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Customer Loyalty to Whom? Managing the Benefits and Risks of Salesperson-Owned Loyalty
Abstract
In a study of 362 buyer–salesperson dyads using triadic data (from buyer, salesperson, and sales manager), the authors examine both a customer's overall loyalty to the selling firm and the customer's loyalty vested specifically in his or her salesperson. They find that only salesperson-owned loyalty, a newly identified construct, directly affects the more tangible seller financial outcomes of sales growth and selling effectiveness, whereas both salesperson-owned loyalty and loyalty to the selling firm increase the customer's willingness to pay a price premium. A longitudinal study verifies that the positive effect of salesperson-owned loyalty on sales growth persists over time. However, because salesperson-owned loyalty simultaneously increases the seller's risk of losing business if the salesperson defects to a competitor, managers need to manage effectively the benefit–risk trade-off. Increasing relationship-enhancing activities and value received by the customer builds both salesperson-owned loyalty and loyalty to the selling firm. The loyalty-building impact of relationship-enhancing activities is moderated by selling-firm consistency and by the selling firm's and salesperson's loyalty-capturing strategies.
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“Similarly, customers who enjoy social benefits due to friendly relations with employees often express loyalty toward a particular employee (Bove and Johnson 2006; Palmatier et al. 2007), which makes it harder to switch (Jones et al. 2002).”
From Understanding and managing customer relational benefits in services: a meta-analysis (2020) · cites this paper as Palmatier et al. 2007
In the citing paper
“this meta-analysis includes only customer loyalty toward an organization as an insufficient number of studies examine customer loyalty toward a frontline employee.”
From Understanding and managing customer relational benefits in services: a meta-analysis (2020) · cites this paper as Palmatier et al. (2007)
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Dimaculangan, E. D., & Aguiling, H. M. (2012) · Cited by 25
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BackgroundResultApproacher be-wear? Increasing shopper approach intentions through employee apparel
Barney, C., Jones, C. L. E., & Farmer, A. (2020) · Journal of Business Research · doi:10.1016/j.jbusres.2019.11.061 · Cited by 24
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“…and trust (Moorman et al., 1992; Morgan and Hunt, 1994; Pan et al., 2012; Tse and Wilton, 1988; Wulf et al., 2001), while outcomes of loyalty include customer word-of-mouth, cross-buying, and firm financial performance (Berger and Schwartz, 2011; Gupta et al., 2004; Palmatier et al., 2007).”
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“Studies have argued that a salesperson’s strong relationship with a customer simultaneously increases the supplier company’s potential risk of losing business in the future if that salesperson defects to a competitor (Bendapudi & Leone, 2002; Palmatier et al., 2007).”
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“firm and consequently there is no basis to presume that it will be affected by the customer’s loyalty to the firm (Palmatier et al., 2007).”
BackgroundEffects of commitment on intentional loyalty at the person-to-person and person-to-firm levels
Strandberg, C., Wahlberg, O., & Öhman, P. (2015) · Journal of Financial Services Marketing · doi:10.1057/fsm.2015.13 · Cited by 13
Will the human factors of relationship selling survive in the twenty‐first century?
Williams, J., Everett, R. R., & Rogol, E. (2009) · International Journal of Commerce and Management · doi:10.1108/10569210910967905 · Cited by 13
“identify primary valued relationships in customer loyalty in which the Palmatier, Scheer, and Steenkamp study accepted their hypotheses testing of these relationships ( Palmatier, 2007”
BackgroundConde, R., Prybutok, V. R., Thompson, K. N., & Sumlin, C. (2023) · Journal of Business and Industrial Marketing · doi:10.1108/jbim-09-2022-0410 · Cited by 13
Berends, J., & Gerpott, T. J. (2023) · Electronic Commerce Research · doi:10.1007/s10660-023-09791-5 · Cited by 17
“Former are willing to pay more [93] and speak favorably (word-of-mouth) to other potential buy - ers [7, 124].”
Schwede, M., Mozafari), N. M. (., Schnakenburg, N. V., & Hammerschmidt, M. (2023) · Hawaii International Conference on System Sciences (HICSS) · doi:10.24251/hicss.2023.425 · Cited by 13
“However, persuasiveness of chatbots or sales assistants are considered to play a significant role when it comes to product commerce (Palmatier et al., 2007), thus firms should have an interest in increasing the persuasiveness of the chatbot.”
Lin, S.-H., & Wu, H. (2012) · Cited by 12
Ashnai, B., Smirnova, M., Henneberg, S. C. M., & Naudé, P. (2019) · Journal of Business-to-Business Marketing · doi:10.1080/1051712x.2019.1565134 · Cited by 12
“The first is to minimize common method bias using both levers of multiple informants and units of observation to capture distinct constructs, such as the employee’s satisfaction and the customer’s satisfaction (see Boukis and Gounaris 2015; Joshi 2009; Palmatier, Scheer, and Steenkamp 2007).”
BackgroundMethodEdwards, C., & Baker, B. L. (2020) · Journal of Marketing Channels · doi:10.1080/1046669x.2020.1757977 · Cited by 12
“Before the industrial age, exchange occurred mostly in local markets where producers assumed responsibility for retailing their wares (Palmatier et al., 2007).”
BackgroundInfluentialAffective commitment recipes for wine clubs: Value goes beyond the vine
Krishen, A. S., Berezan, O., Agarwal, S., & Kachen, S. (2022) · Journal of Business Research · doi:10.1016/j.jbusres.2022.113464 · Cited by 12
Zheng, Y., Liu, D., Zheng, Y., & Zang, Z. (2021) · Journal of Business and Industrial Marketing · doi:10.1108/jbim-09-2020-0445 · Cited by 12
Jha, A., & Dash, S. B. (2022) · Journal of Cleaner Production · doi:10.1016/j.jclepro.2022.135337 · Cited by 12
An exploratory study of factors influencing make-or-buy of sales activities
Rogers, B., & Rodrigo, P. (2015) · Strategic Outsourcing An International Journal · doi:10.1108/so-07-2015-0016 · Cited by 13
“The impact of using contract sales organisations in on-going customer relationships has been briefly explored (Palmatier et al., 2007).”
BackgroundFinch, D., Hillenbrand, C., O’Reilly, N., & Varella, P. (2015) · Journal of Marketing Management · doi:10.1080/0267257x.2015.1076496 · Cited by 15
“The construct of psychological contract fulfilment was adapted from Palmatier, Scheer, and Steenkamp (2007) and Ponzi, Fombrun, and Gardberg (2011).”
Method
Metadata
- Authors
- Palmatier, R. W., Scheer, L. K., & Steenkamp, J.-B. E. M.
- Affiliations
- University of Cincinnati (US)
- University of Missouri (US)
- University of North Carolina at Chapel Hill (US)
- Corresponding author
- Palmatier, Robert W.
- Scheer, Lisa K.
- Steenkamp, Jan-Benedict E.M.
- Venue
- Journal of Marketing Research
- Publisher
- SAGE Publications
- Published
- 2007-05
- Volume
- 44
- Issue
- 2
- Pages
- 185-199
- ISSN
- 0022-2437 (ISSN-L)
- 1547-7193
- OpenAlex
- W2099463741
- Cited by
- 555
- References
- 42
- Citations by year
- 2026: 9 · 2025: 16 · 2024: 16 · 2023: 25 · 2022: 31 · 2021: 31 · 2020: 29 · 2019: 34 · 2018: 38 · 2017: 36 · 2016: 43 · 2015: 40 · 2014: 41 · 2013: 33 · 2012: 32
- FWCI
- 44.17
- Type
- journal article
- Language
- en
- Open access
- closed
- Locations
- Journal of Marketing Research (publishedVersion)
- Topics
- Social Sciences › Business, Management and Accounting › Marketing › Customer Service Quality and Loyalty
- Social Sciences › Business, Management and Accounting › Marketing › Consumer Behavior in Brand Consumption and Identification
- Social Sciences › Business, Management and Accounting › Marketing › Consumer Market Behavior and Pricing
- Keywords
- customer loyalty, sales growth, price premium, risk-benefit trade-off
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