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RELATIONSHIP MARKETING THROUGH
CROSS-SELLING: DIVERSIFICATION AND
         CUSTOMER BASES
    Yildirim Kadak PhD Candidate, MBS, BA (Hons)


                 www.ykadak.com
   Paradigm shift from transactional to relationship
    marketing
   The shift of focus from product branding to
    corporate branding.
   Multimarket Competition (Multipoint
    Competition)
   Cross-selling has received limited attention in the
    academic literature. Most of the literature focuses
    on methodology for identifying common
    acquisition patterns of products bought by
    customers based on their usage or ownership data
CONTRIBUTION TO KNOWLEDGE
This research will test:
 The role cross-selling has in customer loyalty (attitudinal and
    behavioural loyalty)
 The role of corporate branding has in cross-selling and its
    effect on loyalty (attitudinal and behavioral loyalty).
If the A Priori Model is confirmed the numerical justifications
will be supported because it will mean both corporate branding
and cross-selling play a major role in diversification and
multipoint competition.
   Two philosophical perspectives that are mainly
    focused on are Positivism and Phenomenology.
   Realism is about the mechanisms of how the
    world functions, while positivism is an
    epistemology that prescribes the examination
    of it. Scientific realists maintain that
    unobservable constructs have existence;
    additionally, it is these unobservable
    mechanisms that frequently offer
    rationalisation for observable phenomena.
   As a result, for the realist researcher, constructs
    such as culture, the organization, and corporate
    planning exist and act quite independently of
    the observer. The analysis of natural
    phenomena is possible. Thus, understanding is
    improved through induction wherein findings
    increase the knowledge about the pertinent
    phenomena. Therefore, recognised paradigms
    are reflections of the world. The more the
    paradigms match with the facts the more
    reliable they are believed to be.
   Structural Equation Modelling is in line with
    the realism perspective. When complex
    phenomena have been adequately identified to
    permit generalisation to a population instead of
    to a theory, then Structural Equation Modelling
    can be used as a method. The reason for this is
    that it models compositions with intricate co-
    dependencies and it unambiguously permits
    multi-item scales and constructs. It is for this
    reason that Structural Equation Modelling is
    the proposed method to be used in this
    research.
RELATIONSHIP MARKETING
   Sustaining long-lasting relationships with customers

   Attracting new customers should not be the main concern
    for most companies

   The focus is on cultivating and retaining current customers
LOYALTY
IT IS PROPOSED THAT RETENTION RATE SHOWS THE LIKELIHOOD OF A
           CUSTOMER REMAINING LOYAL TO A SUPPLIER.

            Despite over three decades of research
The loyalty phenomenon has not been conceptually elucidated
LOYALTY

BEHAVIOURAL LOYALTY       ATTITUDINAL LOYALTY


    Recency                 Attitudes are quantified
    Frequency                through surveys where
                              customers declare their
    Monetary Value
                              purchase goals.
                             Attitudinal loyalty can be
                              used as an antecedent of
                              behavioural loyalty
ATTITUDINAL AND BEHAVIOURAL LOYALTY
      There is the need to study the relationship
      between behaviour and attitude since the
    discourse in the literature is mainly conceptual
COGNITIVE DISSONANCE THEORY
The evaluation process from pre-purchases to post purchases is
the main concern of much consumer research.

Cognitive Dissonance Theory indicates that customers look for
congruent relationships in attitudes and behaviours.
Inconsistency is supposed to create mental pressure.
Consequently customers discard selecting substitutes or
evidence that can be inconsistent with their present conviction.

H1 Behavioural loyalty has a positive effect on attitudinal loyalty
TRUST
             TRUST IS NEEDED IN UNCERTAINTY
CUSTOMERS TRY TO DECREASE RISK AND AMBIGUITY WHEN BUYING
           GOODS THROUGH MENTAL HEURISTICS

           TRUST IS AN EFFICIENT HEURISTIC THAT CAN REDUCE
                              UNCERTAINTY
      A STUDY FOUND A POSITIVE EFFECT ON TRUST ON CROSS-BUYING
                     INTENTIONS AND CROSS-BUYING
           H2 TRUST HAS A POSITIVE EFFECT ON CROSS-BUYING
       H3 TRUST HAS A POSITIVE EFFECT ON ATTITUDINAL LOYALTY
       H4 TRUST HAS A POSITIVE EFFECT ON BEHAVIOURAL LOYALTY
SATISFATION                      COMMITMENT
                              Even though the literature acknowledged
Conventionally satisfied      satisfaction’s importance the progression from a
customers were seen less      satisfied customer to a relational partner is not
price sensitive and as        fully comprehended.
those who buy additional
products and services.        Concomitantly, a rational antecedent of loyalty is
                              commitment since it is the degree to which a
Positive effect of customer   customer wishes to remain in a continuous
satisfaction on cross-        relationship. Commitment can be divided into two
buying has been               forms:
supported.
                              Calculative commitment: is the determination to
                              remain in the relationship considering switching
H6 Satisfaction has a         costs and shortage in options. An example can be
positive effect on cross-     customers being loyal to a company though he/she
                              as low satisfaction levels.
buying
                              H7 Calculative Commitment has a positive effect on
                              behavioural loyalty.
Affective commitment: is warmer because of mutuality or
connection customer has with a firm that result in stronger
degree if trust and devotion.
Therefore emotive commitment means stronger degree of trust
and devotion. Affective commitment is considered as a bond
that matures over time and through various involvements.
H8 Affective commitment has a positive affect on trust
H9 Affective commitment has a positive effect on attitudinal
loyalty.

Affective commitment instead of previous experiences with the
firm affects satisfaction.
H10 Affective commitment has a positive effect on satisfaction
CROSS-SELLING
   Firms sell more than one product or service to increase the value of the
    relationships. The more a customer bought from a company the more loyal that
    customer is.

H11 Cross-selling has a positive effect on attitudinal loyalty
H12 Cross-selling has a positive effect on behavioural loyalty.
CORPORATE IMAGE
When it is about the corporate brand perceived
by customers is usually referred to as image. It is
    about perceptions, beliefs and attitudes
       customers have about a company.
THE SHIFT TO CORPORATE BRANDING
   Products are swiftly imitated and standardised
   These occurrences require the positioning of the entire
    organisation , then, the corporate images stand out as the
    main differentiation strategy.

   H13 Customers will more likely to cross-buy unrelated
    products if the corporate brand is strong
IMAGE AND PERSONALITY
   Studies theorise image as the customer’s psychological
    depiction of a company and emphasise it mainly as a
    personal character. Given that customers’ perceptions of a
    corporation’s image influence their loyalty, companies focus
    more on the image than the tangible product.
   Image is about positioning the selling proposition in the
    minds of customers.

H14 A positive image strengthens attitudinal loyalty.
H15 A positive image strengthens behavioural loyalty
A PRIORI MODEL
CORPORATE STRATEGY
  Cross-selling and Synergy
MULTIPOINT COMPETITION
  The acknowledgement of involving multimarket contact with
diversification is relatively new. The two are theoretically always
 together. Multi-market analysis installs a dynamic dimension.
MULTIPOINT COMPETITION
Usually companies in multimarket settings have complementary
productions or distributions. Operations characteristically exhibit
  “product extensions” or “market extensions”. These fusions
through internal growth or mergers enable the firm to utilise its
  marketing links. Diversified firms usually have products in the
                    same distribution outlets.
DIVERSIFICATION AND MULTIPOINT
   COMPETITION, THEORETICAL
          IMPLICATIONS
   Introduction chapter complete
   Literature Review complete
   Methodology chapter in progress
   Questionnaire design in progress

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Relationship Marketing

  • 1. RELATIONSHIP MARKETING THROUGH CROSS-SELLING: DIVERSIFICATION AND CUSTOMER BASES Yildirim Kadak PhD Candidate, MBS, BA (Hons) www.ykadak.com
  • 2. Paradigm shift from transactional to relationship marketing  The shift of focus from product branding to corporate branding.  Multimarket Competition (Multipoint Competition)  Cross-selling has received limited attention in the academic literature. Most of the literature focuses on methodology for identifying common acquisition patterns of products bought by customers based on their usage or ownership data
  • 3. CONTRIBUTION TO KNOWLEDGE This research will test:  The role cross-selling has in customer loyalty (attitudinal and behavioural loyalty)  The role of corporate branding has in cross-selling and its effect on loyalty (attitudinal and behavioral loyalty). If the A Priori Model is confirmed the numerical justifications will be supported because it will mean both corporate branding and cross-selling play a major role in diversification and multipoint competition.
  • 4. Two philosophical perspectives that are mainly focused on are Positivism and Phenomenology.  Realism is about the mechanisms of how the world functions, while positivism is an epistemology that prescribes the examination of it. Scientific realists maintain that unobservable constructs have existence; additionally, it is these unobservable mechanisms that frequently offer rationalisation for observable phenomena.
  • 5. As a result, for the realist researcher, constructs such as culture, the organization, and corporate planning exist and act quite independently of the observer. The analysis of natural phenomena is possible. Thus, understanding is improved through induction wherein findings increase the knowledge about the pertinent phenomena. Therefore, recognised paradigms are reflections of the world. The more the paradigms match with the facts the more reliable they are believed to be.
  • 6. Structural Equation Modelling is in line with the realism perspective. When complex phenomena have been adequately identified to permit generalisation to a population instead of to a theory, then Structural Equation Modelling can be used as a method. The reason for this is that it models compositions with intricate co- dependencies and it unambiguously permits multi-item scales and constructs. It is for this reason that Structural Equation Modelling is the proposed method to be used in this research.
  • 7. RELATIONSHIP MARKETING  Sustaining long-lasting relationships with customers  Attracting new customers should not be the main concern for most companies  The focus is on cultivating and retaining current customers
  • 8. LOYALTY IT IS PROPOSED THAT RETENTION RATE SHOWS THE LIKELIHOOD OF A CUSTOMER REMAINING LOYAL TO A SUPPLIER. Despite over three decades of research The loyalty phenomenon has not been conceptually elucidated
  • 9. LOYALTY BEHAVIOURAL LOYALTY ATTITUDINAL LOYALTY  Recency  Attitudes are quantified  Frequency through surveys where customers declare their  Monetary Value purchase goals.  Attitudinal loyalty can be used as an antecedent of behavioural loyalty
  • 10. ATTITUDINAL AND BEHAVIOURAL LOYALTY There is the need to study the relationship between behaviour and attitude since the discourse in the literature is mainly conceptual
  • 11. COGNITIVE DISSONANCE THEORY The evaluation process from pre-purchases to post purchases is the main concern of much consumer research. Cognitive Dissonance Theory indicates that customers look for congruent relationships in attitudes and behaviours. Inconsistency is supposed to create mental pressure. Consequently customers discard selecting substitutes or evidence that can be inconsistent with their present conviction. H1 Behavioural loyalty has a positive effect on attitudinal loyalty
  • 12. TRUST TRUST IS NEEDED IN UNCERTAINTY CUSTOMERS TRY TO DECREASE RISK AND AMBIGUITY WHEN BUYING GOODS THROUGH MENTAL HEURISTICS TRUST IS AN EFFICIENT HEURISTIC THAT CAN REDUCE UNCERTAINTY A STUDY FOUND A POSITIVE EFFECT ON TRUST ON CROSS-BUYING INTENTIONS AND CROSS-BUYING H2 TRUST HAS A POSITIVE EFFECT ON CROSS-BUYING H3 TRUST HAS A POSITIVE EFFECT ON ATTITUDINAL LOYALTY H4 TRUST HAS A POSITIVE EFFECT ON BEHAVIOURAL LOYALTY
  • 13. SATISFATION  COMMITMENT Even though the literature acknowledged Conventionally satisfied satisfaction’s importance the progression from a customers were seen less satisfied customer to a relational partner is not price sensitive and as fully comprehended. those who buy additional products and services. Concomitantly, a rational antecedent of loyalty is commitment since it is the degree to which a Positive effect of customer customer wishes to remain in a continuous satisfaction on cross- relationship. Commitment can be divided into two buying has been forms: supported. Calculative commitment: is the determination to remain in the relationship considering switching H6 Satisfaction has a costs and shortage in options. An example can be positive effect on cross- customers being loyal to a company though he/she as low satisfaction levels. buying H7 Calculative Commitment has a positive effect on behavioural loyalty.
  • 14. Affective commitment: is warmer because of mutuality or connection customer has with a firm that result in stronger degree if trust and devotion. Therefore emotive commitment means stronger degree of trust and devotion. Affective commitment is considered as a bond that matures over time and through various involvements. H8 Affective commitment has a positive affect on trust H9 Affective commitment has a positive effect on attitudinal loyalty. Affective commitment instead of previous experiences with the firm affects satisfaction. H10 Affective commitment has a positive effect on satisfaction
  • 15. CROSS-SELLING  Firms sell more than one product or service to increase the value of the relationships. The more a customer bought from a company the more loyal that customer is. H11 Cross-selling has a positive effect on attitudinal loyalty H12 Cross-selling has a positive effect on behavioural loyalty.
  • 16. CORPORATE IMAGE When it is about the corporate brand perceived by customers is usually referred to as image. It is about perceptions, beliefs and attitudes customers have about a company.
  • 17. THE SHIFT TO CORPORATE BRANDING  Products are swiftly imitated and standardised  These occurrences require the positioning of the entire organisation , then, the corporate images stand out as the main differentiation strategy.  H13 Customers will more likely to cross-buy unrelated products if the corporate brand is strong
  • 18. IMAGE AND PERSONALITY  Studies theorise image as the customer’s psychological depiction of a company and emphasise it mainly as a personal character. Given that customers’ perceptions of a corporation’s image influence their loyalty, companies focus more on the image than the tangible product.  Image is about positioning the selling proposition in the minds of customers. H14 A positive image strengthens attitudinal loyalty. H15 A positive image strengthens behavioural loyalty
  • 20. CORPORATE STRATEGY Cross-selling and Synergy
  • 21. MULTIPOINT COMPETITION The acknowledgement of involving multimarket contact with diversification is relatively new. The two are theoretically always together. Multi-market analysis installs a dynamic dimension.
  • 22. MULTIPOINT COMPETITION Usually companies in multimarket settings have complementary productions or distributions. Operations characteristically exhibit “product extensions” or “market extensions”. These fusions through internal growth or mergers enable the firm to utilise its marketing links. Diversified firms usually have products in the same distribution outlets.
  • 23. DIVERSIFICATION AND MULTIPOINT COMPETITION, THEORETICAL IMPLICATIONS
  • 24.
  • 25. Introduction chapter complete  Literature Review complete  Methodology chapter in progress  Questionnaire design in progress