Modeling customer equity, SERVQUAL, and ethnocentrism: a Vietnamese case study

Purpose – The purpose of this paper is to explore how the return‐on‐marketing framework and its customer equity drivers (value, brand, and relationship) can be combined with service quality (SERVQUAL) measures to help managers develop strategies for high‐ and low‐ethnocentric Vietnamese customers. Design/methodology/approach – The services literature is employed to propose a framework. The structure of the framework is evaluated from data obtained from self‐administered questionnaires, which are mailed to an automobile firm's customers. To explore the moderating affect of ethnocentrism, the model's proposed relationships and fit statistics are tested by employing multi‐group comparisons (high‐ and low‐ethnocentrism) through structural equation modeling. Findings – Ethnocentrism encourages customers to express loyalty and to spread positive word of mouth about Company X, which is a local automobile manufacturer. High‐ethnocentric customers are also less reactive to Company X's value drivers, including product quality, price, and convenience, than low‐ethnocentric customers. However, high‐ethnocentric customers place greater importance on dealership SERVQUAL than low‐ethnocentric customers. Practical implications – The findings indicate that Southeast Asian managers should consider consumer ethnocentrism a factor that influences marketing planning, as well as ways they can use the return‐on‐marketing and SERVQUAL frameworks for strategic planning. In addition, managers should understand that ethnocentric customers counterbalance their willingness to forgo product quality with augmented expectations of dealership SERVQUAL. Originality/value – This paper combines the product‐focused return‐on‐marketing framework with the SERVQUAL‐focused SERVQUAL framework to show how these elements influence consumers' future behavioral intentions under the moderating influence of ethnocentrism.