• Journal of Global Scholars of Marketing Science
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• v.20 no.3
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• pp.262-268
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• 2010

Virtual communities (VCs) have developed rapidly, with more and more people participating in them to exchange information and opinions. A virtual community is a group of people who may or may not meet one another face to face, and who exchange words and ideas through the mediation of computer bulletin boards and networks. A business-to-consumer virtual community (B2CVC) is a commercial group that creates a trustworthy environment intended to motivate consumers to be more willing to buy from an online store. B2CVCs create a social atmosphere through information contribution such as recommendations, reviews, and ratings of buyers and sellers. Although the importance of B2CVCs has been recognized, few studies have been conducted to examine members' word-of-mouth behavior within these communities. This study proposes a model of involvement, statistics, trust, "stickiness," and word-of-mouth in a B2CVC and explores the relationships among these elements based on empirical data. The objectives are threefold: (i) to empirically test a B2CVC model that integrates measures of beliefs, attitudes, and behaviors; (ii) to better understand the nature of these relationships, specifically through word-of-mouth as a measure of revenue generation; and (iii) to better understand the role of stickiness of B2CVC in CRM marketing. The model incorporates three key elements concerning community members: (i) their beliefs, measured in terms of their involvement assessment; (ii) their attitudes, measured in terms of their satisfaction and trust; and, (iii) their behavior, measured in terms of site stickiness and their word-of-mouth. Involvement is considered the motivation for consumers to participate in a virtual community. For B2CVC members, information searching and posting have been proposed as the main purpose for their involvement. Satisfaction has been reviewed as an important indicator of a member's overall community evaluation, and conceptualized by different levels of member interactions with their VC. The formation and expansion of a VC depends on the willingness of members to share information and services. Researchers have found that trust is a core component facilitating the anonymous interaction in VCs and e-commerce, and therefore trust-building in VCs has been a common research topic. It is clear that the success of a B2CVC depends on the stickiness of its members to enhance purchasing potential. Opinions communicated and information exchanged between members may represent a type of written word-of-mouth. Therefore, word-of-mouth is one of the primary factors driving the diffusion of B2CVCs across the Internet. Figure 1 presents the research model and hypotheses. The model was tested through the implementation of an online survey of CTrip Travel VC members. A total of 243 collected questionnaires was reduced to 204 usable questionnaires through an empirical process of data cleaning. The study's hypotheses examined the extent to which involvement, satisfaction, and trust influence B2CVC stickiness and members' word-of-mouth. Structural Equation Modeling tested the hypotheses in the analysis, and the structural model fit indices were within accepted thresholds: ${\chi}^2^$/df was 2.76, NFI was .904, IFI was .931, CFI was .930, and RMSEA was .017. Results indicated that involvement has a significant influence on satisfaction (p<0.001, ${\beta}$=0.809). The proportion of variance in satisfaction explained by members' involvement was over half (adjusted $R^2$=0.654), reflecting a strong association. The effect of involvement on trust was also statistically significant (p<0.001, ${\beta}$=0.751), with 57 percent of the variance in trust explained by involvement (adjusted $R^2$=0.563). When the construct "stickiness" was treated as a dependent variable, the proportion of variance explained by the variables of trust and satisfaction was relatively low (adjusted $R^2$=0.331). Satisfaction did have a significant influence on stickiness, with ${\beta}$=0.514. However, unexpectedly, the influence of trust was not even significant (p=0.231, t=1.197), rejecting that proposed hypothesis. The importance of stickiness in the model was more significant because of its effect on e-WOM with ${\beta}$=0.920 (p<0.001). Here, the measures of Stickiness explain over eighty of the variance in e-WOM (Adjusted $R^2$=0.846). Overall, the results of the study supported the hypothesized relationships between members' involvement in a B2CVC and their satisfaction with and trust of it. However, trust, as a traditional measure in behavioral models, has no significant influence on stickiness in the B2CVC environment. This study contributes to the growing body of literature on B2CVCs, specifically addressing gaps in the academic research by integrating measures of beliefs, attitudes, and behaviors in one model. The results provide additional insights to behavioral factors in a B2CVC environment, helping to sort out relationships between traditional measures and relatively new measures. For practitioners, the identification of factors, such as member involvement, that strongly influence B2CVC member satisfaction can help focus technological resources in key areas. Global e-marketers can develop marketing strategies directly targeting B2CVC members. In the global tourism business, they can target Chinese members of a B2CVC by providing special discounts for active community members or developing early adopter programs to encourage stickiness in the community. Future studies are called for, and more sophisticated modeling, to expand the measurement of B2CVC member behavior and to conduct experiments across industries, communities, and cultures.

• Journal of Global Scholars of Marketing Science
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• v.19 no.4
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• pp.32-43
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• 2009

Trust has been studied extensively in psychology, economics, and sociology, and its importance has been emphasized not only in marketing, but also in business disciplines in general. Unlike past relationships between suppliers and buyers, which take considerable advantage of private networks and may involve unethical business practices, partnerships between suppliers and buyers are at the core of success for industrial marketing amid intense global competition in the 21st century. A high level of mutual cooperation occurs through an exchange relationship based on trust, which brings long-term benefits, competitive enhancements, and transaction cost reductions, among other benefits, for both buyers and suppliers. In spite of the important role of trust, existing studies in buy-supply situations overlook the role of trust and do not systematically analyze the effect of trust on relational performance. Consequently, an in-depth study that determines the relation of trust to the relational performance between buyers and suppliers of business services is absolutely needed. Business services in this study, which include those supporting the manufacturing industry, are drawing attention as the economic growth engine for the next generation. The Korean government has selected business services as a strategic area for the development of manufacturing sectors. Since the demands for opening business services markets are becoming fiercer, the competitiveness of the business service industry must be promoted now more than ever. The purpose of this study is to investigate the effect of the mutual trust between buyers and suppliers on relational performance. Specifically, this study proposed a theoretical model of trust-relational performance in the transactions of business services and empirically tested the hypotheses delineated from the framework. The study suggests strategic implications based on research findings. Empirical data were collected via multiple methods, including via telephone, mail, and in-person interviews. Sample companies were knowledge-based companies supplying and purchasing business services in Korea. The present study collected data on a dyadic basis. Each pair of sample companies includes a buying company and its corresponding supplying company. Mutual trust was traced for each pair of companies. This study proposes a model of trust-relational performance of buying-supplying for business services. The model consists of trust and its antecedents and consequences. The trust of buyers is classified into trust toward the supplying company and trust toward salespersons. Viewing trust both at the individual level and the organizational level is based on the research of Doney and Cannon (1997). Normally, buyers are the subject of trust, but this study supposes that suppliers are the subjects. Hence, it uniquely focused on the bilateral perspective of perceived risk. In other words, suppliers, like buyers, are the subject of trust since transactions are normally bilateral. From this point of view, suppliers' trust in buyers is as important as buyers' trust in suppliers. The suppliers' trust is influenced by the extent to which it trusts the buying companies and the buyers. This classification of trust using an individual level and an organization level is based on the suggestion of Doney and Cannon (1997). Trust affects the process of supplier selection, which works in a bilateral manner. Suppliers are actively involved in the supplier selection process, working very closely with buyers. In addition, the process is affected by the extent to which each party trusts its partners. The selection process consists of certain steps: recognition, information search, supplier selection, and performance evaluation. As a result of the process, both buyers and suppliers evaluate the performance and take corrective actions on the basis of such outcomes as tangible, intangible, and/or side effects. The measurement of trust used for the present study was developed on the basis of the studies of Mayer, Davis and Schoorman (1995) and Mayer and Davis (1999). Based on their recommendations, the three dimensions of trust used for the study include ability, benevolence, and integrity. The original questions were adjusted to the context of the transactions of business services. For example, a question such as "He/she has professional capabilities" has been changed to "The salesperson showed professional capabilities while we talked about our products." The measurement used for this study differs from those used in previous studies (Rotter 1967; Sullivan and Peterson 1982; Dwyer and Oh 1987). The measurements of the antecedents and consequences of trust used for this study were developed on the basis of Doney and Cannon (1997). The original questions were adjusted to the context of transactions in business services. In particular, questions were developed for both buyers and suppliers to address the following factors: reputation (integrity, customer care, good-will), market standing (company size, market share, positioning in the industry), willingness to customize (product, process, delivery), information sharing (proprietary information, private information), willingness to maintain relationships, perceived professionalism, authority empowerment, buyer-seller similarity, and contact frequency. As a consequential variable of trust, relational performance was measured. Relational performance is classified into tangible effects, intangible effects, and side effects. Tangible effects include financial performance; intangible effects include improvements in relations, network developing, and internal employee satisfaction; side effects include those not included either in the tangible or intangible effects. Three hundred fifty pairs of companies were contacted, and one hundred five pairs of companies responded. After deleting five company pairs because of incomplete responses, one hundred five pairs of companies were used for data analysis. The response ratio of the companies used for data analysis is 30% (105/350), which is above the average response ratio in industrial marketing research. As for the characteristics of the respondent companies, the majority of the companies operate service businesses for both buyers (85.4%) and suppliers (81.8%). The majority of buyers (76%) deal with consumer goods, while the majority of suppliers (70%) deal with industrial goods. This may imply that buyers process the incoming material, parts, and components to produce the finished consumer goods. As indicated by their report of the length of acquaintance with their partners, suppliers appear to have longer business relationships than do buyers. Hypothesis 1 tested the effects of buyer-supplier characteristics on trust. The salesperson's professionalism (t=2.070, p<0.05) and authority empowerment (t=2.328, p<0.05) positively affected buyers' trust toward suppliers. On the other hand, authority empowerment (t=2.192, p<0.05) positively affected supplier trust toward buyers. For both buyers and suppliers, the degree of authority empowerment plays a crucial role in the maintenance of their trust in each other. Hypothesis 2 tested the effects of buyerseller relational characteristics on trust. Buyers tend to trust suppliers, as suppliers make every effort to contact buyers (t=2.212, p<0.05). This tendency has also been shown to be much stronger for suppliers (t=2.591, p<0.01). On the other hand suppliers trust buyers because suppliers perceive buyers as being similar to themselves (t=2.702, p<0.01). This finding confirmed the results of Crosby, Evans, and Cowles (1990), which reported that suppliers and buyers build relationships through regular meetings, either for business or personal matters. Hypothesis 3 tested the effects of trust on perceived risk. It has been found that for both suppliers and buyers the lower is the trust, the higher is the perceived risk (t=-6.621, p<0.01 for buyers; t=-2.437, p<0.05). Interestingly, this tendency has been shown to be much stronger for buyers than for suppliers. One possible explanation for this higher level of perceived risk is that buyers normally perceive higher risks than do suppliers in transactions involving business services. For this reason, it is necessary for suppliers to implement risk reduction strategies for buyers. Hypothesis 4 tested the effects of trust on information searching. It has been found that for both suppliers and buyers, contrary to expectation, trust depends on their partner's reputation (t=2.929, p<0.01 for buyers; t=2.711, p<0.05 for suppliers). This finding shows that suppliers with good reputations tend to be trusted. Prior experience did not show any significant relationship with trust for either buyers or suppliers. Hypothesis 5 tested the effects of trust on supplier/buyer selection. Unlike buyers, suppliers tend to trust buyers when they think that previous transactions with buyers were important (t=2.913 p<0.01). However, this study did not show any significant relationship between source loyalty and the trust of buyers in suppliers. Hypothesis 6 tested the effects of trust on relational performances. For buyers and suppliers, financial performance reportedly improved when they trusted their partners (t=2.301, p<0.05 for buyers; t=3.692, p<0.01 for suppliers). It is interesting that this tendency was much stronger for suppliers than it was for buyers. Similarly, competitiveness was reported to improve when buyers and suppliers trusted their partners (t=3.563, p<0.01 for buyers; t=3.042, p<0.01 for suppliers). For suppliers, efficiency and productivity were reportedly improved when they trusted buyers (t=2.673, p<0.01). Other performance indices showed insignificant relationships with trust. The findings of this study have some strategic implications. First and most importantly, trust-based transactions are beneficial for both suppliers and buyers. As verified in the study, financial performance can be improved through efforts to build and maintain mutual trust. Similarly, competitiveness can be increased through the same kinds of effort. Second, trust-based transactions can facilitate the reduction of perceived risks inherent in the purchasing situation. This finding has implications for both suppliers and buyers. It is generally believed that buyers perceive higher risks in a highly involved purchasing situation. To reduce risks, previous studies have recommended that suppliers devise risk-reducing tactics. Moving beyond these recommendations, the present study uniquely focused on the bilateral perspective of perceived risk. In other words, suppliers are also susceptible to perceived risks, especially when they supply services that require very technical and sophisticated manipulations and maintenance. Consequently, buyers and suppliers must solve problems together in close collaboration. Hence, mutual trust plays a crucial role in the problem-solving process. Third, as found in this study, the more authority a salesperson has, the more he or she can be trusted. This finding is very important with regard to tactics. Building trust is a long-term assignment; however, when mutual trust has not been developed, suppliers can overcome the problems they encounter by empowering a salesperson with the authority to make certain decisions. This finding applies to suppliers as well.