Effects of Supplier Customer Orientation on Buyer Loyalty: A Contingent Process Model Based on Self-Determination Theory

Abstract Prior supplier-buyer relationship research has identified supplier customer orientation as a driver of buyer loyalty. In this research, we address how and when this effect occurs. Based on self-determination theory, we identify three buyer psychological states—buyer autonomy, buyer competence, and buyer relatedness—that mediate the impact of supplier customer orientation on buyer loyalty. Drawing from prior supplier-buyer relationship scholarship, we identify three contingencies—buyer asset specificity, buyer environmental uncertainty, and buyer reciprocal interdependence—that, respectively, moderate the mediating effects of the three buyer psychological states. Results from a survey of 171 supplier-buyer matched dyads show that the three buyer psychological states are positive mediators of the impact of supplier customer orientation on buyer loyalty. Results also show that while the positive mediating effects of buyer autonomy and buyer competence are respectively strengthened by buyer asset specificity and buyer environmental uncertainty, the positive mediating effect of buyer relatedness is weakened by buyer reciprocal interdependence. Theoretical and practical implications are discussed.