Know Your Customer: How Salesperson Perceptions of Customer Relationship Quality Form and Influence Account Profitability

Abstract

Firms often utilize salesperson intelligence in marketing strategies to improve sales performance. However, this approach is problematic if the information is based on inaccurate perceptions. In light of this, the authors introduce a theoretical model to study the antecedents and profit impact of salesperson perceptions of customer relationship quality. Dyadic analyses using matched survey responses from salesperson–customer dyads and secondary performance data reveal several insightful findings. Results show that self-efficacious salespeople are upwardly biased, whereas customer-oriented salespeople are downwardly biased in their perceptions of customer relationship quality. However, managers can correct these inaccuracies using a behavior-based control system. Response surface analyses illustrate that the effects of salesperson accuracy and inaccuracy are distinct and curvilinear. During later relationship phases, salespeople profit more from salesperson accuracy in high- and low-quality relationships (i.e., a U-shaped effect). Yet the increasingly harmful impact of salesperson inaccuracy on profit is more severe during earlier relationship phases. Together, these findings highlight the benefits of measuring salesperson perceptions and how to manage them.