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Do We Fully Understand the Critical Success Factors of Customer Satisfaction with Industrial Goods? - Extending Festge and Schwaiger’s Model to Account for Unobserved Heterogeneity

  • Marko Sarstedt
  • Manfred Schwaiger
  • Christian M. Ringle
Research Article

Abstract

This paper extends Festge and Schwaiger’s (2007) model of customer satisfaction with industrial goods by accounting for unobserved heterogeneity. The application of a novel response-based segmentation approach in partial least squares path modeling (PLS-PM) - the finite mixture partial least squares (FIMIX-PLS) methodology - opens the way for the effective identification of distinctive customer segments. In comparison to previous studies in this field, group-specific path model estimates reveal each customer segment’s particular characteristics as well as other differentiated findings. Hence, this contribution demonstrates that structural equation modeling studies on the aggregate data level can be seriously misleading and makes a strong case for segment-specific customer satisfaction analyses.

Keywords

Customer satisfaction Structural equation model PLS path modeling Segmentation Finite mixture Latent class Unobserved heterogeneity 

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Copyright information

© Gabler-Verlag 2009

Authors and Affiliations

  • Marko Sarstedt
    • 1
  • Manfred Schwaiger
    • 1
  • Christian M. Ringle
    • 2
    • 3
  1. 1.Institute for Market-Based ManagementLudwig-Maximilians-University MunichMunichGermany
  2. 2.Institute of Industrial ManagementUniversity of HamburgHamburgGermany
  3. 3.Centre for Management and Organisation Studies (CMOS)University of Technology Sydney (UTS)SydneyAustralia

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