Relationship matters: How relational factors moderate the effects of emotional labor on long-term customer outcomes

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Relationship matters: How relational factors moderate the effects of emotional labor on long-term customer outcomes☆ ⁎

Nai-Wen Chia, , Pei-Chi Chenb a b

Institution of Human Resource Management, National Sun Yat-Sen University, Taiwan, 70, Lienhai Rd., Kaohsiung 80424, Taiwan Department of Business Management, National Sun Yat-Sen University, Taiwan, 70, Lienhai Rd., Kaohsiung 80424, Taiwan

A R T I C LE I N FO

A B S T R A C T

Keywords: Emotional labor Service sweethearting Relationship strength Customer satisfaction Customer purchase

Previous studies have examined the immediate effects of emotional labor (EL) on short-term customer outcomes in service encounters. We replicated and extended prior findings by examining whether EL can have lagged effects on long-term customer outcomes (i.e., purchase amount, willingness to maintain a long-term relationship/to recommend) and how relationship strength and service sweethearting moderate these effects in service relationships. Using two-wave time-lagged designs, Study 1 collected data from 122 insurance agent-customer dyads, and Study 2 included 177 employee-customer dyads from various service occupations. The results show that deep (surface) acting increases (reduces) long-term customer outcomes via increased (decreased) satisfaction. Contrary to previous findings, we find that relationship strength enhances the positive (negative) indirect effects of deep (surface) acting. Finally, service sweethearting enhances (weakens) the positive (negative) indirect effects of deep (surface) acting. These findings indicate that service sweethearting is an important yet neglected moderator of the EL–customer outcomes relationship.

1. Introduction The recent growth in service economies has highlighted the importance of building long-term customer relationships (Beatty et al., 2016; Collier, Barnes, Abney, & Pelletier, 2018; Zablah, Sirianni, Korschun, Gremler, & Beatty, 2017). In order to enhance customer satisfaction and loyalty, service employees have to engage in emotional labor (EL) in order to display appropriate emotions towards customers (Grandey, 2000; Hochschild, 1983; Tsai & Huang, 2002). As a result, investigating how service employees' EL influences customer attitudes and behaviors has become an important issue in both academic and practical fields (Barger & Grandey, 2006; Chi, Grandey, Diamond, & Krimmel, 2011; Grandey & Gabriel, 2015). EL refers to service employees' regulation of feelings and expressions in order to display organizationally required emotions towards customers (Grandey, 2003; Hochschild, 1983). Service employees can utilize two EL strategies to express appropriate emotions: deep acting involves modifying inner feelings by recalling a prior event or reappraising the situation (Grandey, 2000), while surface acting involves faking superficial expressions while suppressing real feelings (Hochschild, 1983). In general, previous studies (e.g., Chi et al., 2011; Groth, Hennig-Thurau, & Walsh, 2009; Hennig-Thurau, Groth, Paul, &

Gremler, 2006; Hüsheger & Schewe, 2011) have documented that deep acting enhances, whereas surface acting impairs, customer positive attitudes, which are critical for the success of service organizations. However, several important questions regarding EL consequences and moderators remain unaddressed in the literature. First, previous studies have mainly examined the effects of EL on short-term customer outcomes within service encounters (e.g., encounter satisfaction; see Appendix A for detailed information). As such, the results obtained are unlikely to capture the effects of EL in ongoing relationships with customers (Grandey & Diamond, 2010). In turn, Grandey and Gabriel (2015) have called for studies to examine whether EL can have long-term benefits for organizations, such as increasing customer purchase or loyalty behaviors. Moreover, as Gutek, Cherry, Bhappu, Schneider, and Woolf (2000) suggested, customers respond to employee behaviors in different ways, depending on whether the service type is a service encounter (i.e., short-term, sporadic interactions between customers and service employees, such as food/coffee store clerks) or service relationship (i.e., the customer repeatedly interacts with the same employee, such as hair stylists, or insurance agents, and thus they might get to know each other as acquaintances or even friends; Liao & Chuang, 2007). Since many service organizations believe that the best way to retain customers is to build long-term

☆ ⁎

We thank Ya-Yun Ruby Tsai for her assistance in data collection of Study 2. Corresponding author. E-mail address: [email protected] (N.-W. Chi).

https://doi.org/10.1016/j.jbusres.2018.08.019 Received 6 February 2017; Received in revised form 13 August 2018; Accepted 17 August 2018 0148-2963/ © 2018 Elsevier Inc. All rights reserved.

Please cite this article as: Chi, N.-W., Journal of Business Research, https://doi.org/10.1016/j.jbusres.2018.08.019

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Relational Factors Relationship Strength Service Sweethearting (Study 2)

Emotional Labor Deep Acting Surface Acting

H3 H5 H4 H6

Customer Satisfaction with Employee

H1, H2

Long-Term Customer Outcomes The Amount of Customer Purchases (Study 1) Customer Willingness to Maintain Service Relationship with Employee Customer Willingness to Recommend Employee

Collected at Time 2

Collected at Time 1 Fig. 1. Conceptual framework of the present study.

The present study fills the aforementioned gaps and advance the existing EL research in several important ways. First, in order to respond to Grandey and Gabriel's (2015) call, we extend prior findings by conducting two studies with different research settings to test if EL strategies can have long-term effects on the amount of customer purchases (Study 1),and customers' willingness to recommend/build a long-term relationship with the service employee via activating customers' satisfaction. Our constructive replication (i.e., deliberate modification of prior studies to avoid methodological limitations) not only improves on the methods of original studies, but also enhances the generalizability of research findings (Easley, Madden, & Dunn, 2000). Second, although previous studies have found that a strong customer-employee relationship attenuates the effects of employees' emotional displays on customers' service evaluations in the short-term or sporadic interactions (Gabriel et al., 2015; Wang & Groth, 2014), we expect differences when customers have high expectations regarding the emotional performance of the same service employees, and are able to verify their emotional authenticity after repeated service interactions (Grandey & Diamond, 2010; Gutek et al., 2000; Price, Arnould, & Deibler, 1995; Zablah et al., 2017). To re-examine the moderating role of relationship strength, we conduct two studies and collect data from occupations that require service employees to repeatedly interact with the same customers. This approach helps us to clarify the boundary conditions of the EL–customer outcomes association. Finally, based on the aforementioned review, in addition to displaying warm and friendly emotions, service employees have to engage in relationship-oriented behaviors (e.g., providing personal treatment or additional benefits) to exceed customers' expectations (Beatty et al., 2016; Collier et al., 2018; Price & Arnould, 1999; Zablah et al., 2017). Hence, we test whether service employees' service sweethearting behaviors are helpful in amplifying the effects of EL strategies on customer outcomes in long-term, continuous service interactions. Fig. 1 presents our conceptual model.

employee-customer relationships (Futrell, 2015), it is important to investigate whether EL is an effective strategy to increase long-term customer outcomes (e.g., customer purchase and willingness to maintain a relationship/recommend) when customers have chances to repeatedly interact with the same service employee (i.e., in the context of service relationships). Second, EL researchers have attempted to clarify the roles of relational moderators on the association between EL and customer outcomes (see Appendix A), and found the EL-customer outcomes relationship was weakened when customers had a strong familiarity or relationship with service employees (i.e., Gabriel, Acosta, & Grandey, 2015; Wang & Groth, 2014). Notably, these studies were conducted in short-term service encounters, where customers had limited opportunities and motivations to monitor service employees' emotional authenticity (Gabriel et al., 2015; Grandey & Diamond, 2010). Under such situations, customers in a strong relationship with the employees tend to make the service evaluations based on their relationship, and thus the authenticity of employees' emotional expressions are less influential on customer outcomes (Gabriel et al., 2015; Wang & Groth, 2014). However, when customers expect to interact with the same service employees repeatedly in the future and have more information with which they can verify employees' emotional authenticity, displaying authentic emotions becomes particularly important to maintain a strong customeremployee relationship. As such, it is valuable to re-examine the role of employee-customer relationships on the effects of EL in the context of long-term service relationships. Finally, as Grandey and Diamond (2010) noted, both customers and employees have the opportunity to provide each other with desired outcomes when they are involved in repetitive interactions: customers seek a desired service or additional benefits (e.g., more discount), while employees can earn repeat purchases or recommendations. Recent findings in the service management literature support this notion: customers desire extraordinary service experiences by pushing service employees to provide special treatment (Beatty et al., 2016; Collier et al., 2018), while service employees engage in customer-oriented deviant behaviors such as service sweethearting behaviors (i.e., providing unauthorized free or discounted goods or services to customers; Brady, Voorhees, & Brusco, 2012) and defy organizational rules in order to benefit their customers (Boukis, 2016; Leo & Russell-Bennett, 2014). Although organizations view these relationship-oriented behaviors as dysfunctional, illegitimate, and unethical due to increased costs and profit losses (Brady et al., 2012), they are intended to satisfy demanding customers and create reciprocal relationships between customers and service employees (Boukis, 2016; Collier et al., 2018; Leo & RussellBennett, 2014). As such, engaging in such behaviors might enhance the effects of EL on long-term customer outcomes. However, no known studies have incorporated the role of relationship-oriented behaviors into the EL literature.

2. Theory and hypotheses 2.1. Emotional labor and long-term customer outcomes: a constructive replication In the present study, we replicate and extend previous findings by examining how service employees' EL strategies influence customers' purchase and willingness to recommend/build a long-term relationship with the service employees. Our approach differs from previous ones in two important ways. First, although the majority of the relevant evidence has found that service employees' EL influences customer outcomes within short-term service encounters (e.g., bank tellers, or food/ coffee/shoe store employees; see Appendix A), emotional contagion might be more likely during repeated and longer service interactions 2

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interpersonal relationship, since authenticity reflects the value and the depth of the relationship (Liu & Perrewe, 2006). In a strong relationship, the interacting partners are concerned about the other's well-being and pay attention to each other's needs (Clark & Taraban, 1991). Expressing authentic emotions provides the partners with information about emotional senders' true thoughts and needs, leading the partners to respond in an appropriate and caring manner (Seger-Guttmann, Medler-Liraz, & Guttmann, 2012). As such, emotional authenticity increases interpersonal liking and intimacy in a strong relationship (Collins & Miller, 1994). However, individuals who express faked emotions in a strong relationship are considered dishonest or insincere (Beck & Clark, 2010), which reduces others' interpersonal liking and sense of rapport with them (Butler et al., 2003; Liu & Perrewe, 2006). Based on this line of reasoning, the effects of service employees' authentic (i.e., deep acting) or faked (i.e., surface acting) emotional displays on customers' attitudes should be pronounced when customers and the service employees are in a strong relationship. In recent years, some EL researchers have attempted to explore how employee-customer relationship influences the effects of EL (Gabriel et al., 2015; Wang & Groth, 2014). Surprisingly, their findings indicate that the effects of employees' EL on customer satisfaction are weakened when customers have a strong relationship with service employees (Gabriel et al., 2015; Wang & Groth, 2014). Specifically, Wang and Groth (2014) argued that customers who have a strong relationship (i.e., relationship strength; the intensity and depth of the employee-customer relationship) with the service employees are inclined to ignore or dismiss information about employees' emotional authenticity, since such information might contradict their beliefs about the employees. Similarly, Gabriel et al. (2015) theorized that customers who have a strong relationship with the service employees (i.e., high familiarity) are less motivated to monitor the service employees' emotional displays in order to reduce uncertainty. As such, the service employees' emotional authenticity is less influential on customers' service evaluations. However, there are reasons to believe that the moderating effect of relationship strength would differ when customers are able to repeatedly interact with the same service employees in the context of a service relationship,1 due to the differences in opportunities and motivations to monitor the employees' authenticity. First, Wang and Groth's (2014) and Gabriel et al.'s (2015) studies were conducted in the context of short-term service encounters (e.g., buying food or coffee in a restaurant or coffee shop; see Appendix A), where the duration of service interactions is limited and customers might interact with a different service employee each time (Gutek et al., 2000). As such, customers have limited opportunities to verify service employees' emotional authenticity. Thus, customers make service evaluations based on their strong relationship with the employees, with the result that employees' emotional authenticity become less influential on customers' service evaluations in these studies. However, in the context of service relationship, customers gain increased exposure to service employees' emotional expressions as they repeatedly interact with the same service employee in longer service interactions (Grandey &

(Barger & Grandey, 2006). Moreover, compared with service encounters, customers have higher expectations regarding the authenticity of service employees' emotional expressions (Price et al., 1995; Zablah et al., 2017), and are better able to verify service employees' emotional authenticity (Gabriel et al., 2015; Grandey & Diamond, 2010) after repetitive service interactions. In this context, service employees' EL can still have similar effects on customer outcomes as those noted in short-term service encounters, but we expect such effects to be stronger when customers repeatedly interact with the same employees in a long term service relationship. Second, compared with a single short-term service encounter, customers are more likely to build aggregate perceptions for a specific employee (e.g., satisfaction with this employee) who repeatedly serves them across multiple service interactions (i.e., the context of a service relationship). Thus, the aggregate and overall perceptions would drive customers' long-term outcomes related to this specific employee, such as increased purchase and enhanced willingness to recommend/maintain the relationship with the employee. Service workers can engage in two different types of EL strategies when serving customers: deep acting and surface acting (Grandey, 2000; Hochschild, 1983). In the context of service relationships, there is a history of shared interactions between customers and the specific service employee, and customers expect to interact with the same service employee in the future (Gutek et al., 2000). Thus, customers believe the service employee can realize and satisfy their needs (Gutek et al., 2000), and they are better equipped to observe and assess the service employee's emotional authenticity (Grandey & Diamond, 2010; Groth et al., 2009). Given that deep acting helps employees to change internal states to express more authentic emotions (i.e., “faking in good faith”; Grandey, 2003), leading employees to think about customers' feelings and needs (Grandey, 2000) and engage in customer-oriented behaviors (Groth et al., 2009), service employees who employ a deep acting strategy towards the same customers are more likely to enhance customers' satisfaction towards them after repeated service interactions. In contrast, service employees who apply a surface acting strategy only modify their facial expressions without changing their true feelings, resulting in inauthentic positive displays (Grandey, 2000, 2003). In repeated service interactions, customers are more likely to detect this inauthenticity, which can activate negative reactions (Hennig-Thurau et al., 2006) and reduces customers' satisfaction towards the employees (Groth et al., 2009). In the service marketing literature, researchers have found that customers' satisfaction leads to stronger willingness to maintain the relationship with service employees (Gwinner, Gremler, & Bitner, 1998; Hennig-Thurau, Gwinner, & Gremler, 2002), as well as an increased likelihood of buying more products from them (Paul, Hennig-Thurau, Gremler, Gwinner, & Wiertz, 2009). Further, these satisfied customers are more likely to recommend the employee to others (Hennig-Thurau et al., 2006). Based on these arguments, we propose: Hypothesis 1. Service employees' deep acting is positively related to customer satisfaction towards the service employees, which in turn enhances: (a) the amount of customer purchase, (b) customer willingness to maintain a long-term relationship, and (c) customer willingness to recommend.

1 One might wonder whether the relationship strength between customers and employees is always high in the context of service relationship. In general, the relationship strength between customers and employees should be higher in the service relationship (than service encounter) since the employees have more opportunities to interact with the customers to develop their relationship (Gutek et al., 1999). However, it is also plausible that the customers and employees are in a weak relationship in the context of service relationship, since some employees might focus on responding to customers' needs and solving customers' problems rather than enhancing the intensity and depth of their relationship. Also, some customers might prefer to keep distance from their service employee and avoid relationship development to have some privacy (even they have to interact repeatedly in the future). Thus, it is reasonable to expect the relationship strength can be strong or weak in the context of service relationship.

Hypothesis 2. Service employees' surface acting is negatively related to customer satisfaction towards the service employees, which in turn enhances: (a) the amount of customer purchase, (b) customer willingness to maintain a long-term relationship, and (c) customer willingness to recommend.

2.2. Relationship strength as a boundary condition The literature on interpersonal relationships and emotional expressions suggests that emotional authenticity is crucial to a strong 3

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special treatment from service employees (Boyd & Helms, 2005; Fisk & Neville, 2011). Moreover, in the context of service relationships, customers trust the service employees and believe they can satisfy their potential needs (Gutek et al., 2000). Therefore, customers not only place importance on employees' sincere emotional displays (Groth et al., 2009), but also expect additional benefits and customized services from service employees when they are involved in repeated employee-customer interactions (i.e., service relationships) (Grandey & Diamond, 2010). As such, we propose that the effectiveness of employees' EL on long-term customer outcomes might depend on the presence or absence of sweethearting behaviors (e.g., providing customers with unauthorized free or discounted goods/services) (Boukis, 2016; Brady et al., 2012; Leo & Russell-Bennett, 2014). Specifically, we expect that employees' service sweethearting can amplify the positive indirect effect of deep acting on customer satisfaction and long-term outcomes. When customers receive free or discounted products from employees, they might feel that they owe the employees a debt of gratitude (Greenberg, 1980), creating a sense of reciprocity (Brady et al., 2012). Further, when service employees engage in both service sweethearting and deep acting within repeated interactions, customers not only form a future obligation to reciprocate, but also view employees' deep acting as more genuine, since they take risks to provide unauthorized resources to the customers (Brady et al., 2012), which combined are more likely to increase customers' satisfaction with employees. These might in turn enhance customers' willingness to recommend and maintain a long-term relationship. Thus, we propose:

Diamond, 2010; Groth et al., 2009; Gutek et al., 2000). Thus, customers have more opportunities to assess one employee's EL strategies and verify the authenticity of the emotional displays during the repeated interactions, which both influence their overall satisfaction with the employee. Second, in the context of service relationships, the service employees will have gained important knowledge about the customers through the history of shared interactions, which helps the employees to provide good service to satisfy customer needs (Grandey & Diamond, 2010). In addition, customers expect that the same service employee will repeatedly serve them in the future, and believe this service employee know them better than those only involved in short-term service encounters (Gutek et al., 2000). Hence, customers may have high expectations for this service employee's performance (Gutek, Bhappu, Liao-Troth, & Cherry, 1999), requiring that the latter display sincere, warm, and friendly emotions (e.g., engaging in deep acting rather than surface acting) to exceed the former's expectations (Chi et al., 2011). This expectation becomes more important when a customer and employee have a strong relationship, since emotional authenticity is highly valued and interacting partners have an obligation to respond to their partners' needs (Clark & Taraban, 1991; Seger-Guttmann et al., 2012). Under such contexts, customers have stronger motivations to evaluate service employees' performance based on the authenticity of their emotional displays, and service employees' use of deep (surface) acting may have a more salient positive (negative) effect on customers' satisfaction with them. However, these situations are less likely to happen in the context of service encounters where customers and employees do not expect to interact in the future, and customers would not set high expectations for service employees' performance (Gutek et al., 2000). Following this line of reasoning, when customers have a strong relationship with the service employees and are involved in repetitive service interactions with the same service employees, they are more likely to trust these employees and expect reciprocation in terms of respect, authenticity, and friendliness (Price & Arnould, 1999). Furthermore, they have more opportunities to verify the service employees' emotional authenticity than in the context of short-term service encounters. Thus, employees need to display sincere emotions (deep acting) in order to meet customers' expectations, which in turn enhances long-term customer outcomes. Finally, inauthentic emotional expressions harm interpersonal evaluations within a strong relationship (Butler et al., 2003; Liu & Perrewe, 2006; Seger-Guttmann et al., 2012). As such, service employees' inauthenticity associated with surface acting would negatively impact long-term customer outcomes, since it may be detected by customers after frequent and repeated service interactions (Groth et al., 2009), and fails to meet customer expectations for a strong relationship. Taken together, we propose:

Hypothesis 5. Service sweethearting behaviors will enhance the positive indirect effect of service employees' deep acting on (a) customer willingness to maintain a long-term relationship, and (b) customer willingness to recommend via customer satisfaction. Similarly, according to the social exchange perspective (Brady et al., 2012), if customers receive additional benefits from the “sweetheart” employees, who are solely at risk for any possible punishment associated with the provision of special treatment, these behaviors can increase customers' perceived obligations to reciprocate (Brady et al., 2012). In this line of reasoning, although surface acting harms customer satisfaction and decreases customer long-term outcomes due to inauthenticity (Chi et al., 2011; Grandey, Fisk, Mattila, Jansen, & Sideman, 2005; Groth et al., 2009), sweethearting behaviors can mitigate the negative reactions to surface acting, since such behaviors may activate a debt of gratitude and lead customers to recognize employees' good intentions (Greenberg, 1980; McCullough et al., 2001). In turn, customers may overlook or dismiss service employees' inauthentic expressions, attenuating the negative indirect effects of surface acting on customers' willingness to recommend and maintain the relationship. Thus, the following hypothesis is proposed:

Hypothesis 3. Relationship strength will enhance the positive indirect effect of service employees' deep acting on (a) the amount of customer purchase, (b) customer willingness to maintain a long-term relationship, and (c) customer willingness to recommend via customer satisfaction with the service employees.

Hypothesis 6. Service sweethearting behaviors will weaken the negative indirect effect of service employees' surface acting on (a) customer willingness to maintain a long-term relationship, and (b) customer willingness to recommend via customer satisfaction.

Hypothesis 4. Relationship strength will enhance the negative indirect effect of service employees' surface acting on (a) the amount of customer purchase, (b) customer willingness to maintain a long-term relationship, and (c) customer willingness to recommend via customer satisfaction with the service employees.

3. Study 1 method In Study 1, we tested our model within one service occupation (i.e., insurance agent) in which customers and agents expect to interact several times (Gutek et al., 2000). Testing our hypotheses within such an occupation helps to compare our findings with previous studies conducted on short-term service encounters (e.g., Gabriel et al., 2015; Wang & Groth, 2014). We recruited 150 insurance agents from one insurance firm in Taiwan, which helped to rule out organizational effects associated with differences in organizational cultures, human resource practices, or service climates (Koys, 2001).We informed the sample firm

2.3. Service sweethearting as a boundary condition Service management researchers have found that customers today have higher service expectations than in the past, and expect service employees to meet their extra needs (Beatty et al., 2016; Collier et al., 2018; Wilder, Collier, & Barnes, 2014). For example, many customers believe that they are important to the company and expect to receive 4

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coordinators of the data collection procedures and sent them the questionnaires, to be distributed to both the agents and one of the agents' customers, obtained by requesting the contact information of one customer that they had served recently. The coordinators distributed the surveys to the insurance agents and chosen customers at Time 1. Insurance agents were asked to rate their use of EL during the service interactions with this customer, whereas customers were asked to rate their satisfaction and relationship strength with the agents. Three months later2 (Time 2), the coordinators distributed a second customer survey to the chosen customers to investigate the amount of insurance coverage they bought from their chosen agent during the past three months. Finally, to avoid the non-independence problem (Hoffmann, 1997), we only collected customer data from one customer for each participating employee. In total, we obtained 122 valid matched surveys (81% valid response rate). Agents were predominantly female (76%), about 40 years old on average (M = 38.92, SD = 8.01), and with a relatively long tenure at the current insurance firm (M = 8.96 years; SD = 5.58). Most customers were female (71%) and ranged from 23 to 62 years old (M = 37.05; SD = 9.70). Finally, customers interacted with the same insurance agents repeatedly during the three month period (Mean = 4.06; SD = 1.86), matching Gutek et al.'s (2000) definition of “service relationships”. On average, the duration of each service interaction is 35.6 min (SD = 17.82).

(ranged from 131 to 32,846 USD, Mean = 3646, SD = 5061) that they purchased from their agent between Time 1 and Time 2.

3.1. Measures

3.1.7. Control variables In Study 1, we controlled for the gender of agents and customers (1 = male; 2 = female) since gender can influence their EL and service outcomes (Tsai & Huang, 2002). In addition, Wang, Liao, Zhan, and Shi (2011) suggested that tenure reflects employees' level of experience and knowledge regarding emotional regulation. As such, employee tenure was also controlled for in the analyses (Mean = 8.96; SD = 5.58) (in years). Finally, given that customers' interaction frequency with the insurance agents might influence their service evaluations, we asked each customer to indicate how many times he/she interacted with the agent during the past three months (Mean = 4.06; SD = 1.86).

3.1.4. Customer willingness to maintain a long-term relationship with employee We used Liao and Chuang's (2007) four-item scale to capture customers' willingness to maintain a long-term relationship with the agent. Responses were made based on a 5-point Likert scale (1 = strongly disagree and 5 = strongly agree). The Cronbach's alpha was 0.83. 3.1.5. Customer willingness to recommend employee We slightly revised Groth et al.'s (2009) four-item scale to measure customer willingness to recommend the agent. Responses were made based on a 5-point Likert scale (1 = strongly disagree and 5 = strongly agree). The Cronbach's alpha coefficient for this scale was 0.91. 3.1.6. Relationship strength We used one item from Wang and Groth's (2014) scale (i.e. “How well do you know the agent who served you”)(1 = complete stranger to 5 = personal friend) and two items from Gabriel et al.'s (2015) scale (i.e. “I know my agent fairly well” and “I have repeated interactions with this insurance agent”) (1 = strongly disagree and 5 = strongly agree). The Cronbach's alpha coefficient for this scale was 0.81.

Following Brislin (1980), we employed the back-translation method to ensure the appropriateness of all translated items. All study items are listed in the Appendix B. 3.1.1. Emotional labor We measured surface acting using Grandey's (2003) five-item scale and used Brotheridge and Lee's (2002) three-item scale to measure deep acting. Agents were asked to evaluate the frequency of their EL strategies towards the chosen customer on a 5-point Likert scale (1 = never and 5 = always). The Cronbach's alphas for surface acting and deep acting were 0.83 and 0.88, respectively.

3.1.8. Data analysis To test Hypotheses 1 to 4, we used the PROCESS program (Hayes, 2012) to compute the confidence intervals (CIs) of the indirect effects of EL on customer outcomes and how relationship strength moderates these effects. To reduce problems associated with multi-collinearity, all variables used to construct the interaction terms were standardized (Cohen, Cohen, West, & Aiken, 2003). We also checked the variance inflation factor (VIF) scores to ensure that all the VIF scores were below 10.0 (i.e., ranged from 1.15 to 1.81).

3.1.2. Customer satisfaction with employee In order to capture customers' satisfaction with the service employees3 (rather than overall customer satisfaction), we used Brady et al.'s (2012) three-item scale to measure customers' satisfaction with the service of their agent. Responses were made based on a 5-point Likert scale (1 = strongly disagree and 5 = strongly agree). The Cronbach's alpha coefficient for this scale was 0.85.

4. Study 1 results 3.1.3. The amount of customer purchase We asked customers to provide the amount of insurance coverage

The means, standard deviations, reliabilities, and correlations among the Study 1 variables are presented in Table 1.

2 In Taiwan, most insurance agents will initially visit potential customers one or two times to explain the purposes and benefits of their insurance contracts. During the visit, agents exhibit friendly/warm attitudes and positive emotions in order to deal with customers' negative attitudes (e.g., resistance) and ease their concerns. Therefore, insurance agents' EL strategies might play important roles during this stage (Time 1). After the initial visit(s), customers carefully consider whether they want to purchase coverage from the insurance agent and make a decision (usually several weeks later). Thus, we collected the data on the amount of customer purchase after three months (Time 2). 3 In the present study, we measured customers' satisfaction towards the service employees (rather than overall customer satisfaction) because it is determined by service employees' behaviors within service interactions and might influence customer following reactions and attitudes (Brady et al., 2012). Overall customer satisfaction, on the other hand, is influenced by a number of company-related factors which are not related to service workers' behaviors. Thus, it will be more relevant to include customers' satisfaction towards the service employees in our study.

4.1. Confirmatory factor analyses To investigate the convergent and discriminant validity of the study variables, we conducted confirmatory factor analyses (CFA) using LISREL 8.54 and examined the fit indices of the hypothesized 6-factor model (i.e., deep acting, surface acting, relationship strength, customer satisfaction, customer willingness to build a long-term relationship and to recommend). The CFA results show that the hypothesized 6-factor model fit the data well (χ2 [194] = 469.8; CFI = 0.92, NFI = 0.90; NNFI = 0.91, IFI = 0.92, SRMR = 0.08, RMSEA = 0.09). The Average variance extracted (AVE) and composite reliability (CR) of each construct ranged from 0.79 to 0.95 and the AVE of each construct was greater than its squared correlations with other constructs, which indicates good convergent validity as well as discriminant validity of the scales (Fornell & Larcker, 1981). Finally, the results show that the 95% 5

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Table 1 Descriptives and bivariate correlations among the Study 1 variables. Variable

M

S.D.

1

2

3

4

5

6

7

Control variables 1 Customer gender 2 Employee gender 3 Employee tenure1 4 Interaction frequency

1.71 1.78 8.96 4.06

0.45 0.41 5.58 1.86

– 0.08 0.20* −0.24**

– −0.09 −0.06

– −0.25**

–

Predictors and moderators 5 Deep acting 6 Surface acting 7 Relationship strength

4.49 4.06 3.87

0.45 0.83 0.65

−0.03 −0.04 −0.07

−0.08 −0.07 −0.08

0.18* 0.20* 0.16

−0.07 −0.05 −0.06

(0.88) 0.35** 0.46**

(0.83) 0.18*

Mediators and outcomes 8 Customer satisfaction2 9 Insurance purchase3 10 Maintain relationship4 11 Recommend4

(0.81)

4.01 3646 3.86 4.51

0.84 5061 0.60 0.44

−0.04 −0.13 −0.01 −0.00

−0.10 0.00 −0.08 −0.21*

0.37** 0.20* 0.18* 0.18*

−0.08 0.00 −0.20* −0.06

0.41** 0.19* 0.37** 0.57**

0.19* 0.08 0.15 0.24**

0.49** 0.18* 0.40** 0.41**

8

9

10

11

(0.85) 0.28** 0.37** 0.39**

– 0.18* 0.04

(0.83) 0.38**

(0.91)

*p < .05; **p < .01 (two-tailed). N = 122. Cronbach's alpha coefficients are presented in boldface on the main diagonal. Note 1: in years. Note 2: Customer satisfaction with the service employee. Note 3: in USD. Note 4: Customer willingness to maintain a long-term relationship with employee. Note 5: Customer willingness to recommend employee.

used Hayes' (2012) PROCESS program to calculate the CIs of these indirect effects. The results of PROCESS indicated that deep acting significantly and positively predicted the amount of insurance purchase, customer willingness to maintain a long-term relationship and to recommend via customer satisfaction (the 95% CIs were [223, 1623], [0.02, 0.24] and [0.01, 0.17], respectively). Thus, Hypotheses 1(a), (b), and (c) were all supported. Based on Models 4 to 6 in Table 2, customer satisfaction fully mediated the deep acting-customer purchase relationship (i.e., the direct effect of deep acting was not significant), and partially mediated the relationship between deep acting and customer willingness to maintain a long-term relationship and to recommend (i.e., significant the direct effects of deep acting). However, as shown in Model 1 of Table 2, surface acting was unrelated to customer satisfaction and the CIs of the indirect effects regarding the relationships between surface acting and long terms customer outcomes included zero (the 95% CIs were [−0.71, 697], [−0.02, 0.09] and [−0.01, 0.08], respectively). Hence, Hypotheses 2(a) to (c) were not supported.

CIs around the correlations among the study variables did not include 1.0, providing further evidence of discriminant validity of the study variables (Anderson & Gerbing, 1988).

4.2. Hypothesis testing 4.2.1. The effects of EL strategies on customer long-term outcomes via customer satisfaction The results for testing Hypotheses 1 to 4 are presented in Table 2. Model 1 of Table 2 indicates that deep acting positively predicted customer satisfaction (β = 0.35, p < .01) whereas surface acting was unrelated to customer satisfaction (β = −0.01, n.s.). As shown in Models 4 to 6 of Table 2, the results indicated that customer satisfaction still positively predicted the amount of insurance purchase (β = 0.22, p < .05), customer willingness to build a long-term relationship (β = 0.21, p < .05) and to recommend (β = 0.20, p < .05) after controlling for the effects of all control variables and all main effects. In order to test the significance of the proposed indirect effects, we Table 2 Study 1 results of hierarchical regression analyses. Variables

Step 1 Customer gender Employee gender Employee tenure Interaction frequency Deep acting Surface acting Customer satisfaction Step 2 Relationship strength (RS) Step 3 Deep acting ∗ RS Surface acting ∗ RS △R2, each step Total R2

Customer satisfaction with the service employee

The amount of insurance purchase

Maintain relationship3

Recommend3

Model 1

Model 2

Model 3

Model 4

Model 5

Model 6

−0.05 −0.12 0.32** −0.03 0.35** −0.01

−0.04 −0.08 0.28** −0.01 0.20* −0.01

−0.01 −0.09 0.27** −0.01 0.20* −0.06

0.04 −0.15 0.15 0.01 0.08 −0.05 0.22*

−0.05 −0.03 0.04 −0.15 0.21* −0.06 0.21*

−0.16* 0.08 0.01 0.00 0.47** −0.06 0.20*

0.36**

0.35**

0.02

0.21*

0.10

0.10** 0.37**

0.21* −0.18* 0.04* 0.41**

0.06 −0.08 0.04* 0.12*

0.15 −0.10 0.03* 0.28**

0.14 −0.11 0.03* 0.37**

0.27** 0.27**

Note1: Standardized regression coefficients (β) are shown in each eq. N = 122; † p < .10; * p < .05; ** p < .01 (two-tailed). Note2: The results were not changed if all control variables were removed. Note 3: Customer willingness to maintain a long-term relationship with employee and customer willingness to recommend employee, respectively.

6

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4

3.5

Customer Satisfaction

High RS 3

Low RS 2.5

2

Deep Acting Fig. 2. The moderating effect of relationship strength (RS) on the deep acting-customer satisfaction relationship in Study 1.

Indirect effect = 292, p < .05, 95% C.I. [243, 2441]; low: Indirect effect = 150, n.s., 95% C.I. [−195, 792]), customer willingness to maintain a long-term relationship (high: Indirect effect = 0.15, p < .05, 95% C.I. [0.03, 0.36]; low: Indirect effect = 0.02, n.s., 95% C.I. [−0.03, 0.13]) and to recommend (high: Indirect effect = 0.10, p < .05, 95% C.I. [0.01, 0.23]; low: Indirect effect = 0.02, n.s., 95% C.I. [−0.02, 0.09]) via customer satisfaction. Overall, Hypotheses 3(a), (b), and (c) were supported. In terms of Hypothesis 4, the results showed that the indirect effects of surface acting on long-term customer outcomes did not differ across higher/lower levels of relationship strength. Therefore, Hypotheses 4(a) to (c) were not supported.

4.2.2. Relationship strength as a boundary condition: a moderated mediation model In order to test Hypotheses 3 and 4, we first examined whether relationship strength can moderate the associations between deep acting/surface acting and customer satisfaction. As revealed in Model 3 of Table 2, relationship strength negatively moderated the surface acting-customer satisfaction (β = −0.18, p < .05) but positively moderated deep acting-customer satisfaction (β = 0.21, p < .05) relationships, respectively. In order to clarify the forms of moderation, we followed Aiken and West's (1991) approach to plot both relationships under high (1 SD above the mean) and low (1 SD below the mean) levels of relationship strength (see Figs. 2 and 3) and applied the simple slope tests to examine the significance of these relationships. Fig. 2 shows that the positive relationship between deep acting and customer satisfaction was strengthened when relationship strength was high (simple slope = 0.47, p < .01). However, this relationship is attenuated when relationship strength was low (simple slope = 0.13, p < .10). The Johnson-Neyman technique suggests that the relationship between deep acting and customer satisfaction becomes non-significant when the value of the relationship strength is smaller than 3.62. Further, Fig. 3 reveals that surface acting was negatively related to customer satisfaction when relationship strength was high (simple slope = −0.15, p < .05), supporting our expectation. However, this relationship becomes non-significant when relationship strength was low (simple slope = 0.13, n.s.). Finally, the relationship between surface acting and customer satisfaction becomes significant when the value of the relationship strength is larger than 4.71. We applied Hayes' (2012) PROCESS program to calculate the CIs of the proposed indirect effects under high/low levels of relationship strength. The results show that relationship strength enhanced the indirect effects of deep acting on the amount of insurance purchase (high:

5. Study 1 discussion and limitations In Study 1, based on a sample of insurance sales agents, we examined whether EL strategies can predict customer long-term outcomes via customer satisfaction and whether relationship strength can moderate the proposed indirect effects. As expected, agents' deep acting increased customers' satisfaction with their service, motivating customers to purchase more, build long-term relationships with the agents, and recommend the agents' service to others. The benefits of deep acting were particularly salient when customers have a stronger relationship with them. However, the proposed negative effects of agents' surface acting on customer satisfaction as well as long-term outcomes were not significant. In addition, surface acting had a slightly positive relationship with customer satisfaction and recommendations (r = 0.19 and 0.24, respectively; See Table 1). Since the sampled agents were relatively senior (mean tenure = 8.96 years), they might have had greater experience and skill in regulating emotions (Wang et al., 2011) thereby making their surface acting less negative. Although the results of Study 1 partially supported the proposed

3.8

Customer Satisfaction

3.3

High RS Low RS 2.8

2.3

Surface Acting Fig. 3. The moderating effect of relationship strength (RS) on the surface acting-customer satisfaction relationship in Study 1. 7

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ranged from 21 to 70 years old (M = 35.45, SD = 12.16). Finally, the average interaction frequency between employees and the chosen customers was 4.86 times per month (SD = 5.17), suggesting the onemonth interval between Time 1 and Time 2 was sufficient for service employees and the corresponding customers to interact.

hypotheses, several limitations need to be noted. First, we tested our hypotheses in a single organization and single occupation (i.e., insurance sales agents). Thus, it remains unclear whether the Study 1 findings can be generalized into other occupations required repetitive customer-employee interactions. Second, as noted above, the participants were relatively senior and thus might make their EL strategies more effective (Grandey & Gabriel, 2015; Wang et al., 2011). Finally, we did not explore the role of service employees' relationship-oriented behaviors in the EL processes. We conducted Study 2 to address these limitations.

6.1. Measures All Study 2 items are listed in Appendix B. 6.1.1. Emotional labor Study 2 used the same scale as Study 1. The Cronbach's alpha coefficients for surface acting and deep acting were 0.91 and 0.72, respectively.

6. Study 2 method In Study 2, we collected 177 paired frontline service employeecustomer questionnaires from 79 service organizations in Taiwan (i.e., 1 to 5 service employees were chosen from each service organization).4 In order to enhance the generalizability of Study 1 findings to other service occupations involved repeated service interactions, and compare them with previous studies that conducted in the context of service encounters (e.g., Gabriel et al., 2015; Wang & Groth, 2014), we chose to collect data from diversified service occupations that fit the three characteristics proposed by Gutek et al. (2000): (a) service employees and customers are able to identify the specific individual with whom they interacted; (b) service employees and customers expect to interact with the same individual in the future; and (c) there is a history of shared interactions between employees and customers.5 These occupations include: financial service agents (26.5%), insurance sales agents (20%), travel agents (15%), self-enrichment instructors (14%), real estate sales agents (10%), hairstylists (5%), meeting, convention, and event planners (5%), and travel guides (4.5%). We sent invitations to 90 human resource professionals who worked in different service industries, and 79 of them agreed to serve as the designated coordinator for their organization. The procedure of Study 2 was the same as Study 1. We employed the time-lag design (i.e., one month) to collect customer data from one customer for each participating employee to avoid the non-independence problem. A total of 249 sets of paired questionnaires were distributed. After dropping unmatched questionnaires, we obtained successfully matched questionnaires from 177 employee-customer dyads, resulting in a valid response rate of 71%. The sample characteristics were as follows: service employees were mostly female (63%), ranged from 20 to 59 years old (M = 32.14, SD = 7.48), and had an average tenure with their current organization of 6.31 years (SD = 6.67). As for the customers, they were mostly female (66%) and

6.1.2. Service sweethearting behavior We used Brady et al.'s (2012) five-item scale to measure service employees' service sweethearting behaviors. Responses were made based on a 7-point Likert scale (1 = never and 7 = always). The Cronbach's alpha was 0.85. We conducted a pilot-study to interview 20 participants from the service occupations involved in Study 2 to verify whether these occupations are appropriate for testing the moderating effect of sweethearting. The results show that participants were able to provide examples of sweethearting behaviors in these occupations (see Appendix C) that are consistent with service sweethearting scale items (e.g., intentionally undercharge the customer for service; provide the customer with goods and services that he/she didn't pay for), suggesting that service employees engage in sweethearting behaviors across these occupations, and the scale is suitable to measure service sweethearting behaviors across them. 6.1.3. Relationship strength We used the same scale as Study 1 to measure relationship strength. The Cronbach's alpha coefficient for this scale was 0.80. 6.1.4. Customer satisfaction with employee We used the same scale as Study 1 (i.e., Brady et al., 2012) to measure customer satisfaction with the service employees. The Cronbach's alpha coefficient for this scale was 0.95. 6.1.5. Customer willingness to maintain a long-term relationship with employee As in Study 1, Liao and Chuang's (2007) scale was used to measure customers' willingness to maintain a long-term relationship with the employee. The Cronbach's alpha was 0.92.

4 Since we collected more than one employee response in some organizations, we assessed the extent to which service employees' responses might be influenced by the non-independence problem by calculating ICC (1) values for all study variables (i.e., including employee and customer ratings). The ICC (1) values ranged from 0.01 to 0.10 for all study variables, suggesting that nonindependence was not a serious concern and did not require multilevel analyses (Bliese, 2000). Similarly, as the data was collected from 10 different service occupations, we also examined whether service employees' responses were influenced by occupational differences. We calculated the ICC (1) values again and found that the values ranged from 0.00 to 0.05, which indicates that employees' responses were not influenced by the occupational difference. 5 Although collecting data from diverse service occupations helps to enhance the generalizability of our findings, the occupational differences might also influence the major variables. In order to alleviate this concern, we conducted several ANOVAs to examine if occupational difference influence the levels of our major variables. The results indicate that the means of surface acting (F = 1.09, n.s.), deep acting (F = 0.77, n.s.), service sweethearting behaviors (F = 1.39, n.s.), relationship strength (F = 0.54, n.s.), customer satisfaction with the service employees (F = 1.35, n.s.), customer willingness to maintain a long-term service relationship (F = 1.16, n.s.) and to recommend (F = 0.92, n.s.) did not differ significantly across different occupations. Thus, these occupational differences are unlikely to have adversely influenced our findings.

6.1.6. Customer willingness to recommend employee We used the same scale as Study 1 (i.e., Groth et al., 2009) to measure customer willingness to recommend. The Cronbach's alpha was 0.93. 6.1.7. Control variables As in Study 1, we controlled for the gender of service workers and customers (1 = male; 2 = female), employee tenure (Mean = 6.31; SD = 6.67) (in years), and interaction frequency during the subsequent one month (Mean = 4.86; SD = 5.17) in the analyses. Finally, service employees' professional competence also influences customers' service evaluations and satisfaction (Price et al., 1995; Tsai, 2001). Thus, we asked customers to evaluate employees' service skills and knowledge using Tsai's (2001) three-item scale. The Cronbach's alpha coefficient for this scale was 0.92. 6.1.8. Data analysis We followed the same procedure as Study 1 to test Hypotheses 1–6. All VIF values were below 10.0 (ranged from 1.01 to 1.29). 8

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Table 3 Descriptives and bivariate correlations among the Study 2 variables. Variable

M

S.D.

1

2

3

4

5

6

7

8

9

Control variables 1 Customer gender 2 Employee gender 3 Employee tenure1 4 Interaction frequency 5 Professional competence

1.67 1.63 6.31 4.86 4.15

0.47 0.48 6.67 5.12 0.67

– 0.18* -0.05 −0.02 −0.15*

– 0.24** −0.17* −0.11

– −0.12 0.01

– −0.05

(0.93)

Predictor and moderators 6 Surface acting 7 Deep acting 8 Relationship strength 9 Service sweethearting

3.40 5.74 3.84 3.84

1.59 0.96 0.78 1.36

−0.06 −0.07 −0.00 −0.13

−0.11 0.09 −0.08 −0.37**

−0.14 0.03 0.05 −0.22**

0.02 −0.00 −0.01 −0.01

−0.08 0.25** 0.19* 0.20**

(0.92) −0.09 −0.01 0.24**

(0.71) 0.18* 0.03

(0.78) 0.11

(0.86)

Mediators and outcomes 10 Customer satisfaction2 11 Maintain relationship3 12 Recommend4

5.92 5.42 5.47

0.81 0.96 1.09

−0.01 −0.03 0.10

0.03 −0.06 0.02

−0.12 −0.07 −0.12

0.08 0.11 0.08

0.22** 0.07 0.09

−0.21** −0.00 −0.19*

0.23** 0.20** 0.28**

0.15* 0.20** 0.17*

0.07 0.05 0.07

10

11

12

(0.95) 0.57** 0.52**

(0.93) 0.37**

(0.94)

*p < .05; **p < .01 (two-tailed). N = 177. Cronbach's alpha coefficients are presented in boldface on the main diagonal. Note 1: in years. Note 2: Customer satisfaction with the service employee. Note 3: Customer willingness to maintain a long-term relationship with employee. Note 4: Customer willingness to recommend employee.

[−0.02, −0.12] and [−0.02, −0.15], respectively). Therefore, Hypotheses 2(b) and (c) also received support. Based on the Models 4 and 5 of Table 4, customer satisfaction fully mediated the association between surface acting and customer willingness to maintain a longterm relationship/to recommend since the direct effects of surface acting on both outcomes were not significant.

7. Study 2 results The means, standard deviations, reliabilities, and correlations among the Study 2 variables are presented in Table 3. 7.1. Confirmatory factor analyses The CFA results show that the hypothesized 8-factor model (i.e., surface acting, deep acting, customer satisfaction, customer willingness to maintain a long-term relationship/to recommend, relationship strength, service sweethearting, and professional competence) fit the data well (χ2 [377] = 778.62; CFI = 0.95, NFI = 0.91; NNFI = 0.94, IFI = 0.95, SRMR = 0.07, RMSEA = 0.07). The AVE and CR of each construct ranged from 0.83 to 0.94 and the AVE of each construct was greater than its squared correlations with other constructs. Moreover, the results show that the 95% CIs around the correlations among the study variables did not include 1.0. This information provides evidence for good convergent and discriminant validity of the measures (Anderson & Gerbing, 1988; Fornell & Larcker, 1981).

7.2.2. Relationship strength as a boundary condition: a moderated mediation model Model 3 in Table 4 reveals that relationship strength significantly moderated the surface acting-customer satisfaction relationship (β = −0.16, p < .05) as well as the deep acting-customer satisfaction relationship (β = 0.16, p < .05). We also plotted the forms of interactions and applied the simple slope tests to examine the significance of these relationships (see Figs. 4 and 5). Fig. 4 shows that deep acting was positively related to customer satisfaction when relationship strength was high (simple slope = 0.32, p < .01) but non-significant when relationship strength was low (simple slope = 0.06, n.s.). The JohnsonNeyman technique suggested that the relationship between deep acting and customer satisfaction becomes non-significant when the value of relationship strength is smaller than 3.51. Moreover, Fig. 5 indicates that the negative surface acting-customer satisfaction relationship was strengthened when relationship strength is high (simple slope = −0.26, p < .01), but not significant when relationship strength is low (simple slope = −0.01, n.s.). The Johnson-Neyman technique indicated that the relationship between surface acting and customer satisfaction becomes significant when relationship strength exceeds 3.95. Furthermore, the PROCESS program shows that relationship strength positively moderated the indirect effects of deep acting on customer willingness to maintain a long-term service relationship (high: Indirect effect = 0.18, p < .05, 95% C.I. [0.08, 0.34]; low: Indirect effect = 0.05, n.s., 95% C.I. [−0.06, 0.16]) and willingness to recommend (high: Indirect effect = 0.17, p < .05, 95% C.I. [0.06, 0.33]; low: Indirect effect = 0.05, n.s., 95% C.I. [−0.05, 0.15]) via customer satisfaction. Hence, Hypotheses 3(b), and (c) were supported. Finally, the results indicate that relationship strength moderated the negative indirect effects of surface acting on customer willingness to build a long-term relationship (high: Indirect effect = −0.09, p < .05, 95% C.I. [−0.01, −0.19]; low: Indirect effect = −0.04, n.s., 95% C.I. [−0.10, 0.02]) and willingness to recommend (high: Indirect effect = −0.08, p < .05, 95% C.I. [−0.01, −0.16]; low: Indirect effect = −0.03, n.s., 95% C.I. [−0.10, 0.01]). Therefore, Hypotheses

7.2. Hypothesis testing 7.2.1. The effects of EL strategies on customer long-term outcomes via customer satisfaction Model 1 in Table 4 indicates that deep acting positively predicted customer satisfaction (β = 0.17, p < .05), whereas surface acting was negatively associated with customer satisfaction (β = −0.19, p < .01). Furthermore, Models 4 and 5 in Table 4 show that customer satisfaction was positively related to customer willingness to maintain the relationship (β = 0.61, p < .01) and to recommend (β = 0.41, p < .01). Moreover, the results of PROCESS program indicate that deep acting positively predicted customer willingness to maintain a long-term service relationship and willingness to recommend indirectly via customer satisfaction (the 95% C.I.s were [0.04, 0.22] and [0.03, 0.19], respectively). Again, Hypotheses 1(b) and (c) were supported. Based on Models 4 and 5 in Table 4, customer satisfaction fully mediated the association between deep acting and customer willingness to maintain the relationship, and partially mediated the association between deep acting and customer willingness to recommend. In addition, we found that surface acting decreases customer willingness to maintain a long-term service relationship and willingness to recommend indirectly through reduced customer satisfaction (the 95% C.I.s were 9

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Table 4 Study 2 Results of hierarchical regression analyses. Variables

Customer satisfaction with the service employee

Step 1 Customer gender Employee gender Employee tenure Interaction frequency Professional competence Deep acting Surface acting Customer satisfaction Step 2 Relationship strength (RS) Service sweethearting (SS) Step 3 Deep acting ∗ RS Surface acting ∗ RS Deep acting ∗ SS Surface acting ∗ SS △R2, each step Total R2

Maintain relationship3

Recommend3

Model 1

Model 2

Model 3

Model 4

Model 5

0.01 0.06 0.16* 0.08 0.17* 0.17* 0.19**

0.01 0.10 0.16* 0.09 0.14† 0.15* 0.21**

0.04 0.13 0.18* 0.11 0.13† 0.18* 0.18*

−0.01 −0.07 0.03 0.07 0.11 0.09 −0.12 0.61**

0.12 0.02 −0.07 0.06 0.06 0.18** −0.10 0.41**

0.10 0.07

0.04 0.06

0.10 −0.07

0.05 0.08

0.02 0.17**

0.16* 0.16* 0.16* 0.15* 0.07** 0.24**

0.03 −0.04 0.04 0.07 0.43** 0.43**

0.15** 0.15**

0.05 −0.03 0.10 0.02 0.35** 0.35**

Note 1: Standardized regression coefficients (β) are shown in each equation. N = 177; † p < .10; * p < .05; ** p < .01 (two-tailed) Note 2: The results were unchanged if all control variables were removed. Note 3: Customer willingness to maintain a long-term relationship with employee and customer willingness to recommend employee, respectively.

sweethearting enhanced the indirect effects of deep acting on customers' willingness to build a long-term relationship (high: Indirect effect = 0.19, p < .05, 95% C.I. [0.10, 0.35]; low: Indirect effect = 0.01, n.s., 95% C.I. [−0.10, 0.13]) and willingness to recommend (high: Indirect effect = 0.20, p < .05, 95% C.I. [0.11, 0.36]; low: Indirect effect = 0.02, n.s., 95% C.I. [−0.11, 0.14]) via customer satisfaction. Overall, Hypotheses 5(a) and (b) were supported. Finally, the results indicate that service sweethearting attenuated the negative indirect effects of surface acting on customer willingness to maintain relationship (high: Indirect effect = −0.01, n.s., 95% C.I. [−0.09, 0.05]; low: Indirect effect = −0.12, p < .05, 95% C.I. [−0.20, −0.04]) and to recommend (high: Indirect effect = −0.01, n.s., 95% C.I. [−0.08, 0.07]; low: Indirect effect = −0.11, p < .05, 95% C.I. [−0.21, −0.02]) via customer satisfaction. Thus, Hypotheses 6(a) and (b) also received support.

4(b) and (c) were also supported.

7.2.3. Service sweethearting as a boundary condition: a moderated mediation model As revealed in Model 3 of Table 4, service sweethearting positively moderated both the surface acting-customer satisfaction (β = 0.15, p < .05) and deep acting-customer satisfaction (β = 0.16, p < .05) relationships. The forms of moderation are shown in Figs. 6 and 7. Fig. 6 depicts that the positive deep acting-customer satisfaction relationship was strengthened when the frequency of service sweethearting is high (simple slope = 0.34, p < .01), but became non-significant (simple slope = 0.05, n.s.) when the frequency is low. The Johnson-Neyman technique revealed that this relationship becomes non-significant when the value of service sweethearting falls below 3.51. Moreover, Fig. 7 reveals that surface acting was negatively related to customer satisfaction when the frequency of service sweethearting is low (simple slope = −0.25, p < .01), but became non-significant when frequency is high (simple slope = 0.01, n.s.). The JohnsonNeyman technique revealed that this relationship becomes non-significant when the value of service sweethearting exceeds 4.50. Furthermore, the PROCESS program shows that service

8. General discussion Previous studies have examined the immediate effects of EL on short-term customer outcomes in the context of service encounter (see Appendix A). The present study extends prior findings by examining the

6

5.5

High RS

Customer Satisfaction

Low RS 5

4.5

Deep Acting Fig. 4. The moderating effect of relationship strength (RS) on the deep acting-customer satisfaction relationship in Study 2. 10

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6

5.5

Customer Satisfaction

High RS Low RS 5

4.5

Surface Acting Fig. 5. The moderating effect of relationship strength (RS) on the surface acting-customer satisfaction relationship in Study 2.

negative surface acting-satisfaction association. These patterns are consistent with the findings in the context of strong interpersonal relationships (Butler et al., 2003; Liu & Perrewe, 2006; Seger-Guttmann et al., 2012). Hence, it is important for service employees to display authentic emotions (deep acting) and avoid faking emotions (surface acting) in repetitive service interactions when customers have a strong relationship with the employees. Although Wang and Groth (2014) and Gabriel et al. (2015) documented that relationship strength between customers and employees can weaken the effect of employees' emotional displays on customer outcomes, their studies were conducted in the short-term service encounters where the duration of service interaction is limited and customers might interact with different service employee next time (Gutek et al., 2000). This reduced customers' opportunity and motivation to “verify” employees' emotional authenticity, making the displays less influential in terms of their service evaluations (Groth et al., 2009). However, we re-examined the moderating role of relationship strength on the EL processes across two samples that require service employees to interact with the same customers repetitively, such settings increase customers' opportunity and motivation to evaluate employees' sincerity. Thus, service employees who engaged in deep (surface) acting during service interactions can enhance (harm) long-term customer outcomes in the future.

lagged effects of EL on long-term customer outcomes as well as the roles of relational moderators on the EL processes in the context of service relationship. Overall, our findings have the following theoretical and practical implications. 8.1. The effects of EL on long-term customer outcomes In order to replicate and extend previous findings of EL, we conducted two studies with different service occupations and employed time-lag design to examine the relationships between service employees' EL strategies and long-term customer outcomes. Across two studies, we found that deep acting increases customer satisfaction with the service employee, thereby motivating the customers to purchase more from this employee (Study 1), continue the service relationship and recommend this service employee to their friends after a few months. In contrast, employees who engaged in more surface acting reduced customers' satisfaction, such that customers were less willing to maintain a relationship with them or recommend him/her after repetitive service interactions (Study 2). Moreover, the present study is one of the first to answer Grandey and Gabriel's (2015) call to demonstrate the beneficial effects of deep acting on customer purchase decisions. Overall, our findings extend prior findings (see Appendix A) by showing that EL strategies can predict long-term customer outcomes after repetitive service interactions.

8.1.2. The importance of service sweethearting behaviors Although researchers tend to view service sweethearting as an illegal behavior since it causes ethical and financial problems for organizations (Brady et al., 2012), we find that such behavior can be beneficial when service employees have to repeatedly interact with the same customers. Building on the perspective of customer-oriented

8.1.1. Reconsidering the moderating role of relationship strength The present study also examined how the relational moderators influence the effects of EL strategies on long-term customer outcomes. Specifically, we found that relationship strength not only strengthened the positive deep acting-satisfaction relationship, but also amplified the 6

5.5

Customer Satisfaction

High SS Low SS 5

4.5

Deep Acting Fig. 6. The moderating effect of service sweethearting (SS) on the deep acting-customer satisfaction relationship in Study 2. 11

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6

5.5

Customer Satisfaction

High SS Low SS 5

4.5

Surface Acting Fig. 7. The moderating effect of service sweethearting (SS) on the surface acting-customer satisfaction relationship in Study 2.

agents, or travel agents), the positive effects of deep acting as well as the negative effects of surface acting on customer satisfaction and longterm outcomes are strengthened by strong relationships. Service employees who need to serve familiar customers repetitively should be encouraged to emphasize pleasure-oriented display actions (e.g., be excited and enthusiastic during service interactions) rather than suppression-oriented display actions (e.g., hide your true feelings when you are down) to display sincere positive emotions and inhibit faked ones. Finally, the present study also indicates that service sweethearting behaviors are effective in terms of enhancing the positive effects of deep acting as well as alleviating the negative effects of surface acting on customer satisfaction and long-term outcomes. Thus, for service employees who have to continually interact with the same customers in the future (e.g., insurance sale agents, financial service agents, or travel agents), service organizations can formally provide them with a fixed quota of discounted services or free gifts, so that they can provide these resources to important customers. By doing so, service employees of these occupations will be better able to exceed customers' expectations and increase the effectiveness of their emotional displays.

deviance literature (Boukis, 2016; Leo & Russell-Bennett, 2014), our findings indicate that service sweethearting behaviors not only strengthen the positive effects of deep acting, but also mitigate the harmful effects of surface acting on long-term customer outcomes. Our findings contribute to the customer-oriented deviance literature in the following ways. First, most studies on sweethearting or customer-oriented deviance behaviors were conducted in high individualism cultural contexts (e.g., United Kingdom, Boukis, 2016; United States, Brady et al., 2012; and Australia, Leo & Russell-Bennett, 2014), where building and maintaining interpersonal relationships/harmony are not necessarily part of the social values (Hofstede, 1997). However, our paper was conducted in a high collectivism cultural context (i.e., Taiwan; Hofstede, 1997), where fostering stronger interpersonal relationship and building connections with others are embedded within the cultural norms (Hofstede, 2001). Hence, it is plausible that service sweethearting is more effective and acceptable in a collectivistic cultural context than an individualistic one. Second, although not hypothesized, it is interesting to note that service sweethearting was unrelated to all long-term customer outcomes in Table 3 (r = 0.07–0.09, n.s.). In fact, Brady et al. (2012) also found that service sweethearting frequency was not related to most customer outcomes. It is plausible that customers' involvement in the sweethearting processes (i.e., whether customers are complicit in the sweethearting collaboration) is more critical in determining customers' attitudes than the frequency of service sweethearting (Brady et al., 2012).

8.1.4. Limitations and future research Although we have made every attempt to ensure the validity of the research findings, some limitations should be acknowledged. First, we collected the data from the same customers at two different time phases to examine the lagged effects of EL on long-term customer outcomes. Although the time-lag design can reduce issues related to common method variance (Podsakoff, MacKenzie, & Podsakoff, 2012) and reversed causality, some very dissatisfied customers may not have continued after the first survey, leading to a restricted range of customer satisfaction (Study 1: M = 4.01, SD = 0.84; Study 2: M = 5.83; SD = 0.85). This would attenuate the observed EL-customer satisfaction relationship and customer satisfaction-long-term outcomes associations. Although our data provides a relatively conservative estimate of the hypothesized relationships, most of our findings are statistically significant and consistent with our expectations. Future researchers could collect a more diversified customer sample that intentionally includes both satisfied and dissatisfied customers to see if our findings can be generalized to the latter. Second, although we examined the effectiveness of EL strategies on the amount of customer purchase in Study 1, we did not include this dependent variable in Study 2 since it is not applicable to all service occupations in Study 2 (e.g., self-enrichment education teachers/instructors; travel guides). Thus, we were not able to test the hypotheses regarding customer purchase in Study 2. Future researchers can include more general measures to capture customer purchase (e.g., purchase decision or intentions) in order to demonstrate the effects of EL strategies on organizational financial gains (Grandey & Gabriel, 2015).

8.1.3. Practical implications The present findings provide several insights for service organizations in regards to managing their employees. First, for service occupations that involve repeated service interactions (e.g., insurance sale agents, financial service agents, or travel agents), employees' deep acting should be encouraged whereas surface acting should be avoided. Hence, service organizations can select service employees who tend to display authentic positive emotions (e.g., high agreeableness) or are less likely to fake emotions (e.g., high extraversion and conscientiousness) (Chi & Grandey, in press; Diefendorff, Croyle, & Gosserand, 2005) by employing personality tests or situational judgment interviews. Furthermore, it will be useful for the service organizations to design extensive training on emotion management to help employees of these service occupations to develop their deep acting skills, such as having them role-play as customers and frontline employees in turn, and then sharing about their experiences in different roles (Noe, 2008). Instructors can also demonstrate how to reappraise negative service situations, and change cognitions in order to better serve customers. Second, in service occupations that involve repetitive customeremployee interactions (e.g., insurance sale agents, financial service 12

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between EL strategies and customer satisfaction using experimental designs (e.g., Grandey et al., 2005; Hennig-Thurau et al., 2006), which might mitigate the concern of reverse causality between EL and customer satisfaction. We encourage future researchers can tackle this issue by collecting data from multiple service interactions and employ cross-lagged panel analysis (e.g., Lian, Ferris, Morrison, & Brown, 2014) to determine the direction of causality between EL and customer satisfaction.

Finally, we collected the data regarding EL and customer satisfaction at the same time. Thus, the causality between EL and customer satisfaction is unclear. However, we have conceptualized service employees' EL as general tendencies to engage in deep or surface acting towards a given customer (see Appendix B). It is plausible that customer's satisfaction towards the service employees are determined by employees' stable patterns of EL across multiple service interactions. Furthermore, previous studies have confirmed the causal relationship

Appendix A. Summary of published evidence for the EL-customer outcomes

Article

Sample and type of service The relationships between EL and interaction customer outcomes

Moderators

Pugh (2001)

220 bank teller-customer service encounters

.

Tsai (2001)

284 shoe store clerkcustomer service encounters 352 shoe store clerkcustomer service encounters

Tsai and Huang (2002) Grandey et al. (2005, Study 2) Barger and Grandey (2006) HennigThurau et al. (2006) Groth et al. (2009)

Chi et al. (2011, Study 1) Wang and Groth (2014)

Gabriel et al. (2015, Study 2)

255 restaurant servercustomer service encounters

Positive emotional displays are positively related to customer perceived service quality (r = 0.23). Positive emotional displays are positively related to customer reactions (r = 0.23)

.

Positive emotional displays are positively related to customer perceived friendliness (r = 0.28) and behavioral intentions (r = 0.20) Display authenticity is positively related to Context customer perceived friendless (r = 0.37) busyness and encounter satisfaction (r = 0.37)

Encounter smiling is positively related to customer perceived service quality (r = 0.22) and encounter satisfaction (r = 0.20). 223 confederate-customer Display authenticity is unrelated to service encounters customer encounter satisfaction (Beta = −0.06) but positively related to customer employee rapport (Beta = 0.45) (based on the results of path analyses) Employee DA is positively related to 285 employee-customer perceived customer orientation (r = 0.13) service encounters (most and service quality (r = 0.17), whereas SA are moderate-contact is unrelated to perceived customer services) orientation and service quality. DA leads to exceeded expectations 404 restaurant server(γ = 0.13) and more tips (γ = 0.64), customer service whereas SA is unrelated to these outcomes encounters (based on HLM results) Faking positive emotions is unrelated to 243 employee-customer service encounters (most of (r = −0.01), whereas suppressed negative emotions is negatively related to them are store and encounter satisfaction (r = −0.22). restaurant employees)

Results of the moderating effects

Context busyness attenuates the positive effects of authenticity

173 food shop employeecustomer service encounters

Service type (high/ moderate contact)

Service type did not moderate the effects of EL on customer outcomes

Relationship strength; service personalization

Relationship strength weakens, whereas service personalization strengthens the negative relationship between suppressed negative emotions and satisfaction Service familiarity weakens the positive effects of positive emotional displays

208 coffee/sandwich shop Positive emotional displays are positively Service employee-customer service related to customer perceived friendliness familiarity encounters (r = 0.40) and encounter satisfaction (r = 0.46)

Appendix B. Items of the Studies 1 and 2 measures (ordered alphabetically)

Constructs and source of items

Items used in Studies 1 and 2 (in parentheses)

Customer satisfaction with employee (three items; Brady et al., 2012).

Overall, I am happy that I got service from this agent (employee). Overall, I am satisfied with my decision to buy insurance coverage from this agent 13

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(employee). Overall, I think I did the right thing when I got service from this agent (employee). Customer willingness to maintain a long-term relationship with I will continue to see this agent (employee) for his/her service. employee I will use the service of this agent (employee) on a regular basis. (four items; Liao & Chuang, 2007) I will maintain a long-term service relationship with this agent (employee). I will regard this agent (employee) as my first choice when necessary Customer willingness to recommend employee I will say positive things about this agent to other people. (four items; Groth et al., 2009) I will encourage friends and relatives to buy insurance coverage from this agent (to do business with this employee). I will recommend this agent (employee) to someone who seeks my advice I would recommend this agent (employee) when I chat with my friends. Deep acting When interacting with this customer: (three items; Brotheridge & Lee, 2002) I try to actually experience the emotions I must show to this customer I make an effort to actually feel the emotions that I need to display towards this customer. I work hard to feel the emotions that I need to show to this customer. Professional competence (Study 2) This employee has a great deal of knowledge about how to propose the right (three items; Tsai, 2001) suggestions for customers. I often like the suggestions proposed by this employee. I am sure that this employee can propose better suggestions for me than his/her colleagues. How well do you know the agent (employee) who served you? Relationship strength I know my agent (this employee) fairly well. (one item from Wang & Groth, 2014 and two items I have repeated interactions with this insurance agent (employee). from Gabriel et al., 2015) Service sweethearting (Study 2) How often do you give away goods and services to this customer? (five items; Brady et al., 2012) How often do you intentionally undercharge this customer for service? How often do you provide this customer with goods and services that he/she didn't pay for? How often do you hook this customer up with special treatments (e.g., free or discounted goods and services)? How often do you hook up this customer by providing extra benefits? Surface acting When interacting with this customer: (five items; Grandey, 2003) I just pretend to have the emotions I needed to display to this customer. I put on an act in order to deal with this customer in an appropriate way. I fake a good mood. I put on a “show” or “performance”. I put on a “mask” in order to display the emotions I need for the job. Appendix C. Examples of service sweethearting behaviors in different occupations

Occupations

Examples of service sweethearting behaviors

Financial service agents

Giving out unauthorized free gifts (e.g., company calendars or notebooks) without permission to familiar customers to maintain their personal relationship. Providing unauthorized goods (e.g., expensive hair conditioners or treatments) to customers in order to become their primary stylist. Giving out unauthorized free gifts (e.g., company calendars or notebooks) without permission to familiar customers to maintain their personal relationship. Providing unauthorized services (e.g., better catering, equipment, or facilities at a lower price) to familiar clients in order to earn more business from these clients. Providing favorable prices to familiar clients. Although this reduces company's profits, it can increase commissions from the satisfied clients in the long-run. Offering discounted or free courses to certain important customers (e.g., a person in charge of employee training and development plan) in order to earn more course invitations and get the higher ranking (e.g., five star instructor) than other instructors in the same company. Providing unreasonable low prices or discounts to important customers (e.g., a person in charge of employee traveling plans) in order to earn large-scale orders and win the competition among coworkers in the same company. Providing extra services to the customers (e.g., additional tour options or discounted goods) to receive tips.

Hairstylists Insurance sales agents Meeting, convention, and event planners Real estate sales agents Self-enrichment education teachers/instructors Travel agents

Travel guides

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Nai-Wen Chi is Professor of the Institute of Human Resource Management at National Sun Yat-Sen University, Taiwan. His primary research focuses on group affect, emotional labor, team composition, and employee attitudes and behaviors. His work has been published in Journal of Applied Psychology, Journal of Management, Organizational Behavior and Human Decision Processes, Journal of Vocational Behavior, Journal of Organizational Behavior, Personnel Psychology, Journal of Occupational and Organizational Psychology, and other outlets. Pei-Chi Chen is the Ph. D. Candidate of Department of Business Management at National Sun Yat-Sen University, Taiwan. Her primary research focuses on consumer behaviors, cause-related marketing, service management, emotions in service encounters, and brand management. Her work has been published in Journal of Advertising Research, International Journal of Advertising, Psychology & Marketing and other outlets.

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