satisfaction and repurchase intention - Allied Academies

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SATISFACTION AND REPURCHASE INTENTION: B2B
BUYER-SELLER RELATIONSHIPS IN MEDIUM-
TECHNOLOGY INDUSTRIES
Gregory M. Kellar, Wright State University
Michael W. Preis, University of Illinois at Urbana-Champaign
ABSTRACT
Customer satisfaction and repurchase intentions are examined in B2B markets for
medium-technology offerings; overall customer satisfaction and repurchase intention are
modeled as functions of three components of overall satisfaction: satisfaction with the
interpersonal relationship with the salesperson, satisfaction with vendor performance, and
product satisfaction. The Chow test confirms that overall customer satisfaction is different than
repurchase intention in medium technology industries. Information theoretic techniques are then
applied to variable subset selection to derive optimal linear regression models for overall
customer satisfaction and repurchase intention in medium-tech industries. Results explain
approximately 64% of the variance of overall satisfaction and 37% of the variance of repurchase
intention. The optimal model for overall satisfaction includes terms for all three components of
satisfaction while the optimal model for repurchase intention includes terms for only product
satisfaction and interpersonal satisfaction.
INTRODUCTION
It is important for supply chain practitioners to understand customers’ repurchase
intentions and the factors that influence repurchase intentions (Patterson, Johnson & Spreng,
1997) because increased repurchases (customer loyalty) are important to profitability (Fornell,
1992). Patterson, Johnson, and Spreng (1997), Shapiro, Slywotzky and Doyle (1997), and Preis
(2003) find increased customer satisfaction is one factor leading to such increased repurchase
intentions. Thus, it is important to obtain a good understanding of the factors that affect
satisfaction and hence influence repurchase intentions.
While a great deal of research on customer satisfaction has been performed in consumer
markets, the influence of customer satisfaction on supply chains has been largely ignored
(Patterson, Johnson & Spreng, 1997; Szymanski & Henard, 2001; Homburg & Rudolph, 2000).
Kellar and Preis (2003) show that the components of satisfaction that influence repurchase
intention are different for high-tech and low-tech industries. This finding naturally leads to the
question of whether components of satisfaction for offerings from industries that are neither
high-tech nor low-tech, i.e., medium-tech, differ substantially from those from high-tech and
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Keiningham, Perkins-Munn and Evans (2003) find a positive relationship between
customer satisfaction and share-of-wallet for services in the B2B sector. Similar research on the
relationship between components of satisfaction and share-of-wallet, repurchase intention and
share-of-wallet (i.e., between repurchase intention and actual repurchase), and satisfaction and
share-of wallet for goods, would all be interesting and useful topics to explore.
CONCLUSION
Models have been developed for the effects of three components of satisfaction on both
overall satisfaction and repurchase intention; the three components examined are satisfaction
with the product, satisfaction with vendor performance, and interpersonal satisfaction. Results
demonstrate that significant differences exist between the components of satisfaction that
influence industrial buyers’ evaluations of overall satisfaction and the components of satisfaction
affecting repurchase intention for offerings from medium-tech industries. More of the variance in
overall satisfaction is explained by the components of satisfaction than is explained in repurchase
intention.
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