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Journal of the Academy of Marketing Science
Published in: Journal of the Academy of Marketing Science 3/2010

01-06-2010 | Original Empirical Research

Customer relationship management and firm performance: the mediating role of business strategy

Authors: Martin Reimann, Oliver Schilke, Jacquelyn S. Thomas

Published in: Journal of the Academy of Marketing Science | Issue 3/2010

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Abstract

As managers and academics increasingly raise issues about the real value of CRM, the authors question its direct and unconditional performance effect. The study advances research on CRM by investigating the role of critical mechanisms underlying the CRM-performance link. Drawing from the sources → positions → performance framework, the authors build a research model in which two strategic postures of firms—differentiation and cost leadership—mediate the effect of CRM on firm performance. This investigation also contributes to the literature by drawing attention to the differential impact of CRM in diverse industry environments. The study analyzes data from in-depth field interviews and a large-scale, cross-industry survey, and results reveal that CRM does not affect firm performance directly. Rather, the CRM-performance link is fully mediated by differentiation and cost leadership. In addition, CRM’s impact on differentiation is greater when industry commoditization is high.
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Appendix
Available only for authorised users
Footnotes
1
For identification purposes, it was necessary to constrain factor loadings within constructs to be equal when estimating this model.
 
2
In order to avoid underidentification of the AMOS model, we adopted common practice and fixed the factor scores’ error variances to zero (Fuchs and Diamantopoulos 2009; Kenny et al. 1998). Following the suggestion by Kline (2005), we reestimated our structural model with a range of values for the measurement error variance. Using the error variance formula suggested by Jöreskog and Sörbom (1988)—i.e., θ1 = VAR(x1) × (1-assumed reliability of x1)— we reestimated the model shown in Fig. 1 with assumed reliabilities of .7, .8, and .9. The structural estimates remained significant in all cases, showing that they are not substantially affected by the level of measurement error in the factor scores that is assumed.
 
3
To obtain the standard errors for the indirect effects, we used the Sobel (1982) method.
 
4
Because our analysis of moderating effects with multi-group analysis was based on the dichotomization of the moderator variable, it may be associated with a reduced level of statistical power (Irwin and McClelland 2001), which could also serve as an explanation for why we do not find support for H4.
 
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Metadata
Title
Customer relationship management and firm performance: the mediating role of business strategy
Authors
Martin Reimann
Oliver Schilke
Jacquelyn S. Thomas
Publication date
01-06-2010
Publisher
Springer US
Published in
Journal of the Academy of Marketing Science / Issue 3/2010
Print ISSN: 0092-0703
Electronic ISSN: 1552-7824
DOI
https://doi.org/10.1007/s11747-009-0164-y

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