Abstract
Relationship marketing emphasizes that for a firm to be profitable, it must be attentive to those factors that affect service satisfaction. Extant research in the service sector reveals two important determinants of service satisfaction. One is service quality, and the other is the service encounter, representing the interaction between the customer and the service provider. Further, it has been demonstrated that service quality is also related to customer perceptions of the service encounter. However, a question that a remains unanswered is about the precise nature of the relationship between service quality and service encounter on one hand, and service satisfaction on the other. Is the relationship direct or indirect? Does one of the factors instead serve as a mediator? This study provides an answer by examining a sample of industrial customers in Singapore who evaluated the service dimensions of ocean freight shipping lines. Results reveal that the relationship between service quality and service satisfaction is not direct, but it is defined or mediated by customer perceptions of service encounters. Implications of the results are discussed.