Unlocking The "Black Box":How Personal Loyalty Transfers To Firm Loyalty?

This study reveals the important psychological mechanisms by which a customer’s loyalty to a specific salesperson (personal loyalty) can transfer over to loyalty to the firm (firm loyalty). Despite the acknowledged existence of multi-foci loyalties (i.e., customer loyalty toward individual employee, the firm/brand/store), and the positive association between personal loyalty and firm level loyalty, the mechanism underlying this relationship remains a black box, and many scholars and managers have raised concerns that personal loyalty can be threatening to firm-level loyalty.However, drawing on a broad body of knowledge in marketing, psychology and organizational behavior, we demonstrate that customer loyalty toward individuals can work positively and cooperatively toward firm loyalty. Specially, we identify and examine three concurrent underlying mechanisms:affective, cognitive and behavioral mediation. Moreover, we explain how the loyalty transfer process can be strengthened by salespersons’brand-building behaviors. We tested our theoretical model in the context of the Chinese direct selling industry, using Amway as our research case. Using paired data from selling representatives and customers, we found that cognitive transfer is the strongest among the three mechanisms. Moreover, the two dimensions of brand-building behavior-in-role behavior and extra-role behavior-exhibit asymmetric influences on the mediating mechanisms. Specifically, in-role behavior strengthens the relationship between personal loyalty and firm loyalty mainly through the cognitive paths, while extra-role behavior moderates the relationship largely through affective mediation.Our findings on the convergence of multilevel loyalty advance marketing theory on customer loyalty. We discuss the implications for managers on the loyalty transfer process and the benefits of brand-building behaviors, and offer suggestions for ways to incorporate this knowledge into managerial strategies and practice.