Page 226 - Marketing Management

ANALYZING BUSINESS MARKETS | CHAPTER 7 203

Personal interactions with employees of the firm, opinions about the com-
pany as a whole,and perceptions of trust will evolve with experience.A firm
is more likely to be seen as trustworthy when it:
• Provides full, honest information
g
Marketin
Marketing InsightInsight • Provides employees incentives that are aligned to meet with
customer needs
• Partners with customers to help them learn and help themselves
• Offers valid comparisons with competitive products
Establishing Corporate Trust, Building trust can be especially tricky in online settings, and firms

Credibility, and Reputation often impose more stringent requirements on their online business part-
ners than on others. Business buyers worry that they won’t get products
Corporate credibility is the extent to which customers believe a firm can of the right quality delivered to the right place at the right time. Sellers
design and deliver products and services that satisfy their needs and worry about getting paid on time—or at all—and how much credit they
wants. It reflects the supplier’s reputation in the marketplace and is the should extend. Some firms, such as transportation and supply chain
foundation for a strong relationship. management company Ryder System, use automated credit-checking
Corporate credibility depends on three factors: applications and online trust services to determine the creditworthiness
• Corporate expertise—the extent to which a company is seen as of trading partners.
able to make and sell products or conduct services.
Sources: Bob Violino, “Building B2B Trust,” Computerworld, June 17, 2002, p. 32;
• Corporate trustworthiness—the extent to which a company is seen as
Richard E. Plank, David A. Reid, and Ellen Bolman Pullins, “Perceived Trust in
motivated to be honest,dependable,and sensitive to customer needs. Business-to-Business Sales: A New Measure,” Journal of Personal Selling and Sales
Management 19, no. 3 (Summer 1999), pp. 61–72; Kevin Lane Keller and David A.
• Corporate likability—the extent to which a company is seen as likable,
Aaker, “Corporate-Level Marketing: The Impact of Credibility on a Company’s Brand
attractive, prestigious, dynamic, and so on. Extensions,” Corporate Reputation Review 1 (August 1998), pp. 356–78; Robert
M. Morgan and Shelby D. Hunt, “The Commitment–Trust Theory of Relationship
In other words, a credible firm is good at what it does; it keeps its
Marketing,” Journal of Marketing 58, no. 3 (July 1994), pp. 20–38; Christine
customers’ best interests in mind and is enjoyable to work with. Moorman, Rohit Deshpande, and Gerald Zaltman, “Factors Affecting Trust in Market
Trust is the willingness of a firm to rely on a business partner. It Research Relationships,” Journal of Marketing 57 (January 1993), pp. 81–101;
Glen Urban, “Where Are You Positioned on the Trust Dimensions?” Don’t Just
depends on a number of interpersonal and interorganizational factors,such
Relate-Advocate: A Blueprint for Profit in the Era of Customer Power (Upper Saddle
as the firm’s perceived competence, integrity, honesty, and benevolence. River, NJ: Pearson Education/Wharton School Publishers, 2005).

7. Mutually adaptive—Buyers and sellers make many relationship-specific adaptations, but
without necessarily achieving strong trust or cooperation.
8. Customer is king—In this close, cooperative relationship, the seller adapts to meet the
customer’s needs without expecting much adaptation or change in exchange.
Over time, however, relationship roles may shift or be activated under different circumstances. 59
Some needs can be satisfied with fairly basic supplier performance. Buyers then neither want nor
require a close relationship with a supplier. Likewise, some suppliers may not find it worth their
while to invest in customers with limited growth potential.
One study found the closest relationships between customers and suppliers arose when the
supply was important to the customer and there were procurement obstacles, such as complex
60
purchase requirements and few alternate suppliers. Another study suggested that greater vertical
coordination between buyer and seller through information exchange and planning is usually
necessary only when high environmental uncertainty exists and specific investments (described
next) are modest. 61

Business Relationships: Risks and Opportunism
Researchers have noted that establishing a customer–supplier relationship creates tension
between safeguarding (ensuring predictable solutions) and adaptation (allowing for flexibility
for unanticipated events). Vertical coordination can facilitate stronger customer–seller ties but
at the same time may increase the risk to the customer’s and supplier’s specific investments.
Specific investments are those expenditures tailored to a particular company and value chain