A Firm 's Reputation And Satisfaction With Previous Interactions

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A firm’s reputation and satisfaction with previous interactions are both positively related to a customer’s cognitive and affective trust. A firm’s reputation is a customer’s belief that the firm can be fair and honest according to Doney and Cannon (1997). As it is taught in business ethics, any firm can gain a reputation that is respectable by doing things that are fair and because they are the right thing to do. The reputation of a company is determined by their compassion for their customers. Therefore, a client’s decision about the reputation of the firm can positively impact their judgment of the firm’s trustworthiness. Satisfaction is associated with an “emotional state arising from both a cognitive process of comparing customer’s…show more content…
Recall that cognitive trust is defined as a customer’s assurance or inclination to depend on a service provider’s capabilities as well as their reliability. Consequently, cognitive trust is a building block for affective trust; thus, it must be present before affective trust can be developed. As the affective trust improves the separations between the two trusts is diminished and “reverse causation increases” (McAllister, 1995). In figure one, cognitive trust is presented as a positive relation to affective trust. This has been argued in McAllister’s (1995) research of cognition-based trust, that a relationship concerning cognition and affect is a two-way formation of attitude. Hence, the link between cognitive trust and affective trust. Sales effectiveness is defined as a seller’s success in the sale of a solution favored by the customer (Weitz, 1981). There have been no findings that support a relationship between trust and profit gains or losses. However, in a study done by Crosby and Stephens (1987), it was found that product performances have a tendency to drive the purchasing decision even though relationship-marketing affect a large part of customer satisfaction. While there is no link between affective trust and sales effectiveness, Johnson (2005) argues that “once the variance associated with affective trust is explicitly modeled, the link between
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