Marketing Management

Exploring consumers’ attitude towards relationship marketing

Michael A. Jones University of Tennessee, Chattanooga, Tennessee, USA

Kristy E. Reynolds University of Alabama, Tuscaloosa, Alabama, USA

Mark J. Arnold Saint Louis University, St. Louis, Missouri, USA

Colin B. Gabler Ohio University, Athens, Ohio, USA

Stephanie T. Gillison University of Tennessee, Chattanooga, Tennessee, USA, and

Vincent Myles Landers Rochester Institute of Technology, Rochester, New York, USA

Abstract Purpose – The purpose of this study is to explore consumers’ overall attitude toward relationship marketing and to determine the influence of consumers’ overall attitude on consumers’ intentions and behaviors. Many services companies practice relationship marketing and customer relationship management. Although the benefits and drawbacks of relationship marketing for consumers have been established, little is known about whether consumers have a relatively positive or negative attitude toward relationship marketing practices. Design/methodology/approach – This research investigates consumers’ attitudes toward relationship marketing using a national survey of 245 consumers and a survey of 417 consumers living in the southern region of the USA. Findings – Although approximately 70 per cent of our national consumer sample had a somewhat positive attitude toward relationship marketing, about 30 per cent had a somewhat negative or neutral attitude. Furthermore, approximately 39 per cent of consumers in the study would choose a company that does not engage in relationship marketing over a company that does. The results also indicate that consumers’ overall attitude toward relationship marketing impacts their likelihood to respond favorably to specific relationship marketing tactics. Research limitations/implications – Some limitations should be noted. First and not uncommon to most survey research in marketing, the relationships between constructs in this study may be inflated because of common methods bias. Second, this research reports the results from two studies. Although one of the studies represents a national sample, additional research using the scales developed in this research is needed. Practical implications – This research indicates that consumers’ attitudes toward relationship marketing impacts their willingness to engage in relationships with service companies and their response to specific relationship marketing tactics. Because consumer attitudes toward relationship marketing vary, companies should consider segmenting their customer base using this information. Originality/value – This study extends previous research by using quantitative techniques to measure consumers’ overall attitudes toward relationship marketing and assessing the influence of those attitudes on intentions and behaviors.

Keywords Consumer attitudes, Customer relationships, Relationship marketing

Paper type Research paper

Relationship marketing, defined as “all marketing activities directed toward establishing, developing, and maintaining successful relational exchanges” (Morgan and Hunt, 1994, p. 22), has had a tremendous impact on both the theory and practice of marketing during the previous decade and a half.

Relationship marketing is common practice across many business-to- consumer contexts, is an important source of a sustainable competitive advantage (O’Malley and Prothero, 2004) and is a critical factor in the new economy (Gummesson, 2002). Companies continue to engage in various activities (such as offering loyalty programs, communicating with customers via phone and e-mail and training service employees to develop personal relationships with customers) in the hope of obtaining the many purported organizational benefits of relationship marketing, including higher retention, decreased price sensitivity as well as

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Journal of Services Marketing 29/3 (2015) 188–199 © Emerald Group Publishing Limited [ISSN 0887-6045] [DOI 10.1108/JSM-04-2014-0134]

Received 16 April 2014 Revised 22 July 2014 Accepted 24 July 2014

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opportunities for up-selling and cross-selling (Dwyer et al., 1987; Pine et al., 1995; Reichheld and Sasser, 1990).

Indeed, the benefits that customers receive from relationship marketing are well-established (Beatty et al., 1996; Bendapudi and Berry, 1997; Gwinner et al., 1998; Mimouni-Chaabane and Volle, 2010; Sheth and Parvatiyar, 1995). However, many shortcomings have also been identified (Palmer et al., 2005), mainly through qualitative research (Fournier et al., 1998; Noble and Phillips, 2004; O’Malley and Prothero, 2004). Scholars have stressed that the success of a relationship marketing strategy depends on the preferences of consumers (Gwinner et al., 1998; Sheth and Parvatiyar, 1995) and that consumers vary in their desire to establish relationships (Bendapudi and Berry, 1997; Berry, 1995; Raciti et al., 2013; Varki and Wong, 2003). Finally, research has demonstrated that reward programs, a common relationship marketing tactic, are sometimes perceived as a threat to consumers’ autonomy, which results in lower repurchase intentions and negative word-of-mouth (Wendlandt and Schrader, 2007). These threats can lead to high relationship marketing failure rates ranging from 55 to 75 per cent (Agariya and Singh, 2011; Chan, 2005; Reinartz et al., 2004). Despite this stream of literature, little research has been conducted to determine the prevalence of positive and negative attitudes toward relationship marketing using quantitative methods. Further, there have been calls for research to address the specific customer orientations to relationship marketing tactics (Palmatier et al., 2006). These gaps have been cited as key factors limiting the success of relationship marketing strategies (Fournier et al., 1998). Given that relationship marketing is used quite extensively by services businesses (Gronroos, 1995), we judge that the current research has the potential to contribute substantially to knowledge in the area.

This study seeks to fill this gap through empirical examination of actual consumer attitudes. If consumers have a negative attitude toward relationship marketing, then the marketing discipline may be devoting much attention to a practice that alienates a large proportion of customers, clearly an action that would be counter to the marketing concept. If, however, consumers have a very positive attitude toward relationship marketing, then the discipline could further embrace this practice and its underpinnings.

This research makes several contributions. First, a national sample is conducted to assess consumers’ overall attitudes toward relationship marketing. In addition, we examine the effect of consumer attitudes on the likelihood of developing a relationship, the number of relationships they maintain and the likelihood of providing companies with personal information. The results indicate that consumers’ overall attitudes toward relationship marketing have a strong, positive impact on these key variables. In addition, in this study, the role of consumers’ general risk aversion is investigated relative to consumers’ attitude toward relationship marketing. Although risk has often been discussed as an important factor in consumer decision-making (Berry, 1995; Sheth and Parvatiyar, 1995), little research has empirically addressed its role in relationship marketing.

A second study is conducted to determine whether consumers’ overall attitudes toward relationship marketing are associated with a favorable response to specific relationship

marketing practices. The findings show that consumer attitudes positively impact participation in frequency/reward programs, reading company communication, developing personal relationships, seeking preferential treatment and likelihood to seek customized products.

In the next section, we examine the existing literature relating to the topic. Then, we present Studies 1 and 2 before discussing the implications of the findings and directions for future research.

Literature review and hypotheses Palmatier et al. (2006) note that relationships are two-sided and that the parties should share in the benefits of strong relationships. They refer to the seller as the party that implements relationship marketing with the intentions of strengthening the relationship with the customer (Palmatier et al., 2006). The benefits and shortcomings of relationship marketing have seen considerable research attention. Benefits that customers receive include special treatment, confidence, social and time-savings (Bendapudi and Berry, 1997; Berry, 1995; Gwinner et al., 1998; Reynolds and Beatty, 1999; Sheth and Parvatiyar, 1995). More recently, however, researchers have begun investigating the “dark side” of these relationships (Anderson and Jap, 2005; Fournier et al., 1998; Wendlandt and Scharder, 2007) as well as the reasons customers may not want to develop them in the first place (Ashley et al., 2011; Noble and Phillips, 2004; O’Malley and Prothero, 2004).

In particular, Fournier et al. (1998, p. 43) discovered that relationships between companies and consumers are “troubled at best”. Their in-depth interviews suggested that companies’ relationship marketing efforts are “confusing, stressful, insensitive, and manipulative” and that consumers feel “trapped and victimized”. Several other themes emerged. First, consumers cannot maintain the number of relationships that companies ask them to maintain. Therefore, consumers feel that many marketing efforts are trivial and useless. Second, consumers feel that, although companies ask them for their friendship, loyalty and respect, companies do not reciprocate. Many consumers feel frustration in response to marketers’ constant requests for personal information. Others feel that the relationship is “all one way” in that companies continually interrupt consumers’ lives but consumers are unable to reach the companies when a problem arises.

Noble and Phillips (2004) examined reasons consumers would not wish to maintain a relationship with a retail company. Based on in-depth interviews, they developed a list of themes relating to factors that hinder relationship development and maintenance. These included upkeep themes (the effort consumers feel they have to make to engage in relationships), time themes (the time involved in engaging in relationships), benefits themes (the unattractiveness of relationship benefits) and personal loss themes (the loss of privacy or anonymity).

O’Malley and Prothero (2004) used a phenomenological approach to examine the drawbacks of relationship marketing. These authors contend that consumers are suspicious of companies that try to form relationships with them. The informants in their study describe company communication as intrusive. They view loyalty programs as schemes to entice customers to buy more, rather than to reward loyalty. Some

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informants even characterized companies’ attempts to learn more about their customers as harmful. Overall, the informants in this study felt used and abused by what they call marketers’ empty promises.

Based on this review, it appears that some consumers do not desire to engage in a relationship with a company and even harbor negative feelings associated with it. Most of these studies focused on small convenience samples that cannot be generalized to the broader population. Although these studies acknowledge that some consumers have negative attitudes toward relationship marketing, the prevalence of these feelings and opinions is not known. Thus, one goal of this study is to determine whether there is a correlation between consumers’ attitude toward relationship marketing and demographic variables.

A consumer’s attitude toward relationship marketing reflects a consumer’s global and enduring evaluation of relationship marketing. This concept is related to – but distinct from – a consumer’s relationship proneness (De Wulf et al., 2001; Odekerken-Schroder et al., 2003). Consumer relationship proneness is a personality trait (Odekerken- Schroder et al., 2003) and is defined as a “consumer’s tendency to engage in relationships with retailers of a particular product category” (De Wulf et al., 2001, p. 38). The three items used to measure relationship proneness reflect this focus, using phrases such as: “I am someone who likes to be a regular customer of an apparel store” and “I am someone who wants to be a steady customer of the same apparel store” (De Wulf et al., 2001, p. 48). Thus, consumer relationship proneness reflects more of a behavioral loyalty (or repeat purchase) tendency than a proneness to develop relationships. Therefore, a consumer could demonstrate pure behavioral loyalty to a store while having an overall negative attitude toward relationship marketing.

Cognitive consistency theories indicate that consumers seek to make choices consistent with their underlying attitudes and beliefs (Heider, 1946; Osgood and Tannenbaum, 1955). Therefore, consumers having a positive (negative) attitude toward relationship marketing should be more (less) likely to develop a relationship with a company and should be engaged in a higher (lower) number of actual relationships with companies. In addition, consumers having a positive (negative) attitude should be more likely to choose a company that engages (does not engage) in relationship marketing tactics. In these examples, consumer actions and choices are consistent with their underlying attitude toward relationship marketing. Stated formally, we predict the following:

H1. Attitude toward relationship marketing will positively affect consumers’ likelihood of developing a relationship with a company.

H2. Attitude toward relationship marketing will positively affect the number of relationships that consumers have with companies.

H3. Attitude toward relationship marketing will positively affect consumers’ likelihood to choose a company that utilizes a relationship marketing strategy over a company that does not utilize a relationship marketing strategy.

As part of a relationship marketing strategy, companies typically ask customers to provide personal information such as phone number, address, e-mail, date of birth and product/ service interests and preferences (Cho, 2006; Schoenbachler and Gordon, 2002). This information is then used to provide customized products, send company communication and develop personal relationships. Failure to obtain this information practically precludes the development of long-term relationships. Customers possessing a positive attitude toward relationship marketing are more likely to provide companies with personal information to realize the benefits associated with relationship marketing. Previous research suggests that consumers compare the benefits and costs when deciding whether or not to provide companies with personal information (Phelps et al., 2000). Based on the previous discussion, the following hypothesis is offered:

H4. Attitude toward relationship marketing will positively affect consumers’ likelihood of providing companies with personal information.

Perceived risk has been discussed as a critical variable in understanding relationship marketing theory (Berry, 1995; Bendapudi and Berry, 1997; Gwinner et al., 1998; Sheth and Parvatiyar, 1995). Risk aversion can be defined as a “preference for a guaranteed outcome over a probabilistic one having an equal expected value” (Qualls and Puto, 1989, p. 180). As such, risk aversion reflects an overall sense that risk is undesirable. The level of risk that individuals are willing to incur varies from person to person (Mandrik and Bao, 2005; Qualls and Puto, 1989; Weber and Milliman, 1997) and plays a critical role in consumer behaviors such as information search (Moorthy et al., 1997) and brand choice (Tellis and Gaeth, 1990). Research suggests that consumers develop relationships with companies as a way to overcome the risk (Berry, 1995; Sheth and Parvatiyar, 1995). Despite the general acceptance of risk reduction in relationship marketing theory, very little research has empirically examined it relative to relationship marketing behaviors (for an exception, see Gwinner et al., 1998).

The present research predicts that consumers’ risk aversion will interact with their attitudes toward relationship marketing and help predict subsequent behaviors. For example, a consumer who has both a very positive attitude toward relationship marketing and a high aversion to risk should be especially likely to respond favorably to a company’s relationship marketing efforts (compared to someone who has only a very positive attitude toward relationship marketing). Developing a relationship with a company is consistent with the positive attitude, and high risk aversion will create an even stronger desire to engage in behaviors that reduce that risk (Berry, 1995; Sheth and Parvatiyar, 1995). Likewise, this interaction may help predict the number of relationships and the choice of a company that utilizes a relationship marketing strategy over a company that does not. Formally:

H5. Consumers’ aversion to risk will moderate the relationship between attitude toward relationship marketing and consumers’ likelihood of engaging in a relationship, such that the relationship will be stronger for consumers with higher aversion to risk.

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H6. Consumers’ aversion to risk will moderate the relationship between attitude toward relationship marketing and the number of relationships that consumers have with companies, such that the relationship will be stronger for consumers with higher aversion to risk.

H7. Consumers’ aversion to risk will moderate the relationship between attitude toward relationship marketing and the choice of a company, such that the relationship will be stronger for consumers with higher aversion to risk.

Risk aversion is also expected to interact with consumer attitude toward relationship marketing in predicting consumers’ willingness to provide personal information. This interaction, however, is expected to have a negative influence. Providing companies with personal information is seen as a somewhat risky behavior because it could be misused by the company (Phelps et al., 2000). Therefore, consumers with a high level of risk aversion are not likely to divulge their personal information even if the consumer has a positive attitude toward relationship marketing. Formally:

H8. Consumers’ aversion to risk will moderate the relationship between attitude toward relationship marketing and the likelihood of consumers’ providing companies with personal information, such that the relationship will be weaker for consumers with higher aversion to risk.

A figure of the proposed relationships can be found in Figure 1.

Method A mailing list of 3,000 randomly selected consumers over the age of 18 years living in the 48 contiguous USA was purchased from a commercial research firm. The survey packet included a letter of introduction, a survey and a postage paid envelope. Two hundred and fifty-five surveys were returned for a 9 per cent response rate after accounting for undeliverables. Although a 9 per cent response rate was lower than desired, response rates less than 10 per cent have become somewhat common in marketing research (Neff, 2006). We assessed non-response bias by comparing early and late respondents on all constructs (Armstrong and Overton, 1977). Non-response bias did not appear to be a factor, as no significant differences emerged. Demographic information for respondents can be found in Table I. Although not intended to be a perfect representation of the US population, the sample characteristics suggest that various demographic groups are reflected.

A four-item scale was used to measure respondents’ attitude toward relationship marketing (Appendix 1). Instructions to the survey included a description of relationship marketing, which is included in Appendix 1. The scale was developed by following standard scale development procedures (Churchill, 1979; Gerbing and Anderson, 1988; Nunnally and Bernstein, 1994). Items were initially generated based on in-depth interviews with consumers and a review of the literature. The

items were extensively pretested prior to their inclusion in the current study[1].

The attitude toward relationship marketing scale utilized a seven-point scale. Exploratory factor analysis was conducted on the scale, and the results supported a single dimension with all items loading highly on the single factor. Item-total correlations were 0.60 or higher for all items, and the coefficient alpha was 0.91.

A three-item scale was also developed to measure consumers’ likelihood of developing a relationship with a company and utilized standard scale development procedures (Churchill, 1979; Gerbing and Anderson, 1988; Nunnally and Bernstein, 1994). The items used a seven-point scale anchored by “very unlikely” and “very likely”, and the scale was pretested prior to its use in the study. The coefficient alpha was acceptable at 0.85. The scale used to measure the likelihood of providing personal information to companies (Cho, 2006) and the scale used to measure risk aversion (Mandrik and Bao, 2005) were based on previous research. Both utilized a seven-point scale anchored by “strongly disagree” and “strongly agree”. The coefficient alphas were 0.80 and 0.86, respectively.

A confirmatory factor analysis was performed using LISREL 9.1 (Jöreskog and Sörbom 2013). All items loaded significantly onto their intended factors. Outcome variables were allowed to correlate, but no individual items were allowed to correlate. The hypothesized four-factor model achieved good fit (�2 � 124.78, df � 71, p � 0.01). Although the overall �2 is significant, the �2/df � 1. Further, we find the root mean square error of approximation (RMSEA) is 0.056, the non-normed fit index (NNFI) is 0.98, the comparative fit

Figure 1 Hypothesized model of consumer attitude toward relationship marketing

Attitude Toward

Relationship Marketing

Risk Aversion

Study One

Likelihood of Developing A Relationship

Number of Relationships

Choice of a Relationship Company

Likelihood of Providing Personal

Information

Study Two

Likelihood of Participating in Frequency/Reward Program

Likelihood of Reading Company Communication

Likelihood of Developing Personal Relationships

Likelihood of Seeking Preferential Treatment

Likelihood of Seeking Customized Products

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index (CFI) is 0.98 and the standardized root mean squared residual is 0.048. The results supported the internal consistency of all the scales, as the composite reliability was greater than 0.80 for all scales (the lowest composite reliability is 0.86). Variance extracted for all scales was greater than the generally accepted value of 0.50 (lowest average variance explained is 0.61), indicating a high level of shared variance between indicators. The items of each scale loaded highly on its respective construct (t-values range from 10.9 to 19.3), providing evidence of convergent validity (Anderson and Gerbing, 1988). Discriminant validity was achieved through comparison of variance extracted estimates with the squared phi estimates (Fornell and Larcker, 1981).

Respondents were presented a list of 34 service/retail industries and asked to identify industries in which they currently have a relationship with a specific company. The list of service providers was based on responses from numerous in-depth interviews asking participants to indicate the types of service companies that they typically use. Examples of industries included were airlines, banks, cell phone providers, dentists, dry cleaners, hotels, lawn care services and financial advisors. The total number of relationships was computed for

each respondent, and the mean number of relationships was 10.1.

To determine the type of company (either a company utilizing a relationship marketing strategy or a company not utilizing a relationship marketing strategy) that consumers prefer, respondents were given a description of two companies and asked to choose the company with which they would prefer. Prices of both companies’ products and services were approximately the same, and the presentation of the two companies was rotated to reduce the potential for order bias. Descriptions of both companies can be found in Appendix 1.

Results Before discussing the results of our hypotheses, we first address consumers’ attitude toward relationship marketing. Overall, consumers have only a slightly positive attitude, as the mean attitude toward relationship marketing score was 4.67 on a seven-point scale, just above the scale’s midpoint. In addition, the median score was 5. The minimum and maximum scores were 1.00 and 7.00, respectively, and 30.6 per cent of respondents scored at or below the scale’s midpoint. Respondents were divided into three groups: those scoring in the bottom third (Low), middle third (Middle) and top third (High) of the attitude toward relationship marketing scale.

A chi-square test found no significant (p � 0.05) relationships between demographic variables and attitude toward relationship marketing.

The hypotheses were tested using moderated regression analysis (Aiken and West, 1991). The attitude toward relationship marketing scale was used as an independent variable to predict each of the outcome variables in H1, H2, H3 and H4 (see Model 1 in Table II). We found support for H1 (� � 0.642, p � 0.01), which predicted that attitude toward relationship marketing was positively associated with consumers’ likelihood of developing a relationship with a company. Attitude toward relationship marketing also had a positive influence on the number of relationships that consumers reported having with companies (� � 0.202, p � 0.01), supporting H2.

Attitude toward relationship marketing was hypothesized to predict consumers’ choice of either a relationship- or non-relationship-oriented company (H3). Overall, 61.2 per cent of respondents chose the company utilizing a relationship marketing strategy, and 38.8 per cent of respondents chose the company not utilizing a relationship marketing strategy. Logistic regression was used to assess the ability of the attitude toward relationship marketing scale to predict respondents’ choice of companies. In support of H3, the coefficient for the attitude toward relationship marketing scale was positive and significant (� � 0.956, p � 0.01), indicating that higher scores on the relationship marketing scale reflected a greater likelihood of selecting the company utilizing a relationship marketing strategy. Overall, the model was able to correctly predict respondents’ company choice in 76.6 per cent of the cases. In support of H4, attitude toward relationship marketing positively influenced the likelihood that respondents would provide personal information to companies (� � 0.315, p � 0.01).

Table I Demographic profile for Studies 1 and 2

Demographic characteristic Study 1 (%) Study 2 (%)

Gender Female 36.1 51.6 Male 63.9 48.4

Age (years) 18-24 0.0 7.5 25-34 6.9 10.2 35-44 15.0 12.2 45-54 19.5 54.6 55-64 26.8 13.7 65 or older 31.7 1.7

Education Less than high school degree 1.6 0.3 High school degree or less 15.1 6.8 Some college 26.9 21.8 Undergraduate degree 23.3 34.0 Some graduate work 5.7 9.0 Graduate degree 27.3 28.3

Income (US$) Less than 35,000 13.5 8.4 35,000 to 49,999 20.7 11.7 50,000 to 74,999 24.8 19.5 75,000 to 99,999 16.2 16.0 100,000 or More 24.8 44.0

Race African American 4.2 10.7 Asian 1.7 0.5 Caucasian/white 89.5 86.8 Hispanic 1.7 1.2 Other 2.9 0.7

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H5-H8 predicted an interaction between attitude toward relationship marketing and risk aversion on the outcomes in H1-H4. To assess the interaction, both variables were mean-centered to reduce multi-collinearity (Aiken and West, 1991), and then, their direct effects were tested (see Model 2 in Table I). Although the main effect of risk aversion was not hypothesized, it is interesting that respondents’ risk aversion had a negative influence on the likelihood of developing a relationship (� � �0.115, p � 0.05), choice of a company utilizing a relationship marketing strategy (� � �0.290, p � 0.05) and likelihood of providing personal information (� � �0.124, p � 0.05). Next, an interaction term was added to the main effects model (see Model 3 in Table I). Contrary to the hypotheses, none of the interaction terms were significant. Therefore, respondents’ risk aversion did not interact with their attitude toward relationship marketing in predicting the overall relationship marketing behaviors and intentions.

Study 2 The results of Study 1 indicate that consumers in a national sample have only a slightly positive attitude toward relationship marketing. Further, there are no significant relationships between any demographic variable and attitude toward relationship marketing. However, even though consumers’ attitudes are only slightly positive, a majority of consumers in this sample chose a company that practices relationship marketing over a company that does not. This finding is interesting in light of previous research that points to the notion that consumers are somewhat negatively disposed to relationship marketing efforts (Fournier et al., 1998; Noble and Phillips, 2004; O’Malley and Prothero, 2004). Finally, consumers’ attitudes were significant in predicting their likelihood of developing a relationship with a company, the number of relationships that they have with service/retail companies, the selection of a company utilizing a relationship marketing strategy and the likelihood of providing companies with personal information. Contrary to suggestions in previous research, consumers’ risk aversion actually decreased their overall responses to relationship marketing.

Although the results from Study 1 are helpful, they do not indicate whether or not consumers’ attitude toward relationship marketing can predict consumers’ responses to specific relationship marketing tactics. Research on relationship marketing has identified a number of these specific tactics (cf. De Wulf et al., 2001; Gordon et al., 1998; O’Malley and Prothero, 2004), which include frequency/reward programs, company communication, personal relationships, preferential treatment and customized services and products. This study was designed to determine whether consumers’ attitudes toward relationship marketing impact their responses to these specific tactics.

Frequency/reward programs reflect offers by companies to provide tangible benefits to regular customers for loyal behavior (Berry, 1995; Gordon et al., 1998; O’Malley and Prothero, 2004). Examples include discounted prices, frequent flyer miles and other point-based systems. Companies also attempt to develop relationships with customers through regular communication (De Wulf et al., 2001; O’Malley and Prothero, 2004). This communication can be via direct mail, e-mails and telephone calls. Developing personal relationships between employees and customers is also seen as a critical component of relationship marketing (Berry, 1995; Gordon et al., 1998; O’Malley and Prothero, 2004). Companies also attempt to develop relationships by providing preferential treatment and personal service and by customizing services and products for regular customers (Berry, 1995; De Wulf et al., 2001; Gordon et al., 1998). Preferential treatment is defined as providing better service to regular customers than to non-regular customers, whereas customized products are tailored to meet the needs of individual customers (De Wulf et al., 2001).

Positive customer responses to these relationship marketing tactics are critical in the development of long-term relationships. For example, it would be extremely difficult for companies to develop or maintain a relationship with customers who do not read company any communication. As discussed previously, cognitive consistency theories indicate that consumers strive to make decisions and choices that are

Table II Regression models testing main and interaction effects – Study 1

Model

Likelihood of developing a relationship

Number of relationships

Choice of a relationship company

Likelihood of providing personal

information � t-value � t-value � Wald statistic � t-value

Model 1 Attitude towards relationship marketing 0.642 13.04�� 0.202 3.20�� 0.956 46.27�� 0.315 5.17��

Model 2 Attitude towards relationship marketing 0.636 13.03�� 0.203 3.22�� 0.960 46.02�� 0.309 5.10��

Risk aversion �0.115 2.35� 0.037 0.58��� �0.290 5.24� �0.124 �2.04�

Model 3 Attitude towards relationship marketing 0.617 13.35�� 0.187 2.88� 0.955 44.99�� 0.290 4.66��

Risk aversion �0.118 2.42� 0.034 0.53 �0.287 5.10� �0.127 2.10�

Attitude towards relationship marketing � risk aversion 0.082 1.65 0.073 1.12 0.063 0.37 0.083 1.33

Notes: � p � 0.05; �� p � 0.01

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consistent with their beliefs and attitudes. Therefore, consumers who generally have a positive attitude toward relationship marketing should also be more likely to respond positively to the specific relationship marketing tactics discussed above. Formally:

H9. Attitude toward relationship marketing will increase consumers’ likelihood of participating in a company frequency/reward programs.

H10. Attitude toward relationship marketing will increase consumers’ likelihood of reading company communications.

H11. Attitude toward relationship marketing will increase consumers’ likelihood of developing personal relationships with company employees.

H12. Attitude toward relationship marketing will increase consumers’ likelihood of seeking preferential treatment from a company.

H13. Attitude toward relationship marketing will increase consumers’ likelihood of seeking customized products from a company.

Method The scales measuring the likelihood of responding to specific relationship marketing tactics were created using in-depth interviews and standard scale development procedures (Churchill, 1979; Gerbing and Anderson, 1988; Nunnally and Bernstein, 1994). All scales were pre-tested and utilized a seven-point Likert format. These scales can be found in Appendix 2. Upper-level undergraduate marketing students were trained in data collection procedures and instructed to recruit non-student participants only. The survey was administered online via an e-mail link of a Web page containing the survey. This approach has been successful in previous research (Arnold and Reynolds, 2003; Bitner et al., 1990).

A total of 417 respondents participated in the study. All respondents were contacted to validate the sample, and no problems were detected. Demographics of respondents for Study 2 can be found in Table I. An exploratory factor analysis supported a single dimension for each scale, and item-total

correlations were high (greater than 0.60) for each construct. The mean attitude toward relationship marketing for this study was 5.36, and descriptive statistics for each scale as well as correlations between all constructs are presented in Table III.

We estimated a measurement model using LISREL with maximum likelihood estimation and achieved acceptable model fit (�2 � 321.50, df � 137; CFI � 0.98; NNFI � 0.97; RMSEA � 0.055) (Hair et al., 1998). The results supported the internal consistency of all the scales, as the composite reliability was greater than 0.80 for all scales. Variance extracted for all scales was greater than the generally accepted value of 0.50, indicating a high level of shared variance between indicators. The items of each scale loaded highly on its respective construct (t-values range from 16.29 to 27.21), providing evidence of convergent validity (Anderson and Gerbing, 1988). Discriminant validity was achieved through a comparison of variance extracted estimates with the squared phi estimates (Fornell and Larcker, 1981).

Results Next, a structural model was estimated to test the proposed relationships. Overall, the fit indices indicated an acceptable model fit (�2 � 410.13, df � 146, NNFI � 0.96; CFI � 0.97; RMSEA � 0.068). As predicted, attitude toward relationship marketing positively influenced the likelihood of participating in a company’s frequency/reward program (� � 0.51; t � 10.59, p � 0.01), the likelihood of reading company communication (� � 0.46; t � 9.19, p � 0.01), the likelihood of developing personal relationships with company employees (� � 0.55; t � 11.23, p � 0.01), the likelihood of seeking preferential treatment from a company (� � 0.34; t � 6.50, p � 0.01) and the likelihood of seeking customized products from a company (� � 0.47; t � 9.37, p � 0.01). Therefore, H9-H13 were all supported.

Summary Relationship marketing has had a tremendous influence on marketing theory and practice. Although early research focused primarily on relationship marketing from the organizational perspective (cf. Dwyer et al., 1987), more recent research has investigated from the consumers’ point of view (cf. Noble and Phillips, 2004; O’Malley and Prothero,

Table III Construct summary statistics – Study 2

Construct Correlations

1 2 3 4 5 6

1. Attitude towards relationship marketing 1.00 2. Likelihood of participating in frequency/reward program 0.50 1.00 3. Likelihood of reading company communication 0.44 0.39 1.00 4. Likelihood of developing personal relationships 0.53 0.33 0.35 1.00 5. Likelihood of seeking preferential treatment 0.34 0.36 0.24 0.32 1.00 6. Likelihood of seeking customized products 0.47 0.40 0.34 0.45 0.63 1.00 Mean 5.36 4.84 4.19 4.77 4.16 4.68 SD 1.16 1.54 1.53 1.40 1.48 1.39 Composite reliability 0.92 0.98 0.95 0.94 0.92 0.95 Variance extracted 0.75 0.94 0.85 0.83 0.79 0.86

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2004). However, this literature has tended to focus on the benefits and drawbacks to consumers (cf. Gwinner et al., 1998; Reynolds and Beatty, 1999; Noble and Phillips, 2004; O’Malley and Prothero, 2004). The purpose of this research was to determine consumers’ overall attitudes toward relationship marketing and the impact that they have on specific tactics associated with these strategies. Understanding consumers’ attitudes toward relationship marketing is critical to determining whether or not services and retail companies may realize the many benefits of relationship marketing (Fournier et al., 1998).

Although previous research has documented that some negative attitudes exist in the marketplace (Noble and Phillips, 2004; O’Malley and Prothero, 2004), the current research quantifies consumers’ attitude using a national sample and finds that consumers’ overall attitude is only slightly positive (4.67 on a seven-point scale). Further, although 61.2 per cent of respondents chose a company that uses a relationship marketing strategy, a rather large percentage, 38.8, chose a company that did not use a relationship marketing strategy. Overall, this confirms previous qualitative research which finds that negative attitudes toward relationship marketing are somewhat prevalent in the consumer marketplace. The results also indicate that consumers’ attitudes toward relationship marketing positively impact their likelihood of developing a relationship with a company, the number of relationships that customers currently have with services/retail companies and the likelihood of providing personal information to companies. Thus, consumers’ attitudes play an important role in the decision to respond favorably, in general, to companies’ relationship marketing efforts.

Managerial implications This research suggests that the development of relationship marketing theory and practice should take into account the fact that a sizable segment of consumers is not particularly interested in developing relationships with services/retail companies. Until recently, marketing theory and practice has assumed that customers were interested and willing to engage in these relationships. Thus, it has focused on the benefits of relationship marketing to both customers and organizations (Noble and Phillips, 2004; O’Malley and Prothero, 2004). Companies must realize that not all customers are interested in developing relationships, even some who are completely satisfied and loyal (Noble and Phillips, 2004).

Companies should consider segmenting their customer base according to whether or not customers are interested in developing a relationship. Our results, however, show no correlation between customer demographics and attitude toward relationship marketing. This finding increases the difficulty of effectively categorizing “relationship” or “non-relationship” customers. The “attitude toward relationship marketing” scale used in this research is short enough that it could be used as part of an initial set-up (e.g. opening a new banking account) with new customers. Based on their answers, customers could then be categorized and unique marketing mixes developed for each group.

Unfortunately, many companies choose to ignore “non-relationship” customers, despite the fact that they may be very satisfied and exhibit a high degree of behavioral

loyalty. To undervalue these customers simply because they do not respond to relationship marketing tactics would have a negative impact on revenues and profits. In fact, the constant onslaught of relationship marketing materials to customers that are not interested may actually decrease customer satisfaction and eventually cause the customer to switch companies (Fournier et al., 1998).

The results from Study 1 also indicate that consumers’ general risk aversion has a negative influence on their likelihood of developing a relationship with a company and the likelihood of providing personal information to companies. These findings support previous research (Berry, 1995; Bendapudi and Berry, 1997; Gwinner et al., 1998; Sheth and Parvatiyar, 1995). Interestingly, consumers’ risk aversion did not have a significant influence on the number of reported relationships with services/retail companies. This finding may suggest that, although risk-averse consumers generally prefer not to engage in relationships, they do engage in actual relationships with companies, perhaps to realize some of the economic or social benefits that relationships can offer. Overall, using risk reduction as a selling point for engaging in a relationship might not be the best strategy for companies attempting to establish relationships with their customers. Future research should more fully investigate the role of risk in relationship marketing, including not just general risk aversion but product category and product-specific risk (Dowling and Staelin, 1994).

Given these findings, companies may do well to highlight the specific benefits to these customers. For example, communications could point out how much members of the company’s loyalty or frequent-buyer program saved using the privileged promotions, coupons and other deals. Testimonials from customers who are members could also focus on how knowing the company’s frontline service employees or simply being a member saves them time and effort, or how nice it is to be recognized by name and to receive personal treatment.

Although numerous relationship marketing tactics have been discussed in the literature (cf. De Wulf et al., 2001; O’Malley and Prothero, 2004), Study 2 was one of the first attempts to measure consumers’ response to these tactics. The results demonstrate that consumers’ attitudes toward relationship marketing have a positive impact on their likelihood of participating in frequency/reward programs, reading company communication, developing personal relationships, seeking preferential treatment and seeking customized products. Thus, if consumers are to respond favorably to these specific relationship marketing tactics, they need a positive overall attitude toward relationship marketing. Again, this finding highlights the importance of knowing the customer base and the specific preferences of certain customer groups. Then, actually communicating with customers in their preferred manner would seem to go a long way.

Finally, the findings from this study can also be used societally as well. For example, governments collect and maintain large quantities of information on individuals, and governments want to have relationships with their citizens. The information on these individuals could be used to help establish and build these relationships. In implementing relationship building programs, however, governments should

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be careful to accommodate differences in attitudes toward relationship marketing.

Limitations and future research Some limitations should be noted. First and not uncommon to most survey research in marketing, the relationships between constructs in this study may be inflated because of common methods bias. Future research should investigate the research questions and hypotheses using multiple methods. For example, the scale could be used to collect data from individuals who are currently enrolled in loyalty programs to compare consumers’ reported attitude with their actual behaviors. In addition, consumers who score higher or lower on the attitude toward relationship marketing scale could also be recruited to participate in laboratory experiments to assess the ability of the scale to predict certain behaviors and to develop behavioral profiles of consumers who are more (or less) relationship marketing-oriented. Future research could also use the scale in a field experiment with an actual company to measures consumers’ attitude toward relationship marketing and to track consumers’ responses to actual relationship marketing tactics. Given that the response rate for the national sample was 9 per cent, future research should also aim to use methods that may achieve higher response rates to avoid the possible influence of non-response bias. Study 2 used a convenience sample. Future research should attempt to reach other types of samples as well.

Second, this research reports the results from two studies. Although one of the studies represents a national sample, additional research using the scales developed in this research is needed. Specific research on known groups that are expected to differ in their attitudes would be interesting as well. For example, scholars could investigate consumers who are currently active in a rewards program or consumers who have given personal information to a company and contrast these opinions with consumers who try to avoid relationships.

This research also relied on consumers’ self-reported likelihood of responding to specific relationship marketing tactics. Future research should strive to investigate consumer responses to actual tactics, which may differ from their survey answers. Such research could identify factors that cause customers to participate in relationship marketing, despite negative attitudes. For example, a coupon providing a certain dollar- or percentage-off may cause a consumer to sign up for a frequency/reward program, despite a negative attitude toward relationship marketing.

The present research focused on consumers’ attitude and likelihood of developing a relationship with a company while holding all other variables constant using scenarios. Future research should explore additional factors to determine their impact on the development of relationships. For example, consumer trust and commitment of the service provider should be investigated along with attitude toward relationship marketing to determine how these factors interact in predicting the establishment and development of relationships. The role of quality should also be investigated in future research, as quality was also held constant when asking respondents to choose a relationship-focused company versus a non-relationship company.

Future research should investigate consumers who actually engage in relationships with companies while having an overall negative attitude toward relationship marketing. Specifically, do customers who have a relationship with a company, despite having a negative attitude engage in any behaviors that may have negative consequences for the company? Finally, scholars should continue to investigate relationship marketing from the customers’ perspective for the simple reason that for there to be a relationship, the customer must first perceive that it exists. Perhaps, a consumer’s idea of what constitutes a relationship is different from the company’s perspective. Further, this perception may impact their overall attitude toward relationship marketing.

Note 1. Additional information on the development of the

attitude toward relationship marketing scale is available from the authors.

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Appendix 1. Items used in Study 1 Attitude toward relationship marketing Companies are increasingly focusing their efforts on developing relationships with their customers by communicating with them on a regular basis, offering rewards and discounts, developing personal relationships, offering preferential treatment to regular customers and offering customized products. The questions in this section of the survey concern these company actions just described and are referred to as “a relationship with a company” or “relationship marketing efforts”. Please read each item and circle a number from 1 to 7 that most accurately reflects your opinions: 1 Having a relationship with a company offers good

benefits. 2 I feel that having a relationship with a company is

beneficial to me. 3 I feel that having a relationship with a company is in my

best interest. 4 Companies’ relationship marketing efforts are beneficial

to me.

(Items were measured using a seven-point scale anchored by “strongly disagree” and “strongly agree”.)

Likelihood of developing relationships with companies 1 In general, I try to develop relationships with companies. 2 I usually respond favorably to a company’s efforts to

establish a relationship with me. 3 I am usually willing to develop relationships with

companies.

Risk aversion 1 I do not feel comfortable taking chances. 2 I prefer situations that have foreseeable outcomes. 3 Before I make a decision, I like to be absolutely sure how

things will turn out. 4 I avoid situations that have uncertain outcomes.

(Items were measured using a seven-point scale anchored by “strongly disagree” and “strongly agree”.)

Likelihood of providing personal information 1 I am willing to provide my personal information to

companies that are trying to develop a relationship with me.

2 I am willing to disclose sensitive personal information to companies that are trying to develop a relationship with me.

3 I am willing to be truthful in revealing my personal information to companies that are trying to develop a relationship with me.

(Items were measured using a seven-point scale anchored by “very unlikely” and “very likely”.)

Company choice Please read the description of the two companies (Company A and Company B) below and place a check mark next to the one company that you would generally prefer to do business with. Please note that the price of the two companies’ products/services is approximately the same.

Company A This company focuses on satisfying your needs and tries to build a relationship with you. This company collects personal information about you, communicates with you on a regular basis, customizes their products and services to your needs, offers preferential treatment to you and offers a reward program.

Company B This company focuses on satisfying your needs but does not attempt to build a relationship with you. This company does not collect your personal information or try to communicate with you on a regular basis. In addition, this company does not attempt to customize its products and services to your needs, does not offer preferential treatment and does not offer a reward program.

Appendix 2. Items used in Study 2

Attitude toward relationship marketing 1 Having a relationship with a company offers good

benefits. 2 I feel that having a relationship with a company is

beneficial to me. 3 I feel that having a relationship with a company is in my

best interest. 4 Companies’ relationship marketing efforts are beneficial

to me.

Likelihood of enrolling in frequency/reward programs 1 If a company offers a frequency/reward program to its

customers, I am likely to sign up for this frequency/reward program.

2 I am likely to enroll in a company’s frequency/reward program.

3 I am likely to participate in frequency/reward programs that companies offer.

Likelihood of reading company communication 1 I am likely to read company communication such as

newsletters that are mailed or emailed to me. 2 I am likely to look at company communication that is sent

to me. 3 If a company sends me information in the mail or email, I

am likely to read it.

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Likelihood of establishing personal relationships with employees 1 I am likely to develop personal relationships with

employees of companies that I do business with. 2 If I started doing business with a new company, I would

probably develop personal relationships with the employees. 3 If I switched to a new company, I would most likely try to get to

know the employees at the new company.

Likelihood of seeking preferential treatment from companies 1 I am likely to seek preferential treatment from a company. 2 If I am a regular customer of a company, I am likely to ask

for preferential treatment. 3 I am likely to ask for special favors from companies that I

do business with.

Likelihood of seeking customized products and services from companies 1 I am likely to seek customized products and services from

a company. 2 If I am a regular customer of a company I am likely to seek

customized products and services from them. 3 I am likely to seek products and services that are

individually customized to my preferences.

(All items above were measured using a seven-point scale anchored by “strongly disagree” and “strongly agree”.)

Corresponding author Kristy E. Reynolds can be contacted at: [email protected]. edu

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