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Why customer disengagement matters

A theoretical conceptualization on the interrelations of customer engagement and customer disengagement

Bachelor Thesis 2016 64 Pages

Business economics - General

Excerpt

Content

ABSTRACT

LIST OF FIGURES

LIST OF TABLES

LIST OF ABBREVIATIONS

1 INTRODUCTION
1.1 CHALLENGES AND RESEARCH QUESTIONS
1.2 STRUCTURE OF THE THESIS

2 APPROACHES TO CUSTOMER ENGAGEMENT AND CUSTOMER DISENGAGEMENT
2.1 DEFINITIONS AND DISTINCTIONS FROM SIMILAR TERMS
2.1.1 The term Engagement in academic disciplines
2.1.2 Customer Engagement in marketing or service literature
2.1.3 Distinctions from similar relationship constructs
2.1.4 Different conceptualisations on Customer Engagement
2.2 WORKING DEFINITION OF CUSTOMER DISENGAGEMENT

3 DEVELOPING THE CONSTRUCT OF CUSTOMER DISENGAGEMENT
3.1 RELEVANCE OF CUSTOMER DISENGAGEMENT
3.2 CURRENT APPROACHES ON RELATIONSHIP ENDING
3.3 EXAMINATION AND EXPLANATION OF THE PROCESSUAL CHARACTER OF CUSTOMER DISENGAGEMENT
3.4 DIMENSIONS OF CUSTOMER DISENGAGEMENT

4 COHERENCE BETWEEN CUSTOMER ENGAGEMENT AND CUSTOMER DISENGAGEMENT
4.1 INTERRELATIONS BETWEEN CUSTOMER ENGAGEMENT AND CUSTOMER DISENGAGEMENT
4.2 CRITICAL DISCUSSION

5 CONCLUSION AND IMPLICATIONS

APPENDIX

REFERENCES

Abstract

Recently, plenty of research was conducted on engagement - more par- ticular on enhancing Customer Engagement (CE). The flip side of CE, namely Customer Disengagement (CDE), seems to be uncharted. Thus, this thesis elaborates a working definition on CDE. This includes the interrelation of CE and CDE. According to this paper, CDE is de- scribed as a psychological process that can cause the state of complete detachment from a Brand or Service (B/S). CDE could have behavioural outcomes in terms of Negative Customer Engagement (NCE). Addition- ally, it interrelates with former CE levels and varies across contexts. CDE is supposed to be a promising research field.

List of figures

Figure 1: Number of articles published within academic marketing and service literature since 2005 using one of the terms: "Consumer Engagement", "Customer Engagement", "Brand Engagement"

Figure 2: Google trend analysis (2009-2015) on the terms: Customer Engagement (blue), Consumer Engagement (red), Brand Engagement (yellow)

Figure 3: Proposed model of engagement and its attributes

Figure 4: Customer Engagement Cycle

Figure 5: Dynamic model - Key Engagement facets

Figure 6: Outcomes of Detachment

Figure 7: Main stages of dissolving personal relationships

Figure 8: Dissolution process between a customer and a brand

Figure 9: Conceptualization of the processual character of CDE

List of tables

Table 1: Foundational Premise of the Service-Dominant Logic

Table 2: Different dimensions of Customer Engagement

List of abbreviations

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1 Introduction

1.1 Challenges and research questions

At the present, almost all companies in the business-to-customer (B2C) environment and several firms in the business-to-business (B2B) context are strongly interested in interacting and engaging with their clients. This interaction between the parties occurs through multiple touchpoints (online or offline) (Dolan, Conduit, and Fahy 2016, 104). Online platforms, espe- cially such as Instagram, Facebook, Twitter, Snapchat, YouTube and also plenty more, allow firms to conduct intense conversations with their cus- tomers. The result entails massive value-creation with enormous potential to better serve the clients’ needs (Sashi 2012, 254). On the one hand, connections between companies and their customers are important rela- tionship marketing tools, when it comes to informing and briefing custom- ers about new products or related services. On the other hand, also firms are gaining data first-hand from different stakeholders in order to conduct new product development (Ommen et al. 2016, 2409) and deal with com- plaints (Brodie et al. 2011, 252).

In the long run, firms aim at increasing their customer base. To achieve loyal customers, who are a key determinant of a firm’s value, organisations must reduce defection rate, boost acquisition or realise both (Riebe et al. 2014, 990). From a firm’s viewpoint it is crucial to have a long-term and sustainable competitive advantage, which is partly pegged onto a firm’s capability to retain and to sustain the customer base (van Doorn et al. 2010, 253). Plenty of research has been conducted on the importance of retaining and satisfying clients and its positive consequences for firms in terms of customer recommendations and referrals, positive WOM and blogging or web postings (van Doorn et al. 2010, 253). Compared to re- taining customers, acquisition of new ones or ‘stealing’ them from a com- petitor often exceeds the costs of the former (Conti and Mai 2008, 421). A few researchers argue that focusing on acquisition is at least as crucial as the active defection reduction (Riebe et al. 2014, 990). In the context of defection, especially knowledge about Customer Disengagement (CDE) is rare (Bowden, Gabbott, and Naumann 2014, 775).

A specific bond between firms and clients is called CE. According to Mc Kinsey (2014), 69% of the interviewed CEOs confirm the importance of CE, especially in the digital environment. CE is rumoured to be a necessity in terms of corporate performance comprising sales growth, profitability, new product development and further aspects regarding health business- es (Brodie et al. 2011a, 252; Cheung et al. 2015, 241). Moreover, compa- nies engage customers in co-production or co-creation of products in order to enhance business performance and customer value (Jaakkola and Al- exander 2014, 247). The importance of CE is omnipresent and has led to several research approaches (Brodie et al. 2011a; Hollebeek 2011). In the last years, many studies (Figure 1) were implemented for a better under- standing of CE:

illustration not visible in this excerpt

Figure 1: Number of articles published within academic marketing and service literature since 2005 using one of the terms: "Consumer Engagement", "Customer Engagement", "Brand Engagement".

Source: Own illustration; referring to Brodie et al. (2011a), p. 252, Fig. 1.

Not only the published articles, further the google trend analysis (Figure 2) on the listed connotations views the concepts as highly relevant. Com- pared to consumer- or brand engagement, the interest in CE is still in- creasing. Additionally, in 2014 the Marketing Science Institute (MSI) pub- lished their research priorities within the timespan 2014-2016: among oth- ers, CE is a promising research field. Special emphasis was drawn to so- cial media engagement and engagement platforms (Marketing Science Institute 2014).

illustration not visible in this excerpt

Figure 2: Google trend analysis (2009-2015) on the terms: Customer Engagement (blue), Consumer Engagement (red), Brand Engagement (yellow).

Source: Google Trend analysis (2016), accessed on: 15.06.2016.

It is necessary to recognize the similarities amongst different research fields. Medical science for example “should both understand sickness and health, while at the same time, marketing science must understand both functional and dysfunctional relationships” (Bowden et al. 2014; Morgan and Hunt 1994, 33). This quote implies a pro- and backward customer management (CM) approach: both CE and CDE are supposed to be ubiq- uitous research fields. Especially the latter, CDE, is an upcoming aspect of a company’s CM strategy. Firms target at increasing their customer base. This includes a reduction in the defection rate. For instance, a defection rate decline of 5% could result in a jump in profits between 25% and 85% (Pressey and Mathews 2003, 138). Moreover, if dissolution occurs, the process should be as simple as possible in order to avoid negative Word of Mouth (WOM), -blogging, etc. A paper on relationship termination calls this a “Beautiful exit” (Alajoutsijärvi, Kristian, and Jaana 2000).

Bowden et al. (2014) offer a first insight into the new field of CDE. In another paper the authors answer the questions why CDE matters. The two articles bear in mind the complete idea of CM, including CDE. In particular, the interrelation between CE and CDE might help a company to intervene and deal with DE attitudes. Therefore, this thesis gives theoretical insights about the aspect of CDE. In order to elaborate CDE, the paper dwells on the following three research questions:

1. What is CDE (working definition)?
2. How could a CDE process look like and which different dimensions are possible?
3. What kind of interrelation exists between CE and CDE and can they be seen as opposites?

1.2 Structure of the thesis

This thesis is organised as follows: the next chapter presents the latest research outcome on engagement and CE (Chapter 2.1.1-2.1.2). The classification and conceptualisation of CE and a distinction of similar terms are imperative to internalize the train of thought in a better way. Based on CE, the thesis steps into a literature review on DE. Finally, a working defi- nition on CDE is elaborated in chapter 2.2. CDE is a significant topic only if it has a proven relevance in the field of CM. Hence, the importance of CDE is worked out in chapter 3.1. Relationship termination is often put on a level with CDE. As a result, chapter 3.2 provides insights into concepts of relationship dissolution and separates them from the paper’s (psycho- logical) view on CDE. In general, research on relationship ending is fairly vague. In particular, research on DE is not yet a relevant topic in research fields (Bowden et al. 2014, 775). Consequently, chapter 3.4 depicts differ- ent dimensions on CDE after examining the processual character in 3.3. At this point of the thesis, the reader will be well equipped with deep in- sights, both within CE and CDE. Foregoing, chapter 4.1 points out the in- terrelation of CE and CDE. A critical discussion and analysis in 4.2 rounds up the main ideas.

To test and improve the suggested ideas, future qualitative and empirical research should be conducted. However, this paper serves as one of the first insights into the interrelations between CE and CDE and its importance for firms involved.

2 Approaches to Customer Engagement and Customer Disengagement

The influence of existing and potential customers’, especially when it comes to innovation, is greater than ever before (Abrell et al. 2016, 324). Mainly, the end-customers’ voice and its generated content (videos, news, blogs, reviews and information) including its possible related values (Chapter 2.1.2) are of primary importance. The value obtained through co- creation might help to satisfy customers and at the same time benefit firms (Agrawal and Rahman 2015, 147). Thus, firms try to be as close and con- nected (for example through the usage of new technology) with customers as possible. Lately, the term engagement appeared when it comes to de- scribing the relation between firms and customers (Vivek, Beatty, and Morgan 2012, 122)

This chapter aims at presenting the term engagement including its con- cepts. Later, the latest research outcomes regarding CE are revealed. Un- der consideration of the developed theories and due to the coherence of DE and CDE (Chapter 4.1), a working definition of CDE is derived.

2.1 Definitions and distinctions from similar terms

2.1.1 The term Engagement in academic disciplines

Engagement is traced back to the 17th century. During this time people made use of the term to depict several notions including moral and legal obligations, tie of duty or military conflict (Brodie et al. 2011a, 254). The Oxford Dictionary (Hornby and Turnbull 2010) devotes the word “to en- gage” with the following meanings: to employ, to hold fast, to bind by a contract, to come into battle or to take part (van Doorn et al. 2010, 255). The two examples show the complexity and discord regarding the term. The engagement idea originates from related academic disciplines such as psychology, sociology, political science and organizational behaviour (Hollebeek 2011, 557). The extensive usage of the concept leads to vari- ous specifications and approaches: this includes civic engagement (Mon- dak, Jeffrey J., Hibbing, Matthew V., Canache, Damarys, Seligson, Mitch- ell. A., & Anderson, Mary. R. 2010, 1) as part of sociology, social engage- ment (Achterberg et al. 2003, 213) in the context of psychology, media engagement explained by Calder (2008) and last but not least employee engagement (EE) (Crawford, LePine, and Rich 2010, 834; Kahn 1990; Salanova, Agut, and Peiró 2005) as a representative of management liter- ature. Notably, in EE the interest has increased due to reports that show that a majority of the workforce dwells to be disengaged from their work- place. This so-called “engagement-gap” is costing U.S. businesses over $300 billion in lost productivity per year (Saks 2006, 600). On the firms level it is proofed that there is a positive correlation in between EE and customer satisfaction and -loyalty (Salanova et al. 2005, 1224). Saks (2006, 603) defines EE as “the amount of cognitive, emotional, and physi- cal resources that an individual is prepared to devote in the performance of one’s work”. Crawford et al. (2010) highlight the triumvirate of cognitive, emotional and physical touch points. Compared to Saks (2006), Crawford et al. (2010) stress the self-expression among employees rather than the amount of resources. Schaufeli et al. (2004, 295) define engagement as an ongoing and pervasive, affective and cognitive state that is not directly related to a specific object, individual, event or behaviour. In terms of work engagement, engagement is observed as a “positive, fulfilling, and work- related state of mind that is characterized by vigour, dedication and ab- sorption" (Schaufeli et al. 2002, 465). The three dimensions are wider ex- plained by the authors:

“Vigour is characterized by high levels of energy and mental resilience […] and by the willingness and ability to invest effort […]. Dedication is characterized by a sense of significance, enthusiasm, inspiration, pride, and challenge. […] absorp- tion, is characterized by being fully concentrated and happily engrossed […]” (2002, 465).

Chapman (1997, 3) describes engagement as “[…] something that en- gages us is something that draws us in, that attracts and holds our atten- tion”. Chapman’s view on engagement is comparable with other research- ers’ results (compare Schaufeli et al. 2002, 465). In terms of media en- gagement, Calder and Malthouse (2008) claim that engagement is a “stronger state of connectedness between the customer and the media than liking alone” (van Doorn et al. 2010, 254). An all-embracing definition is not obtainable due to the numerous applications on various contexts and situations. Notwithstanding, the reviews on engagement agree on four aspects: engagement is a cognitive, affective, behavioural and social con- struct (Vivek et al. 2012, 128). This multidimensional approach on en- gagement is incumbent. Especially, the tri-partite of cognitive (absorption), emotional (dedication) and behavioural (vigour) engagement represents the different dimensions dependent on actors (subjects vs. objects) and contexts (brand, product and organization) (Brodie et al. 2011a, 254; Pat- terson, Yu, and Ruyter 2006). Bearing the three dimensions in mind, 40% of the definitions depict engagement as an unidimensional concept focus- ing on one of the three pillars (Brodie et al. 2011a, 255). Divergently from

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Figure 3: Proposed model of engagement and its attributes

Source: Referring to O'Brien and Toms (2008), p. 948, Fig. 3.

Schaufeli et al. (2002), O’Brien and Tom´s paper (2008) reveals the process character of engagement with own attributes inherent at each level. Figure 3 depicts the process character of engagement within the context of computer science.

According to the authors, the different steps include: the point of en- gagement, period of engagement, disengagement and re-engagement. Engagement is not supposed to always occur. Rather, it is a quality of us- er experience and is often embedded and connected to a bigger event or experience (O'Brien and Toms 2008, 942-948). The engagement process ranges from short-term and extremely variable to lasting and relatively stable manifestations. The process character and the open ended potential “for the evolution in intensity makes engagement a desirable outcome” (Fredricks, Blumenfeld, and Paris 2004, 61).

2.1.2 Customer Engagement in marketing or service literature

Chapter 2.1.1 introduced the terminology of engagement. From this point on, the thesis is focusing on marketing and service relevant connota- tions. Thus, the next lines elaborate engagement, more precisely CE.

With the beginning of the 21th century, practitioners and academics de- voted themselves to both the construct and concept of customer- and con- sumer engagement. This includes the Gallup CE metric (2011), many spe- cial issues in the Journal of Service Research, Journal of Services Market- ing and last but not least in the Advertising Research Foundation (Vivek et al. 2012, 128). Not only CE and consumer engagement, also brand-, ad- vertising- and media- are similar constructs that are in the spotlight of mar- keting and communication literature (Gambetti and Graffigna 2010, 805). Recognizing different variations of engagement - this paper solely focuses on CE. It can be viewed as an application of the construct of engagement (Vivek 2009, 21). In Appelbaum's (2001) comment ‘The constant consum- er’, he took engagement in business context into consideration. Based on his comment, uncountable definitions, constructs and concepts emerged (Brodie et al. 2011a, 254). To follow the ideas of Brodie et al., Appendix 2 provides an overview on various definitions and conceptualizations on CE.

It becomes clear that there is no consistent view on CE, but numerous definitions and applications. CE plays a key role in the customer centric marketing approach. This approach is a combination of the principles of market proximity and customer experience management. It was estab- lished to cope with the permanently evolving individual and social dynamic of the nowadays consumer behaviour (Gambetti and Graffigna 2010, 801) in order “to determine the value-adding required to meet [customers’] needs” (Sashi 2012, 258). From a firm’s perspective customers generate value for a firm. This value-creation often exceeds the mere transaction and purchase behaviour. Verhoef et al. (2010, 248) emphasize the raising importance of notably non-transactional customer behaviour. Van Doorn et al (2010, 254) argue that CE surpasses transaction and define it hence as “customer’s behavio[u]ral manifestations that have a brand or firm focus, beyond purchase, resulting from motivational drivers“. This behavioural manifestation can be either positive (WOM or blogging) or negative (com- plaints and demonstrations). Especially in order to prevent negative WOM, firms have started taking measures to engage their customers and devel- op stronger relationships (Agrawal and Rahman 2015, 148). According to Kumar et al. (2010) the value eventuating from customer engagement (CEV), independently if the value is generated from a transaction or not, can be segmented into four separate constructs: first of all, value derived directly from a transaction is called customer lifetime value (CLV). Second- ly, value derived from non-transactional behaviour: customer referral value (CRV), customer influencer value (CIV) and customer knowledge value (CKV) (Kumar et al. 2010, 307). Ignoring CE may lead to an overvaluation or undervaluation of customers’ potential (Verhoef, Reinartz, and Krafft 2010, 250). Kumar et al. (2010) disagree partly with the conceptualizations of van Doorn et al. (2010). They claim that CLV contains the main ideas. Nevertheless, the non-transactional values (CIV, CRV, CKV) must be added (Verhoef et al. 2010, 250). Not only the value provided for a firm, further the active role in the consumption process, the urge to co-create value to enhance customer relationships or to socialise with other custom- ers and the enjoyment of memorable experiences are of primary im- portance. The uppermost objective of CE is to boost conversational rela- tionships with consumers in order to fasten their brand attachment and loyalty (Gambetti and Graffigna 2010, 803). According to Lusch and Vargo (2014) the interactive and co-creative customer experience can be viewed as an act of engaging. Hence, CE represents a central role of the Service- Dominant Logic (S-D Logic) concept. Brodie et al. (2011a, 253) append that four (6, 8, 9 10) of the 10 foundational premises of the S-D Logic are representing the ideas of CE. The meaningful and sustainable interactions among companies and its customers elucidate the process character of CE that evolves over the course of a relationship. According to Sashi (2012, 255-256), CE is characterised as a process in terms of an engagement cycle (Figure 4).

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Figure 4: Customer Engagement Cycle

Source: Own illustration, referring to Sashi (2012), p. 261, Fig. 4.

As a matter of fact, CE allows companies to create better and more effective marketing strategies to target, acquire and retain their best customer. Thus, CE is considered to be a vital, but still new research stream within CM (Verhoef et al. 2010, 249).

2.1.3 Distinctions from similar relationship constructs

Practitioners and researchers have internalised the ideas of CE. Never- theless, confusion among similar notations occurs on a regular basis. As a consequence, CE is separated from consumer engagement and resem- bling concepts namely commitment, participation and involvement.

To start with the latter - Mollen and Wilson (2010, 924) are arguing that involvement is a crucial aspect of the engagement concept. However, there are three main differences between engagement and involvement: firstly, involvement needs a consumption object. Secondly, engagement exceeds involvement, meaning that engagement depicts the active rela- tionship with a B/S. Thirdly, engagement “requires the satisficing of expe- riential value” that is more than just the exercise of cognition (Mollen and Wilson 2010, 929-930). Involvement can occur with different objects (ad- verts, products or purchases). In terms of products involvement results in a bigger perception of attribute differences, perception of greater product importance or likelihood to choose a brand. Basically, it is the perceived relevance based on inherent needs, values and interests (Zaichkowsky 1985, 341). In his dissertation, Vivek (2009) views involvement as a factor indicating the perceived personal relevance, which leads to greater depth of processing several product trials or greater external search. According to Vivek (2009, 31), involvement is a psychological construct which does not indicate behaviour. Hollebeek and Chen’s (2014, 63) standpoint on involvement is comparable: involvement “does not require the undertaking of any specific interactions per se”. Thus, it is often seen as an antecedent of the behavioural construct of customer engagement (Vivek 2009, 31). Engagement, in contrast, requires a “proactive and interactive customer relationship” with an engagement object (Brodie et al. 2011a, 257). Amine (1998) agrees with Vivek’s approach on involvement stating that involve- ment “must be understood as a personal relevance of a product […]". Amine (1998, 311) adds that high levels of involvement result in consumer loyalty in terms of repeat purchases. Finally, the levels of involvement dif- fer depending on the service category. Lower levels of involvement have been identified primary in highly functional services such as banking, transport or mechanical repairs. These services focus mainly on delivering core, generic and standardised products or services (Bowden et al. 2014, 780).

In contrast, participative and co-creative services, e.g. experiential ser- vices (retailing, tourist attractions or fine-dining restaurants), are more cus- tomised and complex. In these services, customers seek higher levels of interaction with providers. This interaction is also described as participa- tion (Bowden et al. 2014, 781). Vargo and Lusch (2004, 11) argue that customers are primarily operant resources (co-producer), rather than op- erand resources (target). Thus, a customer is involved in the whole value and service chain and participates as a co-producer. The term participa- tion is defined by Dabholkar (2015, 484)as “the degree to which the cus- tomer is involved in producing and delivering the service”. Studies concen- trate on virtual brand communities use the term CE as a substitute for par- ticipation or involvement (Schau, Muñiz, and Arnould 2009). Engagement, unlike other relational constructs (involvement, participation) needs a focal interactive customer experience with an unique engagement object (brand, advert etc.) (Brodie et al. 2011a, 257). Therefore, involvement ought to be separated from engagement. The same applies for participa- tion. Under consideration of the definition by Dabholkar (2015), participa- tion only reflects one facet of the multidimensional approach (cf. Chapter 2.1.4) of CE: the behavioural one. Therefore, participation does not entail the psychological facet of CE. As it is evident from Dabholkar’s definition: co-production, co-creation and customer participation view customers’ connection with firms, specifically in exchange situations (Vivek 2009, 24). Brodie et al. (2011b, 107) recognize that both involvement and participa- tion act as prerequisite to drive engagement and/or consequences result- ing from the iterative engagement process. Customers’ levels in participa- tion range from firm - over joint - to customer production (Meuter and Mary 1998, 1). Nevertheless, literature argues that concepts such as commit- ment, connection, attachment, emotional involvement or participation are used to depict own engagement forms. This reflects the disagreement re- garding the separation among the listed term. Being aware of this discord, the thesis follows the train of thought that distinguishes engagement from similar constructs (Brodie et al. 2011b, 105).

The last construct to be separated from CE are the omnipresent ideas regarding commitment. Compared to loyalty, commitment depicts bonds (or attitude strengths) between a consumer and a specific brand. Loyalty, in comparison, solely indicates a repurchase behaviour (e.g. intention to return) (Amine 1998, 310; Bowden 2009, 70). Morgan and Hunt (1994, 23) define commitment as “an exchange partner’s believe that an ongoing re- lationship with another is so important as to warrant maximum efforts at maintaining it […]”. Therefore, the specific level of commitment determines the strength of a relationship and the intention of the parties to stay close and involved within it (Conti and Mai 2008, 422; Morgan and Hunt 1994). Commitment needs to be distinguished into two subgroups: affective and calculative commitment. Affective commitment reflects the extent to which a customer is willing to maintain the relationship with a brand due to affec- tive attachment (emotional feelings) and identification with the brand. Therefore, affective commitment is supposed to be crucial to reduce cus- tomers’ likelihood to substitute the habitual brand with a new one. In con- trast, calculative commitment draws the customer to a B/S according to an evaluation of costs of switching and benefits of remaining with brand. Thus, customers appear to be quasi loyal for opportunistic reasons. This approach considers the customer as cognitively committed, meaning that choosing a specific brand is less risky than buying another one (Amine 1998, 309-312; Vivek 2009, 97; Vivek et al. 2012). Especially, affective commitment develops progressively in a relationship; passion, for instance usually diminishes (van Doorn et al. 2010, 260). Brands that trigger strong brand commitment or attachment can win their clients over to engage (cf. Sashi’s engagement cycle in Figure 4). Compared to engaged customers, committed ones are characterised by less interactivity, immersion, passion and activation (Bowden et al. 2014, 776). Consequently, and in accord- ance with van Doorn et al.’s (2010, 256) CEB-model, commitment is identi- fied as a customer-based antecedent of CEB. Their view is in accordance with empirical evidence by Grégoire, Tripp, and Legoux (2009) that proofs commitment and trust influence CE levels (van Doorn 2011, 281). Brodie et al. (2011a, 260) state that commitment can be both an antecedent and or an outcome of CE, depending on whether considering a new customer or a repeat purchaser. The former explained constructs of involvement and participation as described by antecedents of CE.

The final separation differs consumer engagement from CE. Vivek (2009, 22) defines consumer engagement “as the intensity of consumer’s participation and connection with the organization’s offerings, and/or orga- nized activities”. Thus, consumer engagement includes both users and potential ones. In contrast CE relates to those people who purchase something and/or are actively engaged in some form of exchange transac- tion. This leads to the argument that a customer is a consumer, but a con- sumer is not supposed to be a customer due to the fact that the former is not urgently involved in transactional exchange (Vivek 2009, 22ff.).

2.1.4 Different conceptualisations on Customer Engagement

The previous subchapters introduced casually different ideas on CE. In the following, these are more specifically explained. Hence, this subchapter aims at filtering out a conceptualisation on CE that can be used as a working definition and conceptualization of CDE (Chapter 2.2).

According to the classic view, the customer is considered as exogenous and passive in his or her relation with a firm. Thus, customers accept val- ues provided by the factory. Transaction oriented CM approaches are out- dated and therefore not enough for a company to survive in the constant evolving market (Bijmolt et al. 2010, 341).Consequently, firms use e.g. the popularity of virtual communities to engage with both customers and con- sumers. Especially online platforms forge relationships with existing and new customers (Sashi 2012, 255). Values resulting from diverse engage- ment activities (CEV) are essential for a firm’s value (Kumar et al. 2010, 307). The behaviour, in the present case CE behaviour, views the cus- tomer as an active client who creates value in interaction with various stakeholders. Thus, value creation occurs through the integration of re- sources in exchange between different stakeholders (Alexander and Jaak- kola 2016, 3; Lusch and Vargo 2014). In other words, customers are in- volved in, and are part of, the value creation process of a B/S. This entails for instance, a constructive feedback to improve services or find solutions developed in exchange with the firm (Bruhn, Keller, and Batt 2015, 87). In general, a value proposition is comparable to an invitation from a third par- ty (firm) to engage with customers or simply to align their connection. Be- cause value propositions differ (highly intense to low intense), some cus- tomers engage others disengage from B/S (Chandler and Lusch 2015, 12).

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Pages
64
Year
2016
ISBN (eBook)
9783668301948
ISBN (Book)
9783668301955
File size
1.8 MB
Language
English
Catalog Number
v340369
Institution / College
University of Bayreuth
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1.3 (sehr gut)

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Title: Why customer disengagement matters