Customer Participation Behavior in High- Versus Low-Contact Services: The Multiple Roles of Customer Trust

ABSTRACT

In light of the changing roles of customers from service co-producer to value co-creator, the customer participation literature has conceptualized two types of participation behavior: co-production and value co-creation. However, there is a dearth of knowledge concerning both the antecedents of customer co-creation behavior and the outcomes of such behavior in relation to customer-perceived value and loyalty. Anchored in the trust-commitment theory, the present research (a) examines the effect of how a customer's trust in the service personnel could affect his/her cooperative behavior over the service design and delivery processes; and (b) investigates how the potential impact of a customer's trust in service personnel on his/her co-design and co-delivery behavior could be made contingent upon the customer's trust in the service brand and the types of high- versus low-customer-contact service contexts. Filling the aforementioned research gaps, the present research contributes to advance our knowledge of the roles played by trust at different levels of analysis in facilitating customer participation behavior and improving our appreciation of the customer contact service contexts when designing the service organization for maximizing service value and sustaining brand loyalty over time.     

Motives and barriers affecting consumers’ co-creation in the physical store

ABSTRACT

The rise of e-commerce has caused a dramatic shift in consumer behaviour, putting pressure on physical stores to offer a more personalised and service-oriented offering. This paper investigates one strategy retailers might apply in this context: in-store consumer co-creation. Research has predominantly focused on online-based consumer co-creation in new product and service development. We argue that with increased focus on digitalisation and consumer experiences in physical retail, this type of co-creation will increasingly take place in-store. Following a pre-study with practitioners, our main study uses 20 scenario-based semi-structured interviews, where we identify eight consumer motives and seven barriers that underlie consumers’ willingness and reluctance to create and select new products in-store, respectively. Some motives, such as ethical, self-efficacy, and concerted are reported as barriers when reverted, due to consumers’ concerns regarding data privacy, low levels of perceived self-efficacy and assumptions that the technology might be flawed. Other motives largely overlap existing research on motives for co-creation whereas other barriers predominantly pertain to the underlying technology and the physical setting of co-creation in-store. The findings further indicate that consumers co-create differently online versus in-store. In-store seems particularly suitable for more marketing related aspects of co-creation, with a stronger emphasis on playfulness and purchase intentions. Practical implications for retailers are therefore discussed.     

Transformative service research and service dominant logic: Quo Vaditis?

This paper takes a closer look at the emerging topic of transformative service research (TSR) and compares its facets with the more established concept of the service-dominant logic (SDL). The paper thus contributes to both theory development and practical application. This work highlights the conceptual parallels in the two approaches, for example, their holistic approach, their systems thinking, addressing entities or actors within such system(s), inclusion of the wider environment, and their focus on the co-creative and interactive nature of well-being generation and value co-creation. The paper also reveals some differences, for example TSR’s focus on eudaimonic and hedonic well-being outcomes vs. SDL’s value co-creation. The paper concludes that both perspectives have merits, but could benefit from being used integratively. By comparing the areas of theory focus, practical application, value co-creation and co-destruction, intentionality, well-being and value concepts, and TSR and SDL’s “logic”, the paper provides suggestions for future research.     

Value co-creation via information and communications technology

The aims of the present work centre on determining whether co-created value constitutes a competitive advantage for firms, and whether it is capable of influencing consumer behaviour. Applying the service-dominant logic perspective, the work examines the firm's capabilities in the context of its business-to-customer (B2C) interactions, focusing on information and communications technology (ICT) as a particular driver of value co-creation. Taking this B2C perspective, ICT is measured, from the firm's point of view, and customer perceptions are analysed, using the variables ‘value co-creation’, ‘perceived value’ and ‘loyalty’. The sample consists of 100 service firms and 572 of their customers. The findings indicate that ICT capabilities have a direct effect on value co-creation, as does value co-creation on perceived value and loyalty.     

The moderating roles of status of B2B evaluator and dependence in the switching costs – switching intentions – performance causal chain in Korea

Switching intentions in the business-to-business (B2B) relationship context have a powerful impact on a firm’s performance and are often considered in relation to perceived switching costs. This factor has also been considered as a good predictor of actual turnover behaviour resulting in reduced market share and profitability of firms. However, despite the importance of switching intentions in B2B relationships, there is still no evidence either to support linkages to switching costs as a key driver of decision-making or to demonstrate interrelationships with firm performance. The author empirically examines the theoretical process of the cognitive assessment – behavioural intentions – performance linkage that explains a firm’s likelihood of terminating B2B relationships using three moderating variables. The results suggest that the switching intentions are driven by switching costs and their similarity to the direct effect on firm performance. Meanwhile, personal relationship loss costs, rather than other types of switching costs, serve an important role in determining the reduction of switching intentions. Finally, the author discusses insights about the present results and suggests future research directions.     

Store Manager–Store Performance Relationship: A Research Note

Despite the critical role that store managers play in linking top management teams and service/retail employees, as well as in fulfilling corporate strategy within chain store environments, service management research infrequently addresses the factors that may promote store managers’ effective exchange relationships within the firm and subsequent effects on store operations and profitability. This study focuses on how store managers’ performance orientation, trust of a regional manager’s capabilities, and organizational commitment affect a manager’s relationships relative to regional managers and frontline employees. The direct effect of store managers’ relationship capacity on store performance is also examined. The results, based on survey data from managers of stores of a retail and service chain and company financial reports, generally support the suggested hypotheses. Specifically, a store manager’s relationship with his/her supervisor has a strong influence on how the manager views the supervisor’s leadership support and leadership style, which ultimately influence store performance (primary goods/service sales and store profits).     

Atypical Shifts Post-failure: Influence of Co-creation on Attribution and Future Motivation to Co-create

This study investigates how the effect of the failure of co-created products or services influences: (a) internal attribution (i.e. the self) and external attribution (i.e. the firm), (b) customers' expectancies of success, and (c) customers' future motivation to co-create and contribute to recovery from failure. We use attribution theory and the attribution–expectancy framework to explain the theoretical relationships we advance and test our hypotheses in two independent experiments that stimulate co-creation through role-play and vignettes. The results show that customer co-creation shifts the attribution for failure to the self, resulting in atypical shifts in expectancy (increasing customers' expectancy of future success and motivation to continue co-creating in the future). Our results suggest that utilizing customers' efforts and skills in the co-creation of products and services can help firms to manage failure effectively. The implications of our findings on co-creation research and product and service failures are discussed, specific applications within the digital context are considered, and suggestions are offered for future research.     

Value co-creation in web-based multisided platforms: A conceptual framework and implications for business model design

The internet is fertile ground for multisided platforms that articulate the production of goods or the execution of services between third parties, thus relying on value co-creation as their core business model mechanism. However, an understanding of co-creation that underlies dynamics and implications for business model design and innovation is still dispersed and fragmented along a number of literature streams. This article aims to provide an understanding of the value co-creation process in web-based multisided platforms. A conceptual framework is proposed based on the combination of an analysis of a comprehensive systematic literature review, interviews with academics and entrepreneurs, and an analysis of secondary data on representative cases of multisided business models based on value co-creation. We offer a model of value co-creation in multisided platforms and advance a number of propositions regarding value dynamics, including the role of the focal firm in defining and maintaining value creation, propositions, and capture structures with consequences to monetization schemes and actors’ contributions and motivations for value co-creation. This article contributes to the understanding of the co-creation phenomenon, especially in multiple actor interaction regimes, and raises a number of suggestions for future research.     

Impact of industry sector on corporate diversification and firm performance: Evidence from Indian business groups

Prior business group (BG) studies implicitly assume that corporate diversification‐firm performance relationships are uniform across industry sectors. This generalization may lead to research implications that are not equally true for BG‐affiliated manufacturing and service firms. Drawing on strategy and marketing literature, this research addresses this scholarly gap. Our empirical analysis of a large sample of BG‐affiliated Indian firms over a five‐year period (2004‐2008) indicates that the influence of corporate diversification on firm performance is greater for affiliated service firms than affiliated manufacturing firms. Results also indicate that the influence of BG size and diversity on diversification‐firm performance relationship varies significantly depending on whether the focal firm belongs to the manufacturing or service sector. Firm's share ownership does not generate similar influence. Copyright © 2015 ASAC. Published by John Wiley & Sons, Ltd.     

Investigating antecedents of consumers' recommend intentions and the moderating effect of switching barriers

The current study moves beyond customer-perceived value, service quality, and corporate image and demonstrates that switching barriers are important factors influencing a customer's decision to recommend a service provider to others. This work examines a contingency model between customer-perceived value, service quality, corporate image, and switching barriers. The results indicate that the impact of these parameters on consumers' recommend intentions increases under conditions of high switching barriers. The implications of these results are also discussed.     

Customer-perceived value and loyalty: how do key service quality dimensions matter in the context of B2C e-commerce?

This paper develops a research model to examine the effect of e-service quality dimensions on customer-perceived value and customer loyalty. Based on a survey of 235 online customers, we identify five key e-service quality dimensions: care, reliability, products portfolio, ease of use, and security. Our empirical results show that all the five dimensions have significant and positive impacts on customer-perceived value which, in turn, increases customer loyalty. We further examine the mediating role of customer-perceived value in the relationship between each e-service quality and customer loyalty. The results suggest that customer-perceived value plays a partially mediating role in the effect of ease of use, care, product portfolio, and reliability on customer loyalty, and a fully mediating role in the relationship between security and customer loyalty. Managers may be in a position to benefit by employing the model presented in this study in an effort to improve service performance and, hence, retain customers.     

共享服务系统体验价值共创行为的影响因素

由于共享经济的发展和信息技术的进步,共享服务系统中的共创行为变得越来越容易实现,消费者与企业协作共创价值成为新的发展趋势。在消费者需求和共享行为都不断变化的情况下,如果共享服务供应商不清楚何种因素能够加速消费者价值共创行为的生成,则会影响共创价值实现。基于服务主导逻辑的理论,构建共享服务系统体验价值共创行为及其影响因素的理论模型。依据收集的450份有效问卷,对数据进行分析后发现,共享服务系统中感知利益、感知信任和社会可持续性通过互动协作(价值共创过程)对顾客体验价值产生影响,顾客体验价值对顾客的价值共创行为意向产生影响。研究结果表明,顾客参与共创动机中的效益动机和信任动机显著正向影响互动协作,互动协作显著正向影响体验价值和共创行为意向,而体验价值在互动协作和共创行为意向之间起到显著部分中介作用。共享服务提供方和产品制造方应多从顾客视角考虑其效益需求和信任需求,定位顾客需求和偏好,提供更有吸引力和说服力的商品与服务,使顾客感知到更多的收益,并形成较高信任度;提升与顾客的互动水平,建立顾客对服务方的好感,激发顾客更多的主动交互行为、参与行为和个人创新行为;重视资源的整合、分配和调动,实行以顾客驱动为核心的开放创新模式;招募优质用户,通过倾听和观察了解其价值主张,促进价值共创行为的生成,改善共享服务系统的整体服务质量。     

Extending customer relationship management into a social context

Informed by the resource-based view, this study draws on customer relationship management (CRM) and value co-creation literature to develop a framework examining the impact of social networking sites on processes to manage customer relationships. Facilitating the depth and networked interactions necessary to truly engage customers, social networking sites act as a means of enhancing customer relationships through the co-creation of value, moving CRM into a social context. Tested and validated on a data set of hotels, the main contribution of the study to service research lies in the extension of CRM processes, termed relational information processes, to include value co-creation processes due to the social capabilities afforded by social networking sites. Information technology competency and social media orientation act as critical antecedents to these processes, which have a positive impact on both financial and non-financial aspects of firm performance. The theoretical and managerial implications of these findings are discussed accordingly.     

Setting and vetting strategy: Bridging the chasm between CEOs and boards

One of directors’ key fiduciary duties is to set the firm’s direction and then vet the strategy proposed by the CEO. Despite this, McKinsey reports that the majority of directors feel they do not understand their firm’s strategy, and even if they do understand it, they do not feel they have the desired impact on their firm’s strategy. This article argues that this shortfall stems from a failure to cross the chasm between CEOs and directors. We propose a framework to bridge this gap and assist board members to better understand and vet their firm’s strategy.     

IMC in digitally-empowering contexts: the emerging role of negotiated brands

In current digitally-empowering contexts, the Integrated Marketing Communications (IMC) paradigm may have lost its ‘original’ customer-centric focus. Drawing on service-dominant logic, the paper examines the changes to IMC when multiple sources of consumer power emerge as central in the value creation process. This change in the focus of IMC likely enables the emergence of negotiated brands, i.e. brands that focus on a marketplace where traditional marketer-created brand value may be replaced by buyer and seller co-created value. The paper argues that this novel type of brand structure represents an appropriate managerial response to multidimensional IMC approaches. As that occurs, four key issues (community-centric orientation, emergent strategy, hybrid communication mix, reciprocity-based assessment) emerge which lead to a number of research questions in the planning and execution of marketing communications in today’s digitally-empowered contexts. All these issues clearly highlight the consumers’ contributions to brand value co-creation, by reaffirming the ‘original’ outside-in perspective of IMC.     

Blurring B2C and B2B boundaries: corporate brand value co-creation in B2B2C markets

ABSTRACT

This paper aims to explore how corporate brands co-create value with their multiple stakeholders in a B2B2C marketplace. Main data sources stem from in-depth interviews with top managers of a technology corporation in the financial sector. Findings depict a model that conceptualises the successful value co-creation process as the careful management of six specific drivers, namely: interdependency, direct approach, trust, strategic alignment, adaptive modus operandi, and knowledge sharing. Hence, the study offers new food for thought for scholars and practitioners who wish to improve their knowledge and understanding on brand value co-creation and corporate marketing.     

Quality management as a driver of innovation in the service industry

This study identifies the combination of factors that lead to quality management reinforcing innovation capability as an organization’s strength. The results from 133 Spanish service organizations show that competitive strategy, manager’s motivation to adopt quality management, and customer orientation are the key factors that explain the presence of innovation capability as a firm’s strength. As some pioneering research points out, the impact of quality management on innovation depends mainly on managers’ interpretation of this management philosophy. When quality management focuses on discovering new customer needs and even new markets, it contributes to strengthen the organization’s innovation capability.     

Defensive Strategy’s Effect on Firm Value: Evidence from Public-Listed Companies in Malaysia

This study examines the relationship between defensive strategy and firm value for a sample of 596 listed firms in Malaysia over the period 2008 to 2015. For the sake of robustness, the institutional setting is considered in this research by gauging the ownership structure. More specifically, this study seeks to determine whether a firm’s ownership structure might have a significant contribution to the value of its defensive strategy. Additionally, the value creation of defensive strategy is compared among family firms, government-linked firms, and foreign firms. This study concludes that defensive strategy, especially retrenchment strategy, has a positive significance on a firm’s excess value. This implies that defensive strategy will improve the firm performance. The reduction of the costs and assets, the efficiency of monitoring structure, the threat of dismissal, and the promotion of stewardship can enhance a firm’s benefits. Low profitability is found to be better for the firm performance. However, the ownership structures of government-linked and foreign firms tend to have a discount value on the excess value when these firms adopt retrenchment actions. The implication of this study lies in two main points. Firstly, it enriches the body of knowledge by showing how an effective defensive strategy creates value, and the role corporate governance plays in that relationship. Secondly, it helps to inform regulator and policymakers about how defensive strategy might have a good corporate governance to create value.     

Customers Perception of Service Quality in Higher Education

ABSTRACT

Intense competition in the higher education sector in New Zealand has forced a number of educational institutions to examine the need for assessments of customer-perceived service quality for differentiation purposes. Research studies in this area have mainly focused on either the administrators or the faculty's perspectives and have overlooked the other customers, namely students and employers. The instruments developed based on the Importance-Performance paradigm were administered to 280 New Zealand employers and 1,000 business graduates. The results indicate that employers and students have perceptual problems with the level of service provided by tertiary institutions. Implications and suggestions for future research are provided.     

Omni-channel retailing: propositions,examples and solutions

Customers are not passive agents, but intrinsic to the value creation process. Because retailers are the customer’s link to the marketplace they are uniquely placed to develop value co-creation opportunities that give themselves a strategic advantage. Omni-channel retailing is a means to create an advantage by forging deeper customer relationships and potentially developing new markets. Omni-channel retailing can appeal to the heterogeneity in customers’ shopping orientations with the aim of providing a seamless cross-channel experience. However, without a clear strategic purpose, omni-channel initiatives can easily result in unbeneficial – or worse, counterproductive – investments. To address this, the purpose of this paper is to formulate guiding principles to facilitate decision-making with respect to developing an omni-channel marketing strategy. Consequently, two complementary research streams are presented. The first pertains to strategic considerations regarding omni-channel retailing; the second pertains to value co-creation as seen through a service-dominant logic lens. These research streams are then linked to derive five propositions– along with examples and solutions – to assist retailing decision-makers when developing an omni-channel marketing strategy. These propositions underline the importance of viewing channels as value-facilitating resources that should be aligned with the customer’s decision journey.