Relationship satisfaction: An overlooked marketing channel safeguard

Abstract

Transaction specific investments (TSIs) are investments that a marketing channel firm makes to create value for a particular channel relationship. TSIs transform the relationship by creating barriers to exit or lock-in situations because the investing party cannot leave the relationship without incurring substantial costs. This situation may compel the investing party to engage in opportunism to recoup the value of the specific investments, particularly when they are not satisfied with the relationship. We argue, therefore, that relationship satisfaction may serve as an important safeguard when TSIs have been made. Further, we argue that monitoring ease will interact with the moderating effect of relationship satisfaction on the relationship between TSIs and opportunism. Data were collected from 296 hotel general managers and 37 hotel headquarters' field representatives in the U.S. and Canada to test these possibilities. We found that relationship satisfaction indeed serves as an important safeguard, particularly when the partner has difficulty in monitoring the firm.