Loyalty Building, Relational Trade Offs and Key Service Employees: The Case of Radio DJ's

Purpose. Interpersonal relationships can be a key success factor in many service businesses. A capable disc jockey, for example, may help a radio station in improving customer satisfaction. But does s/he help in building customer loyalty too? What happens if this employee leaves the organisation? The aim of this study is to assess the overall net effect that customer satisfaction with a key service employee may have on customer loyalty to a service firm. Methodology. The radio industry was selected as a specific case where a key service employee exists. A conceptual model was developed and tested on a sample of radio listeners using structural equation modeling. Findings. The results confirm that customer satisfaction with a disc jockey increases personal loyalty to this employee. That outcome, in turn, cancels out part of the positive effects on customer loyalty to the radio station. Research limitations/implications. Our model is tested within a specific service industry and the findings are not generalizable to contexts whose underlying characteristics differ from that industry. The aim is to propose a frame for estimating the net effects of relational trade-offs with a key service employee. More generally, the study contributes to increased knowledge on the topic of customers’ multiple levels of relationships. Practical Implications. When designing a value proposition in service industries where a key employee exists, it becomes especially important to add value elements and satisfaction drivers strictly referable to the firm and not to a specific person (e.g. image and reputation, behavioural consistency, overall experience, etc.). Originality/value of paper. (1) The concept of ‘key service employee’ is formally introduced and defined. (2) A crossed design to weigh both direct and indirect relational outcomes is proposed. (3) Loyalty to a key employee is explicitly measured as concurrent loyalty toward the firm