The Role of Leadership in Salespeople's Price Negotiation Behavior

Seminars - Brown Bag Series
12:00 - 13:30
Meeting room 4.E4.SR03 ' Via Roentgen, 1

The sales force assumes a key role in defending firms’ price levels in price negotiations with customers. The role of interpersonal influence oin affecting whether salespeople successfully defend prices has not been investigated to date. In a broader perspective, the interface of leadership and price negotiation research is barely understood conceptually or empirically. Therefore, using social learning theory and the situational leadership perspective, the authors developed a framework focusing on the idea that salespeople's adoption of their leaders’ price defense behavior (role modeling) will be contingent upon their supervisor's adoption of a transformational style as well as on situational variables rooted in the Motivation-Opportunity-Ability framework (MOA). They tested this model using data collected from 264 matched responses of salespeople and customers in car dealers. Results show that salespeople’s adoption of leaders’ price defense behavior critically depends upon the supervisor's style and salespeople's Motivation and Ability, as well as on customer-related Opportunity. Therefore, this study both extends marketing theory and provides actionable guidance to practitioners on how to improve price defense success through adequate leadership.

Paolo Guenzi, Università Bocconi