Corporate which signal the ability of a service

Corporate image and reputation are the results of an aggregation process which incorporates diverse information used by the consumer to form a perception of the “rm.

Even for a consumer who has not yet had experience with the firm, these perceptions may be formed from other sources of information such as advertising or word-of-mouth. In our opinion, the emotional component of corporate image and corporate reputation may share a close relationship because of the psychological dimensions which contribute to their formation. These dimensions are manifested by the consumer’s attitudes and beliefs which rely on past actions of the firm or previous experiences with the firm. In the case of services that are categorized as experience products whose quality can only be evaluated after consumption, given their intangibility, corporate image and reputation both can be used as effective means of predicting the outcome of the service production process and, perhaps, considered as the most reliable cues which signal the ability of a service firm to satisfy the customer’s desires.  The impact of corporate image and reputation on consumer behavior is well recognized in spite of the lack of empirical evidence.

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Numerous authors assert that a good corporate image or reputation helps to increase the firm’s sales and its market share (Shapiro, 1982), and to establish and maintain a loyal relationship with customers (Andreassen and Lindestad, 1998; Robertson, 1993; Yoon et al., 1993) . A favorable store image can influence repeated patronage (Dick and Basu, 1994). In an investigation on service quality and customer loyalty in the commercial airline industry, Ostrowski (1993, p. 22) found that “a passenger’s image of the carrier which is based on long-term experiences encompassing many service encounters is more important in explaining customer loyalty than is the evaluation of the current, single flight”.

They also argue that the consumer may consider a bad experience as an exception to his whole impression of the service provider. In addition, this study suggested a consistent and significant relationship between the reputation of the carrier and customer loyalty. Corporate reputation is viewed in the study as a dimension of corporate image


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