Thinking of the Firm: How the Firm’s Benefit Influences Consumer Normative Expectations for Change

Abstract This research employs two scenario-based experiments to explore whether consumers “think of the firm” in setting their normative expectations regarding a customer-benefitting firm change. Results indicate that consumers take the firm benefit of potential firm actions into account in setting their expectations for what firms should do. Even in the absence of strong relationship ties, the associated firm benefit increases normative expectations for firms to enact a change. However, the customer benefit associated with a potential change dominates consumer expectations as it impacts normative expectations both directly as well as indirectly via an apparent lay belief that “what’s good for the customer is good for the firm.” In addition, the customer and firm benefits of potential changes positively interact in driving expectations; when customers believe that a change will be a “win-win” for themselves and the firm they strongly expect the firm to enact it. The findings suggest that firms must make clear how the costs associated with a potential change will be borne by their customers.