Index of Paper Presentations for the Parallel Sessions - Academy of ...

development of long term business relationships as well as purchase intentions. For the present work,Berry‘s (1994) framework of relationship marketing investments has been adopted.Relationship marketing investments are the investments done by marketers with the perception that theseinvestments would enhance competitive advantage by increasing repeated patronage by the customers(Bolten, 1989). In extant marketing literature, various researchers have described these relationinvestments approaches in different forms such as customer bonds formed (Berry 1995), exchangecontrol mechanisms utilized (Cannon et al. 2000), benefits offered (Gwinner et al. 1998),functions served (Hakansson and Snehota 2000), and content area supported (Morgan 2000).Though, all the different mechanisms described above, uses different criteria for grouping the relationalactivities, yet the inherent intentions are similar e.g. to enhance the bonding between buyer and seller.Among all, Berry‘s framework of RM investments has been well accepted in the marketing literature.Therefore, for the present work, Berry‘s (1994) framework of relationship marketing activities has beenadopted. According to this framework, all types of relational marketing investments are categorized intothree types of investments, e.g. financial, social and structural investments.Hypothesis development and conceptual frameworkFinancial investmentsFinancial investments include providing financial and tangible rewards to customers with the intentions toincrease the patronage. These investments includes, providing free samples, gifts, coupons, reward pointsand any other form of monetary promotions (e.g., Berry, 1995; Gwinner et al., 1998; and Peterson, 1995).Financial offers increase customer patronage by enhancing customer‘s utilitarian value and therebyincreasing acquisition utility of the purchase. Although marketing literature includes all the incentives asfinancial investments which are given prior and post purchase, looking at the nature of the study,incentives which are given prior to purchase are considered as financial investments.ObligationCustomer feelings of obligation are feelings of indebtedness; an aversive psychological tension (Goei andBoster, 2005). Greenberg and Bar-Tal, 1976) has defined obligation as a negative, uncomfortable statewhich is determined by normative demand and can be perceived aversive. As a psychological construct,obligation has been defined as a ―state of indebtedness to repay another‖ in the context of the receipt of abenefit from another (Greenberg, 1980). It is argued that indebtedness is an emotional stat of ―arousal anddiscomfort‖ and that when one is in this state, one is alert to opportunities to reduce this discomfort.Financial investments and obligationResearchers across many disciplines have recognized that after receiving a benefit (e.g. financial, RMinvestments done by the seller), buyers feel ingrained psychological pressure to reciprocate. As a result,they would like to act in reciprocation. Equity theory perspective says that people like to reciprocate the