A Bayesian examination of the relationship of internal and external touchpoints in the customer experience process across various service environments

Customer experience (CX) is an aggregate of consumer touch points that can be brand-owned (completely controlled by the firm), partner-owned (collectively controlled by the firm and one or more of its partners), customer-owned (where the firm or its partner cannot exert any control or influence) or represented by social/external touch points that account for the importance of the roles of others in the customer experience process. Although the concept of CX is widely used, not much has been examined about how external touch points impact customer perception of experience. Therefore, the main purpose of this study is to examine the role and impact of internal and external touchpoints as dimensions of customer experience and how CX can impact consumer word-of-mouth intention. Service outcome and peace of mind were used to represent internal experience touchpoints and peer to peer quality (PTP) was used to represent an external experience touchpoint. A total of 293 usable surveys were used for analysis using a Bayesian model developed for this study instead of the more traditional SEM approaches. Results showed that an external experience touchpoint has a similar impact to those of internal experience touchpoints in the experience process. CX was also found to have a strong effect on customer word of mouth intention. These findings make various contributions to the literature on CX, especially to research differentiating internal from external experience touchpoints. On the practical side, this study provides recommendations to retailers about how to manage an external touchpoint.     

An omnichannel approach to retailing: demystifying and identifying the factors influencing an omnichannel experience

ABSTRACT

The purpose of this research is to identify the factors that influence an omnichannel experience. Omnichannel is an emerging approach to retailing that responds to the changing nature of how customers shop in alternation between online and offline shops, and the increasing use of digital devices (e.g. smartphones and tablets), as a consequence retailers are focusing and establishing a seamless integrated approach to their services. Omnichannel is now a hot topic in retailing but there is a lack of empirical studies into the factors that influence an omnichannel experience. Using a mixed methods approach, we propose and empirically test a conceptual model that identifies four factors influencing an omnichannel experience: brand familiarity; customisation; perceived value, and technology readiness. We conceptualise omnichannel to include three key channels; in-store, online and mobile. Two hundred and forty-six questionnaires were collected and analysed using PLS-SEM and 11 interviews were carried out with marketing/ omnichannel professionals. Our results indicate that brand familiarity has a strong influence on omnichannel (in-store, online and mobile) while perceived value has a negative impact on the mobile experience. Our results show that retailers need to consider multiple factors, such as brand familiarity, customisation, perceived value and technology readiness as influencing factors of an omnichannel experience, and plan the use of multiple touchpoints simultaneously to enhance their overall customer’s experience. Although this study demonstrates the significant factors influencing an omnichannel experience, questions remain regarding the exact use of each touchpoint by customers and the extent of overlap between the touchpoints. which .     

Modelling short-and long-term marketing effects in the consumer purchase journey

The role of advertising in consumer demand has received much attention in the marketing literature, where the marketing response model has emerged as a dominant analytical framework. In recent years, the basic model structure has evolved in three directions. Firstly, the incorporation of online paid, owned and earned media to accommodate the off-online path-to-purchase. Secondly, the introduction of consumer mindset metrics to capture the emotional foundations of brand-building. Finally, combinations of both to offer a complete view of the consumer purchase journey. In this paper, we argue that no one development successfully provides a fully holistic representation of the role of advertising. We thus propose a more comprehensive structural approach: one that combines search, paid, owned and earned media with a cointegrating mechanism for brand-building, linking mindset metrics directly to long-term base sales. The result is a practical modelling system for marketing mix practitioners with a rigorous economic and statistical foundation for short and long-term advertising effects. The proposed approach is applied to a global electronics manufacturer in the US market, where results fall into three broad areas. Firstly, we demonstrate how off and online marketing interact in the journey structure, the part played by search, owned and earned media and how specific media types play different roles. Secondly, we illustrate how consumer touchpoint experience is a key element of the process, improving measurement of in-store marketing. Finally, we show how consumer mindset metrics and social media play an important word-of-mouth role, with paid and earned media working together to drive long-term demand evolution.     

Managing a Global Retail Brand in Different Markets: Meta-Analyses of Customer Responses to Service Encounters

This study investigates how retailers can leverage their brand to shape customers’ satisfaction with service encounters. It develops and tests hypotheses about how brand, store, and consumer factors moderate customer responses to experience clues during retail service encounters. Six meta-regression analyses synthesize and compare results from 842 satisfaction equations describing customers’ encounters with a global retailer operating 400 stores in 32 countries. The results show how customers weigh their perceptions of service encounters differently depending on brand, store, and consumer factors. In markets where customers believe the retailer has high holistic brand quality, they place less weight on experience clues within the store. In markets where customers believe the retailer’s service brand promise, they place more weight on in-store experience clues. In markets where the retailer promises utilitarian value, customers weigh functional experience clues more heavily. In markets with an online purchasing channel, the effect of experience clues common to offline and online store environments is magnified, and unique clues are diminished. In addition, customers heavily weigh experience clues that fit their goals. In general, retail success factors include high brand quality (which makes customers more forgiving), a service brand promise that is mirrored in the store image (which makes customers attend to the experience clues aligned with them), and the careful monitoring and managing of retail touchpoints (to customize experience clues to each market). In this way, retailers can use customer-based strategies to effectively design and manage their global retail brand in different markets.     

Can't touch this? Conceptualizing the customer touchpoint in the context of omni-channel retailing

Due to the rise of omni-channel management, the customer touchpoint concept has become more important. However, research lacks a common understanding of this concept. This article addresses this research gap by conceptualizing the customer touchpoint following the design science research paradigm. As a result, an overview of the constructs and their respective properties, as well as their possible manifestations that collectively define the customer touchpoint, is provided. The conceptualization has implications for researchers and practitioners alike as it comes as a tool to design and evaluate touchpoints in the field as well as to provide fertile soil for future research.     

When retailers and manufacturers advertise together; examining the effect of co-operative advertising on ad reach and memorability

Retailers often feature manufacturer brands in their advertising with the aim to drive sales for those brands and, at the same time, increase in-store traffic. The adoption of such co-operative advertising strategies should reach an expanded audience base comprising of store and brand buyers. Based on empirical evidence in non-retail settings, these buyers are more likely to remember the advertising than non-buyers. This usage-bias effect implies that co-operative advertisements achieve greater cut through than would be the case if either brand advertised alone. Our paper tests this hypothesis in the context of retailer advertisements that feature manufacturer brands in the US, UK and Australia. Our results confirm that a retail brand's shoppers are more likely to recall its advertisements than non-shoppers, extending the usage-bias generalisation to a retailing context. However, while co-operative advertising does expand the buyer-base reach, any uplift in ad-memorability is negated by a reduced ability for buyers of only one of the two brands to recall the advertisement. Information overload on cognitive processing is a possible explanation for this finding, and has implications for extracting value from any investment in co-operative advertising.     

How to create a realistic customer journey map

Although many articles discuss customer journey mapping (CJM), both academics and practitioners still question the best ways to model the consumer decision journey. We contend that most customer journey maps are critically flawed. They assume all customers of a particular organization experience the same organizational touchpoints and view these touchpoints as equally important. Furthermore, management lacks an understanding of how to use CJM as a cross-functional, strategic tool that promotes service innovation. This article proposes a solution to the unwieldy complexity of CJM by linking customer research to the CJM process and by showing managers how to develop a customer journey map that improves a customer's experience at each touchpoint. Using the case of an actual retail mall, we show that common CJM assumptions about the equal importance of all touchpoints are fundamentally wrong, and how easy it is for retail managers and strategic planners to make incorrect judgements about customer experience. This article demonstrates through a case study how customer research helped a mall's strategic management team understand which touchpoints were more or less critical to customer experience. It also shows key strategic initiatives at each touchpoint, resulting in cross-functional input aimed to advance service innovation at the mall.     

Brand personality appeal,brand relationship quality and WOM transmission: a study of consumer markets in Vietnam

This study investigates the impact of brand personality appeal on both brand relationship quality and word-of-mouth (WOM) transmission in Vietnam. It also examines the role of consumer attitudes towards advertising and public relations on brand personality appeal as well as brand relationship quality. An empirical test with a sample of 477 consumers by means of structural equation modelling reveals that brand personality appeal has a positive impact on both brand relationship quality and WOM transmission and that brand relationship quality has a positive effect on WOM transmission. Furthermore, attitudes towards public relations have positive impacts on both brand personality appeal and brand relationship quality. Finally, attitudes towards advertising have a positive impact on brand personality appeal but not on brand relationship quality.     

Are Brand Promotions Just a Zero-Sum Game – or Can They Increase the Size of the Pie?

Packaged goods companies now "spend" more on promotions – special offers, in-store displays and the like – than on media advertising. Until recently, it was generally believed that while promotions benefit individual brands, they usually do not result in an increase in overall category sales. Recent research, however, suggests that promotions can increase total category sales in a wide range of circumstances. This article starts by discussing the relationship between brand promotion and category sales, outlines research to date, and then describes the author's own most recent research on this topic. It concludes by pointing to implications for managers.     

The Impact of a New Retail Brand In-Store Boutique and its Perceived Fit with the Parent Retail Brand on Store Performance and Customer Spending

With data from a specialty apparel retailer, we present two studies that investigate the impact of an in-store boutique displaying merchandise of a new retail brand on overall performance of the parent stores in which the boutiques are placed, and on customer spending on merchandise offered by each of the two brands. Findings from the two studies generally support that the in-store boutique enhances three key store-level metrics: average customer transaction value per store visit; comparable sales growth from one year to the next; and customer conversion ratio. At the customer-level both studies show that average customer transaction value on merchandise offered by the new brand is negatively related to average customer transaction value on the parent brand, and vice versa. Furthermore, both studies reveal that the relationship between the perceived fit between the two brands and average customer transaction value on the parent brand increases at an increasing rate (positive main and quadratic effects of perceived fit), but that the impact of perceived fit on average customer transaction value on the in-store boutique brand increases at a deceasing rate (positive main effect, but a negative quadratic effect of perceived fit). Implications for retail practice and theory are offered.     

Advertising for New and Existing Brands: The Impact of Media Context and Type of Advertisement

The effects of advertisement and context type on the responses to advertisements for different brands of new and existing products were tested. In the first experiment (243 graduate students) a positive emotional advertisement and a non‐emotional advertisement for a well‐known and a new brand of printer were tested in a positive emotional context and a non‐emotional media context. In the second experiment (206 graduate students) positive emotional and non‐emotional advertisements for new brands of watches and healthy drinks were tested in an emotional and a non‐emotional context. The type of context moderated the responses to advertisements for the well‐known and new products: a positive emotional context led to a more positive attitude towards the advertisement and the brand and purchase intention for the well‐known brand than for the new brand. A non‐emotional context led to more positive responses for the new brand than for the well‐known brand. In general, emotional advertisements led to more positive affective reactions and non‐emotional advertisements led to more positive cognitive reactions. However, the type of advertisement did not have a moderating effect on the responses to advertising for the new or well‐known brands or different product types. The studies illustrated the relevance of media context for advertising new versus existing products.     

Customer Relationship Stage and the Use of Picture-Dominant versus Text-Dominant Advertising: A Field Study

This research reports the results of two field experiments designed to help determine what format of email advertising is most effective with customers at different lifecycle stages. The experiments examine customer response to picture-dominant versus text-dominant advertising. Although the relative effectiveness of picture- versus text-dominant advertising has received some attention in previous research, the issue of which type would be most effective at different points in the customer's relationship with the brand and for different metrics has not been explored. The two field experiments were executed by a major fashion retailer that sells clothing and accessories for special events. The first experiment was conducted with prospective customers and focused on advertising for the retailer's primary product, which typically occurs first in the purchase cycle. The second experiment was conducted with customers who had already purchased the primary product and focused on advertising for an accessory typically purchased later in the cycle. The investigation was conducted from a customer relationship management perspective, examining the financial impact of each type of advertisement at different stages in the customer's relationship with the brand. At the aggregate level we find only minor differences in the performance of the picture-dominant versus text-dominant advertisements. However, we find that the retailer can greatly improve revenue by customizing ad format based on observed customer traits.     

Can Social Media Campaigns Backfire? Exploring Consumers' Attitudes and Word-of-Mouth Toward Four Social Media Campaigns and Its Implications on Consumer-Campaign Identification

In response to the unprecedented growth of social media, companies are continuously creating unique social media campaigns encouraging customers to share their advertising messages. However, many of these social campaigns end up backfiring. The purpose of this study is to examine consumers' preferences toward 4 social media campaigns and to investigate the impact of positive and negative word-of-mouth and social value on consumer-campaign identification. Using a sample of 525 respondents in Australia, the results show social media campaigns that contain negative messages are more likely to receive negative word-of-mouth while partnering with non-profit organizations may help generate positive word-of-mouth. This study will assist marketing managers to better understand the consumers' perceptions on recent social media campaigns in Australia.     

Decomposing the effect of advertising: What happens in the retail channel?

The diverging interests of manufacturers and retailers famously give rise to the double marginalization problem but have consequences far beyond pricing. Advertising is another marketing instrument that is under the control of the manufacturer but its ultimate effect on consumer demand also depends on retailers’ pricing decisions. We decompose the effect of advertising in the channel and highlight an additional route through which advertising affects sales, namely via the changes in the retail price that a strategic retailer makes in response to changes in demand following manufacturer advertising. The total demand effect of advertising thus comprises the direct effects of advertising on market shares, and the indirect effects coming through adjustments that the retailer makes to the in-store prices of all the brands in a given product category in response to the shifted demand due to advertising. We match advertising data for four different categories (both food and non-food) to store-level scanner panel data, which also include information on wholesale prices. Controlling for wholesale prices, we establish in a reduced-form model that the retailer reacts to manufacturer advertising by changing retail prices instead of simply imposing a constant markup on the wholesale price. To further explore the role of the strategic response of the retailer in a systematic fashion and quantify the effects derived in the decomposition, we estimate a discrete-choice model of demand and determine the magnitude of the direct and indirect effects. We find that the indirect effect of advertising through retailer prices is about half the size of the direct effect, and thus substantively affects advertising effectiveness.     

The Impact of Brand Delisting on Store Switching and Brand Switching Intentions

A tool retailers often use to improve their negotiating position with brand manufacturers is to delist - or threaten to delist - the manufacturers’ brand. Because brand manufacturers rely mainly on retailers to sell their products to consumers, a brand delisting will cause a sales loss for the brand manufacturer. Therefore, many brand manufacturers feel enormous pressure to give in and improve buying conditions to favor the retailer. The question thus emerges: Can a brand manufacturer resist a retailer's threat to delist its brand(s)? If a brand delisting severely hurts retail sales, it is easier for a brand manufacturer to resist. The authors study the impact of brand delistings on store switching and brand switching using a controlled online experiment and in-store shopper survey. They develop and test a conceptual model with several antecedents of consumers’ reactions to a brand delisting and conclude that brand equity, market share, and the products’ hedonic level drive store and brand switching.     

The moderating effects of in-store marketing on the relationships between shopping motivations and loyalty intentions

This study attempts to understand the moderating roles of in-store marketing by incorporating the effects of shopping motivations on repatronage and word-of-mouth intentions in the context of fashion apparel by applying theories related to self-determination and social impact. Structural equation modeling using data collected from young adult fashion apparel shoppers in Thailand reveals positive effects of shopping motivations. The utilitarian shopping motivation shows a greater effect in predicting loyalty intentions than hedonistic shopping motivation. In-store marketing is shown to have a moderating effect on loyalty intentions, although the influence of each moderator on the investigated direct effects varies. The findings can prove helpful to fashion apparel retailers in developing effective advertising and promotional strategies that correspond to the specific needs of the shoppers to promote store loyalty intentions.     

Interplays between manufacturer advertising and retailer store brand introduction: Agency vs. wholesale contracts

In retail supply chains, manufacturers' advertising for national brands and retailers' store brand introduction may relate to each other, and two types of contracts, i.e., agency contract and wholesale contract, are widely used. This paper uses game-theoretic models to investigate the strategic interaction between a manufacturer's advertising strategy and a retailer's store brand introduction strategy. We derive the equilibrium outcomes, including wholesale price, retail price, market demand, retailer's and manufacturer's profits under different contract forms. We find that when the product cost is small relative to the perceived value of the store brand, the introduction of a store brand will benefit the retailer. The retailer is more likely to introduce store brands under the wholesale contract than under the agency contract. In addition, compared with the wholesale contract, the agency contract may increase both the manufacturer's and the retailer's profits and lead to Pareto improvement for them.     

Here Today,Gone Tomorrow? Mapping and modeling the pop-up retail customer journey

Pop-up retail and customer journey mapping are widely adopted in the retail industry, yet they have received modest coverage within academic literature to date. Through a qualitative field study of five marketplace-based pop-ups (MBPUs), this research defines and identifies differences and similarities between marketplace-based pop-ups (MBPUs) and brand-based pop-ups (BBPUs), seeks to understand how marketplace-based pop-ups fit within the customer journey and experience, and explores how touchpoint ownership and influence illuminates the understanding of the marketplace-based pop-up customer journey. Further, this research extends an existing conceptual customer journey framework to visually map and model the purchase stages, touchpoint categories and types of marketplace-based pop-up customer journeys. As a result, this research presents and discusses three emerging themes (here today gone tomorrow; high-touch low-tech; and ownership and influence) to further the understanding of MBPUs. Pop-ups are more than a single encounter; they are a complex customer journey process, whereby the customer travels through pre-purchase, purchase and post-purchase stages, and across multiple touchpoints.     

Exploring an in-store customer journey for customers shopping for outdoor apparel

The omni-channel shopping phenomenon creates major challenges for brick-and-mortar stores to remain relevant and appeal to customers. A way to counteract these challenges is to offer customers a journey where in-store experiences enable them to encounter numerous physical and virtual touchpoints evoked by affective, cognitive, physical, relational, sensorial and symbolic responses. This study ascertained the customer journey activated by the experiences causing value and resulting in intentions to revisit a retailer specializing in outdoor apparel. Our web-based survey collected 300 valid responses for analyses. The statistical analyses confirmed a positive relationship between the customer in-shop experience factors and the shopping trip value experienced, which in turn mediated the relationship with intention to repatronage. Some conclusions are made and various suggestions for future research are recommended.     

Children’s Responses to Traditional Versus Hybrid Advertising Formats: The Moderating Role of Persuasion Knowledge

Research on the impact of advertising on children has failed to keep pace with the rapidly changing media environment. Using an experimental approach, children’s responses towards traditional (television advertisement) versus new, hybrid advertising techniques (trailer, advergame, and their combination), and the moderating role of persuasion knowledge, are investigated. Results show that children who played an advergame have more difficulty recalling the advertised brand than children who saw a traditional television advertisement. When confronted with integrated marketing communications (a trailer followed by an advergame), children without knowledge of persuasive intent developed a more positive brand attitude than children with persuasion knowledge. The implications of these results are discussed.