An Examination of Customer Relationship Value in high vs low Technology Industries

The paper examines supplier’s perspective of relationship value and investigates if, how and to what extent relationship value and its impact on relationship quality vary according to the technological level of the product. Two types of relationship value are identified through qualitative research, direct value and indirect value and assessed using confirmatory factor analysis. A two aspect conceptualisation of each type of value is developed- a benefit-cost discrepancy regarding value drivers e.g., payment, risk, collaboration, and the relative importance of each driver to the firm. Employing a sample of 67 firms manufacturing high technology product and 65 firms manufacturing low technology product, the relative-value instrument was assessed. Using structural path modelling the effect of product technology on the links of relationship value to the two aspects of relationship quality- trust and satisfaction was examined. The survey results provide support for the relative-value based measurement instrument, a positive effect of direct and indirect value on both aspects of relationship quality, and a significant variation in value due to the technological level of the product. There are limitations related to the sampling procedure: qualitative research; selected large-sized organizations. Further research is needed to test the relationship value in different contexts. Firms may find the relative-value instrument useful in assessing what kind of value is the most cherished by the high technology (low technology) product supplier, and how the relationship value perceptions of the supplier could be improved.