Social and Institutional Foundations for Trust in Customer-Financial Advisor Relationships: the moderating role of relationship length

Marketing

Centre for Marketing Working Paper

2000

Research on trust in marketing has focused primarily on process-based trust, which is the trust that grows between two specific exchange partners based on their interactions together. Yet, scholars outside of marketing have argued that trust between exchange partners is influenced by types of trust that have a broader scope of influence than process-based trust. These include role trust, institution-based trust, and generalized trust. Using survey results collected from 586 clients of financial advisors from four banks, we test competing theories about the influence of these broad-scope trusts on process-based trust. Our results show that broad-scope trust provides a foundation for process-based trust in exchange relationships. We also show that the influence of different types of broad-scope trust can change, depending on the type of trust and on the age of the relationship. Our results also suggest that a serious breach of trust at the individual level can affect trust at a broader level. Lastly, we show that process-based trust can (again depending on relationship length) have a direct association with business outcomes, although the influence of broad-scope trust on business outcomes tends to be mediated by process-based trust.

Centre for Marketing

00-501

Centre for Marketing Working Paper

No