Role of marketing and technological innovation on store equity, satisfaction and word-of-mouth in retailing
| Pages | 650-666 |
| DOI | https://doi.org/10.1108/JPBM-07-2016-1279 |
| Published date | 18 September 2017 |
| Date | 18 September 2017 |
| Author | María Fuentes-Blasco,Beatriz Moliner-Velázquez,David Servera-Francés,Irene Gil-Saura |
| Subject Matter | Marketing,Product management,Brand management/equity |
Role of marketing and technological
innovation on store equity, satisfaction and
word-of-mouth in retailing
María Fuentes-Blasco
Department of Management and Marketing, Universidad Pablo de Olavide, Sevilla, Spain
Beatriz Moliner-Velázquez
Department of Market Research, University of Valencia, Valencia, Spain
David Servera-Francés
Department of Marketing, Universidad Catolica de Valencia San Vicente Martir, Valencia, Spain, and
Irene Gil-Saura
University of Valencia, Valencia, Spain
Abstract
Purpose – Despite the importance of innovation in business performance, investigation into innovation in services is scanty and lacking consensus.
In retailing, it is a topic that has been awakening considerable academic and business interest in recent years. In this study context, this work aims
to analyse innovation in retail experiences from two aspects – marketing innovation and technological innovation – to understand the role it
exercises in satisfaction and subsequent recommendation.
Design/methodology/approach – The authors’ objective is to investigate the direct and indirect influence of marketing and technological
innovation on satisfaction and word-of-mouth (WOM) through three core constructs: store image, consumer value and store brand equity. SEM
methodology is applied on a sample of 820 retail customers of grocery, clothing, furniture an electronics store.
Findings – The results show that technological innovation is more important than marketing innovation in shaping image, value and satisfaction.
At the same time, store image is the variable that most influences customer satisfaction and that satisfaction is a very significant antecedent of WOM
behaviour. Practical implications for retail managers and further research are presented.
Originality/value – The main value of this work has been to go deeper into the study of retail innovation, both in marketing and technologies,
and its direct and indirect effects on satisfaction and subsequent recommendation through store image, consumer value and store brand equity. It
is a new line of study, which is still fragmented and with little empirical evidence.
Keywords Marketing, Innovation, Word-of-mouth, Retailing, Satisfaction, Brand equity, Technologies
Paper type Research paper
1. Introduction
Innovation in the services sector has received little attention
(Djellal et al., 2013). Although retailers are among the most
influential actors in developed economies, there has been
relatively little research on retail innovation from a conceptual
and empirical perspective compared to other sectors (Hristov
and Reynolds, 2015). This work seeks to deepen the study of
retail innovation in marketing and technologies and examines
the direct and indirect effects of innovation in these areas on
satisfaction, subsequent recommendation through store
image, consumer value and store brand equity.
Innovation refers to the introduction of new technologies,
products, services, marketing ideas, systems and ways of
operating to stimulate a company’s economic performance
(Townsend, 2010). One new research line examines
marketing activities and practices (Gil et al., 2014), but
empirical evidence relating such innovation with variables
associated with satisfaction and loyalty is still scanty (Nemati
et al., 2010). Furthermore, the rapid evolution of information
and communication technologies (hereinafter ICT) has
radically changed market conditions by providing new
instruments to add value to customer experience (Thiesse
et al., 2009). There is consensus in the literature over the
advantages for firms of ICT use such as cost reductions,
enhanced customer satisfaction, increased market share, more
flexible jobs and better competitive advantages (Gil et al.,
2014). However, technological innovation in retailing is a
The current issue and full text archive of this journal is available on
Emerald Insight at: www.emeraldinsight.com/1061-0421.htm
Journal of Product & Brand Management
26/6 (2017) 650–666
© Emerald Publishing Limited [ISSN 1061-0421]
[DOI 10.1108/JPBM-07-2016-1279]
This research has received financial support from the Spanish Ministry of
Education and Science (Project reference: ECO2013-43353-R).
Received 28 July 2016
Revised 7 February 2017
26 April 2017
2 June 2017
Accepted 3 June 2017
650
recent area of interest with challenges and debates still to be
resolved (Renko and Druzijanic, 2014).
This work studies retail innovation by exploring marketing
innovation and technological innovation from the consumer
perspective. We analyse the direct and indirect effects of both
types of innovation on satisfaction, as well as the influence of
satisfaction on one of the most important dimensions of
loyalty, that is, word-of-mouth behaviour (hereinafter WOM).
Three variables – store image, consumer value and store brand
equity – were selected for this study from the retailing
literature as they are closely related to satisfaction and loyalty.
They are particularly relevant in competitive sectors and show
little differentiation between products and services (Cortiñas
et al., 2010). Store image is a key strategic tool for achieving a
competitive advantage (Delgado et al., 2014) and has recently
received particular attention (Kumar et al., 2014). Value has
also been found to be especially relevant in retail experiences
in recent years (Yoon et al., 2014). Whilst brand equity is an
emerging area in the context of retailing and requires greater
in-depth study (White et al., 2013;Gil et al., 2016). We thus
believe that these variables will offer an improved and broader
conceptual framework than classical linear models of loyalty.
Our aim, therefore, is to study the contribution of marketing
and technological innovation on satisfaction and WOM
through image, consumer value and brand equity in retailing
experiences. This analysis will enable us to detect differences
in the effects of each type of innovation and further
understand the relationship between innovation and customer
satisfaction. The results can help commercial managers design
strategies and distribute resources to improve customers’
levels of satisfaction and their subsequent recommendations.
2. Theoretical framework and research
hypotheses
The contribution of satisfaction to loyalty has been widely
studied in the literature (Agustin and Singh, 2005), and the
relationship has traditionally been approached through
antecedent variables like expectations, service quality and
perceived value (Payne and Holt, 2001), among others.
Although the link between satisfaction and loyalty seems
obvious, various recent studies have highlighted the need to go
deeper into the antecedents and type of relationship between
the two constructs (Pomirleanu et al., 2016). While some
studies have revealed nonlinear and/or asymmetric effects
(Cooil et al., 2007), others confirm that the effect of
satisfaction depends on numerous mediator and moderator
factors (Kumar et al., 2013;Eisenbeiss et al., 2014). This
complex relationship is particularly important on a practical
level as firms have to assess to what extent and where it is
advisable to invest in satisfaction to generate loyalty (Kumar
et al., 2013). Therefore, the loyalty process still presents
important challenges that require further investigation.
Technological development has led to significant changes in
consumer demands and behaviours (Grewal et al., 2017). In
this digital era, the latest works on loyalty in retailing highlight
the limitations of evaluating satisfaction as an end result and
insist on the need to measure each consumer touchpoint with
the retailer (e.g. website), and integrate the technologies in
loyalty programmes (e.g. mobile wallets) (Kumar et al., 2017).
In view of these challenges, the study of innovation in any
areas of retailer strategy is crucial for identifying what aspects
contribute directly and indirectly to satisfaction and loyalty.
In addition to innovation, variables such as store image,
consumer value and brand equity have a significant presence
in the loyalty process. Store image refers to the perception of
marketing activities (Jinfeng and Zhilong, 2009) (e.g.
merchandising, promotion, etc.), value is usually associated
with utilitarian and hedonic aspects (Sweeney and Soutar,
2001) (e.g. price) and brand equity is the added value linked
to the brand perceived by consumers (Yoo et al., 2000). These
variables are, therefore, closely linked to different touchpoints
between the customer and the store and make key
contributions to satisfaction and loyalty. Given the growing
recent interest in consumer recommendations and comments
(Jayawardhena et al., 2016;Leppäniemi et al., 2017),
especially online (King et al., 2014), loyalty is approached in
the present study on the basis of WOM behaviour
(Jayawardhena et al., 2016;Leppäniemi et al., 2017).
2.1 Marketing and technological innovation
Innovation in services is less tangible and tends to be ongoing
and more difficult to define and measure (Tether, 2005). In
retailing especially, literature on innovation is relatively new
and fragmented (Musso, 2010;Djellal et al., 2013) and offers
two lines of research: marketing innovation and technological
innovation.
Attempts to define and classify marketing innovation in
retail are still scanty. One of the most representative
contributions is from Homburg et al. (2002), who consider
that it refers to the degree of adoption of new ideas about
merchandising or services. Innovation in merchandising
focuses on incorporating new forms of presenting, organising
and distributing products and services in the store, whereas
innovation in services focuses on offering new services linked
to the shopping experience (e.g. nurseries, entertainment
spaces for shopping companions, personalized service while
shopping, etc.) (Kotler and Keller, 2012). From this
perspective, innovation means incorporating new techniques
and tools to improve sales. Thus, the definition provided by
the OECD (2005) focuses on this line, defining marketing
innovation as the implementation of new marketing methods.
Most contributions to the literature on marketing
innovation are merely conceptual (Ganesan et al., 2009;
Musso, 2010;Hristov and Reynolds, 2015); there are some
qualitative studies with a business focus (Hristov and
Reynolds, 2015) and a few quantitative works that analyse end
consumers (Anselmsson and Johansson, 2009). There have,
however, been hardly any contributions from the academic
field of marketing (Naidoo, 2010).
Table I summarises the main contributions from studies
analysing marketing innovation. In general, the works show
the advantages and benefits of innovations and call for further
study of the variable. More empirical research is needed to
find better measurement scales and explore the relationship
between marketing innovation and satisfaction and loyalty. In
short, the study of marketing innovation presents major
challenges and areas to be exploited (Christofi et al., 2015).
Innovation is usually associated with technological
change. Technological innovation through the introduction
and development of ICTs has become consolidated in
Role of marketing and technological innovation
María Fuentes-Blasco et al.
Journal of Product & Brand Management
Volume 26 · Number 6 · 2017 · 650–666
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