry type are industry-level characteristics that could influence the firm’s degree of interaction orientation. We now develop hypothes that relate the antecedents to interaction orientation.
Jaworski and Kohli (1993) show that a market-oriented reward system has a strong impact on market orientation. An interaction-oriented reward system focus on customer-level performance measures. If a firm’s employee reward system is bad on customer metrics (e.g., customer acquisition, customer retention, customer win-back, cus-tomer profitability) instead of sales and mark
et share mea-sures, we could expect a greater degree of adoption of cus-tomer value management practices. Thus:
H4: The greater a firm’s reliance on customer metrics for eval-uating and rewarding managers, the greater is its inter-
action orientation.
Recently, IBM provided free access to 500 patents to companies, groups, or individuals working on open-source projects in a move welcomed by academics and industry analysts (Lohr 2005). The u of patents to enjoy a short-term lead is fading in importance in many industries, except for the pharmaceutical industry (Reitzig 2004). Firms that are ensured business by virtue of the patents they own on their products are less likely to invest in process to inter-act with their customers. Dependence on patents fosters a product-centric management approach in firms. If firms depend on patents to sustain their business, they might not recognize customers’needs to bond with their products and are unlikely to develop a high degree of interaction orienta-tion. Such firms resist the move to involve their customers becau, in their current wisdom, they believe that there are limited returns to such a strategy. Thus:往后余生的句子
H5: The lower the dependence on trademark and patent pro-tection as the source of continued business for a firm, the
greater is its interaction orientation.蚬子肉
Rather than ttling for the subt of prospects who find one offer relevant, it is better for firms to attract and retain customers by prenting many relevant offerings to each customer (Newell 2003). Outsourcing vastly expands the ability to provide a wide range of products and rvices, but success in outsourcing depends on the degree to which con-tracts with suppliers and the performance levels expected of suppliers are specified and monitored (King 2004). A supe-rior control of outsourced back-end supply systems enhances a firm’s interaction respon capacity. Thus: H6: The greater the outsourcing experti of a firm, the greater is its interaction orientation.
太上老君简介Organizations that embrace electronic markets to mimic a successful benchmark firm believe that the benchmarked organization succeeded primarily becau of its participa-tion in electronic markets (Grewal, Comer, and Mehta 2001). Normative pressure caud by the sheer number of competitive firms adopting new interactive technologies hastens a firm’s adoption of interactive tools (Tsikriktsis, Lanzolla, and Frohlich 2004; Wu, Mahajan, and Balasubra-manian 2003). Thus:
H7: The greater the institutional pressures for a firm to adopt interactive technologies, the greater is its interaction
orientation.
Business-to-business and business-to-retail firms orga-nize themlves into account management teams that r-vice individual clients. Therefore, we expect a greater acceptance and dismination of the belief in the customer concept and the adoption of process and practices com-mensurate with this belief in business-to-business firms than in business-to-consumer firms. Thus:
H8: Business-to-business firms exhibit a greater degree of interaction orientation than business-to-consumer firms.
Moderators:Customer-Initiated Contacts and Competitive Intensity Given that reciprocity of firm–customer communication is integral to interaction orientation, we needed a moderator variable that could capture the differences between firms in terms of the behaviors of their customer bas toward the firm. Interactions drive relationships, but interactions do not constitute a genuine relationship unless the customer acknowledges that they do (Peppers and Rogers 2004). The extent of two-way communication determines the strength
Interaction Orientation and Firm Performance / 31
