Vertical Marketing Systems for Complex Products: A Triadic Perspective

The authors find that buyers value sequences of selective strong ties as well as sequences of more numerous weak ties, thus providing criterion validation to the bidimensional nature of tie strength that has been documented in previous research.

Abstract

Products that require extensive and complex information flows among suppliers, intermediary vendors, and customers often pose particular challenges to the vertical marketing system. Using social network theory, the authors investigate buyers' preferences for specific patterns of relationships among buyers, intermediary vendors, and suppliers of complex products. Using a conjoint experiment with actual and prospective buyers of integrated computer networks and services, the authors find that beyond their dyadic interaction with a vendor, buyers take into account the buyer-vendor-supplier triad. Specifically, buyers value sequences of selective strong ties as well as sequences of more numerous weak ties. This is consistent with theoretical propositions that strong ties facilitate the mobilization of support and the transfer of complex knowledge, whereas nonoverlapping weak ties facilitate the gathering of intelligence and the monitoring of new developments. The authors find only mixed evidence that buyers value direct access to suppliers when strong ties exist between the vendor and suppliers, as predicted by the third-party sanctioning argument in social network theory. In addition, they find that interaction intensity and valence do not always have the same effects, thus providing criterion validation to the bidimensional nature of tie strength that has been documented in previous research.