|The study aims to develop insight about the specific importance of trustworthiness dimensions (ability, integrity, benevolence) for retailer customer loyalty in a subsistence context characterized with high rates of corruption and crime, namely that of Nairobi’s informal settlements (slums). To our knowledge, this is the first study of the relative impact of trustworthiness dimensions on retailer loyalty in a subsistence market setting. Differences between service- and product-oriented firms are also investigated.
Despite low literacy rates, data was gathered from 566 face-to-face interviews in Nairobi’s informal settlements based on a quantitative questionnaire. Multiple regression and structural equations modeling are used to test effects.
The findings show that trustworthiness, especially integrity and benevolence, of retailer business people are important factors in order to gain subsistence customers’ loyalty, also when perceived quality is controlled for. The effect of integrity is significantly larger than that of ability. Perceived quality partially mediates the effect of integrity on loyalty, and fully mediates the effect of ability, meaning ability only affects loyalty by increasing quality perceptions, while integrity affects loyalty both directly and through quality perceptions. Integrity is even more important in service-firms compared to in product-oriented firms.
Limitations include that the measures should be developed further in order to measure the constructs clearer in this kind of context. More constructs from the marketing mix could be included, e.g. price/value. Replication with a different sample would be beneficial in order to generalize the effects.
The findings indicate that integrity and benevolence are important factors that should be considered in future research modeling subsistence customers’ retailer loyalty. In practice, integrity and benevolence should be key focus areas in the training of entrepreneurs in subsistence markets. On the micro-level this can help retailers build loyal customers; on a higher level this can help communities reduce inequality and poverty.