Valentinngobo 2004

European Journal of Marketing
Drivers of customers' cross-buying intentions

Paul Valentin Ngobo
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Paul Valentin Ngobo, (2004),"Drivers of customers' cross-buying intentions", European Journal of
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Customers’
Drivers of customers’ cross-buying
cross-buying intentions intentions
Paul Valentin Ngobo
Faculté de Droit, Economie & Gestion, Université d’Angers, 1129
Angers, France
Received January 2002,
Keywords Customer loyalty, Customer satisfaction, Service delivery, Buying behaviour June 2002
Revised January 2003,
Abstract Why do some customers cross-buy different services from the same provider while others April 2003
are less disposed to do so? The present research examines the drivers of the customers’ cross-buying
intentions for services. Cross-buying refers to the customer’s practice of buying additional products
and services from the existing service provider in addition to the ones s/he currently has. The results
obtained from two samples of service consumers indicate that the customers’ cross-buying
intentions are primarily associated with image conflicts about the provider’s abilities to deliver
high-quality services from different service activities, and the perceived convenience of cross-buying
from the same provider. Customers’ experiences with the service provider have a weaker or
marginal effect on cross-buying.
Introduction
In practically every recently announced merger in the financial services sector, the most
frequently stated goal is cross-selling services to existing customers. The merger of Citicorp
with Travelers which created Citigroup was also intended to cross-sell insurance policies
and banking services to its more than 100 million customers, giving them the opportunities
of one-stop shopping different services from the same multi-service company.
Cross-selling is the practice of promoting additional products and services to
existing customers in addition to the ones a customer currently has (Butera, 2000). The
interest in cross-selling is due to its advantages for firms. Specifically, the selling of
additional services to existing customers could reduce the need to spend money on
customer acquisition (e.g. advertising) and lead to a pricing advantage over
competitors (Reichheld and Sasser, 1990). Moreover, the customer’s knowledge of the
service provider’s service delivery processes lowers her/his resistance to the provider’s
cross-selling propositions. The firm also has a lower risk and liability exposure due to
its knowledge of the customer. Finally, the more products and services a customer
buys the longer s/he is likely to stay with the firm (Reinartz and Kumar, 2003).
Identifying cross-selling opportunities is one thing. Making them happen
successfully is quite another, as attested by the following quotes:
The selling of insurance by banks, and vice versa, is a simple enough concept in theory. In
practice, though, as Allianz and Dresdner may discover, it is often far from straightforward.
In the case of Citibank, for instance, hopes were high following its 1998 merger with
Travelers Group that the latter’s insurance products would be sold to the bank’s customers.
In reality, however, there has been only limited integration of the organisation’s insurance
European Journal of Marketing
and banking operations since the merger (The Economist, 7 April 2001, p. 78). Vol. 38 No. 9/10, 2004
pp. 1129-1157
q Emerald Group Publishing Limited
This version has benefited from the comments of the reviewers of the European Journal of 0309-0566
Marketing. DOI 10.1108/03090560410548906
EJM For every successful example of cross-selling there are a handful of failures. Capital One, the
US credit card issuer and an acknowledged corporate master at database marketing, this year
38,9/10 abandoned its attempts to sell mobile phones to its card customers. Even with state-of-the-art
data-mining technology at its disposal, the return on capital was deemed insufficient
(Financial Times, 12 July 2001).
Although, cross-selling is associated with increased lifetime duration and value
1130 (Reinartz and Thomas, 2001), the above quotes tend to suggest that it is not easy to get
customers to cross-buy different services from the same provider.
The success of cross-selling efforts depends on such factors as salesforce training,
incentives, promotional campaign, knowledge transfer between firm departments, and
teamwork. Cross-selling also requires wider customer acceptance of cross-buying
different products and/or services from the same provider. It is unlikely to occur if
customers are not disposed to buy other products and services from the same provider
in addition to the ones they already have. Indeed, not all the customers are ready to
engage in a relationship (Day, 2000) and ultimately to expand that relationship

(Bendapudi and Berry, 1997). Likewise, although customers may want to engage in a
relationship with a service provider, they may not want to have all their services
provided by that single provider (Day, 2000). For some service categories, customers
intrinsically develop a multi-brand loyalty (Jacoby and Chestnut, 1978). For example, in
the banking industry most households use two or more financial providers.
Over the past years, customer loyalty has been an important research area in
marketing. Researchers have placed considerable emphasis on relating service quality
(Rust et al., 1995), value (Bolton and Drew, 1991), and satisfaction (Anderson and
Sullivan, 1993) to repurchase intentions. Some of the studies have concerned specific
components of loyalty such as price tolerance (Zeithaml et al., 1996), word-of-mouth
(Bloemer et al., 1999; Anderson, 1998) or aggregated indices of behavioural intentions
(Nayarandas, 1998). However, the issue of why customers decide to cross-purchase and
enhance their relationship with the firm has received scant attention. One exception is
the study by Verhoef et al. (2001) of the effects of customer satisfaction and payment
equity on cross-buying. They report that satisfaction and payment equity are
associated with cross-buying behaviour although the association depends on the
length of the relationship.
The primary focus of this study is to understand whether a customer who has a
pre-existing relationship with a service provider but is asked to enhance that
relationship by purchasing additional services from that provider or is approached by
a competitor that offers similar services will decide to buy or not. Different questions
will be addressed throughout the paper. They are:
.
Do the customers’ evaluations of the service experiences facilitate (prevent)
cross-buying?
.
Does the customer’s willingness to maintain the relationship matter?
.
Do the benefits of one-stop shopping really explain cross-buying intentions?
.
Do the customer’s evaluations of the firm’s capabilities to offer different types of
services explain cross-buying?.
The data come from two different samples. The first sample is composed of the
customers of a global retailer. This retailer is a multi-service firm that provides general
merchandise, financial, personal care products, entertainment, and travelling services Customers’
and which explicitly tries to cross-sell these services to its current customers. The cross-buying
second sample is composed of clients of different banks, most of which are engaged in
advertising campaigns in an effort to cross-sell their newly established insurance intentions
services to their existing clients. The analyses indicate that the customers’ cross-buying
intentions are primarily associated with the image conflicts about the provider’s
abilities to deliver high-quality services from different service activities, and the 1131
perceived convenience of cross-buying from the same provider. Customers’ experiences
with the service provider have a weaker or marginal effect on cross-buying.
The rest of the article is organised as follows. The conceptual model of cross-buying
intentions and the hypotheses are developed in the first section. The second section
presents the data. The results are presented in the third section. Finally, the paper
concludes with the research implications.
Conceptual model
Although little has been done on the drivers of cross-buying, prior research on the
antecedents of customer loyalty and brand extension provides the foundation for
developing a model of cross-buying intentions. The constructs of service quality
(Zeithaml et al., 1996), perceived value (Fornell et al., 1996), and customer satisfaction
(Mittal et al., 1998; Anderson and Sullivan, 1993) have proved to be important predictors
of repurchase intentions. In a recent study, Cronin et al. (2001) argue that service quality,
perceived value, and satisfaction must all be included in models of loyalty because the
three constructs are associated with loyalty even when considered simultaneously.
Verhoef et al. (2001) report that satisfaction and payment equity are among the drivers of
cross-buying. Therefore, in my model, depicted in Figure 1, I include the concepts of
service quality, perceived value and customer satisfaction as possible drivers of
cross-buying intentions. The model considers that there are two routes leading to the
formation of the cross-buying intentions. One is based on the assessment of the current
relationship and the other is based on the cross-buying specific considerations (e.g. the
benefits of one-stop shopping). Second, I consider that the reasons why the customer
Figure 1.
The conceptual model of
the drivers of cross-buying
intentions
EJM maintains the relationship with the service provider will have an impact on the customer’s
38,9/10 decision to enhance that relationship or not (Bendapudi and Berry, 1997). Specifically, I
argue that customers’ repurchase intentions (dedication-based maintenance) and
perceptions of switching costs (constraint-based maintenance) will matter when it
comes to cross-buying. Third, I consider that the customer’s intentions to cross-buy are
also a function of the convenience provided by one-stop shopping from the same provider.
1132 The perceived convenience is one of the benefits of one-stop shopping (Seiders et al., 2000;
Hall, 1999) and the benefits of one-stop shopping are among the factors that shape
customers’ intentions to cross-buy from the same provider. The literature on brand
extension (Aaker and Keller, 1990; Riel et al., 2001) also suggests that the fit between
currently provided services and the new services matter when it comes to cross-category
purchases. Thus, I consider that the image conflicts (or lack of confidence) created by the
selling of different types of services by one single provider will influence the customer’s
readiness to cross-purchase different services from that provider. However, I also expect
these image conflicts to be moderated by the customer’s evaluations of the relationship

and the benefits associated with cross-buying.
In the following sections, I specify how these variables influence the development of
customers’ cross-buying. Next, I discuss the possible interactions among these
variables and the image conflicts.
Effects of customer’s evaluations of service experiences

Relationships between service quality, perceived value, customer satisfaction, switching
costs and repurchase intentions. The most frequently researched component of loyalty
in service marketing studies is future intentions (e.g. Fornell, 1992; Rust et al., 1995).
Studies also exist that show that switching costs have a significant influence on
customer retention (Jones et al., 2000; Burnham et al., 2003). Switching costs can be
defined as any costs that customers associate with the process of switching from one
provider to another, e.g. search, financial, psychological costs (Porter, 1980). Although,
the concept is multidimensional in nature (see Burnham et al., 2001), I globally consider
the disutility that make it difficult for the customer to switch to another provider (see
Ruyter et al., 1998).
Service experiences and repurchase intentions. Many studies report a positive
association between service quality (Boulding et al., 1993; Biong, 1993; Taylor and
Baker, 1994; Cronin et al., 2001; Lee and Cunningham, 2001), perceived value (Chang
and Wildt, 1994;Cronin et al., 2001; Varki and Colgate, 2001) and repurchase intentions.
Here I replicate these relationships as follows:
H1a. Perceptions of quality are positively associated with repurchase intentions.
H1b. Perceptions of value are positively associated with repurchase intentions.
Furthermore, even though the nature of the relationship between satisfaction and
loyalty is still the subject of a debate (Mittal and Kamakura, 2001; Anderson and
Mittal, 2000; Ngobo, 1999), most of the studies conclude on the existence of positive
associations between these variables (Cronin et al., 2001; Anderson and Sullivan, 1993;
Biong, 1993; Bolton and Drew, 1991). Thus, I replicate that:
H1c. Satisfaction is positively associated with repurchase intentions.
Service experiences and switching costs. Many authors suggest that consumers Customers’
sometimes become so comfortable with a provider’s services that they avoid a change cross-buying
for fear the new provider will operate differently (Liljander and Strandvik, 1995;
Bendapudi and Berry, 1997). If so, then, positive service experiences should be related intentions
to perceived switching costs. However, a decrease in perceptions of service, value and
satisfaction should increase perceptions of switching benefits (Jones et al., 2000). The
association between service experiences and switching costs could be moderated by 1133
the value (Jones et al., 2000), heterogeneity (Burnham et al., 2001) of the alternative
providers. However, these variables are not measured in the present study. Therefore,
only the main effects are hypothesised. Thus, I expect that:
H2a. Perceived quality is positively associated with perceived switching costs.
H2b. Perceived value is positively associated with perceived switching costs.
H2c. Satisfaction is positively associated with perceived switching costs.

Relationships between quality, value and satisfaction. Prior research has shown that
service quality is related to consumer value and satisfaction (see, e.g. Varki and
Colgate, 2001; Cronin et al., 2001). The association of value with satisfaction is also
widely documented (e.g. Fornell et al., 1996; Cronin et al., 2001). Perceived value is one
of the different cognitive operations in the satisfaction formation process (Oliver, 1996).
It is supposed to provide additional satisfaction beyond and above that provided by
quality. Thus, we hypothesise that:
H3a. Perceived quality is positively associated with perceived value.
H3b. Perceived quality is positively associated with customer satisfaction.
H3c. Perceived value is positively associated with satisfaction.
Service experiences and cross-buying intentions. Customers reporting high scores of
service quality, value, and satisfaction will be likely to continue the relationship with
the service provider (Fornell et al., 1996) and ultimately expand it through a
cross-buying behaviour (Bendapudi and Berry, 1997). These customers are likely to
transfer their favorable evaluations of previous experiences to the other services
provided by the firm. Nayyar (1993) argues that one of the reasons service firms
diversify into new services is to exploit the information asymmetries with the
customers. These information asymmetries exist because customers cannot easily
determine the quality of the service until after it is used. Services are co-produced and
intangible, and cannot be well evaluated before the consumption experience. As a
result, diversified service firms with good reputations (e.g. in terms of service quality
and value) can leverage that equity as customers use the reputations to select service
providers from which to purchase new services (Hitt et al., 2001). Diversification
provides “one-stop shopping” opportunities and customers are expected to transfer
their favourable evaluations of service experiences to the new services (Nayyar, 1993).
Therefore, the concepts of service quality, perceived value and customer satisfaction
are expected to be positively associated with the customer’s intentions to buy
additional services from the same provider.
EJM However, I expect this positive association to be mediated by repurchase intentions.
38,9/10 The reason is that cross-buying (e.g. purchasing different services from the same
provider) implies a higher commitment to the service provider.
H4. The association between service experience (as measured with perceived
quality, value and satisfaction) and cross-buying intentions is mediated by
repurchase intentions.
1134
The effects of customers’ repurchase intentions and perceptions of switching costs on
cross-buying intentions
Most of the authors identify switching costs as factors contributing to the maintenance
of the relationship (Morgan and Hunt, 1994; Jones et al., 2000; Gremler et al., 2001). The
rationale is that switching costs represent the disutilities that customers do not want to
incur (Burnham et al., 2001). Thus, I replicate these studies as follows:
H5. Perceived switching costs are positively associated with repurchase

intentions.
It is reasonable to expect that customers with strong repurchase intentions will also be
likely to cross-buy from the same service provider. This is consistent with the view
that it is easier to cross-sell new services to existing customers than to the new ones
(Reichheld, 1996; Anderson and Mittal, 2000).
The relationship between switching costs and cross-buying intentions is not
straightforward, however. Bendapudi and Berry (1997) suggest that customers’
willingness to maintain or expand the relationship will depend on the reason why they
maintain that relationship. Repurchase intentions should be positively associated with
cross-buying intentions because customers with strong intentions view cross-buying
as one way of raising the quality of the relationship (Gwinner et al., 1998). From this
perspective, customers who stay with the service provider because of switching
barriers should be less disposed to cross-buy as cross-buying would raise the exit
barriers. Indeed, customers experiencing the constraints and power of the service
provider in an asymmetrical relationship should be motivated to act to counter or
reduce these constraints. For instance, they could behave opportunistically or develop
simply a cognitive type loyalty (Oliver, 1997). Geyskens and colleagues (1996, p. 307)
argue that a weaker partner in a relationship will be “motivated to continue the
relationship just because it is the necessary thing to do, given the high switching
costs”. Some customers interviewed during the qualitative phase of the research
indicated that they rejected cross-buying offers because they fear to be tied up with one
single service provider for a long time.
However, there is an equally logic argument that suggests that customers
perceiving significant switching costs should be more disposed to stay and ultimately
expand the relationship with the current provider (Gremler et al., 2001; Liljander and
Strandvik, 1995). In such a case, a positive relationship between switching costs and
cross-buying intentions should be observed. As switching costs in the present study
are measured in terms of the fear of incurring disutilities, this argument will apply in
this context. Thus, I predict that:
H6. Perceived switching costs are positively associated with cross-buying intentions.
H7. Repurchase intentions are positively associated with cross-buying intentions.
Cross-buying considerations Customers’
The effects of perceived convenience. Customers decide to cross-buy services from the cross-buying
same provider to achieve one-stop shopping benefits. One-stop shopping offers the
possession convenience created by the fact that various services and products are intentions
provided under one single roof (Seiders et al., 2000, Hall, 1999). The benefits for the
customers are time and effort savings. Hoch et al. (1999) show that there are search
economies from having all required services available from the same source. The 1135
importance of convenience provided through one-stop shopping is increased by the fact
that many busy customers want to consolidate their purchases to get it easier, faster
and cheaper (Seiders et al., 2000). Thus, selling different services under one single roof
reinforces cross-buying intentions because of the convenience that it provides to the
customers.
H8. Perceived convenience of cross-buying from the same service provider is
positively associated with cross-buying intentions.
The effects of image conflicts

By expanding the scope of their activities, service firms with good reputations can gain
a competitive advantage as current and future customers use firms’ reputations when
selecting firms from which to purchase new services (Nayyar, 1993). For example, most
banks now provide insurance policies along with their traditional banking services.
Customers can transfer their impressions of service quality that their bank delivers to
the insurance policies, as the latter are difficult to evaluate. The exploitation of these
information asymmetries through the provision of different services can create image
conflicts (Normann, 2000; Carman and Langeard, 1980). Image in service industries is
conveyed by the service concept (i.e. benefits offered), delivery system (i.e. personnel
and technology), and target markets (i.e. types of clients served). Normann (2000)
suggests that image serves as an information tool that shapes customers’ expectations
about the quality of the service and influences the types of behaviours that are required
from its employees. Mixing different service management systems can create image
conflicts, as different service concepts, delivery systems, customers, and employee
behaviors will be associated. As different services require different capabilities, the
provision of different services could result in customers’ mistrust, meaning that the
potential and existing buyers may not believe in the firm’s ability to deliver
high-quality service across all its activities.
Image conflicts are more likely to result from an unrelated diversification strategy
as opposed to a related diversification strategy. Service firms that follow a related
diversification strategy – i.e. that combine services close to their core business (e.g.
banking and insurance) – could make scope economies by sharing both tangible (e.g.
production facilities and distribution channels) and intangible (e.g. brand names,
selling know-how) assets (Porter, 1985). Moreover, the similarity or the fit between
their businesses will make customers transfer their positive attitudes to the new
businesses. Aaker and Keller (1990; see also Riel et al., 2001; Guiltinan, 1987) found that
when customers believe that “the people, the facilities, and skills a firm uses to make
original product would ‘transfer’ and be employed effectively in designing and making
the product extension”, they have favourable attitudes towards brand extensions. In
this case, customers should be more disposed to trust the service provider, as the new
services offered are close to what it used to provide. However, service firms that follow
EJM an unrelated diversification strategy, i.e. that add new services that are very far from
38,9/10 their core business (e.g. entertainment and financial services), should experience
stronger image conflicts from the customers. The reason is that customers will not
believe in the firm’s ability to provide high quality on all the services it offers because
of the lack of connections between its businesses. These image conflicts will cause
inconsistency between the firm’s desired image, the customers’ expectations and
1136 ultimately preclude the transfer of reputation effects across the many services offered
by the firm (Nayyar, 1993).
H9. The greater the customers’ image conflicts about the service provider’s
capabilities the lower their cross-buying intentions.
Moderating effects
The discussion so far has shown that most of the variables, except for image conflicts,
reinforce the customers’ intentions to cross-buy. It may be useful, however, to examine
whether some of these variables can reduce the effects of image conflicts on
cross-buying intentions. I expect that customers’ favourable evaluations of the service,
their commitment to the provider as well as the perceived convenience of cross-buying
reduce the negative effects of image conflicts. The buyer could have negative
perceptions of the provider’s abilities to offer superior value on different services if
asked to cross-buy. However, if s/he has most often had positive experiences in terms
of service quality, value, and satisfaction, then the image conflicts become less
influential. The reason is that experience breeds trust. Service experiences provide both
parties in the relationship with the opportunity to understand each other and to trust
each other (Ganesan, 1994; Morgan and Hunt, 1994; Geyskens et al., 1999). For example,
a customer with favourable evaluations will view the service provider as reliable and
competent. Similarly, for customers with strong repurchase intentions, the negative
effect of image conflicts on cross-buying intentions will be lower. The reason is that
committed customers tend to show a higher level of resistance to negative information
and beliefs (Dick and Basu, 1994). Moreover, if one-stop shopping benefits can enhance
the customer’s cross-buying intentions, then there is reason to believe that the
perceived convenience (i.e. the benefits) of cross-buying will also attenuate the negative
effects of image conflicts.
H10. The negative effects of image conflicts are positively attenuated by quality,
value, satisfaction, repurchase intentions, and perceived convenience.
The moderating role of switching costs on image conflicts should depend on the reason
customers stay with the service provider. Switching costs are likely to reinforce the
negative effects of image conflicts if customers are constrained to stay. Indeed,
high-switching-cost customers are thought to be committed to the service provider not
because of their satisfaction but because they have to. Geyskens et al. (1996) argue that
the dependent party in a relationship fears to be exploited by the less dependent party
and this reduces its satisfaction with and preference for the partner. Switching costs
also induce negative feelings towards the partner due to the impression of being
exploited (Geyskens et al., 1996). These negative feelings are likely to reduce the
customer’s confidence in the service provider’s abilities to provide high quality services
across different activities. However, for those customers who stay because they fear to
lose important benefits should they switch provider, switching costs should have a
positive moderating effect image conflicts as these customers should trust the current Customers’
provider more than the others. Thus, again, given the way switching costs are cross-buying
measured, I expect that:
intentions
H11. The negative effects of image conflicts on cross-buying intentions are
negatively moderated by switching costs.
1137
Do customers’ experiences with the service provider insulate them from competitors’
cross-selling blandishments?
Loyal customers tend to search less for alternative propositions (Sambandam and
Lord, 1995; Newman and Staelin, 1972) and to be more willing to wait if their preferred
brand is out of stock (Cunningham, 1967). Because of their strong commitment, these
customers also tend to show a higher level of resistance to the competitors’
counter-persuasion attempts (Nayarandas, 1998; Dick and Basu, 1994). Therefore,
based upon this research, I expect that customers with positive experiences with the
service provider will resist cross-selling propositions from the competitors offering
similar services (Sambandam and Lord, 1995). For example, customers with positive
evaluations of the service experiences with their bank (e.g. in terms of quality, value,
satisfaction) should be less disposed to accept cross-buying financial services from
their insurer and vice versa.
H12. The customers’ experiences with a service provider are negatively associated
with their intentions to cross-buy from the competitors.
Method
Samples
A consumer survey was developed to examine the drivers of cross-buying intentions
under different scenarios. France was selected as the research site for the study.
According to PriceWaterhouseCooper, cross-selling has been more successful in
France and Spain than in the UK. They estimate that about 60 per cent of the life
insurance products in France and 80 per cent in Spain are sold through bank branches.
The data was collected in a medium-sized city with a population of approximately
200,000.
To ensure the cross-validation of results, two studies are reported that investigate
two service industries and utilise different respondents. The first sample is composed
of 280 customers of a global retailer. This retailer is a multi-service firm that provides
general merchandise, financial, personal care products, entertainment, and travelling
services and is currently engaged in a campaign of cross-selling these services to its
current customers. The analysis, however, focuses only on the cross-buying of
financial services. The cross-selling of these financial services is managed by another
retailer’s business which is in charge of the financial services with its offices located in
every super/hypermarket of the retailer. Eligible customers are offered a
payment/credit card.
The respondents are not cross-buyers. Questions about their cross-buying
intentions were asked instead of their actual cross-buying behaviours. Therefore, the
study consisted in understanding what makes customers accept “buying” financial
services from this retailer. The survey method was a self-completed questionnaire
given to the respondents coming out of the super/hypermarkets. All the three stores of
EJM the retailer in the area of study were considered. The average age of the respondents is
38,9/10 40.06 (SD ¼ 10:40); most of the respondents are female (57.70 per cent), married (44.80
per cent), working (92.6 per cent), and 72.70 per cent of the respondents have been to
college.
The second sample is composed of 257 clients of the major retailing banks in the
city. These banks are currently engaged in advertising and promotional campaigns in
1138 an effort to cross-sell their newly established insurance services to their existing
clients. The intention is to understand what could make these bank clients
cross-purchase their insurance policies from these banks and vice versa. We used a
quota sampling methodology. Quotas were defined based on the banks’ number of
branches in the city. The respondents were recruited in various locations. Participants
were asked to evaluate their relationship with their primary bank and then state their
intentions to cross-buy under different scenarios. The average age of the respondents is
42.67 years old (SD ¼ 12:54), most of the respondents are female (51.80 per cent),
married (55.40 per cent), working (74.70 per cent), and 60.90 per cent have been to
college.
Measures
All the items used in the present studies were measured on 11-point Likert scales from
0 (strongly disagree) to 10 (strongly agree) except for the control variables. The items
were a compromise of the literature review and two qualitative studies (30
participants/study), one for each sample. The personal interviews were part of a larger
study that included cross-buying intentions as a sub-study. The purpose was to
identify the reasons individuals are disposed or not to cross-buy different services from
the same provider. The findings helped design the questionnaire, specifically the
measures of the perceived convenience. I analysed the dimensionality of the variables
in each sample by conducting a principal components analysis using SPSS. The
analysis revealed clear factors. I used an eigenvalue cut-off value of 0.5. Then, I looked
at the reliability and excluded all the components with reliabilities lower than 0.60.
Next, I performed a confirmatory factor analysis (CFA) with LISREL (Jöreskog and
Sörbom, 1999). The resulting items are described below.
Perceptions of service quality were measured with a shorter version (19 items) of
SERVQUAL (Parasuraman et al., 1988) adapted to the retailing and banking contexts.
For the sample of the retailer’s customers, exploratory factor analysis revealed only
two reliable components:
(1) confidence in the product quality (four items); and
(2) assurance/reliability (six items).
The first component is named as “confidence in the product quality” because it refers
primarily to the customer’s confidence in the retailer’s products and behaviours (i.e.
provision of information, care about the customer’s interests). For the sample of banks’
clients, four components emerged from the factor analysis: tangibles (three items);
empathy (two items); assurance/reliability (five items); and responsiveness (six items).
The responsiveness component was excluded for reasons of comparison between the
two samples. The tangible dimension was dropped because of its low reliability.
Perceived value was measured in terms of quality regarding price and price regarding
quality (Fornell et al., 1996). Consistent with that definition, three items were retained
to measure the perceived value of the banking services and three items for the retailing Customers’
services. Customer satisfaction with the services was measured with different items cross-buying
collected from the literature (e.g. Oliver, 1997). In the two samples, satisfaction is
measured with three items. Image conflicts reflect the lack of fit in the customer’s mind intentions
about the different services the firm currently offers. In other words, it captures the
customers’ confidence in the firm’s capability to deliver high quality on various
services (Aaker and Keller, 1990). Three items are retained for the two samples. 1139
Perceived convenience reflects the customers’ expectations about the benefits of
cross-buying. The measures were developed to reflect the fact that customers
cross-buy to get it easier and faster (Seiders et al., 2000). After the exploratory factor
analysis, three items emerged from the retail sample and four items from the bank
sample. Repurchase intentions here refer to the conative loyalty dimension discussed in
the literature (see Oliver, 1999). Three items are used for the retailer sample and the
bank sample. Then, respondents were asked to report their perceived switching costs.
Four items were used in both samples reflecting the difficulty of switching but also the
possible loss incurred by the customer should s/he decide to leave (Jaros et al., 1993).
For the bank sample, the measures were not reliable and this construct is excluded
from further analyses.
Approach to the measurement of cross-buying intentions

Respondents were confronted with hypothetical situations with their service provider
and asked to state how they would react. For the sample of the retailer’s customers,
respondents were asked to state their intentions under the following scenario:
Retailer *** now allows its customers to open an account, with a payment/credit card, and the
possibility to borrow money some day. If they offer that you open such an account, how
would you react?
For the bank sample, cross-buying intentions were measured in reference to insurance
policies. Customers were asked to state their intentions under the following scenarios:
Most of the banks and insurance companies now offer both banking services and insurance
policies. For example, Bank *** sells car and housing insurance while insurer *** offers
savings accounts. If your bank offers that you cancel your insurance policies with your
current insurer, and transfer them to your bank, in order to have only one provider for both
your banking services and insurance policies, how would you react?
[A “competitor’s cross-buying offer” context] Now let’s suppose that your current insurer
offers that you open a savings account paying about 2.5 per cent more than your primary
bank, how would you react?
This last scenario tries to understand if customers’ assessments of the service quality
provided by their bank insulates them from competitors’ (i.e. the insurer’s)
blandishments.
Control variables
In estimating the models, it is important to control for some variables that are likely to
affect cross-buying intentions. For the retailer, respondents’ membership in the
retailer’s loyalty programme is considered. Members of the loyalty programme are
expected to be more likely to cross-buy from the same retailer than non-member
EJM customers. Membership is a dummy variable (0 ¼ not a member and 1 ¼ member).
38,9/10 Usage of the retailer’s services is the second control variable. The more the customer
uses the services of the retailer the more likely s/he will accept cross-buying from that
same retailer because of learning and inertial effects (Oliver, 1999). Usage is a
combination of two items: the frequency with which the customer patrons the
supermarket and the share of purchases (in per cent) made with the retailer through its
1140 supermarkets. In the bank sample, usage level of the banking services is measured
with three items: the percentage of usual transactions (e.g. credit card payments); the
percentage of loans; and percentage of investments with (or through) the main bank. In
both samples, I also consider the age of the respondent. Old customers are thought to
have stable preferences and to be more loyal than the younger ones (Mittal and
Kamakura, 2001). However, their knowledge may also “divert” their attention from
buying additional services such as credit cards from retailers.
Results
The procedure suggested by Gerbing and Anderson (1988) was adopted. It consists of
assessing the psychometric properties of the items before testing hypotheses.
Measurement model
Two measurement models (one for each sample) were estimated through LISREL 8.30
(Jöreskog and Sörbom, 1999). The covariance matrix was used as input for
confirmatory factor analysis. In terms of goodness of fit, reliance on chi-square test as
the sole measure of fit is not recommended because of its dependence on sample sizes
(Bearden et al., 1982). Therefore, it is desirable to examine other measures of fit not as
sensitive to sample size (Bagozzi and Edwards, 1998). The root mean squared error of
approximation (RMSEA), which is a measure of the average of the fitted residuals,
suggests a satisfactory fit for low values (typically less than about 0.08). Furthermore,
an analysis of incremental indices by Marsh et al. (1996) showed that the relative
noncentrality index (or its counterpart, the comparative fit index (CFI)) and the
non-normed fit index (NNFI) perform better in terms of the bias due to sample size,
penalties of model complexity, rewards for model parsimony, and estimation
reliability.
The first model concerned the retailer’s sample and produces the following fit:
x2 (506) ¼ 1013.04, p ¼ 0.00, RMSEA ¼ 0.06, NNFI ¼ 0.98, CFI ¼ 0.99. Although the
chi square test is significant, the other indices indicate an acceptable fit. Table AI in the
Appendix shows the loadings and reliabilities of each construct. As can be seen,
constructs achieve high reliabilities. Indeed, except for the Image conflicts variable,
which has a reliability of 0.60, all the constructs exceed the value of 0.70.
The second CFA model – estimated for the bank sample – also has an acceptable fit
given the large number of variables: x2 (450) ¼ 812.34, p ¼ 0.00, RMSEA ¼ 0.056,
NNFI ¼ 0.98 and CFI ¼ 0.98. The measures are presented in Table AII in the
Appendix and they achieve high reliabilities as well.
Discriminant validity can be assessed for two estimated constructs by constraining
the estimated correlation parameter between them to 1.0 and then performing a chi
square difference test on the values obtained for the constrained and unconstrained
models. Estimation of the constrained models yields the following indices:
x2 (527) ¼ 1295.16, p ¼ 0.00 (for the retailer) and x2 (495) ¼ 970.87, p ¼ 0.00 (for
the bank). The chi-square difference test indicates that the null hypothesis of perfect Customers’
correlation between the constructs must be rejected for the retailer sample x2 (19) 282.12, cross-buying
p , 0.001 and the bank sample x2 (45) ¼ 158.53, p , 0.001. Tables I and II present the
raw correlations between the constructs. intentions
As can be seen, cross-buying intentions seem to be higher in the bank sample (5.35)
than in the retailer sample (4.42). However, image conflicts and perceived convenience
seem not to be very different across the two samples. 1141
Regression results
Sample 1 (Retailer). Table III shows the results about how customers develop their
repurchase intentions. The results are presented in a hierarchical fashion to better
depict the variance explained by the different sets of predictor variables.
The results show that confidence in product quality (0.66, p , 0.001) and
assurance/reliability (0.24, p , 0.001) are related to perceived value.
Assurance/reliability (0.46, p , 0.001) and perceived value (0.47, p , 0.001) are also
related to customer satisfaction. Next, in Model 3, I estimate the effects of quality and
value on switching costs while controlling for the effects of age, usage and loyalty
program membership. In Model 4, I add the influence of satisfaction. The F test shows
that satisfaction explains an additional amount variation in switching costs (change in
R 2 ¼ 0:01, F(1; 273) ¼ 3.33, p , 0:01). The results show that satisfaction mediates the
influence of perceived quality and value on switching costs. This finding is consistent
with the argument that satisfied customers will perceive higher switching costs when
terminating a relationship because they fear to lose the benefits they are deriving from
their current relationship (Bendapudi and Berry, 1997). Looking at Models 5 through 7,
one can see that switching costs mediate the influence of value and satisfaction on
repurchase intentions but only the partial influence of assurance/reliability.
Next, I analyze the results about the cross-buying intentions. These results appear
in Table IV. Given that the interaction effects are not significant, I do not report them
and, therefore, I limit the discussion to the main effects. The results are shown in a
hierarchical way to better depict the variance explained by the different predictors.
Model 1 shows that satisfaction has a marginal positive association with
cross-buying intentions. Usage and age have the most significant effects on
cross-buying intentions. The inclusion of switching costs (Model 2) captures the
influence of satisfaction. The positive association between switching costs and
cross-buying intentions indicate that switching costs play a positive role in customers’
decisions. Customers seem to stay because alternative providers are less interesting.
Repurchase intentions (Model 3) then captures the influence of switching costs. It
appears from these results that the service experience variables explain about 14 per
cent of variation in cross-buying intentions. Next, I consider the influence of perceived
convenience. The results indicate that this variable explains additional variation in
cross-buying intentions (change in R 2 ¼ 0:04). Then, I consider the influence of image
conflicts. Again, the results show that this variable explains a significant amount of
variation (change in R 2 ¼ 0:12). While the perceived convenience of one-stop shopping
has positive effects, the image conflicts have a negative influence on cross-buying
intentions. Finally, I consider the interactive effects in Model 6. This model adds some
additional 0.08 points in R 2. This final model shows that the association between
perceived convenience and cross-buying intentions is positive and significant (0.57,
EJM
Table I.
1142
38,9/10
retailer sample
Correlation matrix for the
1 2 3 4 5 6 7 8 9 10 11 12
Confidence in product quality 1.00

Reliability/responsiveness 0.61 1.00
Perceived value 0.57 0.47 1.00
Customer satisfaction 0.60 0.69 0.57 1.00
Perceived switching costs 0.25 0.26 0.25 0.29 1.00
Repurchase intentions 0.36 0.49 0.37 0.45 0.51 1.00
Cross buying intentions 0.20 0.22 0.17 0.23 0.28 0.31 1.00
Perceived convenience 0.20 0.24 0.22 0.33 0.34 0.30 0.43 1.00
Image conflicts 2 0.32 20.27 20.35 2 0.29 20.18 20.25 2 0.47 20.21 1.00
Usage of the services 0.24 0.19 0.16 0.24 0.23 0.30 0.20 0.22 20.18 1.00
Age 2 0.05 0.14 20.07 0.07 0.15 0.14 0.17 0.17 20.03 0.00 1.00
Loyalty program membership 0.40 0.37 0.33 0.36 0.35 0.33 0.24 0.22 20.21 0.16 0.25 1.00
Mean 6.15 5.95 5.52 6.38 5.06 4.47 4.42 5.45 4.65 3.40 40.06 0.37
Standard deviation 1.69 1.75 1.98 1.96 1.73 2.24 2.63 2.48 2.46 1.25 10.4 0.48
1 2 3 4 5 6 7 8 9 10 11
Assurance/reliability 1.00
Empathy 0.56 1.00
Perceived value 0.36 0.21 1.00
Customer satisfaction 0.57 0.15 0.60 1.00
Repurchase intentions 0.46 0.22 0.31 0.36 1.00
Perceived convenience 0.22 0.22 0.11 0.22 0.17 1.00
Image conflicts 2 0.27 20.17 2 0.17 2 0.18 20.08 2 0.35 1.00
Cross buying intentions 0.25 0.26 0.09 0.23 0.15 0.64 2 0.48 1.00
Cross buying intentions (competitor) 2 0.12 0.13 0.05 0.07 20.17 0.15 2 0.13 0.13 1.00
Usage of the services 0.05 0.13 0.06 0.02 0.14 0.12 2 0.02 0.06 0.19 1.00
Age 0.17 0.00 0.11 2 0.14 0.16 2 0.15 0.09 20.13 20.27 2 0.07 1.00
Mean 6.21 7.52 4.77 6.19 4.52 5.40 4.60 5.35 6.27 3.07 42.67
Standard deviation 1.88 2.21 2.12 2.19 2.40 2.90 2.61 2.21 2.31 1.06 12.54
cross-buying
intentions
Customers’
bank sample
Correlation matrix for the
1143
Table II.
EJM
1144
intentions
38,9/10
Table III.
Sample 1 (Retailer’s
leading to repurchase
Regression results for
customers): the process

Model 5 Model 6 Model 7
Model 1 Model 2 Model 3 Model 4 Repurchase Repurchase Repurchase
Perceived Customer Switching costs Switching costs intentions intentions intentions
Independent variables value satisfaction (1) (2) (1) (2) (3)
Constant 0.70 (1.20) 20.07 (20.14) 2.10*** (3.53) 2.24*** (3.76) 21.25**** (21.78) 21.00 (21.43) 22.76*** (24.17)
Control variables
Loyalty program
membership 0.21 (0.92) 0.05 (0.29) 0.76*** (3.41) 0.79*** (3.52) 0.44**** (1.66) 0.49**** (1.86) 20.12 (20.51)
Usage levels of the
services 20.03 (20.45) 0.11**** (1.74) 0.22** (2.89) 0.21** (2.69) 0.35*** (3.85) 0.33*** (3.61) 0.17* (1.99)
Age of the customer 20.01 (21.60) 0.0 (1.02) 0.02**** (1.80) 0.01 (1.55) 0.02 (1.61) 0.01 (1.25) 0.002 (0.24)
Core variables of the
model
Product quality 0.66*** (9.32) 0.07 (1.07) 20.02 (20.22) 0.002 (0.03) 20.10 (21.13) 20.06 (20.68) 20.06 (20.66)
Assurance/reliability 0.24*** (3.60) 0.46*** (8.04) 0.05 (0.66) 20.01 (20.08) 0.40*** (4.84) 0.33*** (3.54) 0.36*** (4.18)
Perceived value 0.47*** (10.23) 0.19*** (3.24) 0.06 (0.95) 0.34*** (4.97) 0.12**** (1.65) 0.09 (1.28)
Customer satisfaction 0.14*(1.98) 0.21* (2.46) 0.05 (0.61)
Switching costs 0.79*** (13.06)
R2 0.36 0.55 0.17 0.18 0.31 0.32 0.37
F(r,u) – – – 3.05* – 3.68* 3.95*
Notes:* p,0.05; ** p , 0.01; *** p , 0.001; ****p , 0.10
Model 1 Model 2 Model 3 Model 4 Model 5 Model 6

Cross-buying Cross-buying Cross-buying Cross-buying Cross-buying Cross-buying
Independent variables intentions intentions intentions intentions intentions intentions
Constant 0.13 (0.13) 20.97 (21.01) 0.24 (0.25) 20.53 (20.58) 6.21*** (6.57) 5.92*** (4.56)
Control variables
Loyalty program
membership 0.60**** (1.71) 0.22 (0.62) 0.37 (1.04) 0.27 (0.81) 0.25 (0.83) 0.19 (0.64)
Usage levels of the
services 0.28* (2.26) 0.18 (1.48) 0.15 (1.24) 0.05 (0.41) 0.02 (0.21) 0.12 (1.14)
Age of the customer 0.03* (2.29) 0.03**** (1.87) 0.03**** (1.92) 0.01 (0.86) 0.02 (1.31) 0.02 (1.30)
model
Product quality 0.05 (0.41) 0.06 (0.50) 0.08 (0.67) 0.12 (0.99) 2 0.04 (2 0.40) 2 0.30 (21.40)
Assurance/reliability 20.003 (20.03) 0.03 (0.27) 20.08 (20.64) 0.03 (0.21) 2 0.02 (2 0.21) 2 0.17 (20.66)
Perceived value 0.02 (0.18) 0.005 (0.05) 20.01 (20.13) 20.03 (20.29) 0.20* (2.31) 2 0.08 (20.48)
Customer satisfaction 0.21**** (1.79) 0.07 (0.59) 0.06 (0.54) 20.13 (21.15) 2 0.02 (2 0.20) 2 0.14 (20.64)
Switching costs 0.50*** (5.41) 0.11 (1.06) 0.06 (0.69) 0.06 (0.70) 2 0.03 (20.22)
Repurchase intentions 0.33*** (3.89) 0.10 (1.27) 0.11 (1.47) 0.17 (1.30)
Perceived convenience 0.64*** (10.94) 0.28*** (5.01) 0.57*** (4.83)
Image conflicts 2 0.72*** (213.96) 2 0.93*** (24.39)
Convenience * Image
conflicts 2 0.05* (22.28)
R2 0.11 0.12 0.14 0.18 0.30 0.38
F(r,u) – 2.83* 5.77*** 12.05*** 42.17*** 31.61***
Notes: * p,0.05; ** p , 0.01; *** p , 0.001; ****p , 0.10
cross-buying
intentions
Customers’
cross-buying intentions
Sample 1 (Retailer’s
leading to the
customers): the process
1145
Table IV.
EJM p , 0:001) while that association is negative for the image conflicts (2 0.93, p , 0:001).
38,9/10 It also indicates that a simultaneous increase in perceived convenience and image
conflicts has a weaker negative influence on cross-buying intentions (2 0.05, p , 0:05)
compared to the main effects of image conflicts.
Sample 2 (The bank clients). Table V now shows the results for the second sample.
Models 1 through 3 indicate that customer satisfaction mediates the total influence of
1146 perceived value on repurchase intentions while satisfaction is only a partial mediator
for quality effects.
The final model in Table V (i.e. Model 6) shows that an increase in customer
satisfaction is associated with an increase in cross-buying intentions (0.27, p , 0:01).
An increase in perceived convenience is associated with cross-buying intentions (0.39,
p , 0:001). However, an increase in image conflicts is negatively associated with
cross-buying intentions (2 0.47, p , 0:001).
In sum, the results of the two samples indicate that perceived convenience (i.e. the
benefits of one-stop shopping) and the image conflicts about the service provider are
the most important drivers of the cross-buying intentions. However, there is a
difference in terms of importance between the two samples. Image conflicts seem to be
more important for the retailer (b ¼ 20:93, change in R 2 ¼ 0:12) compared to the
banking industry (b ¼ 20:47, change in R 2 ¼ 0:09). This might reflect the fact that for
customers, general merchandise activities are more distant from financial services
business while the latter are perceived to be closer to the insurance services. This
difference in image conflicts certainly explains why the benefits of one-stop shopping
are more important for the banks’ customers ðb ¼ 0:69, change in R 2 ¼ 0:10)
compared to the retailer’s customers (b ¼ 0:64; change in R 2 ¼ 0:04). The two samples
also differ in the roles that the service experiences evaluations play in determining
cross-buying intentions. In the first sample, the influence of repurchase intentions
disappears when the perceived convenience is considered while in the second sample
customer satisfaction significantly predict cross-buying intentions.
Cross-buying intentions following a competitor’s offer

I estimated a model to assess the effects of the customers’ experiences with their
primary bank on their responses to their insurance company’s propositions. The
purpose is to examine whether service experiences insulate customers from
competitors’ blandishments. In this model, image conflicts are excluded as these
evaluations refer to the customer’s bank, not to the insurance company. However, the
perceived convenience was retained because customers’ responses referred to banking
and insurance services, not to a specific bank or insurance company. Table VI shows
the estimate results.
Customers who appreciate having both their banking and insurance contracts
managed by one single provider are disposed to accept their insurance company’s
proposition. Similarly, customers who report high levels of usage of the financial
services (i.e. loans, investments and transactions) are disposed to cross-buy from their
insurance company. This might reflect the fact that these customers are price sensitive.
Therefore, they would be attracted by better offers. Older customers are less disposed
to cross-buy. However, repurchase intentions explain only 2.7 per cent of the variation
in cross-buying intentions, which means that loyalty is not enough to insulate banks’
customers from switching to insurance companies when it comes to cross-buy financial
Model 2 Model 3 Model 4 Model 5 Model 6

Model 1 Customer Repurchase Cross-buying Cross-buying Cross-buying
Independent variables Perceived value satisfaction intentions intentions (1) intentions (2) intentions (3)
Constant 2.20*** (14.89) 2.21*** (13.66) 3.38 (1.55) 1.41*** (4.99) 3.52 (1.34) 1.57*** (5.81)
Control variables
Usage levels of the
services 20.05 (0.51) 0.05 (0.63) 0.08 (0.87) 0.02 (0.84) 0.01 (0.10) 20.10 (2 1.02)
Age of the customer 20.07**** (1.86) 2 0.02 (20.68) 0.08* (2.20) 20.10* (22.26) 2 0.05 (21.36) 20.05 (2 1.41)
model
Assurance/reliability 0.29*** (6.66) 0.10** (2.66) 0.24*** (5.41) 0.14* (2.31) 0.08 (1.53) 0.03 (0.63)
Empathy 20.05 (0.71) 0.27*** (4.21) 0.17* (2.33) 20.02 (20.25) 2 0.03 (20.40) 20.07 (2 0.89)
Perceived value 0.60*** (11.84) 0.08 (1.30) 0.01 (0.18) 0.02 (0.31) 0.11 (1.51)
Customer satisfaction 0.36*** (5.27) 0.29*** (3.28) 0.26*** (3.26) 0.27*** (3.57)
Repurchase intentions 20.02 (20.28) 2 0.03 (20.37) 0.02 (0.35)
Perceived convenience 0.69*** (14.83) 0.39*** (8.04)
Image conflicts 20.47*** (2 8.62)
R2 0.02 0.21 0.23 0.11 0.21 0.30
F(r,u) – – – – 34.43*** 34.84***
Notes: *p,0.05; **p , 0.01; ***p , 0.001; ****p , 0.10
cross-buying
intentions
Customers’
repurchase intentions
Sample 2 (Banks’ clients):
the process leading to
Table V.
1147
EJM services. The unexpected relationship here is the positive association of empathy with
38,9/10 cross-buying intentions. One could suspect multicollinearity as a possible explanation
for this result. I conducted the tests and found that the variance inflation factor (VIF)
ranges from 1.051 to 2.063 (lower than the typical 10 level).
1148 Discussion
The primary focus of this study was to understand whether a customer who has a
pre-existing relationship with a service provider but is asked to enhance that
relationship by purchasing additional services from that provider, or is approached by
a competitor that offers similar services, will decide to buy or not. Different questions
were addressed throughout the paper:
.
Do the customers’evaluations of the service experiences facilitate (prevent)
cross-buying?
.
Does the customer’s willingness to maintain the relationship matter?
.
Do the benefits of one-stop shopping really explain cross-buying intentions?
.
Do the customer’s evaluations of the firm’s capabilities to offer different types of
services explain cross-buying?
The results of the analyses are summarised in Table VII.
Customers in both samples perceive image conflicts and perceived convenience to
be more important determinants of cross-buying intentions than their evaluations of
the previous experiences. Service quality, perceived value, customer satisfaction, and
repurchase intentions are associated with cross-buying intentions. The direction of the
associations between the perceived convenience and the image conflicts, and
cross-buying intentions are consistent across the contexts and the samples. Image
conflicts are negatively associated with cross-buying intentions while the perceived
convenience of cross-buying has a positive effect.
Yet, the effects (magnitude) of image conflicts on cross-buying intentions differ
between the two samples. Image conflicts seem stronger for the retailer compared to
the banks. One possible explanation is that financial services are perceived as
unrelated to traditional retailing activities (e.g. merchandise) while selling insurance
policies is closer to banking services, at least in the French context. Therefore,
customers perceive insurance and banking activities as being more related than
retailing and banking services. In the former situation, customers have more
confidence in the firm’s ability to offer high-quality services while in the latter they
have less confidence in the provider’s capabilities to offer different services.
Consequently, the more confidence they have in the service provider the higher their
Independent variables
Assurance/ Perceived Repurchase
Constant Age Usage reliability Empathy convenience intentions
Table VI.
The drivers of Estimate 6.83 2 0.27 0.15 20.25 0.21 0.20 20.14
cross-buying intentions t-value 6.51 2 2.68 2.46 22.89 2.78 3.09 21.97
following a competitor’s p-value 0.000 0.01 0.05 0.01 0.01 0.01 0.05
offer R2 0.20
Expected relationships Retailer Bank
Customers’
cross-buying
1. The role of service experiences
H1a. Perceptions of quality are positively associated
intentions
with repurchase intentions Partially supported Supported
H1b. Perceptions of value are positively associated
with repurchase intentions. Supported Not supported 1149
H1c. Satisfaction is positively associated with
repurchase intentions Supported Supported
H2a. Perceived quality is positively associated with
perceived switching costs Not supported N/A
H2b. Perceived value should be positively
associated with perceived switching costs Not supported N/A
H2c. Satisfaction should be positively associated
with perceived switching costs Supported N/A
H3a. Perceived quality is positively associated with

perceived value Supported Partially supported
H3b. Perceived quality is positively associated with
customer satisfaction Partially supported Supported
H3c. Perceived value is positively associated with
satisfaction Supported Supported
H4. The association between service experience (as
measured with perceived quality, value, and
satisfaction) and cross-buying intentions is
mediated by repurchase intentions. Supported Not supported
H12. The customers’experiences with a service
provider are negatively associated with their
intentions to cross-buy from the competitors. N/A Partially supported
2. The role of the customer’s willingness to maintain the relationship

H5. Switching costs are positively associated with
repurchase intentions Supported N/A
H6. Switching costs are negatively associated with
cross-buying intentions. Not supported N/A
H7. Repurchase intentions are positively
associated with cross-buying intentions. Not supported Not supported
3. The benefits of one-stop shopping
H8. Perceived convenience of cross-buying from
the same service provider is positively
associated with cross-buying intentions Supported Supported
4. The customer’s evaluations of the firm’s abilities to
offer different services
H9. The greater the customers’ image conflicts
about the service provider’s capabilities the
lower their cross-buying intentions Supported Supported
H10. The negative effects of image conflicts are
positively attenuated by quality, value,
satisfaction, repurchase intentions, and
perceived convenience. Supported Not supported
H11. The negative effects of image conflicts on
cross-buying intentions are negatively
moderated by switching costs. Not supported N/A
Table VII.
Note: N/A ¼ not applicable Summary of the results
EJM perceptions of the benefits of having different services provided by that single
38,9/10 provider.
Moreover, although, favourable service evaluations (e.g. empathy) and the
customer’s repurchase intentions are associated with cross-buying intentions,
depending on the model, these variables are not very important incentives for
customers to enhance their relationships with the service provider through cross-selling.
1150 This finding is important given the emphasis placed on service quality, value and
satisfaction in customer relationships and profitability. It implies that other factors,
such as prices, will be important when it comes to cross-selling. Likewise, the analyses
indicate that although the customer loyalty to the service provider can diminish the
effect of a competitor’s cross-selling propositions, its influence is very weak as attested
by the variance explained by the repurchase intentions.
Contrary to the relationship marketing literature, the present results show that
customers are less influenced by their prior experiences with the service provider when
it comes to cross-buying. Therefore, relationship does not matter a lot. Competitors

seeking to target existing customers with similar services can succeed if they offer
significant one-stop shopping benefits and are significantly trustworthy in the eyes of
these customers. This limited influence of the service experience variables raises some
questions regarding the appropriate way to cross-sell to the customers. The current
findings temper previous conclusions, which state that it is easier to cross-sell to
existing customers than to newly acquired customers. The research indicates that it is
not that easy because when it comes to new services, customers consider not only their
previous experiences with the service provider but also its capacity to deliver
high-quality services and the benefits of buying all the services under one single roof.
The study is also consistent with authors who argue that service firms should not
overuse their delivery systems and image by attempting to serve the needs of too many
socio-demographic segments (Normann, 2000; Carman and Langeard, 1980).
Overall, the present results are consistent with the study by Verhoef et al. (2001): the
state of the current relationship is not a good indicator of the customer potential for
cross-buying. However, by examining some additional variables, the present study
offers a possible explanation for this intriguing result. That is customers consider the
transferability of the service provider’s qualities from one service category to another.
The perceived discrepancy between one service and the other could negatively impact
their intentions to cross-buy. Similarly, having all services offered by one single
provider may come at a cost for the customer. Some individuals are not disposed to
cross-buy because they fear to depend on one provider for a long time. Therefore, when
asked to cross-buy different services from the same provider, customers will consider
the benefits of one-stop shopping from one single provider.
Cross-selling is viewed by managers as the best client development tool. Almost any
newly announced megamerger is justified on the cross-selling opportunities between
the company’s different businesses. Thus, the present results are important for firms.
By understanding the determinants of cross-buying the firm can identify the issues
that must be addressed in order to enhance cross-buying activity in its customer base.
The first implication of the present research is that service firms should recognise that
everything is not cross-sellable. The firm needs to consider the customers’ perceptions
of its capacity to deliver high-quality services from two or more activities. The present
study would explain the failure by Capital One to cross sell mobile phones to its card
customers by the fact that customers do not view Capital One as a mobile phone Customers’
business (i.e. image conflicts). Consequently, no matter the quality of the relationship, cross-buying
Capital One has with its customers or the quality of the data-mining technology it uses,
its cross-selling efforts are less likely to succeed. The results also suggest that service intentions
providers must offer significant one-stop shopping benefits to their customers. That is
customers must feel that they are gaining something valuable (e.g. time, money, and
effort savings) in return for their purchasing of different services from the same 1151
provider. This has been the policy of the Goupama du Midi, a French insurance
company, which offers price reductions on car insurance contracts to any customer
holding two different contracts with the company.
Although it is generally believed that long-term relationships reduce customers’
switching behaviour, the present study indicates that for cross-buying customers can still
switch if competitors offer significant amount of convenience and trust. The important
role of image and trust also implies that it will be easier for companies operating in related
industries than unrelated firms to cross-sell their products and services. This implies that
cross-selling is more likely to succeed when the firm: offers significant benefits to the
customers; has the required capabilities; and these are recognised by the customers.
The present research has a number of limitations. The first is the approach used to
measure cross-buying intentions. The question is whether customers would react
similarly in a natural context. In the present study, respondents were allowed to
respond without the consequence of actually cross-purchasing another service from the
service provider. It is possible that the customers’ intentions to cross-buy would be
lower in an actual situation because of time and effort costs associated with
transferring business from one provider to another or due to the fear of dependence.
The second limitation is that the results do not demonstrate the causality between the
antecedent variables and cross-buying intentions. Although results of two samples are
reported, the analyses are still based on cross-sectional data. Therefore, it is important
for future research to address the issue of causality.
Overall, this research has shown that although service experiences matter, the
perceived convenience of one-stop shopping and the image conflicts are variables that
are the most important predictors of the customer potential for cross-buying.
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(Appendix appears over page.)

EJM Appendix
38,9/10
Constructs Loading Reliability
Confidence in the product quality 0.88

Store ___ does not really consider my best interests (reversed) 0.77
1156 Store ___ offers products that I can trust 0.76
Store ___ does not inform its customers appropriately(reversed) 0.76
Store ___ offers high-quality products 0.92
I can trust the employees of Store ___ 0.91
The employees of Store ___ always do things well 0.91
The employees are always respectful 0.86
I don’t get the attention I deserve (reversed) 0.93
Store ___ always provides reliable service 0.89
The employees are always courteous 0.92

Perceived value 0.85
Products are not good given their price (reversed) 0.83
Given the levels of prices, Store ___ could do more (reversed) 0.75
Store ___ is more expensive than its competitors (reversed) 0.84
Customer satisfaction 0.90
I am always enchanted by the quality of the service 0.86
Whenever I complain, Store ___ always respond positively 0.83
Store ___ has always met my expectations 0.91
Repurchase intentions 0.88
For my next purchases, I will consider only Store ___ 0.84
I want to buy from this store for a long time 0.85
I strongly intend to stay with Store ___ 0.84
Perceived switching costs 0.83
I am sticking to (Store Name) because:
I don’t want to make long distances 0.76
I will find it hard to get a better store 0.80
I fear to lose the benefits offered by Store ___ 0.68
The store is not far from my home 0.73
Perceived convenience 0.86
I will economise on time if I can do everything at the same place 0.85
I will enjoy having one single provider 0.74
I will appreciate having my accounts where I do my shopping 0.86
Image conflicts 0.60
I don’t trust Store ___ when it comes to money 0.80
I find it abnormal for Store ___ to offer banking services 0.50
Cross-buying intentions 0.94
I will seriously consider the offer 0.94
I will take this opportunity 0.84
Nothing can make me accept that offer (reversed) 0.91
The chances are very low that I will consider that offer (reversed) 0.89
Control variables 0.85
Usage of the services
Number of visits per month 0.77
Table AI.
Share of monthly purchases at Store_____ 0.95
Measurement model for
the retailer sample Notes: Chi-square ¼ 1013.04; p ¼ 0.00; RMSEA ¼ 0.06; CFI ¼ 0.99; NNFI ¼ 0.98
Constructs Loading Reliability
Customers’
cross-buying
Empathy
The employees are always respectful 0.83
0.78 intentions
The employees of my bank are always courteous 0.77
My bank always keeps its promises 0.77 1157
The employees always do things appropriately 0.80
In case of a problem, my bank always reassures me 0.75
My bank is trustworthy 0.77
My bank always provides a reliable service 0.71
Perceived value (reversed) 0.82
Service quality is not good given the prices 0.78
My bank can do more given its prices 0.79
My bank is too expensive compared to its competitors 0.75

Satisfaction 0.77
I am always enchanted by the quality of the service 0.77
Overall, I am not satisfied with my bank (reversed) 0.69
My bank has always met my expectations 0.73
Repurchase intentions 0.86
For my future transactions, I will consider only my current bank 0.80
I strongly intend to stay with this bank for a long time 0.71
I strongly intend to continue with this bank 0.90
Perceived convenience 0.83
I will economize on time if I could have everything at the same place 0.82
I will enjoy having one single provider 0.74
I will appreciate having my accounts and insurance policies at the same place 0.81
Image conflicts 0.82
It is not my bank’s job to sell insurance policies 0.82
I do not trust my bank when it comes to insurance policies 0.72
It is quite abnormal that my bank deals with insurance policies 0.80
Cross-buying intentions towards one’s bank propositions 0.88
Cross-buying intentions towards the client’s current insurer proposition 0.90
Control variables – usage of the services 0.83
Per cent of loans with the bank 0.77
Per cent f investments with the bank 0.82
Table AII.
Per cent of transactions with the bank over the last three months 0.79
Measurement model for
Notes: Chi-square (450) ¼ 812.34, p ¼ 0.00, RMSEA ¼ 0.056; NNFI ¼ CFI ¼ 0.98 the bank sample
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engage in a relationship (Day, 2000) and ultimately to expand that relationship

these image conflicts to be moderated by the customer’s evaluations of the relationship

Effects of customer’s evaluations of service experiences

H2c. Satisfaction is positively associated with perceived switching costs.

H5. Perceived switching costs are positively associated with repurchase

The effects of image conflicts

Approach to the measurement of cross-buying intentions

Confidence in product quality 1.00

customers): the process

Model 1 Model 2 Model 3 Model 4 Model 5 Model 6

Cross-buying intentions following a competitor’s offer

Model 2 Model 3 Model 4 Model 5 Model 6

H3a. Perceived quality is positively associated with

2. The role of the customer’s willingness to maintain the relationship

it comes to cross-buying. Therefore, relationship does not matter a lot. Competitors

consumer switching costs”, working paper, R. Smith Business School, University of

Management, Vol. 214 No. 19, pp. 20-7.

No. 3, pp. 34-49.

(Appendix appears over page.)

Confidence in the product quality 0.88

The employees are always courteous 0.92

My bank is too expensive compared to its competitors 0.75

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