The Relative Effects of Relationship Quality and Exchange Satisfaction on Customer Loyalty

Seigyoung Auh, Chuan Fong Shih

Research output: Contribution to journalArticlepeer-review

21 Scopus citations

Abstract

This paper addresses two key questions on how supplier firms can better manage industrial buyers to create higher loyalty. The first involves whether to focus on relationship quality or exchange satisfaction. This dual route model towards enhancing loyalty in essence is concerned with comparing the relative strengths of the effect from relationship quality to loyalty and from exchange satisfaction to loyalty. The second point of interest pertains to whether the effects from relationship quality and exchange satisfaction to loyalty are moderated by environmental conditions such as switching barriers and viable alternatives. Using data on business customers' ratings of a major information technology provider, we find that the effect of exchange satisfaction on loyalty is significantly greater than the effect of relationship quality on loyalty. We also find that the impact of exchange satisfaction on loyalty is less sensitive and more stable across different levels of switching barriers and viable alternatives. Conversely, the effect of relationship quality on loyalty is more pronounced to such moderating variables in that the effect of relationship quality on loyalty was greater when switching barriers were low and many viable alternatives existed. Implications for marketing theory and practice are discussed.

Original languageEnglish (US)
Pages (from-to)73-100
Number of pages28
JournalJournal of Business-to-Business Marketing
Volume12
Issue number2
DOIs
StatePublished - Jul 6 2005
Externally publishedYes

Keywords

  • Exchange satisfaction
  • Relationship quality
  • Relative effects

ASJC Scopus subject areas

  • Management Information Systems
  • Marketing

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