Journal of Distribution Science (유통과학연구)

Korea Distribution Science Association (한국유통과학회)
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Effect of Digital Selling Readiness on Salespeople's Customer-Oriented Behavior Through Digital Literacy and Self-Efficacy

  • Hyunseung NA (Department of Business Administration, Mokpo National University) ;
  • Hangeun LEE (Department of Business Administration, Mokpo National University) ;
  • Chankoo YEO (Department of International Trade, Kunsan National University)
  • Received : 2023.11.22
  • Accepted : 2024.02.05
  • Published : 2024.02.29
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Abstract

Purpose: This study systematically examined the concept of digital selling readiness of salespeople. Additionally, this study empirically confirms the sequential mediating roles of digital literacy and salesperson self-efficacy in the impact of digital selling readiness on customer-oriented behavior. Research design, data, and methodology: We collected data from salespeople at a Bank and Financial Service firm in South Korea. A total of 254 salespeople were invited to participate, with 154 surveys returned. After removing the questionnaires with missing values, 150 complete surveys were employed for the analysis. Results: The empirical analysis indicates that digital selling readiness positively affects digital literacy. Digital literacy, in turn, is positively associated with self-efficacy, leading to increased customer-oriented behaviors among salespersons. This study also confirms the sequential mediating effects of digital literacy and self-efficacy in the impact of salespeople's digital selling readiness on customer-oriented behavior. Conclusions: Our research deepens the understanding of how digital selling readiness fosters customer-oriented behavior through the sequential mediating effects of digital literacy and self-efficacy. This study extends the previous model by sequentially involving digital literacy and self-efficacy to better understand the psychological processes of digital selling. The results highlight the role of digital selling readiness in preparing salespeople for digital sales.

Keywords

1. Introduction

Many firms have recently engaged in digital transformation, enabling firms to gain real-time insightsinto customers’ purchasing experiences and accelerate the development of new products and digital channels (e.g., augmented reality, virtual reality, Metaverse, and Omnichannel). These trends also affect sales organizations (Guenzi & Habel, 2020; Guenzi & Nijssen, 2021; Mullins & Agnihotri, 2022).

Since the COVID-19 pandemic, the number of customers making purchasing decisions through digital channels has increased, and subsequently, sales organizations have been rapidly transforming their sales strategies by leveraging digital technologies to enhance customer interactions (Guenzi & Nijssen, 2021; Mullins & Agnihotri, 2022). According to McKinsey (2020), 90% of sales organizations are rapidly moving to digital sales activities such as remote selling and video conferencing. Additionally, 54% of firms responded that a sales strategy using digital technology would be more effective in customer reach and customer service responses than traditional face-to-face sales strategies.

Following these changes, salespeople are required to understand the nature of digital technology and utilize it for various purposes. Thus, existing studies have focused on the digital literacy of salespeople to increase their digital sales capabilities (Na & Lee, 2022; Ribble & Shaaban, 2011; Mullins & Agnihotri, 2022). Digital literacy refers to the ability to use information and data acquired through digital technology for business purposes and customer value (Na & Lee, 2022; Ribbla & Bailey, 2007; UNESCO, 2016). Previousresearch has demonstrated that digital literacy is an important antecedent of self-efficacy in digital sales skills, reduced job stress, and increased job performance (Jung, 2021; Na & Lee, 2022). However, some studies have suggested negative views of the effectiveness of digital literacy (Denning, 2021; Guenzi & Nijssen, 2021). A fundamental reason for these views is that the organization only invested in instrumental support (e.g., digital device support and digital sales space) to increase digital literacy. In other words, many executives invest in digital assets without measuring salespeople’s readiness for digital sales (Mullins & Agnihotri, 2022). Organizations will not be able to increase their digital sales capabilities unless they understand the psychological factors that have led salespeople to embrace digital salestechnology. Despite this important issue, extant studies provide little guidance for identifying the psychological factors related to the acceptance of digital technologiesto increase digital literacy and sales behaviors.

This study aims to better understand the psychological mechanisms involved in digital literacy by extending the findings of previous studies. First, digital selling readiness is a predictor of increasing digital literacy. Digital selling readiness, a personal belief in accepting digital technologies and capabilities (e.g., digital assets) for exchange activities with customers, offers existing studies as an important factor in explaining salespeople’s perceived preparedness toward digital selling activities (Mullins & Agnihotri, 2022).

Second, despite important insights from previous research, one of the most important questions about the effects of digital literacy remains unanswered in the field of digital selling, namely how digital selling readiness influences salespeople’s customer orientations and, specifically, the precise mechanism through which digital selling readiness may increase salespeople’s customeroriented behaviors. With this in mind, we explored the role of self-efficacy as the missing link between digital literacy and salespeople’s customer-oriented behavior.

Finally, we explored how digital selling readiness affects salespeople’s customer-oriented behaviors through the double mediating effects of digital literacy and self-efficacy to explain the underlying reason for the positive relationships between digital selling readiness and salespeople’s customer-oriented behaviors. Consequently, this study aims to shed light on the links between digital selling readiness and salespeople’s customer-oriented behavior by highlighting the intervening roles of digital literacy and self-efficacy

2. Literature Review and Hypotheses Development

2.1. Digital Selling Readiness and Digital Literacy

Owing to rapid digital transformation, firms have moved away from customer relationship management strategies that rely on simple offline channels, and customers have also naturally accepted interactions and purchasing behaviors with companies through digital channels. This is not limited to purchasing behavior but is also applied to various purchasing decision-making stages, such as information search and post-purchase stages (Min & Jang, 2020). Therefore, digital technology-based sales capabilities are essential for salespeople to achieve sales targets and high performance (Giovannetti et al., 2020; Tanner & Shipp, 2005).

According to change readiness theory, employee readiness for change plays a central role in its success (Rafferty et al., 2013). Employee readiness refers to “an individual’s inclination or belief to accept new changes and technologies in achieving individual job goals” (Armenakis et al., 1993; Jones et al., 2005) and has been identified as having a substantial impact on organizational change. Additionally, Chonko et al. (2002) suggested that employee readiness is a critical component of an adaptive sales force.

From this perspective, previous studies have claimed the importance of digital selling readiness in increasing salespeople’s digital capabilities(Mullins &Agnihotri, 2022; Guenzi & Nijssen, 2021). Digital selling readiness—a salesperson’s desire to accept digital technology and an individual’s belief in their ability to utilize it (Mullins & Agnihotri, 2022; Rafferty et al., 2013)—is the most prevalent positive attitude toward digital selling. Therefore, salespeople with a high level of digital sales readiness are likely to consider the acceptance of digital technology as valuable to their jobs, and their ability to achieve results based on digital technology will increase (Armenakis et al., 1993; Weiner, 2009; Mullins & Agnihotri, 2022).

The formation process of outcomes resulting from digital selling readiness can be explained by selfdetermination theory. According to the self-determination theory, an individual’s behavior and personality development occur along a continuum called selfdetermination, and a person’s position on this continuum is determined by the type of motivation an individual possesses (Ryan & Deci, 2000).

Motivation is generally divided into intrinsic and extrinsic motivation. Intrinsic motivation refers to motivation that causes behavior, such as enjoyment of the task itself, and is internal to the individual. In contrast, extrinsic motivation refers to the fact that the motivation for a behavior is an external stimulus, such as a reward or punishment (Deci & Ryan, 2000). Therefore, behavior driven by intrinsic motivation means that an individual autonomously adjusts their behavior, whereas behavior driven by extrinsic motivation means that behavior is controlled by external regulations rather than by an individual’s sense of autonomy (Ryan & Deci, 2000).

In this context, salespeople with a high level of digital selling readiness have a high desire to accept digital technology and a greater willingness to perform behavioral regulation, which is a driving force in motivation formation. In other words, digital selling readiness not only increases self-determination, which is a continuous motivational structure that causesindividual behavior but also plays a role in responding to external stimuli (e.g., compensation/performance through digital sales). Therefore, digital selling readiness positively affects salespeople’s internal and external motivations.

Considering that a salesperson’s combination of intrinsic and extrinsic motivation is an important driver in determining individual job performance (Harris & Daunt, 2013), salespeople with a high level of digital readiness will want to increase their digital literacy. Salespeople with a high level of digital selling readiness will have a high motivation to interact with customers by using digital technology to improve their jobs and will also have a high motivation related to compensation through digital sales effectiveness. Accordingly, a salesperson’s digital selling readiness increases an individual’s job-related intrinsic and extrinsic motivation; thus, the use of digital technology will positively impact the individual’s job capabilities. Therefore, we propose the following hypothesis:

H1: Digital selling readiness will increase digital literacy.

2.2. Digital Literacy, Self-Efficacy, and Customeroriented Behavior

In sales activities, digital literacy refers to an individual’s ability to use digital technologies (Na & Lee, 2022; Jung, 2021; Giovannetti et al., 2020). In other words, digital literacy does not mean technical knowledge in a specific field but rather an individual’s digital capabilities to access, understand, manage, integrate, evaluate, communicate, and create information appropriately through digital technology for the salesperson’s job purpose (Iordache et al., 2017; Lankshear & Knobel, 2008; Markauskaite, 2007; UNESCO, 2016).

Most studies on digital technology and sales demonstrate that digital sales capabilities positively impact sales effectiveness. This literature includes research focusing on the impact of digital sales capabilities on sales effectiveness (Mullins & Agnihotri, 2022), salespersoncustomer interactions (Bharadwaj & Shipley, 2020), and customers’ reactions to digital sales technologies/tools (Mahlamäki et al., 2020).

Although previous studies have highlighted the importance of digital literacy, they have not focused on salespeople’s psychological mechanisms (Guenzi & Nijssen, 2021). In a recent extensive review of the past 20 years, Herhausen et al. (2020) identified less than 3% of published papers on employees’ digital capabilities. Similarly, Mullins and Agnihotri (2022) pointed out that psychological factors related to digital sales are the most under-researched.

To fill these knowledge gaps, we draw on the job demand-resources (JD-R) model. This theory explains the effects of job resources and demands on salespersons’ job outcomes (Boudrias et al., 2011). Job demands such as role ambiguity, heavy workload, and interpersonal conflicts deplete salespersons’ cognitive/emotional resources and ultimately cause job stress. By contrast, job resources such as organizational support, compensation, and career development are positive aspects that not only reduce the various costs of job demands but also promote individual growth, learning, and development, all of which help salespersons achieve their individual task goals (Demerouti et al., 2001; Schaufeli & Bakker, 2004). Therefore, job resources play a role in regulating the negative effects of job demands and are important factors in increasing individual motivation and capabilities (Bakker &Demerouti, 2007).

From this perspective, a salesperson’s digital literacy can serve as an important job resource that increases their sales capabilities. A salesperson’s digital literacy is the ability to use digital technology for service contact with customers and can be used as an important resource to increase sales skills. Thus, salespeople’s beliefs and confidence in their ability to perform their tasks well, that is, job-related self-efficacy, will increase. In this context, Jeong (2001) empirically demonstrated that digital literacy not only plays a positive role in self-efficacy in sales technology but can also reduce job-related stress. Therefore, this study proposes the following hypothesis:

H2: Digital literacy will increase self-efficacy.

Additionally, we suggest that self-efficacy positively affects customer-oriented behavior. Existing studies have proven from various perspectives that the relationship between salespeople’s self-efficacy and sales effectiveness is positive (Bandura, 1997; Vancouver et al., 2008). The core perspective of these studies is that self-efficacy is a crucial individual resource for successfully performing specific tasks in the work environment (Avey et al., 2010; Bandura, 1997). According to the JD-R model, individual resources such as self-efficacy motivate salespeople to engage in performance-enhancing activities (Rhee et al., 2017). For example, Antoncic et al. (2016) found that a higher level of self-efficacy increased job-related motivation and led employeesto complete their tasksthrough work engagement. The same principle is applied to a salesperson’s self-efficacy in the digital sales process, which isthe context of thisstudy. In other words, salespeople’s digital literacy increases selfefficacy, which positively affects customer-oriented behavior. Therefore, this study proposes the following hypothesis:

H3: Self-efficacy will increase customer-oriented behavior.

2.3. Sequential Mediating Role of Digital Literacy and Self-Efficacy

Although several existing studies have consistently claimed that salespeople’s digital capabilities positively affect their sales behavior and effectiveness (Na & Lee, 2022; Jung, 2021; Román & Rodríguez, 2015; Mantrala & Albers, 2012; Mullins & Agnihotri, 2022), little is known about the sequence by which salespeople’s digital-related acceptance and capabilities affect sales behavior. Thus, our research explores how digital selling readiness causes salespersons to increase digital literacy, which improves job-related self-efficacy and, in turn, increases customeroriented behavior.

Mullins and Agnihotri (2022) confirmed the importance of digital selling readiness by verifying a model for digital sales effectiveness. However, their study does not identify the mechanism by which salespeople’s digital selling readiness influences their job performance. Additionally, while Jung (2022) demonstrated that digital literacy positively impacts self-efficacy, this study did not test the impact of digital literacy on sales behavior.

Accordingly, a more robust model would be obtained if we combined these two models to explain the underlying mechanism of the positive relationship between digital selling readiness and customer-oriented behavior. To do this, we consider digital literacy and self-efficacy as possible sequential mediating effect variables between digital selling readiness and customer-oriented behavior.

Previous studies have argued that salespeople with a high level of digital readiness will have a high intention to accept digital technology to accomplish their jobs, and digital competency can positively affect digital literacy (Armenakis et al., 1993; Weiner, 2009; Mullins &Agnihotri, 2022), and this influence may positively affect productive task behavior by increasing the self-efficacy of salespeople (Mullins & Agnihotri, 2022). Therefore, a salesperson’s digital sales readiness will positively impact their digital literacy, increasing their self-efficacy. Ultimately, this process positively impacts salespeople’s customer-oriented behavior. Therefore, this study proposes the following hypothesis:

H4: Digital literacy and self-efficacy mediate the positive relationship between digital selling readiness and customer-oriented behavior.

3. Methods

3.1. Data Collection and Participant Characteristics

We collected data from the salespeople who were working in a Bank and Financial Service firm in South Korea. The firm is a leader in the Korean Banking and Financial Service market and is very active in the digitalization of its sales and service units. We conducted a survey using the self-administered instrument for data collection. Before sending the questionnaire, we administered the questionnaire to the marketing manager and human resource (HR) manager to verify its wording, format, and clarity of measurement items. In total, 254 salespeople were invited to participate in this research, and 154 surveys were returned. After removing the questionnaires with missing values, we used 150 complete surveys for the analysis (net response rate 59.0%). Table 1 shows the characteristics of the samples.

Table 1: The characteristics of the sample

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3.2. Measurement Scales

To develop appropriate measurement scales for research purposes, we used all scales adapted from existing research. Construct scales were adopted and then slightly modified in this research setting. We also applied a reflective measurement approach. Digital readiness was measured with four items adapted from the research of Mullins and Agnihotri (2022). Digital literacy was measured with three items adapted from Jung (2021) and Na and Lee (2022). Selfefficacy was measured with three items adopted from Baundra (2010) and Baundra et al. (1999). Customeroriented behavior was measured with five items adapted from Bettencourt and Brown (1997). All items were measured using a five-point Likert scale for all multi-item constructs (1 = strongly disagree, 5 = strongly agree).

3.3. Measure Validation

We conduct a commonly used validation process to assess the reliability and validity of the proposed constructs. First, the reliability of the constructs was evaluated using Cronbach’s α coefficient (see Table 2). The Cronbach’s α coefficient for the variables ranged from 0.77 to 0.91, which is considered satisfactory (Nunnally, 1978). Second, we performed confirmatory factor analysis (CFA) to verify the convergent and discriminant validity (χ2(83)= 135.82; p < .05, CFI = .96, TLI=.95, RMSEA=.06, GFI=.89).

Table 2: Results of the confirmatory factor analysis

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Note: λ = factor loading: all factor loadings are significant (p < 0.01); α = reliability coefficient; CR = composite reliability; AVE = average variance extracted; CSR = corporate social responsibility.

Across our measurement model, all factor loadings exceeded .62, with all t-values greater than 10.82, thus providing evidence of convergent validity among our measures. We also identify the internal consistency of constructs using average variance extracted (AVE) and composite reliabilities (CR). The AVE for the constructs exceeded .50 and the CR ranged from .81 to .93 (see Table 2).

Finally, we performed Fornell and Lacker (1981) method for discriminant validity. The Fornell and Lacker method proposes that square root values of the average variance extracted should be greater than the corresponding construct. Empirical results showed that the square root values of the average variance extracted were higher than the correlation of other constructs (see Table 3).

Table 3: Correlation and squared root of the average variance extracted

OTGHB7_2024_v22n2_95_t0003.png 이미지

† Root of average variance extracted; **correlation; CSR = corporate social responsibility.

3.4. Hypotheses Testing

To test our hypotheses, we used the Hays Process approach (2018). This approach tests the indirect effect between the predictor and the dependent variables through the mediator via a bootstrapping procedure. In Table 4, we showed estimates of the indirect effects along with the symmetric and 95 % bias-corrected bootstrapped confidence intervals for our path estimates.

Table 4: Results of the Hypotheses testing

OTGHB7_2024_v22n2_95_t0004.png 이미지

Notes: DSR, digital selling readiness; DL, digital literacy; SE, self-efficacy; COR, customer-oriented behavior. *p<0.05; **p<0.01

H1 predicted the positive relationship between digital selling readiness and digital literacy. Examination of these hypotheses showed that digital selling readiness has a positive effect on digital literacy (β=.24; t=2.39; p<.05).

H2 expected the positive effect of digital literacy on selfefficacy. Hypotheses testing showed that digital literacy has a significant positive effect on self-efficacy (β=.34; t=5.61; p<.01).

H3 predicted the positive relationship between selfefficacy and customer-oriented behavior. The results showed that self-efficacy has a positive effect on customeroriented behavior (β=.53; t=7.14; p<.01).

Finally, H4 stated and found that digital literacy and selfefficacy sequentially mediated the relationship between digital selling readiness and customer-oriented behavior (β=.04, 95 percent CI [.00, .09]). These results indicated that digital selling readiness was associated with higher digital literacy and self-efficacy, which related to higher customer orientation levels toward salespeople. In sum, we confirmed that the positive relationship between digital literacy and customer-oriented behavior was fully and sequentially mediated by digital literacy and self-efficacy

5. Conclusions

The acceleration of digital transformation due to COVID-19 is rapidly changing from offline-centered to non-face-to-face sales, incorporating digital technology. This change in sales requires salespeople to understand digital technology as well as digital skills and capabilities that can be used flexibly in the sales process (Giovannetti et al., 2020).

Accordingly, this study systematically examined the digital competency of salespeople, that is, the concept of digital selling readiness, and empirically identified its relationship with digital literacy. Additionally, this study empirically confirms the sequential mediating roles of digital literacy and salesperson self-efficacy in the impact of digital selling readiness on customer-oriented behavior. The empirical analysis results of this study are as follows. As illustrated in Table 4, digital selling readiness positively affects digital literacy (H1), and digital literacy is positively associated with self-efficacy (H2), leading to increases in salespersons’ customer-oriented behaviors (H3). Finally, this study verified the sequential mediating effects of digital literacy and self-efficacy in the impact of salespeople’s digital selling readiness on customer-oriented behavior.

5.1. Theoretical Implications

In the research on salesforce digital capability, empirical studies have adopted a piecemeal fragmented approach by identifying the impact of applications, thus addressing only partial aspects of sales digital transformation. Simultaneously, sales research on digital technologies has been predominantly conceptual and focused on executivelevel studies rather than on salesperson responses to digital transformation. Subsequently, we suggest and test a readiness perspective to fill the research gap and add to the marketing literature by emphasizing salespeople’s perceived readiness for a digital selling approach.

Our research deepens our understanding of how digital selling readiness leads to customer-oriented behavior through the sequential mediating effects of digital literacy and self-efficacy. This study extends the previous model by sequentially involving digital literacy and self-efficacy to better understand the psychological processes of digital selling. The results indicate the role of digital selling readiness in preparing salespeople for digital sales. Specifically, salespeople with high levels of digital selling readiness are willing to rapidly adopt digital technologies, which increases their digital literacy and leads to customeroriented behavior owing to their elevated levels of selfefficacy.

Utilizing the JD-R model, we provide a theoretical explanation of how digital selling readiness and digital literacy work together to cause self-efficacy, leading to customer-oriented behavior. This study demonstrates that the more digitally prepared salespeople are, the more likely they are to engage in digital literacy. Moreover, digital literacy may lead to job resource benefits for salespeople because it is positively associated with self-efficacy. Thus, we extend the concepts of the JD-R model by suggesting that digital selling readiness leads to the motivation for digital selling, resulting in salespersons increasing their sales effectiveness regarding customer-oriented behavior.

5.2. Practical Implications

The empirical findings of this study have important implications for practitioners. Organizational managers must assess digital selling readiness to support a digitally ready sales force, which will provide managers with an assessment tool for efficiently investing in digital assets in the sales force. Managers must measure applicants’ digital selling readiness during the hiring process. This will potentially increase the likelihood that organizations will hire people with high digital selling skills. Additionally, organizations should evaluate their salespeople’s digital sales readiness to increase their digital literacy and sales effectiveness. Organizations can efficiently improve the digital capabilities of salespeople through differentiated education and training based on their digital selling readiness.

5.3. Limitations and Future Directions

While this study has several theoretical and practical implications, it also has some limitations. First, this study was not devoid of common method bias as data were collected and utilized through cross-sectional studies and self-report methods. In this study, these problems were identified through reliability and validity analyses; however, to resolve the problem of same-method bias more clearly, data collection methods using various response sources should be performed. Additionally, salespeople’s digital selling readiness and digital literacy may not only change over time; however, their effectiveness may also vary. Therefore, it is required to examine this issue through longitudinal research in future research.

At the organizational level, our study did not comprehensively include other moderating factors, such as organizational support and coworker support. These variables are crucial organization-level factors related to digital literacy and self-efficacy. Future research should include these moderators to improve the robustness of the results.

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