Wednesday, October 11, 2017 | 10:30am-12:00pm | Room 331, HSBC Business School Building

Abstract

Marketing channel literature has yet to examine firms’ strategy to diversify relationships in addition to maintaining existing relationships. In supplier–distributor exchanges, for instance, distributors may seek alternative suppliers while committing to incumbent suppliers. This research proposes the coexistence of commitment and diversification and investigates their drivers. We propose that dominant relational governance that leads to commitment may have spillover effects on diversification. We further hypothesize the boundary conditions of the spillover effects: they are stronger when distributors’ network embeddedness is high and weaker when market uncertainty is high. We examine this intriguing phenomenon with a qualitative study and a longitudinal survey across six industries. Results validate the construct of relationship diversification, identify spillover effects of some relational safeguards on diversification, and contrast the impacts of commitment versus diversification. This research integrates dyadic and network views of channel management and provides new insight on channel governance.