Interpersonal Relationship, Service Quality ... - Wiley Online Library

Interpersonal Relationship, Service Quality, Seller Expertise: How Important Are They to Adolescent Consumers? Wendy W. N. Wan Sun Yat-Sen University

Chung-Leung Luk City University of Hong Kong

Kim-Shyan Fam Victoria University of Wellington

Peiguan Wu Sun Yat-Sen University

Cheris W. C. Chow University of Macau

ABSTRACT Drawing upon social capital theory and psychosocial development theory, this paper argues that a true buyer–seller relationship is a key determinant of favorable consumer behaviors for adolescent consumers of hairstylist services. Other important determinants include quality of the service delivery process (i.e., service quality as measured by the five SERVQUAL factors) and quality of the core service (in this case, the hairstylist’s expertise). A survey of 350 adolescent consumers confirms these predictions. It shows that a true interpersonal relationship negatively moderates the positive effects of service quality on consumer satisfaction with, and overall assessment of the hairstylist. This negative moderating effect is labeled resource substitution benefit and the argument made that this is the fourth social capital benefit. The theoretical and practical implications of these findings C 2012 Wiley Periodicals, Inc. are discussed.

Adolescents are characterized by their strong concern for self-image. According to Erik Erikson’s theory of psychosocial development (Erikson, 1963a, 1963b), the focus of adolescence is the search for an ego identity, which is developed by identifying with one’s social group. The other people forming the group help to shape the adolescent’s self-image. Therefore, interpersonal relationships are an important determinant of adolescent behavior. As a result of this, adolescent consumers take seriously those products and services that are tied to selfimage, such as hairdressing. One’s hairstyle conveys his/her public, social, and even ideal self. Adolescents are therefore a major target market for hairdressing services. As Gutek, Bhappu, Liao-Troth, and Cherry (1999) show, of seven different services, hairstylists are

the type of provider with whom the greatest number of students is likely to develop a true service relationship. Thus, it seems that for adolescents, hairstylists are not only service providers, but also play a significant role in their social lives. Adolescents develop true interpersonal relationships with their hairstylists, who can help them build their ego identity. Conversely, hairstylists who have such relationships can effectively influence their adolescent customers and successfully generate consumer satisfaction (Smith, 1998). True interpersonal relationships are therefore a key determinant of their business success. According to the extant literature on relationship marketing, service quality also results in consumer satisfaction (see, e.g., Rauyruen & Miller, 2007; Rust, Zahorik & Keiningham, 1995; Zeithaml, Berry, &

Psychology and Marketing, Vol. 29(5): 365–377 (May 2012) View this article online at wileyonlinelibrary.com/journal/mar C 2012 Wiley Periodicals, Inc. DOI: 10.1002/mar.20527 365

Parasuraman, 1996). Recently, researchers have revealed the positive relationship between relationship quality and service quality, and the collective impact of these two variables on marketing effectiveness (e.g., Chakrabarty, Whitten, & Green, 2007/2008; Sun, 2010). Thus, for adolescent clients of hairstylists, service quality and interpersonal relationship with the seller are both likely to be key criteria in the evaluation and choice of service provider. A third evaluative criterion can be identified from the relationship marketing literature: seller expertise (Crosby, Evans, & Cowles, 1990; Palmatier, Dant, Grewal, & Evans, 2006; Smith, 1998). This is fundamentally important because it is the core product attribute looked for by consumers (see, e.g., Vargo & Lusch, 2004). To this extent, it is equivalent to product quality. These three related lines of research suggest that all three variables (true interpersonal relationship between the buyer and the seller, service quality, and seller expertise) contribute to consumer satisfaction. However, few studies (except Crosby & Stephens, 1987) have compared the effectiveness of these three variables and no study has ever examined the interactions between them. Which variables are more or less effective? Can one variable compensate for the absence of another? Does the presence of two or all three of them produce complementary effects? These are the research questions that this paper was set out to answer. Using social capital theory (Bourdieu, 1984, 1986) as theoretical framework, this paper proposes that a true interpersonal relationship between the buyer and the seller can compensate for poor service quality. However, seller expertise is a fundamental attribute of the service and its absence cannot be compensated for by good buyer–seller relationship. The remainder of this paper will review the relevant literature, and report on the survey that was carried out to test these hypotheses. The contributions of the present study are twofold. It is the first to empirically examine the relative effectiveness of a true interpersonal relationship, service quality, and seller expertise on the satisfaction of adolescent consumers. With this knowledge, both frontline service providers and company managers can adjust their business strategies. Second, it is also the first to identify a negative interactive effect between a true interpersonal relationship and service quality, which is labeled the “resource substitution benefit.” This is an important addition to social capital theory.

TRUE INTERPERSONAL RELATIONSHIP AND RELATIONSHIP MARKETING The construct of interpersonal relationship is the cornerstone of relationship marketing (see, e.g., Coviello, Brodie, & Munro, 1997; Ford, 1990; Gummesson, 1994; Hakansson, 1982; Hakansson & Snehota, 2000). Per-

366

spectives on relationship marketing commonly suggest that interpersonal interactions and relationships engender satisfaction, trust, commitment, mutual cooperation, mutual interdependency, and social exchange, and ultimately lead to ongoing economic exchanges between business partners. This has been affirmed by much empirical research on the importance of interpersonal relationship in business markets (see, e.g., Grayson & Ambler, 1999; Gu, Hung & Tse, 2008; Luk, Yau, Sin, Tse, Chow, & Lee, 2008; Luk, Yau, Tse, Sin, & Chow, 2008; Palmatier, 2008). This line of research has also identified the boundary conditions in which interpersonal relationships are more or less important. However, exactly how interpersonal relationship affects marketing effectiveness in consumer markets is much less clear. Little progress has been made beyond the general observation that a good relationship benefits the service provider by increasing consumer satisfaction, loyalty, and tolerance (e.g., Gutek et al., 1999; Mattila, 2001). The recent work of Athanasopoulou (2009) reviewing relationship quality shows that a vast majority of previous research has only investigated its main effects, with only four out of 64 studies looking at interactive effects. Furthermore, the effects that these four studies probed were between relationship quality and contextual variables (namely age of relationship, gender, product importance, and the buyer’s corporate culture). There was no exploration of the interactive effects between interpersonal relationship and other core marketing variables.

Social Emotional Bonding as the Core of a True Interpersonal Relationship Heide and Wathne (2006) distinguish between friends and businesspeople. Luk et al. (2008) make a similar distinction when they discuss the differences between social capital and product innovativeness. Friendship, a form of social capital, is based on social embeddedness; whereas businesspeople, who offer quality or innovative products or services to the market, operate on the basis of economic rationality. These two types of relationship roles are inherently distinct, and on some occasions may even be in conflict with one another. Therefore, the present paper disagrees with Hennig-Thurau and Klee (1997) and Rauyruen and Miller (2007) who conceptualize product or service quality as a component of relationship quality. A good interpersonal relationship is more like a friendship than a business relationship. Friendship is nonrational. True friendship is strong, close, and positive. The core of such a relationship is the act of social emotional bonding, something that transcends economic exchanges (Palmer, 1995; Sheth & Parvatiyar, 1995). Barnes (1997) shows, using a sample of 400 retail bank customers, that affective variables (interpersonal closeness and positive emotions experienced during a service encounter) contribute

INTERPERSONAL RELATIONSHIP Psychology and Marketing DOI: 10.1002/mar

more than situational or behavioral variables to the building of strong, close, and satisfying customer relationships. Price and Arnould (1999) describe this type of emotional bonding as commercial friendship. Using in-depth interviews with consumers and content analysis, Price and Arnould (1999) find that commercial friendship involves affection, intimacy, social support, loyalty, and reciprocal gift giving. When friendship is present in the buyer–seller relationship, both parties enjoy relational benefits such as mutual cooperation, accommodation, and tolerance. True friendship can also bring about trust in, and satisfaction with, the service provider (Crosby, Evans, & Cowles, 1990; Sun, 2010). Without friendship, a buyer-seller relationship is short-term and transactional in nature.

How Social Emotional Bonding is Cultivated Social emotional bonding, the core of the true interpersonal relationship, is cultivated through long-term and continuous face-to-face personal interactions (Barnes, 1997; Crosby, Evans, & Cowles, 1990; Rowe & Barnes, 1998). Personal contacts can break the ice in international marketing and help reduce the cultural distance between two individuals (Bjorkman & Kock, 1995). Ongoing personal contacts provide a favorable environment for mutual disclosure, which in turns breeds friendship and enhances relationship quality (Crosby, Evans, & Cowles, 1990; Dwyer, Schurr, & Oh, 1987; Price & Arnould, 1999). Athanasopoulou’s (2009) review similarly shows that information sharing and mutual disclosure are processes which promote relationships. Social contacts and friendship in turn foster a common social identity between seller and the consumer. The extant literature on social identity theory (Hogg & Abrams, 1999; Tajfel, 1974, 1981; Turner, 1996) shows that people with a common social identity perceive each other in a positive light and exchange exclusive favors with one another. This gives rise to the phenomena of ingroup favoritism and outgroup discrimination. A common social identity is a basis for similarity, which in turn enhances relationship quality (Smith, 1998). In summary, the three most important elements contributing to a true interpersonal relationship are mutual disclosure, friendship, and common social identity. It should be stressed that the present paper treats the true interpersonal relationship as conceptually different from the notion of relationship quality as commonly defined in the extant literature. There is a growing consensus that relationship quality consists of the three components of satisfaction, trust, and commitment (Athanasopoulou, 2009). The true interpersonal relationship, as defined here, is an antecedent of relationship quality (Athanasopoulou, 2009; Smith, 1998). The former includes the processes through which good relationships are built, and the lat-

WAN, LUK, FAM, WU, AND CHOW Psychology and Marketing DOI: 10.1002/mar

ter is the consequence. The components of relationship quality are exactly the favorable consumer responses that marketers try to generate (e.g., Rust, Zahorik, & Keiningham, 1995; Zeithaml, Berry, & Parasuraman, 1996).

MODEL AND HYPOTHESES Importance of Interpersonal Relationships to Adolescents Adolescence is period of transition (McMahan, 2009). It is marked by a shift of centrality from one’s family to a much broader social world which is made up of different people, including friends and competitors (Erikson, 1963a, 1963b). Having to find their position in this larger social world, adolescents are preoccupied with the question of who they are. Thus, the primary psychosocial task for adolescents is to find for themselves consistent social and ego identities (Erikson, 1963a, 1963b). Interpersonal relationships, especially friendship, play an important role in the psychosocial development of adolescents by providing them with the input needed for the formation of social and ego identities (Buhrmester & Furman, 1987). That is why peer group influences and peer pressure are particularly pertinent to adolescents. Empirical research has confirmed that friendship is a valuable asset for adolescents and can enhance social adjustment and adaptation (Hartup & Stevens, 1997). Thus, a key characteristic of adolescents, in comparison with more mature consumers, is their stronger need for friendship and social identification. By interacting with other people in their social groups, young people come to know themselves better. The better the interpersonal relationship, the stronger are its influences on the adolescent. Social capital theory (Bourdieu, 1984, 1986) provides a systematic account of the influence of true interpersonal relationship on business exchanges. It also informs the basic premise of this paper. True interpersonal relationships accrue social capital, which is like a “club good” and serves to maintain the privileges and status of the “club members” (Field, 2003). Club members, or ingroupers, are those with a common social identity. They give exclusive benefits to one another to increase cohesion (Gabbay, 1997). This is known as solidarity benefit (Adler & Kwon, 2002; Sandefur & Laumann, 1998). With a common social identity, consumers are more willing to give exclusive business opportunities to the seller, regardless of the quality of his or her services or products (Davies, Leung, Luk, & Wong, 1995). The nature of the exchange is relational and not transactional (Dwyer, Schurr, & Oh, 1987). From a true interpersonal relationship with a seller, the adolescent consumer derives a social identity and a feeling of satisfaction, even if the quality of the service or product is low.

367

A True Interpersonal Relationship is a Compensation for Poor Service Quality, but not Poor Workmanship It is well established that service quality generates consumer satisfaction (see, e.g.,Rust, Zahorik, & Keiningham, 1995; Zeithaml, Berry, & Parasuraman, 1996). If the adolescent consumer focuses entirely on the interpersonal relationship and ignores service quality, this positive effect should not exist. The fact that it does exist indicates that consumers do not focus solely on the interpersonal relationship, but also consider core service quality. In line with this proposition, Crosby and Stephens (1987) show that both interaction variables (i.e., the seller’s relationship-building activities) and communications variables (i.e., the seller’s communication of core service information) have significant main effects on consumer satisfaction with the core service. They conclude that relationship-building activities can only add value to the core service and not replace it. Consumers do make a rational evaluation of core service quality. It is worthwhile to reexamine and refine Crosby and Stephens’ (1987) conclusion for two reasons. First, in addition to the main effects on consumer satisfaction, interactive effects between service-related variables (service quality and seller expertise) and interaction variables (the interpersonal relationship) may also be important. Specifically, a true interpersonal relationship may reduce the effectiveness of the servicerelated variables but will not render them totally ineffective. In other words, the true interpersonal relationship does not replace service-related variables entirely. Furthermore, there will only be such a substitution when the relationship is good. When service quality is low, the true interpersonal relationship fills the gap and substitutes for the role of quality in generating consumer satisfaction with the core service. In other words, there may be a negative interaction effect between the true interpersonal relationship and servicerelated variables. Although no study has directly tested this effect, the findings from Mattila’s (2001) pseudo-experiments may inform it. Using written scenarios, Mattila (2001) assigned restaurant customers to one of three conditions (1) true service relationship, (2) pseudo-relationship, and (3) service encounter. After a successful service recovery, customer satisfaction remained high across the three experimental conditions. By contrast, after a failed service recovery, customer satisfaction was significantly lower in the pseudo-relationship and service encounter conditions than in the true service relationship condition. This finding suggests that a true service relationship is a partial buffer against the devastating impact of poor service quality. This is equivalent to a negative interactive effect between interpersonal relationship and service quality. The second reason why it is worthwhile to reexamine Crosby and Stephens’s (1987) proposition is that

368

the service-related variables they studied were communications of core service information, but they did not investigate the quality of the delivery process of the core service. Attributes of the delivery process include the five SERVQUAL dimensions of tangibles, reliability, responsiveness, assurance, and empathy (Parasuraman, Berry, & Zeithaml, 1991; Parasuraman, Zeithaml, & Berry, 1991; Zeithaml, Berry, & Parasuraman, 1996). While quality of the delivery process cannot replace the quality of the core service, it may add value to it. However, the delivery process is peripheral and so may be more susceptible than the core service to the moderating effect of the interpersonal relationship. Thus, it can be proposed that a true interpersonal relationship can compensate for poor quality in the service delivery process (in terms of tangibles, reliability, responsiveness, assurance, and empathy), but not in the core service. For example, in the case of hairstylists, if a true interpersonal relationship exists, lower levels of tangibles, reliability, responsiveness, assurance, and empathy will be acceptable. On the other hand, the relationship cannot compensate for the absence of technical expertise. If the hairstylist cannot properly perform the core service of haircutting, the consumer who cares very much about his or her own appearance would not be satisfied no matter how good the interpersonal relationship is. This proposal is in line with Crosby and Stephens’ (1987) finding that the core service cannot be replaced by relationship-building activities. Price and Arnould’s (1999) in-depth interviews with hairstylist customers also confirm this. There can be a commercial friendship between a hairstylist and a customer, but the hairstylist’s haircutting abilities remain crucial to the relationship. It is also hypothesized that consumer satisfaction with the hairstylist, and an overall assessment of the hairstylist, to be closely associated. A good assessment engenders feeling of satisfaction, and vice versa. Figure 1 is a schematic representation of the proposed model. The hypotheses are represented by arrows. Stated formally, they are as follows: H1a:

The true interpersonal relationship is positively associated with adolescent consumers’ satisfaction with their hairstylists.

H1b:

The true interpersonal relationship is positively associated with adolescent consumers’ overall assessment of their hairstylists.

H2a:

Service quality (quality of the service delivery process) is positively associated with adolescent consumers’ satisfaction with their hairstylists.


Figure 1. Summary of H1a to H4b.

H2b:

Service quality (quality of the service delivery process) is positively associated with adolescent consumers’ overall assessment of their hairstylists.

H3a:

Hairstylist expertise (quality of the core service) is positively associated with adolescent consumers’ satisfaction with their hairstylists.

H3b:

Hairstylist expertise (quality of the core service) is positively associated with adolescent consumers’ overall assessment of their hairstylists.

H4a:

The true interpersonal relationship negatively moderates the effect of service quality (quality of the service delivery process) on adolescent consumers’ satisfaction with their hairstylists.

H4b:

The true interpersonal relationship negatively moderates the effect of service quality (quality of the service delivery process) on adolescent consumers’ overall assessment of their hairstylists.

In this connection, Holloway, Wang, and Beatty’s (2009) recent study deserves some discussion. Taking a betrayal hypothesis perspective, these authors argue that relationship quality magnifies rather than buffers the negative effects of a failed service recovery. That is, consumers who have a good relationship with a com-


pany feel betrayed if it fails to deliver on its promises, and the damage to satisfaction and repurchase intention is more severe than when relationship quality is low. Nevertheless, such a perception of betrayal is more plausible when the service failure is serious, related to a core attribute, and-–most important of all-–the consumer believes it to be intentional. It is true that betrayals can be disappointing and even devastating. But in true interpersonal relationships in real life, betrayals are arguably less common than promise fulfillments. Otherwise, people would be unwilling to be involved in any true interpersonal relationship. Therefore, in most circumstances, the true interpersonal relationship is a buffer rather than a magnifier. Two reasons may explain why Holloway et al. (2009) find the unusual magnifying effects. First, they assessed the quality of the consumer-company relationship, in which the social emotional bonding of the true interpersonal relationship is missing. Second, they used a hypothetical scenario of failed service recovery, rather than an event which had actually happened to the research participants. Thus, the psychological responses of forgiveness and tolerance might not have been activated.

Satisfaction with the Hairstylist Versus Satisfaction with the Hair Salon Rauyruen and Miller (2007) distinguish between a relationship with employees of the supplier and with the supplier as a whole. This distinction has a practical relevance for the marketing managers of companies providing personal services through frontline staff. From the company’s point of view, frontline service providers are employees and the ultimate goal of hiring them to provide services is to make a profit for the company. It is in the interests of the company for consumers’ satisfaction with, and positive assessment of, the employees

369

to extend to the organization as a whole. Hence, a set of hypotheses is proposed about the effects of interpersonal relationship, service quality, and seller expertise on consumer satisfaction with, and assessment of, the company. First, an interpersonal relationship, by definition, is interpersonal in nature. To the consumer, the company is not a person, but a remote and abstract concept. Therefore, the positive effects of a hairstylist– consumer relationship are unlikely to benefit the company as a whole. As a consequence, neither the main nor interactive effect of the interpersonal relationship on consumer satisfaction with, and assessment of, the company as a whole would be significant. Similarly, hairstylist expertise is likely to be very individual (i.e., fully owned by the hairstylist) and may have nothing to do with the company. Hairstylist expertise is expected to have no effect on the consumer’s satisfaction with or assessment of the company. Yet, the positive main effects of service quality (quality of the service delivery process) are likely to generalize to consumer satisfaction with, and assessment of, the company. This is because the delivery of a hairstyling service is a team effort, involving the receptionist, the housekeeper, the hair washer, the cashier, and so on. Therefore, the salon as a whole can take the credit for good service quality. The following hypotheses are proposed: H5a:

Service quality (quality of the service delivery process) is positively associated with adolescent consumers’ satisfaction with the hair salon.

H5b:

Service quality (quality of the service delivery process) is positively associated with adolescent consumers’ overall assessment of the hair salon.

METHOD Sample The target population of the study was adolescents who were relatively independent from their parents and could make their own consumption decisions. Therefore, university students, who were in the stages of middle and late adolescence, were chosen as research participants. It should be noted here that adolescence is a period of transition and does not refer to any fixed age range (Eysenck, 2004; McMahan, 2009). According to the Encyclopaedia Britannica (Britannica, 2010), adolescence roughly covers the ages between 12 and 20. The World Health Organization defines adoles-

370

cence as the period of life between 10 and 19, while the US Government defines it as covering the ages between 10 and 24 (Department of Health and Social Services, 2009). McMahan (2009) concludes that middle adolescence runs from about 15 to 18 and late adolescence from about 19 to 22 or later. The research participants in the present study were a convenience sample of 350 full-time students of a major university in Hong Kong. Their ages ranged from 17 to 20 (M = 17.75, SD = 0.51), which falls within the commonly accepted age ranges of adolescence. One hundred forty-eight of them were male and 202 were female. This sample was relatively homogeneous. The influence of many demographic variables, such as culture, education, and life experience, was limited.

Data Collection Procedure As mentioned at the beginning of this paper, a hairstylist service is an appropriate context for the study of the buyer–seller relationship in adolescent consumers. Their involvement in the hairstyle is high, as is the uncertainty associated with the core service of haircutting; the core service can be customized, and the price is not fixed. These are the ideal conditions for relational exchanges (O’Malley & Tynan, 2000). It is also customary in relationship marketing research to use a single industry as the context of study (Crosby & Stephens, 1987). There was a large shopping mall besides the campus where data collection took place. A well-known hair salon had a large branch in that mall. Students of the university were one of the salon’s target markets. From time to time, it offered them special discounts. Many students had visited the salon and were familiar with the services of its hairstylists. Therefore, the service provided by the hairstylists working in this salon was chosen as the object that research participants should think about when filling out the survey. Using a single company as the object of investigation helps to control for confounding variables due to differences across companies. The method of mall-intercept was used. Five research assistants were responsible for recruiting respondents by intercepting them in public areas of the campus (such as the canteen, library, and podium). The assistants stopped the respondents and invited them to participate. There were two screening questions as follows: (1) whether the respondent had used the service of the hair salon before; and (2) whether the respondent was aged 20 or below. Those who answered yes to both were given the questionnaire. The respondent filled out the questionnaire alone, which took an average of about five minutes. The research assistant then went back to the respondent, collected the completed questionnaire, and thanked him or her for participating. Data collection continued until 350 completed questionnaires had been returned.


Questionnaire A structured questionnaire was used. The instructions specifically highlighted that the survey referred to the hairstylist who had served the respondent during his or her last visit to the salon. The whole questionnaire was written in Chinese because all respondents were Hong Kong Chinese. The True Interpersonal Relationship. Although measures of relationship quality abound (such as Lages, Lages, & Lages, 2005), none of them measure all three components of true interpersonal relationships, namely mutual disclosure, friendship, and common social identity. Churchill’s (1979) guidelines were followed in the development of a measure of the true interpersonal relationship. First, a pool of nine items according to constitutive definitions of the three components was generated. These nine items were then pilot-tested with a group of 48 business students. On the basis of their responses and feedback, six items were retained for use in the main study. Two psychologists confirmed that these six items had face validity. These items were originally developed in Chinese. The English translation is as follows: 1. You would talk with this hairstylist about personal matters not related to haircutting. 2. You enjoy chatting with this hairstylist. 3. Your relationship with this hairstylist is more like that of a friend or family member than that between two businesspeople. 4. You and this hairstylist have developed a longterm interpersonal relationship. 5. You and this hairstylist share common social circles. 6. You regard this hairstylist as your ingrouper. Service Quality. The 22 items of the SERVQUAL questionnaire of Parasuraman, Berry, & Zeithaml, (1991) were used to measure perceived service quality. This instrument was translated into Chinese using the back translation procedure. Hairstylist Expertise. Again, a 5-item scale measuring hairstylist expertise was constructed according to Churchill’s (1979) guidelines. The items were pilot tested. The same two psychologists had also confirmed the face validity of these items. They were originally developed in Chinese. The English translation is as follows: 1. This hairstylist cuts your hair beautifully. 2. This hairstylist’s haircutting skill is excellent. 3. This hairstylist keeps him- or herself updated on the most fashionable hair styles. 4. This hairstylist is creative. 5. This hairstylist can fix and make many different hair styles. Participants responded to all of the above items using a 7-point Likert scale, where 1 stood for “strongly disagree” and 7 stood for “strongly agree.”


Dependent Measures. Respondents indicated on a 7point Likert scale the extent to which they were satisfied with the service of the hairstylist and the hair salon (1 = strongly dissatisfied and 7 = strongly satisfied). They also gave marks out of 100 as overall assessments of the service of the hairstylist and the hair salon. These four dependent measures are single-item measures, the validity of which has been shown in recent studies to be equivalent to that of multiple-item measures (see, e.g., Bergkvist & Rossiter, 2007; Drolet & Morrison, 2001). Control Variables. Control variables included the respondent’s sex, age, personal income, the number of different services that the respondent had used before, the amount he or she spent in the hair salon every month, and the duration of his or her relationship with the hair salon. Past research has shown that these variables are relevant to relationship quality (Athanasopoulou, 2009) although they are not central to the current theoretical model.

RESULTS Dimensionality of the Newly Constructed Scales An exploratory factor analysis with varimax rotation was performed to explore the factor structure of the independent measures (true interpersonal relationship, the five SERVQUAL factors, and hairstylist expertise). Five factors emerged with eigenvalues over one. These factors explained 63.59% of the total variance, whereas the first factor explained 39.42% of the variance in the unrotated solution. Since one general factor could not explain the majority of the total variance in the unrotated solution, common method variance was not a problem (Podsakoff & Organ, 1986). True interpersonal relationship, hairstylist expertise, and tangibles formed separate factors. However, the items measuring the other four SERVQUAL factors (reliability, responsiveness, assurance, and empathy) were mixed across two factors. Next, another two exploratory factor analyses were conducted; one on the items measuring the true interpersonal relationship, and the other on those measuring hairstylist expertise. Both resulted in a onefactor solution, showing the unidimensionality of the two newly constructed scales. Then, confirmatory factor analyses were employed to examine the construct validity of the independent measures. In the first analysis, the 33 items (22 from SERVQUAL, six for the true interpersonal relationship, and five for hairstylist expertise) were loaded on their corresponding factors, and all seven factors (five SERVQUAL factors, true interpersonal relationship, and hairstylist expertise) were allowed to correlate. The model was estimated and resulted in the following fit indexes: χ2 (df = 457) = 892.26, p < 0.001, GFI (goodness-of-fit index) = 0.87,

371

CFI (comparative fit index) = 0.94, RMSEA (root mean squared error of approximation) = 0.05, χ2 /df = 1.95. Although GFI is slightly below the 0.90 benchmark, all the standardized factor loadings were significant and above the benchmark of 0.40 set by Stevens (1996). This model formed the base model for further comparisons. To further examine the discriminant validity of the scales, a series of confirmatory factor analyses were run, in which true interpersonal relationship was combined with any one of the other six factors. All six models were significantly worse off. Then, another series of confirmatory factor analyses were run, in which hairstylist expertise was combined with any one of the other six factors. Again, all six models were significantly worse off. Combined, the newly constructed scales of the true interpersonal relationship and hairstylist expertise could capture unique factors that were distinct from each other and from service quality. Discriminant validity is good.

Hypothesis Testing For each of the variables of true interpersonal relationship and hairstylist expertise, a composite score was calculated by averaging the items pertaining to the construct. Overall service quality was conceptualized as a second-order factor consisting of tangibles, reliability, responsiveness, assurance, and empathy. A composite score for service quality was calculated by averaging these five factors. Table 1 displays the correlations between true interpersonal relationship, service quality, hairstylist expertise, and the four dependent measures. Their descriptive statistics are also displayed. All Cronbach alphas were greater than 0.8. Hypotheses were tested by hierarchical regression analyses. In three consecutive steps, each of the four dependent measures were regressed on (1) the six control variables, (2) the three independent variables, and (3) the two-way interaction between true interpersonal relationship with each of service quality and hairstylist expertise. The three independent variables were meancentered before being entered in the regression models. Four hierarchical regression analyses were run, each for one dependent measure. All variance inflation factors (VIFs) were below 3, indicating little threat of mulTable 1.

Zero-Order Correlations and Descriptive Statistics of Key Constructs (N = 350).

1. True interpersonal relationship 2. Service quality 3. Hairstylist expertise 4. Satisfaction with the hairstylist 5. Overall assessment of the hairstylist 6. Satisfaction with the hair salon 7. Overall assessment of the hair salon Mean Standard deviation Cronbach’s alpha ∗

372

ticollinearity. Table 2 displays the results of these four regression analyses. To save space, it presents only the full regression models tested in Step 3. Consistent with H1a to H3b, all three independent variables have positive main effects on satisfaction with, and overall assessment of, the hairstylist. In the hierarchical regression analyses looking at satisfaction with, and overall assessment of, the hairstylist, both two-way interactions (true interpersonal relationship with each of service quality and hairstylist expertise) taken together produce significant R2 changes in Step 3. The R2 change produced by the two two-way interactions is 2.9% (F[2, 338] = 9.17, p < 0.001) for satisfaction, and 4.1% (F[2, 338] = 14.21, p < 0.001) for overall assessment. Table 2 shows that of the two two-way interactions, only the one between the true interpersonal relationship and service quality is significant and negative. Therefore, H4a and H4b are supported. Aiken and West’s (1991) plotting technique plus the simple slope analysis were applied to probe the two significant two-way interactions consistent with H4a and H4b. The association between service quality and satisfaction with the hairstylist was plotted in Panel A of Figure 2 at high (one SD above mean) and low (one SD below mean) levels of the true interpersonal relationship. Simple slope analysis shows that the association is significant only when the true interpersonal relationship is weak (beta = 0.38, t = 4.60, p < 0.001) and is not significant when it is strong (beta = 0.15, t = 1.75, p > 0.05). A similar pattern is evident in Panel B of Figure 2, which illustrates the association between service quality and overall assessment of the hairstylist at high (one SD above mean) and low (one SD below mean) levels of the true interpersonal relationship. Again, simple slope analysis shows that the association is significant when the true interpersonal relationship is weak (beta = 0.48, t = 6.19, p < 0.001). Although the association is also significant when the true interpersonal relationship is strong (beta = 0.28, t = 3.36, p = 0.001), the strength of the association has reduced substantially. Turning to the dependent measures of satisfaction with, and overall assessment of, the hair salon, the effects of service quality are positive and significant. Thus, H5a and H5b are supported. The main effects

1

2

3

4

5

6

7

0.49∗∗∗ 0.43∗∗∗ 0.48∗∗∗ 0.43∗∗∗ 0.25∗∗∗ 0.12∗ 3.00 1.17 0.91

0.75∗∗∗ 0.57∗∗∗ 0.64∗∗∗ 0.55∗∗∗ 0.42∗∗∗ 4.33 0.72 0.84

0.55∗∗∗ 0.58∗∗∗ 0.43∗∗∗ 0.27∗∗∗ 4.25 0.99 0.89

0.69∗∗∗ 0.53∗∗∗ 0.29∗∗∗ 4.10 1.28 -

0.45∗∗∗ 0.54∗∗∗ 66.10 14.77 -

0.54∗∗∗ 4.39 1.16 -

71.08 11.03 -

p < 0.05; ∗∗ p < 0.01; ∗∗∗ p < 0.001.


Table 2.

Moderated Regression Analyses (N = 350). Dependent Measures Satisfaction with the Hairstylist

Step 1: control variables Gender Age Income Usage Spending Duration Step 2: main effects True interpersonal relationship Service quality Hairstylist expertise Step 3: Two-way interactions IR × SQ IR × HE Adjusted R2 df F R2 (Step 4−Step 3)

Overall Assessment of the Hairstylist

− 0.02 − 0.06 0.01 0.04 0.04 0.13∗∗ 0.26∗∗∗ (H1a) 0.27∗∗∗ (H2a) 0.20∗∗ (H3a) − 0.14∗ (H4a) − 0.05 0.44∗∗∗ 11, 338 26.29∗∗∗ 0.029∗∗∗

− 0.14∗∗∗ − 0.06 0.04 0.02 0.04 0.06 0.18∗∗∗ (H1b) 0.38∗∗∗ (H2b) 0.18∗∗ (H3b) − 0.12∗ (H4b) − 0.10 0.50∗∗∗ 11, 338 33.07∗∗∗ 0.041∗∗∗

Satisfaction with the Hair Salon

Overall Assessment of the Hair Salon

− 0.03 − 0.02 − 0.001 0.08 − 0.07 0.17∗∗

− 0.15∗∗ − 0.12∗ 0.04 0.01 − 0.04 0.08

− 0.03 0.51∗∗∗ (H5a) 0.05

− 0.07 0.53∗∗∗ (H5b) − 0.09

− 0.04 0.04 0.32∗∗∗ 11, 338 15.67∗∗∗ 0.001

− 0.06 0.10 0.21∗∗∗ 11, 338 9.43∗∗∗ 0.004

Note: Numbers shown are standardized regression coefficients. Gender was dummy-coded such that 0 stood for female and 1 stood for male. IR = true interpersonal relationship; SQ = service quality; HE = hairstylist expertise. ∗ p < 0.05; ∗∗ p < 0.01; ∗∗∗ p < 0.001.

of the true interpersonal relationship and hairstylist expertise are not significant. Neither of the two-way interactions explains a significant amount of variance (i.e., the R2 change) in any of these two dependent measures.

DISCUSSION As pointed out by Grayson and Ambler (1999) and Hakansson and Snehota (2000), interpersonal relationships in business markets have both a positive and negative impact. On the positive side, there can develop tolerance, commitment, preference, productivity, and efficiency. On the negative side, they can be liabilities instead of assets, introducing burdens, and rigidity (and thus vulnerability to external changes) rather than flexibility, and blocking change rather than promoting efficiency. When it comes to consumer markets, a true interpersonal relationship between seller and buyer seems to benefit the former because the buyer seems to be willing to make sacrifices. This may be particularly true for adolescent consumers who probably value relationships more than the adult sellers. By studying adolescent consumers of hairstylists, the present paper has delineated the role of the true interpersonal relationship in service selling. On a theoretical level, it has also contributed by enriching social capital theory. In the following section, the major findings and their implications are discussed. Consistent with Crosby and Stephens’ (1987) findings, the present study shows that both a true in-


terpersonal relationship and service-related variables (service quality and hairstylist expertise) have positive main effects on satisfaction with, and overall assessment of, the hairstylist. These findings indicate that adolescent consumers are to a certain extent rational, meaning that they do not ignore the quality of the core service (i.e., hairstylist expertise) or of the service delivery process (i.e., service quality). Due to their unique developmental needs, adolescent consumers are more susceptible than their more mature counterparts to interpersonal influences (Erikson, 1963a, 1963b). Nevertheless, they do not rely solely on the interpersonal relationship to evaluate the quality of a service that is important to them. Such a relationship only adds value to the core service, the performance of which remains unshakably important. However, it would be wrong to conclude that adolescent consumers are entirely rational. The true interpersonal relationship also negatively moderates the positive effects of service quality on satisfaction with, and overall assessment of, the hairstylist. When there is a true interpersonal relationship present, service quality matters less. Without the buffer of the relationship, service quality becomes a significant determinant of consumer satisfaction and evaluation. To this extent, the rationality of adolescent consumers is bounded. A further point to note is that a true interpersonal relationship can only moderate the positive effects of service quality, not of hairstylist expertise. In other words, the quality of the core service that is important to the consumers cannot be compromised at all. This reflects a boundary condition for the effectiveness of the relationship. Perhaps in the unpleasant

373

Figure 2. Interaction between true interpersonal relationship and service quality. Note: IR = true interpersonal relationship.

374


circumstances where a service provider deliberately cheats, as Holloway et al. (2009) argue, a true interpersonal relationship will backfire, engendering particularly strong feelings of frustration for the consumer.

Theoretical Implications The present paper has two major implications for social capital theory. First, it has identified a boundary condition for the operation of the true interpersonal relationship in consumer markets. It only moderates the effects of the peripheral (quality of the service delivery process) and not core (hairstylist expertise) attributes of a service. For adolescent consumers, the beauty of their hairstyle is important to their ego identity. Thus, hairstylist expertise cannot be compromised. Second, the present paper has identified a negative moderating effect of the true interpersonal relationship. This finding is theoretically significant because only positive moderating effects have been identified in the past. For example, managerial ties positively moderate the effectiveness of product innovativeness in the manufacturing sectors of mainland China (Luk et al., 2008). The true interpersonal relationship can enhance the positive effects of some resources by allowing them to be more fully utilized, a phenomenon known as social influence benefit (Adler & Kwon, 2002; Sandefur & Laumann, 1998). The present study shows that a true interpersonal relationship can also negatively moderate the positive effects of other resources. However, this effect cannot be readily classified under any of the three existing social capital benefits (solidarity, information, and social influence) (Adler & Kwon, 2002; Sandefur & Laumann, 1998). The first of these refers to the direct positive effect of the interpersonal relationship; information benefit refers to its indirect positive effect, with information exchange as the mediator; and the last-named refers to the positive moderating effect of the interpersonal relationship on other resources. None of these is the same as the negative moderating effect identified by the present study. The negative interaction effect represents the fourth social capital benefit. The present paper labels this the resource substitution benefit. This label highlights the benefit of the true interpersonal relationship as a substitution for another valuable resource when the latter is absent. The present study has identified service quality, that is, the quality of the service delivery process, as one such valuable resource. Future studies should explore under what other conditions the resource substitution benefit may occur.

Practical Implications The implications of the present study for marketers are twofold. First and foremost, for the frontline service provider, it shows that both a true interpersonal


relationship and technical expertise are fundamental to business success. The quality of the service delivery process is of secondary importance, because a poorquality resource of this type can be substituted for by a true interpersonal relationship. In contrast, the quality of the process of service delivery by frontline providers is the only determinant of consumer satisfaction with, and overall assessment of, the company as a whole. Consumers may attribute such service quality to the management of the company and its corporate culture. Therefore, the company can take the credit when the frontline staff member gives good service. For the company that hires frontline service providers, this is not exactly good news because their staff’s good relationships with customers, and their individual expertise, are highly idiosyncratic and therefore of little benefit to the organization. It is difficult for consumers to attribute their interpersonal relationship with the hairstylist, and his or her expertise to the salon. The implication is that the salon’s competitive advantage depends heavily on its ability to keep good hairstylists (i.e., those who both enjoy true interpersonal relationships with customers and have the required expertise). If it fails to do so, its competitive advantage would not be sustainable.

Limitations The present study has a few limitations that should be overcome in future studies. First, it used a convenience sample and the context involved only one industry. To establish the external validity of our findings, future studies will need to use a representative sample and cover more diverse industries. Second, further experiments may be needed to confirm whether any causal relationships exist among the key constructs of the present study.

REFERENCES Adler, P. S., & Kwon, S. W. (2002). Social capital: Prospects for a new concept. Academy of Management Review, 27, 17–40. Aiken, L. S., & West, S. G. (1991). Multiple regression: Testing and interpreting interactions. Thousand Oaks, CA: Sage. Athanasopoulou, P. (2009). Relationship quality: A critical literature review and research agenda. European Journal of Marketing, 43, 583–610. Barnes, J. G. (1997). Closeness, strength, and satisfaction: Examining the nature of relationships between providers of financial services and their retail customers. Psychology and Marketing, 14, 765–790. Bergkvist, L., & Rossiter, J. R. (2007). The predictive validity of multiple-item versus single-item measures of the same constructs. Journal of Marketing Research, 44, 175–184. Bjorkman, I., & Kock, S. (1995). Social relationships and business networks: The case of Western companies in China. International Business Review, 4, 519–535.

375

Bourdieu, P. (1984). Distinction: A social critique of the judgment of taste. London: Routledge. Bourdieu, P. (1986). The forms of capital. In Richardson JG. (Ed.), Handbook of theory and research for the sociology of education (pp. 241–258). New York: Greenwood Press. Britannica (2010). Adolescence. In Encyclopædia Britannica. Retrieved March 22, 2010 from Encyclopædia Britannica Online: http://www.brita nni ca.com/EBch ecked/t opic/6216/ado lescence Buhrmester, D., & Furman, W. (1987). The development of companionship and intimacy. Child Development, 58, 1101–1113. Chakrabarty, S., Whitten, D., & Green, K. (2007/2008). Understanding service quality and relationship quality in IS outsourcing: Client orientation & promotion, project management effectiveness, and the task-technology-structure fit. The Journal of Computer Information Systems, 48, 1– 15. Churchill, G. A., Jr. (1979). A paradigm for developing better measures of marketing constructs. Journal of Marketing Research, 16, 64–73. Coviello, N. E., Brodie, R. J., & Munro, H. J. (1997). Understanding contemporary marketing: Development of a classification scheme. Journal of Marketing Management, 13, 501–522. Crosby, L. A., Evans, K. R., & Cowles, D. (1990). Relationship quality in services selling: An interpersonal influence perspective. Journal of Marketing, 54, 68–81. Crosby, L. A., & Stephens, N. (1987). Effects of relationship marketing on satisfaction, retention, and prices in the life insurance industry. Journal of Marketing Research, 24, 404–411. Davies, H., Leung, T. K. P., Luk, S. T. K., & Wong, Y. H. (1995). The benefits of guanxi: The value of relationships in developing the Chinese market. Industrial Marketing Management, 24, 207–214. Department of Health and Social Services (2009). Adolescent health. In Department of Health and Social Services. Retrieved December 18, 2009, from: http://www.dh ss.mo.gov/Ado lesc entHealth/index.html Drolet, A. L., & Morrison, D. G. (2001). Do we really need multiple-item measures in service research? Journal of Service Research, 3, 196–204. Dwyer, F. R., Schurr, P. H., & Oh, S. (1987). Developing buyerseller relationships. Journal of Marketing, 51, 11–27. Erikson, E. H. (1963a). Childhood and society, 2nd ed. New York: Norton. Erikson, E. H. (1963b). Youth: Change and challenge. New York: Norton. Eysenck, M. W. (2004). Psychology: An international perspective. New York: Psychology Press. Field, J. (2003). Social capital. London: Routledge. Ford, D. (Ed.) (1990). Understanding business markets: Interaction, relationships, and networks. London: Academic Press. Gabbay, S. M. (1997). Social capital in creation of financial capital. Champaign, IL: Stipes. Grayson, K., & Ambler, T. (1999). The dark side of long-term relationships in marketing services. Journal of Marketing Research, 36, 132–141. Gu, F. F., Hung, K., & Tse, D. K. (2008). When does guanxi matter? Issues of capitalization and its dark sides. Journal of Marketing, 72, 12–28. Gummesson, E. (1994). Making relationship marketing operational. International Journal of Service Industry Management, 5, 5–20.

376

Gutek, B. A., Bhappu, A. D., Lia-Troth, M. A., & Cherry, B. (1999). Distinguishing between service relationships and encounters. Journal of Applied Psychology, 84, 218–233. Hakansson, H. (Ed.). (1982). Developing relationships in business networks. London: Routledge. Hakansson, H., & Snehota, I. J. (2000). The IMP perspective: Assets and liabilities of business relationships. In Sheth, J. N. & Parvatiyar, A. (Eds.), Handbook of relationship marketing (pp. 69–94). Thousand Oaks, CA: Sage. Hartup, W. W., & Stevens, N. (1997). Friendships and adaptation in the life course. Psychological Bulletin, 121, 355–370. Heide, J. B., & Wathne, K. H. (2006). Friends, businesspeople, and relationship roles: A conceptual framework and a research agenda. Journal of Marketing, 70, 90–103. Hennig-Thurau, T., & Klee, A. (1997). The impact of customer satisfaction and relationship quality on customer retention: A critical reassessment and model development. Psychology and Marketing, 14, 737–764. Hogg, M. A., & Abrams, D. (1999). Social identity and social cognition: Historical background and current trends. In D. Abrams & M. A. Hogg (Eds.), Social identity and social cognition (pp. 1–25). Oxford: Blackwell. Holloway, B. B., Wang, S., & Beatty, S. E. (2009). Betrayal? Relationship quality implications in service recovery. Journal of Services Marketing, 23, 385–396. Lages, C., Lages, C. R., & Lages, L. F. (2005). The RELQUAL scale: A measure of relationship quality in export market ventures. Journal of Business Research, 58, 1040–1048. Luk, C. L., Yau, O. H. M., Sin, L. Y. M., Tse, A. C. B., Chow, R. P. M., & Lee, J. S. Y. (2008). The effects of social capital and organizational innovativeness in different institutional contexts. Journal of International Business Studies, 39, 589–612. Luk, C. L., Yau, O. H. M., Tse, A. C. B., Sin, L. Y. M., & Chow, R. P. M. (2005). Stakeholder orientation and business performance: The case of service companies in China. Journal of International Marketing, 13, 89–110. Mattila, A. S. (2001). The impact of relationship type on customer loyalty in a context of service failures. Journal of Service Research, 4, 91–101. McMahan, I. (2009). Adolescence. Boston: Pearson. O’Malley, L., & Tynan, C. (2000). Relationship marketing in consumer markets: Rhetoric or reality? European Journal of Marketing, 34, 797–815. Palmatier, R. W. (2008). Interfirm relational drivers of customer value. Journal of Marketing, 72, 76–89. Palmatier, R. W., Dant, R. P., Grewal, D., & Evans, K. R. (2006). Factors influencing the effectiveness of relationship marketing: A meta-analysis. Journal of Marketing, 70, 136–153. Palmer, A. J. (1995). Relationship marketing: Local implementation of a universal concept. International Business Review, 4, 471–481. Parasuraman, A., Berry, L. L., & Zeithaml, V. A. (1991). Refinement and reassessment of the SERVQUAL scale. Journal of Retailing, 67, 420–450. Parasuraman, A., Zeithaml, V. A., & Berry, L. L. (1988). SERVQUAL: A multiple-item scale for measuring consumer perceptions of service quality. Journal of Retailing, 64, 12–40. Podsakoff, P. M., & Organ, D. W. (1986). Self-reports in organizational research: Problems and prospects. Journal of Management, 12, 531–543. Price, L. L., & Arnould, E. J. (1999). Commercial friendships: Service provider-client relationships in context. Journal of Marketing, 63, 38–56.


Rauyruen, P., & Miller, K. E. (2007). Relationship quality as a predictor of B2B customer loyalty. Journal of Business Research, 60, 21–31. Rowe, W. G., & Barnes, J. G. (1998). Relationship marketing and sustained competitive advantage. Journal of Market Focused Management, 2, 281–297. Rust, R. T., Zahorik, A. J., & Keiningham, T. L. (1995). Return on quality (ROQ): Making service quality financially accountable. Journal of Marketing, 59, 58–70. Sandefur, R. L., & Laumann, E. O. (1998). A paradigm for social capital. Rationality and Society, 10, 481–501. Sheth, J. N., & Parvatiyar, A. (1995). The evolution of relationship marketing. Industrial Business Review, 4, 397–418. Smith, J. B. (1998). Buyer-seller relationships: Similarity, relationship management, and quality. Psychology and Marketing, 15, 3–21. Stevens, J. (1996). Applied multivariate statistics for the social science. Mahwah, NJ: Erlbaum. Sun, H. (2010). Transferring attributes of e-commerce systems into business benefits: A relationship quality perspective. Journal of Electronic Commerce Research, 11, 92–109. Tajfel, H. (1974). Social identity and intergroup behavior. Social Science Information, 13, 65–93.


Tajfel, H. (1981). Human groups and social categories: Studies in social psychology. Cambridge, England: Cambridge University Press. Turner, J. C. (1996). Henri Tajfel: An introduction. In Robinson WP (Ed.), Social groups and identities: Developing the legacy of Henri Tajfel (pp. 1–24). Oxford: ButterworthHeinemann. Vargo, S. L., & Lusch, R. F. (2004). Evolving to a new dominant logic for marketing. Journal of Marketing, 68, 1–17. Zeithaml, V. A., Berry, L. L., & Parasuraman, A. (1996). The behavioral consequences of service quality. Journal of Marketing, 60, 31–46.

This research was supported by the Strategic Research Grant (7001674–880) awarded to the first two authors by the City University of Hong Kong. Correspondence regarding this article should be sent to: Peiguan Wu, Professor, International Business School, Sun Yat-Sen University, 135 Xingang Xi Road, Guangzhou 510275, P. R. China ([email protected]).

377