Effects of Service Quality and Shared Value on Trust and Commitment: An Empirical Study of 3cs Product Customers in Taiwan

Article excerpt

The convergence of computer, communications, and consumer electronics (3Cs) technologies, catalysed by advancement of protocol standards, has forced three previously separate retailing industries to integrate their business operations, such as consolidation of retail outlets. This provides an unprecedented level of convenience for consumers to work, shop, and network with each other. To survive in this highly competitive market, companies in the 3Cs retail industry in Taiwan are adopting innovative marketing strategies and aggressive promotion campaigns to strengthen their customer relationships. From the consumer point of view, lying at the core of customer relationship management are such notions as commitment, trust, and value. This study examines the effect of service quality on customers' trust in and relationship commitment toward the service-providing company. The role of shared value as a mediating factor is also examined. Three findings are revealed: (I) Service quality significantly impacts trust and trust significantly impacts relationship commitment; (2) Service quality impacts relationship commitment indirectly through trust; and (3) Shared value significantly impacts both trust and relationship commitment.

Key Words: Service Quality, Shared Value, Relationship Commitment, Trust, Consumer Behaviour, 3C Products Retailing

I. INTRODUCTION

Customer relationship management is emerging as a major management issue in marketing as competition escalates in virtually every business sector. From the consumer behaviour perspective, the quality of the customer relationship may be closely related with such factors as quality delivery, shared value, and trust. Much research has been conducted to address the roles of these factors. For example, the emphasis on quality delivery in products and services has been an important issue in marketing research and practices since the 1980s (Leonard & Sasser, 1982; Rabin, 1983; Parasurama, et al., 1985). There is, however, still a dearth of research conducted to systematically assess the interplay of these factors. Understanding the relationship between these factors is especially important for the more recent types of retail business, such as those selling computers, communications, and entertainment (3C) products / services, given their lack of past experience with the target customers.

The rapid convergence of 3C technologies has fundamentally transformed the marketing strategy of the 3C products retail stores. With the competition rapidly escalating, firms are stressing the importance of service quality, and aggressively acting to enhance customer relationships through a variety of measures. A wide variety of price-related and non-price-related measures have been adopted to promote customer interactions in the hope of enhancing customer loyalty.

The objective of this study is to empirically examine how consumers' perception of service quality impacts consumer trust and how consumer trust impacts relationship commitment. It also investigates the role of shared value in the abovementioned relationships. The 3C retail industry is chosen as the context from which primary data are gathered because of the highly competitive nature of the market. Although data are collected only from the 3Cs industry in Taiwan, it is hoped that the results may apply to other industries and cultures, due to the generic nature of the research constructs.

The remainder of the paper first presents a brief review of existing literature related to service quality, trust, relationship commitment, and shared value. This is followed by a section on the research method employed to conduct this study consisting of the research approach, research hypotheses, variable definitions, data collection and data analysis methods. The findings are subsequently presented. The paper is concluded by a summary of the research and implications of the research findings for marketing practices as well as for further research. …