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A signaling theory approach to relationship recovery

Husni Kharouf · Donald J. Lund · Alexandra Krallman · Chris Pullig

90 citations0/0 files storedEuropean Journal of Marketing

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Customer Service Quality and Loyalty Marketing and Advertising Strategies Consumer Behavior in Brand Consumption and Identification

Abstract

Purpose Drawing on signaling theory, the purpose of this study is to investigate the effects of the strength and framing of firm signals sent to repair relationships following relationship violations. Design/methodology/approach Three 2 × 2 scenario-based experiments (total n = 527) manipulate signal strength × violation type (Study 1); signal frame × violation type (Study 2); and signal strength × brand familiarity (Study 3) to examine their dynamic impacts on relationship recovery efforts. Findings Stronger signals are more effective at relationship repair and are especially important following integrity (vs competence) violations. Signals framed as customer gains (vs firm costs) lead to more favorable relationship outcomes. Finally, brands that are less (vs more) familiar see greater benefits from strong signals. Research limitations/implications The three experiments were scenario-based, which may not replicate real-life behavior or capture participants’ actual emotions following a violation, thus future research should extend into real-world recovery efforts. Practical implications Managers should send strong signals (communicating the level of resources invested in the recovery efforts) framed as benefits to the customer, rather than costs to the firm. Strong signals are especially important when brand familiarity is low or an integrity violation has occurred. Originality/value This is the first research to directly apply signaling theory to the relationship recovery process and contributes to theory by examining the role of signal strength; framing of the signal as a customer gain vs firm cost; and the interplay of signal strength and brand familiarity on the relationship recovery effort.

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References

1994The Commitment-Trust Theory of Relationship Marketing 1973Job Market Signaling 2010Signaling Theory: A Review and Assessment 1961The Economics of Information 1990The Service Encounter: Diagnosing Favorable and Unfavorable Incidents 1987Dimensions of Consumer Expertise 2002Consumer Trust, Value, and Loyalty in Relational Exchanges 2006Factors Influencing the Effectiveness of Relationship Marketing: A Meta-Analysis

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