Beyond firm-customer interactions to better customer experience
Abstract
This dissertation puts forward a mix of quantitative and qualitative methods to study the effects of low control determinants and peer-to-peer interactions on customer experience. Peer-to-peer (P2P) is the exchange between participants of equal power and authority to perform common tasks in a service context. It was made popular by file sharing system like Napster. Some firms have successfully harnessed P2P interactions to advance their competitive position. As an example, online communities for open source software provide collaborative platforms for users to share information, as well as exchange and look for social support. These platforms are often sponsored and hosted by firms who in turn benefit from the insights generated that can be used for product and service development (Libai et al. 2010). The structure of consumption comprises consumer actions that directly engage objects and often involve interactions with other people including P2P interactions. Holt (1995) refers to the latter as consuming as play and consuming as integration. Despite these developments, there are limited examples of firms using P2P interactions as a lever to improve customer experience, drive satisfaction and loyalty (Zomerdijk & Voss 2010). The literature is filled with strategies to manage customer experience (Bitner 1992; Berry & Carbone 2002; Rust & Chung 2006; Bitner, Ostrom & Morgan 2008; Schmitt 2010; Rosenbaum & Massiah 2011; Achrol & Kotler 2012; Pine & Gilmore 1998, 2014) using firm controllable factors. However, there is a dearth of research on how firms can exert influence over firm uncontrollable factors or low control determinant. Consequently, this dissertation proposes the concept of low control determinants to bridge the vital research gap. The author defines low control determinants as factors that affect customer experience, but firms have little influence over. With archival data of an island resort, the quantitative analysis proposed a proof-ofconcept for low control determinants as a situation moderator in customer experience (Verhoef et al. 2009) based on extant literature on customer experience management. Specifically, the climate factor was hypothesized as the situation moderator between functional, mechanic and humanic clues respectively, on customer experience. From the findings of the quantitative study, the moderating effects of climate factors were inconclusive, although the direct effect of climate factors on customer experience was significant. The findings might be due to a selection bias and perhaps a coarse measurement of the independent variable – the daily average temperature was used to represent climate data instead of, say, the hourly breakdown. Nonetheless, the significant direct effects of a low control determinant suggested that firms need to identify low control determinants in addition to high control determinants and have strategies to exert influence over them. A second study used a qualitative case study method to investigate how firms could exert their influence over low control determinants. The second study used ethnographic research techniques and interviews to gather insights into how a local healthcare organization exerted influence over P2P interactions. Empirical research in brand experience, customer decision journey, sense of community and normative community pressure for firms, formed the basis for developing the conceptual model for the qualitative research framework. In-depth interviews with 39 administrators and customers or patients uncovered experiential dimensions of respondents and allowed respondents who were regular members of the wellness centers managed by the focal healthcare organization, to describe their feelings and experiences in their languages. The wellness centers were extensions of the healthcare organization into the residential estate; they were assimilated into the residential community without the infrastructure complexities of a hospital. The healthcare organization conceived of the wellness centers as a first step to promoting supported self-management of community-dwelling seniors. Besides explicating the governing mechanism of P2P interactions in building a sense of community, the qualitative study assessed the resulting outcomes on customer experience and effects on customer well-being. The study found a role transformation in the firm as it expanded its reach from that of a provider in institutional settings to that of a facilitator or catalyst in the community that was closer to community-dwelling seniors or patient. As a catalyst, the firm evolved its operating framework, and the researcher distilled the findings into a managerial implementation framework for firms interested to harness P2P interactions to improve customer experience. Customers in P2P interactions are not mere recipients, but active contributors or co-producers to the community. Instead of firm-sponsored support functions, firms could harness P2P interactions as a cost-efficient strategy that could deliver transformative customer experience. Firms could harness P2P interactions by facilitating customer helping behaviors which could be more effective than firm sponsored resources in achieving desired outcomes. P2P interactions offer a promising strategy for firms interested to deliver superior outcomes at lower or not impact on their cost structure. This research offered prescriptive value for managers to expand firm capabilities and capacities without the corresponding increase in costs. The insights that were generated informed and provided managers with an implementation framework to exert control over P2P interactions. In conclusion, the findings contributed to the literature in customer experience management and transformative service research through an advanced understanding of how a firm can deliver a transformative experience of lasting customer benefits.