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Mark Heitmann, Donald R. Lehmann, and Andreas Herrmann
Executive Summary
Satisfaction is both a firm objective with financial consequences and a popular topic of research. In this article, the authors address the way exogenous factors, such as individual characteristics, social setting, and choice set factors, affect satisfaction. They argue and show empirically that these determinants affect satisfaction indirectly through five choice goals, which in turn affect satisfaction.
A key element of the article is the role of choice goals in satisfaction judgments. Achieving two desired (approach) goals—the ability to justify a decision and confidence that the decision is the best one—increases satisfaction. In addition, not achieving (avoiding) undesired outcomes (having feelings of regret that the decision was wrong, expending effort on making a decision, and negative emotions experienced after a decision is made) also contributes to satisfaction.
Another element of the article is the distinction between decision (process) and consumption (outcome) satisfaction. The authors demonstrate that these are separate and that decision satisfaction affects consumption satisfaction. Furthermore, they demonstrate the impact of satisfaction on four outcome measures relevant to managers: loyalty, willingness to recommend the product to others, whether word of mouth (WOM) is positive, and the amount of WOM generated.
The authors conduct empirical analyses in the framework of a structural equation model, which links determinants to choice goals, which then drives satisfaction, which in turn affects the four outcome measures. For data, the authors use a survey of 661 members of a German panel who reported on a recent purchase of a consumer electronic product that cost more than €50. The results support the model, though not all determinants affect all choice goals. Notably, decision satisfaction is driven by anticipated regret, evaluation costs, negative affect, and justifiability, whereas evaluation costs, choice confidence, justifiability, and decision satisfaction drive consumption satisfaction. Unsurprisingly, consumption satisfaction drives all four outcomes, whereas decision satisfaction significantly affects only loyalty and willingness to recommend the product. Even consumption satisfaction has relatively little impact on the two WOM variables, suggesting that WOM is driven mainly by individual or circumstantial causes.
These results are stable. Using a second wave of data obtained 4.5 months later from 419 (63.4%) of the original respondents, the authors find stability in the satisfaction measures (correlation = .6) and in the model parameters. Therefore, they suggest that (1) separating decision and consumption satisfaction and (2) assessing the extent to which decision goals are achieved can provide potentially useful diagnostic information to managers.
Biography
Mark Heitmann is Assistant Professor of Marketing at the University of St. Gallen. He holds a PhD from the University of St. Gallen and an MBA from the University of Hamburg. His research interests center primarily on customer satisfaction and loyalty, affect, judgment and decision making, simultaneous equation modeling, and the impact of communities of interest on loyalty and individual choice behavior. He teaches courses on pricing and price psychology, product policy, branding, and quantitative methods. He has published more than 35 articles in academic and business journals.
Donald R. Lehmann is George E. Warren Professor of Business at the Columbia University Graduate School of Business. He has a BS in Mathematics from Union College, Schenectady, New York, and an MSIA and a PhD from the Krannert School at Purdue University. His research interests include modeling individual and group choice and decision making, empirical generalizations and meta-analysis, the introduction and adoption of new products and innovations, and measurement of the value of marketing assets (e.g., brands, customers). He has taught courses in marketing, management, and statistics at Columbia and has also taught at Cornell, Dartmouth, New York University, and the University of Pennsylvania. He has published in and served on the editorial boards of Journal of Consumer Research, Journal of Marketing, Journal of Marketing Research, Management Science, and Marketing Science and was founding editor of Marketing Letters. Professor Lehmann has served as the executive director of the Marketing Science Institute and as president of the Association for Consumer Research.
Andreas Herrmann earned his MBA from the Koblenz School of Corporate Management in1988 and his PhD in Marketing in 1991. From 1993 to 1996, he was Assistant Professor of Marketing at the University Mannheim. In 1997, he became Chair Professor of Marketing at University Mainz, and in 2002, he was appointed director of the Institute for Media and Communications Management at University St. Gallen. Since 2004, he has been Director of the Center for Business Metrics at University of St. Gallen. His areas of teaching are multivariate analysis, pricing, product development, market research, brand management, and research methodology. He has published 15 books and more than 250 journal articles. |