Understanding Customer Loyalty and Disloyalty The Effect of Loyalty-Supporting and -Repressing Factors (first edition sold out, 'print on demand' 60 €)

Customer loyalty has been a central topic of both marketing theory and practice for several decades. Customer disloyalty, or relationship ending, has received much less attention. Despite the close relation between customer loyalty and disloyalty, they have rarely been addressed in the same study. The thesis bridges this gap by focusing on both loyal and disloyal customers and the factors characterising them. Based on a qualitative study of loyal and disloyal bank customers in the Finnish retail banking market, both factors that are common to the groups and factors that differentiate between them are identified. A conceptual framework of factors that affect customer loyalty or disloyalty is developed and used to analyse the empirical data. According to the framework, customers’ loyalty status (behavioural and attitudinal loyalty) is influenced by positive, loyalty-supporting, and negative, loyalty-repressing factors. Loyalty-supporting factors either promote customer dedication, making the customer want to remain loyal, or act as constraints, hindering the customer from switching. Among the loyalty-repressing factors it is especially important to identify those that act as triggers of disloyal behaviour, making customers switch service providers. The framework further suggests that by identifying the sources of loyalty-supporting and -repressing factors (the environment, the provider, the customer, the provider-customer interaction, or the core service) one can determine which factors are within the control of the service provider. Attitudinal loyalty is approached through a customer’s “feeling of loyalty”, as described by customers both orally and graphically. By combining the graphs with behavioural loyalty, seven customer groups are identified: Stable Loyals, Rescued Loyals, Loyals at Risk, Positive Disloyals, Healing Disloyals, Fading Disloyals, and Abrupt Disloyals. The framework and models of the thesis can be used to analyse factors that affect customer loyalty and disloyalty in different service contexts. Since the empirical study was carried out in a retail bank setting, the thesis has managerial relevance especially for banks. Christina Nordman is associated with CERS, Center for Relationship Marketing and Service Management at the Swedish School of Economics and Business Administration. The doctoral thesis is part of the Göran Collert Research Project in Customer Relationships and Retail Banking and has been funded by The Göran Collert Foundation.

Roles of forced nicotine exposure and Comt gene disruption in the development of addiction-related behavioural and neurochemical changes in mice

Activation of midbrain dopamine systems is thought to be critically involved in the addictive properties of abused substances. Drugs of abuse increase dopamine release in the nucleus accumbens and dorsal striatum, which are the target areas of mesolimbic and nigrostriatal dopamine pathways, respectively. Dopamine release in the nucleus accumbens is thought to mediate the attribution of incentive salience to rewards, and dorsal striatal dopamine release is involved in habit formation. In addition, changes in the function of prefrontal cortex (PFC), the target area of mesocortical dopamine pathway, may skew information processing and memory formation such that the addict pays an abnormal amount of attention to drug-related cues. In this study, we wanted to explore how long-term forced oral nicotine exposure or the lack of catechol-O-methyltransferase (COMT), one of the dopamine metabolizing enzymes, would affect the functioning of these pathways. We also wanted to find out how the forced nicotine exposure or the lack of COMT would affect the consumption of nicotine, alcohol, or cocaine. First, we studied the effect of forced chronic nicotine exposure on the sensitivity of dopamine D2-like autoreceptors in microdialysis and locomotor activity experiments. We found that the sensitivity of these receptors was unchanged after forced oral nicotine exposure, although an increase in the sensitivity was observed in mice treated with intermittent nicotine injections twice daily for 10 days. Thus, the effect of nicotine treatment on dopamine autoreceptor sensitivity depends on the route, frequency, and time course of drug administration. Second, we investigated whether the forced oral nicotine exposure would affect the reinforcing properties of nicotine injections. The chronic nicotine exposure did not significantly affect the development of conditioned place preference to nicotine. In the intravenous self-administration paradigm, however, the nicotine-exposed animals self-administered nicotine at a lower unit dose than the control animals, indicating that their sensitivity to the reinforcing effects of nicotine was enhanced. Next, we wanted to study whether the Comt gene knock-out animals would be a suitable model to study alcohol and cocaine consumption or addiction. Although previous work had shown male Comt knock-out mice to be less sensitive to the locomotor-activating effects of cocaine, the present study found that the lack of COMT did not affect the consumption of cocaine solutions or the development of cocaine-induced place preference. However, the present work did find that male Comt knock-out mice, but not female knock-out mice, consumed ethanol more avidly than their wild-type littermates. This finding suggests that COMT may be one of the factors, albeit not a primary one, contributing to the risk of alcoholism. Last, we explored the effect of COMT deficiency on dorsal striatal, accumbal, and prefrontal cortical dopamine metabolism under no-net-flux conditions and under levodopa load in freely-moving mice. The lack of COMT did not affect the extracellular dopamine concentrations under baseline conditions in any of the brain areas studied. In the prefrontal cortex, the dopamine levels remained high for a prolonged time after levodopa treatment in male, but not female, Comt knock-out mice. COMT deficiency induced accumulation of 3,4-dihydroxyphenylacetic acid, which increased further under levodopa load. Homovanillic acid was not detectable in Comt knock-out animals either under baseline conditions or after levodopa treatment. Taken together, the present results show that although forced chronic oral nicotine exposure affects the reinforcing properties of self-administered nicotine, it is not an addiction model itself. COMT seems to play a minor role in dopamine metabolism and in the development of addiction under baseline conditions, indicating that dopamine function in the brain is well-protected from perturbation. However, the role of COMT becomes more important when the dopaminergic system is challenged, such as by pharmacological manipulation.

Cortical processing of musical pitch as reflected by behavioural and electrophysiological evidence

In a musical context, the pitch of sounds is encoded according to domain-general principles not confined to music or even to audition overall but common to other perceptual and cognitive processes (such as multiple pattern encoding and feature integration), and to domain-specific and culture-specific properties related to a particular musical system only (such as the pitch steps of the Western tonal system). The studies included in this thesis shed light on the processing stages during which pitch encoding occurs on the basis of both domain-general and music-specific properties, and elucidate the putative brain mechanisms underlying pitch-related music perception. Study I showed, in subjects without formal musical education, that the pitch and timbre of multiple sounds are integrated as unified object representations in sensory memory before attentional intervention. Similarly, multiple pattern pitches are simultaneously maintained in non-musicians' sensory memory (Study II). These findings demonstrate the degree of sophistication of pitch processing at the sensory memory stage, requiring neither attention nor any special expertise of the subjects. Furthermore, music- and culture-specific properties, such as the pitch steps of the equal-tempered musical scale, are automatically discriminated in sensory memory even by subjects without formal musical education (Studies III and IV). The cognitive processing of pitch according to culture-specific musical-scale schemata hence occurs as early as at the sensory-memory stage of pitch analysis. Exposure and cortical plasticity seem to be involved in musical pitch encoding. For instance, after only one hour of laboratory training, the neural representations of pitch in the auditory cortex are altered (Study V). However, faulty brain mechanisms for attentive processing of fine-grained pitch steps lead to inborn deficits in music perception and recognition such as those encountered in congenital amusia (Study VI). These findings suggest that predispositions for exact pitch-step discrimination together with long-term exposure to music govern the acquisition of the automatized schematic knowledge of the music of a particular culture that even non-musicians possess.

Essays on Misplanning Wealth and Health: A Behavioural Approach

The dissertation consists of three essays on misplanning wealth and health accumulation. The conventional economics assumes that individual's intertemporal preferences are exponential (exponential preferences, EP). Recent findings in behavioural economics have shown that, actually, people do discount near future relatively heavier than distant future. This implies hyperbolic intertemporal preferences (HP). Essays I and II concentrate especially on the effects of a delayed completion of tasks, a feature of behaviour that HP enables. Essay III uses current Finnish data to analyse the evolvement of the quality adjusted life years (QALYs) and inconsistencies in measuring that. Essay I studies the existence effects of a lucrative retirement savings program (SP) on the retirement savings of different individual types having HP. If the individual does not know that he will have HP also in the future, i.e. he is the naïve, for certain conditions, he delays the enrolment on SP until he abandons it. Very interesting finding is that the naïve retires then poorer in the presence than in the absence of SP. For the same conditions, the individual who knows that he will have HP also in the future, i.e. he is the sophisticated, gains from the existence of SP, and retires with greater retirement savings in the presence than in the absence of SP. Finally, capabilities to learn from past behaviour and about intertemporal preferences improve possibilities to gain from the existence but an adequate time to learn must be then guaranteed. Essay II studies delayed doctor's visits, theirs effects on the costs of a public health care system and government's attempts to control patient behaviour and fund the system. The controlling devices are a consultation fee and a deductible for that. The deductible is effective only for a patient whose diagnosis reveals a disease that would not get cured without the doctor's visit. The naives delay their visits the longest while EP-patients are the quickest visitors. To control the naives, the government should implement a low fee and a high deductible, while for the sophisticates the opposite is true. Finally, if all the types exist in an economy then using an incorrect conventional assumption that all individuals have EP leads to worse situation and requires higher tax rates than assuming incorrectly but unconventionally that only the naives exists. Essay III studies the development of QALYs in Finland 1995/96-2004. The essay concentrates on developing a consistent measure, i.e. independent of discounting, for measuring the age and gender specific QALY-changes and their incidences. For the given time interval, use of a relative change out of an attainable change seems to be almost intact to discounting and reveals that the greatest gains are for older age groups.

Evaluation of methods and applications for behavioural profiling of transgenic mice

During the last 10-15 years interest in mouse behavioural analysis has evolved considerably. The driving force is development in molecular biological techniques that allow manipulation of the mouse genome by changing the expression of genes. Therefore, with some limitations it is possible to study how genes participate in regulation of physiological functions and to create models explaining genetic contribution to various pathological conditions. The first aim of our study was to establish a framework for behavioural phenotyping of genetically modified mice. We established comprehensive battery of tests for the initial screening of mutant mice. These included tests for exploratory and locomotor activity, emotional behaviour, sensory functions, and cognitive performance. Our interest was in the behavioural patterns of common background strains used for genetic manipulations in mice. Additionally we studied the behavioural effect of sex differences, test history, and individual housing. Our findings highlight the importance of careful consideration of genetic background for analysis of mutant mice. It was evident that some backgrounds may mask or modify the behavioural phenotype of mutants and thereby lead to false positive or negative findings. Moreover, there is no universal strain that is equally suitable for all tests, and using different backgrounds allows one to address possible phenotype modifying factors. We discovered that previous experience affected performance in several tasks. The most sensitive traits were the exploratory and emotional behaviour, as well as motor and nociceptive functions. Therefore, it may be essential to repeat some of the tests in naïve animals for assuring the phenotype. Social isolation for a long time period had strong effects on exploratory behaviour, but also on learning and memory. All experiments revealed significant interactions between strain and environmental factors (test history or housing condition) indicating genotype-dependent effects of environmental manipulations. Several mutant line analyses utilize this information. For example, we studied mice overexpressing as well as those lacking extracellular matrix protein heparin-binding growth-associated molecule (HB-GAM), and mice lacking N-syndecan (a receptor for HB-GAM). All mutant mice appeared to be fertile and healthy, without any apparent neurological or sensory defects. The lack of HB-GAM and N-syndecan, however, significantly reduced the learning capacity of the mice. On the other hand, overexpression of HB-GAM resulted in facilitated learning. Moreover, HB-GAM knockout mice displayed higher anxiety-like behaviour, whereas anxiety was reduced in HB-GAM overexpressing mice. Changes in hippocampal plasticity accompanied the behavioural phenotypes. We conclude that HB-GAM and N-syndecan are involved in the modulation of synaptic plasticity in hippocampus and play a role in regulation of anxiety- and learning-related behaviour.

Behavioural, population, and genetic processes affecting metapopulation dynamics of the Glanville fritillary butterfly

In my thesis I have been studying the effects of population fragmentation and extinction-recolonization dynamics on genetic and evolutionary processes in the Glanville fritillary butterfly (Melitaea cinxia). By conducting crosses within and among newly-colonized populations and using several fitness measures, I found a strong decrease in fitness following colonization by a few related individuals, and a strong negative relationship between parental relatedness and offspring fitness. Thereafter, I was interested in determining the number and relatedness of individuals colonizing new populations, which I did using a set of microsatellites I had previously developed for this species. Additionally, I am interested in the evolution of key life-history traits. By following the lifetime reproductive success of males emerging at different times in a semi-natural setup, I demonstrated that protandry is adaptive in males, and I was able to rule out, for M. cinxia, alternative incidental hypotheses evoked to explain the evolution of protandry in insects. Finally, in work I did together with Prof. Hanna Kokko, I am proposing bet-hedging as a new mechanism that could explain the evolution of polyandry in M. cinxia.

Behavioural and physiological responses to predators of captive-bred Arctic charr: significance of genetics, learning and ontogeny

Predation forms one of the main selective forces in nature and in a vast number of prey species the behavioural responses form the main way to avoid predation. World wide numerous captive breeding programs are used to produce fish and other animal species for conservational reintroductions. However, rearing animals in the absence of predators in captivity has been shown to weaken their predator avoidance skills and lead to behavioural divergence between wild and captive-bred populations. In my thesis I studied the effects of predator odour exposures on antipredator behavioural and physiological responses of captive reared Saimaa Arctic charr. This charr population is the most endangered fish population in Finland and a sample of the remaining population has been taken to captive breeding and used for an extensive reintroduction program. Lowered responsiveness to predators is probably one of the major reasons for the poor survival probability of the charr after release into the wild. The main aims of my thesis were to explore the reasons for behavioural phenotypic variation in this charr population and whether naïve charr young could be trained to recognise their natural predators. The predator species in my thesis were burbot (Lota lota) and pikeperch (Sander lucioperca). In my thesis I showed that the captive-bred charr responded to chemical cues from burbot and pikeperch, but the magnitude of responses was linked to the predator species. The burbot odour increased the spatial odour avoidance of the charr young. On the other hand, in the pikeperch treatment charr reduced their relative swimming activity and tended to show more freezing behaviour relative to the burbot treatment. It seems evident that these different responses are related to the different hunting tactics of predator species. Furthermore, I detected wide between-family differences in antipredator responsiveness (i.e. inherited variation in antipredator behaviours) in this captive stock. Detected differences were greater in the response towards burbot than towards pikeperch. These results, in addition to predator-specific antipredator responses, suggest that there is a clear inherited component in antipredator responsiveness in Saimaa charr population and that the detected inherited differences could explain a part of the behavioural phenotypic variation in this population. In my thesis I also found out that both social learning and direct exposure to live predators enhance the antipredator responsiveness of charr young. In addition, I obtained indications that predator odour exposures (i.e. life-skills training) in alevin and fry stages can fine-tune the innate antipredator responsiveness of charr. Thus, all these methods have the potential to enhance the innate antipredator responsiveness of naïve charr young, possibly also improving the post-release survival of these trained individuals in the wild. However, the next logical phase would be to carry out large scale survival studies in the wild to test this hypothesis. Finally, the results of my thesis emphasize that possible long-term life-skills training methods should take into account not only the behavioural but also the physiological effects of training.

Does relationship marketing improve customer relationship satisfaction and loyalty?

Purpose - This study investigates the relationship marketing (RM) strategy of a retail bank and examines whether - after its implementation - customer relationships were strengthened through perceived improvements in the banking relationship and consequent loyalty towards the bank. Design/methodology/approach - A survey was conducted on two profitability segments, of which the more profitable segment had been directly exposed to a customer oriented RM strategy, whereas the less profitable segment had been subjected to more sales oriented marketing communications. Findings - No significant differences were found between the segments on customers’ evaluations of the service relationship or their loyalty toward the bank. Furthermore regression analysis revealed that relationship satisfaction was less important as a determinant of loyalty in the more profitable segment. Research limitations/implications - This study was conducted as a case study of one specific branch of a bank group in Finland, which limits the external validity of its results. It was not possible to ascertain if, or to what extent, customers of the more profitable segment had received the intended RM treatment. Other limitations are also discussed. Practical implications - Customer orientation is desirable within retail banking and more studies are needed on the differential drivers of loyalty across customer profitability segments. By identifying the aspects of a banking relationship that are more highly valued among more profitable customers than among less profitable customers, bank managers would be able to more effectively devise appropriate strategies for different segments. Originality/value - The study contributes to the RM literature and marketing of financial services by providing empirical evidence of the effects of RM activities on customer relationship perceptions in different profitability segments.

Boost Customer Loyalty with Online Support. The Case of Mobile Telecoms Providers.

The paper explores the effect of customer satisfaction with online supporting services on loyalty to providers of an offline core service. Supporting services are provided to customers before, during, or after the purchase of a tangible or intangible core product, and have the purpose of enhancing or facilitating the use of this product. The internet has the potential to dominate all other marketing channels when it comes to the interactive and personalised communication that is considered quintessential for supporting services. Our study shows that the quality of online supporting services powerfully affects satisfaction with the provider and customer loyalty through its effect on online value and enjoyment. Managerial implications are provided.

Leader - Follower Relations In An Intercultural Chinese Context - Personal, Interpersonal and Behavioural Influences and Impact on Work Contribution

The successful interaction between leaders and their followers is central to the overall functioning of a company. The increasingly multinational nature of modern business and the resulting multicultural and increasingly heterogeneous workforce imposes specific challenges to the development of high-quality work relationships. The Western multinational companies that have started operations in China are facing these challenges. This study examines the quality of leader-follower relationships between Western expatriate leaders and their Chinese followers as well as between Chinese leaders and their Chinese followers in Western-owned subsidiaries in China. The focus is on the influence of personal, interpersonal and behavioural factors (personality, values, cultural knowledge, perceived and actual similarity, interactional justice, and follower performance) and the work-related implications of these relationships (job attitudes and organisational citizenship behaviour). One interesting finding of this study is that Chinese followers have higher perceptions of their Western than their Chinese leaders. The results also indicate that Chinese and Western leaders’ perceptions of their followers are not influenced favourably by the same follower characteristics. In a similar vein, Chinese followers value different traits in Western versus Chinese leaders. These results, as well as the numerous more specific findings of the study, have practical implications for international human resource management and areas such as selection, placement and training. Due to the different effect of personal and interpersonal factors across groups, it is difficult to achieve the “perfect match” between leader and follower characteristics that simultaneously contribute to high-quality relationships for Chinese and Western leaders as well as for followers. However, the results indicate that the ability of organisations to enhance the quality of leader-follower relations by selecting and matching people with suitable characteristics may provide an effective means for organisations to increase positive job attitudes and hence influence work-related outcomes.

Relationship Drivers in Provider - Consumer Relationships. Empirical Studies of Customer Loyalty Programs (första upplagan slutsåld / first edition sold out, 'print on demand' 60 €)

The study addressed a phenomenon that has become common marketing practice, customer loyalty programs. Although a common type of consumer relationship, there is limited knowledge of its nature. The purpose of the study was to create structured understanding of the nature of customer relationships from both the provider’s and the consumer’s viewpoints by studying relationship drivers and proposing the concept of relational motivation as a provider of a common framework for the analysis of these views. The theoretical exploration focused on reasons for engaging in customer relationships for both the consumer and the provider. The themes of buying behaviour, industrial and network marketing and relationship marketing, as well as the concepts of a customer relationship, customer loyalty, relationship conditions, relational benefits, bonds and commitment were explored and combined in a new way. Concepts from the study of business-to-business relationships were brought over and their power in explaining the nature of consumer relationships examined. The study provided a comprehensive picture of loyalty programs, which is an important contribution to the academic as well as the managerial discussions. The consumer study provided deep insights into the nature of customer relationships. The study provides a new frame of reference to support the existing concepts of loyalty and commitment with the introduction of the relationship driver and relational motivation concepts. The result is a novel view of the nature of customer relationships that creates new understanding of the forces leading to loyal behaviour and commitment. The study concludes with managerial implications.