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The personal touch of business relationship: A study of the determinants and impact of business friendship

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  • Weihe Gao

    (Shanghai University of Finance and Economics)

  • Yong Liu

    (University of Arizona)

  • Liping Qian

    (Chongqing University)

Abstract

Business friendship refers to the integration of “business” dealings and personal “friendship” that permeates many markets. As relationship marketing and customer relationship management become increasingly prevalent practices, business friendship as a fundamental element embedded in business relationships needs to be better understood. This paper studies how business friendship is formed and its impact on key marketing outcomes. We propose that business friendship is driven by three factors spanning business and personal domains—congeniality, rule adherence and business reputation. Our empirical analysis is based on survey and actual sales data from 263 client firms of a leading provider of business intelligence and strategic planning services. The results show the three factors contribute significantly to business friendship. We find that business friendship between the client and the supplier significantly impacts the sales to the client, and this impact is further moderated by how the two parties share responsibilities in achieving common goals. In addition, we show that business friendship induces one party to accommodate and cooperate with the other (i.e., compliance), and to engage in positive word-of-mouth. The framework and findings shed lights on how companies may influence (and be influenced by) business friendship as they increasingly emphasize long-term business relationships.

Suggested Citation

  • Weihe Gao & Yong Liu & Liping Qian, 2016. "The personal touch of business relationship: A study of the determinants and impact of business friendship," Asia Pacific Journal of Management, Springer, vol. 33(2), pages 469-498, June.
    • Handle: RePEc:kap:asiapa:v:33:y:2016:i:2:d:10.1007_s10490-016-9464-1
    DOI: 10.1007/s10490-016-9464-1
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    Cited by:

    1. Jean-Baptiste Welté & Julien Cayla & Bernard Cova, 2022. "The intimacy trap: Navigating the commercial friendships of luxury," Post-Print hal-04103608, HAL.
    2. Oliver Rossmannek, 2022. "When do service suppliers leave their platform?—The role of friendships," Review of Managerial Science, Springer, vol. 16(5), pages 1311-1334, July.
    3. Elaine Aparecida Regiani Campos & Luis Mauricio Resende & Joseane Pontes, 2019. "Barriers, external aspects and trust factors in horizontal networks of companies: a theoretical proposal for the construction of a model for evaluation of trust," Journal of Intelligent Manufacturing, Springer, vol. 30(4), pages 1547-1562, April.
    4. Fu, Xiaorong & Pang, Jing & Gursoy, Dogan, 2022. "Effects of online commercial friendships on customer revenge following a service failure," Journal of Business Research, Elsevier, vol. 153(C), pages 102-114.
    5. Welté, Jean-Baptiste & Cayla, Julien & Cova, Bernard, 2022. "The intimacy trap: Navigating the commercial friendships of luxury," Journal of Business Research, Elsevier, vol. 145(C), pages 649-659.
    6. Lu, Tingyu & Zhuang, Mengzhou & Zhuang, Guijun, 2021. "When does guanxi hurt interfirm cooperation? The moderating effects of institutional development and IT infrastructure capability," Journal of Business Research, Elsevier, vol. 125(C), pages 177-186.

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