TY - JOUR
T1 - Unlocking the power of marketing
T2 - understanding the links between customer mindset metrics, behavior, and profitability
AU - Petersen, J. Andrew
AU - Kumar, V.
AU - Polo, Yolanda
AU - Sese, F. Javier
N1 - Funding Information:
Acknowledgements We would like to thank Valarie Zeithaml, Bob Leone, Nita Umashankar, and the participants of the 2015 Theory + Practice of Marketing Conference for their valuable comments on an earlier version of this paper. We would also like to thank a telecommunications firm and a high-tech firm for providing the data for this study. Yolanda Polo and F. Javier Sese appreciate financial support from the projects ECO2014-54760 (MINECO, FEDER), and S09-PM062 (Gobierno de Aragon and Fondo Social Europeo). F. Javier Sese acknowledges financial aid from BAyudas a la Investigación en Ciencias Sociales, Fundación Ramón Areces^.
Publisher Copyright:
© 2017, Academy of Marketing Science.
PY - 2018/9/1
Y1 - 2018/9/1
N2 - Recent evidence about the central role played by perceptual constructs in driving performance outcomes has produced a renewed interest in studying customer mindset metrics (CMMs; e.g., satisfaction, service quality, and loyalty intentions). However, we still lack a proper understanding of how (i.e., process) and to what extent (i.e., magnitude) these CMMs ultimately translate into profitability at the customer level. In this study, we integrate CMMs into an individual-level framework of customer behavior and profitability and provide a conceptual understanding of the process through which these metrics influence customer profitability. Specifically, we propose three mechanisms through which CMMs affect customer behavior and profitability: behavioral effect, marketing effectiveness effect, and marketing efficiency effect. We empirically test this framework across two distinct contexts, a B2B high-tech firm and a B2C telecommunications firm. The results demonstrate that these unobservable CMMs have a significant and multi-dimensional impact on customer behavior and customer profitability. Furthermore, we compute the increases in customer behavior and customer profitability that each firm can expect due to increases in CMMs to help firms improve resource allocation and make better decisions about how much (and when) to invest in CMMs.
AB - Recent evidence about the central role played by perceptual constructs in driving performance outcomes has produced a renewed interest in studying customer mindset metrics (CMMs; e.g., satisfaction, service quality, and loyalty intentions). However, we still lack a proper understanding of how (i.e., process) and to what extent (i.e., magnitude) these CMMs ultimately translate into profitability at the customer level. In this study, we integrate CMMs into an individual-level framework of customer behavior and profitability and provide a conceptual understanding of the process through which these metrics influence customer profitability. Specifically, we propose three mechanisms through which CMMs affect customer behavior and profitability: behavioral effect, marketing effectiveness effect, and marketing efficiency effect. We empirically test this framework across two distinct contexts, a B2B high-tech firm and a B2C telecommunications firm. The results demonstrate that these unobservable CMMs have a significant and multi-dimensional impact on customer behavior and customer profitability. Furthermore, we compute the increases in customer behavior and customer profitability that each firm can expect due to increases in CMMs to help firms improve resource allocation and make better decisions about how much (and when) to invest in CMMs.
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U2 - 10.1007/s11747-017-0554-5
DO - 10.1007/s11747-017-0554-5
M3 - Article
AN - SCOPUS:85023772926
VL - 46
SP - 813
EP - 836
JO - Journal of the Academy of Marketing Science
JF - Journal of the Academy of Marketing Science
SN - 0092-0703
IS - 5
ER -