Tolerating and managing failure: An organizational perspective on customer reacquisition management

Vomberg, Arnd ; Homburg, Christian ; Gwinner, Olivia

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URN: urn:nbn:de:bsz:180-madoc-566540
Document Type: Article
Year of publication: 2020
The title of a journal, publication series: Journal of Marketing : JM
Volume: 84
Issue number: 5
Page range: 117-136
Place of publication: Thousand Oaks, CA
Publishing house: Sage Publishing
ISSN: 0022-2429 , 1547-7185
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Publication language: English
Institution: Business School > Business-to-Business Marketing, Sales & Pricing (Homburg 1998-)
Pre-existing license: Creative Commons Attribution, Non-Commercial 4.0 International (CC BY-NC 4.0)
Subject: 650 Management
Abstract: Although reacquiring customers can lead to beneficial outcomes, reacquisition processes are often unpleasant for employees, who may be required to admit and address failures. Because many organizational environments reward success and punish failure, companies need to understand how to create an organizational environment that stimulates customer reacquisitions. This study investigates the impact of failure-tolerant cultures and formal reacquisition policies on successful customer reacquisition management. Drawing on organizational design theory and psychological ownership theory, the authors find that failure-tolerant cultures have an inverted U-shaped effect on reacquisition performance because moderate failure tolerance increases reacquisition attempts while not inducing more failures or increasing their severity. Formal reacquisition policies, in contrast, have a positive linear relationship. Notably, formal reacquisition policies do not conflict with failure-tolerant cultures but enhance the beneficial effects of failure tolerance on reacquisition performance; formal reacquisition policies provide guidance for reacquisition attempts that failure-tolerant cultures inspire. Finally, results show that customer reacquisition performance is positively related to overall firm financial performance, a finding that emphasizes the managerial and organizational-level importance of reacquisition management.

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