Customer Engagement in Theory and Practice
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Customer Engagement in Theory and Practice

A Marketing Management Perspective

Katarzyna Żyminkowska

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eBook - ePub

Customer Engagement in Theory and Practice

A Marketing Management Perspective

Katarzyna Żyminkowska

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About This Book

Offering a pragmatic understanding of customer engagement as an object of effective marketing management, this book takes an integrative approach and brings together different streams of marketing research, such as customer activism and value formation. The author explores the notion of customer engagement by analysing empirical data compiled from firms operating in the consumer goods and services sectors, as well as from the consumers themselves. An insightful read for scholars of consumer behaviour and customer relationship management, this book advances understanding of the drivers, components and effects (both positive and negative) of customer engagement and proposes a comprehensive framework for its management.

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Year
2019
ISBN
9783030116774
© The Author(s) 2019
Katarzyna ŻyminkowskaCustomer Engagement in Theory and Practicehttps://doi.org/10.1007/978-3-030-11677-4_1
Begin Abstract

1. Concepts of Customer Activism

Katarzyna Żyminkowska1
(1)
University of Bielsko-Biala, Bielsko-Biala, Poland
Katarzyna Żyminkowska

Abstract

The concept of customer engagement refers to the customer activism in value formation, which is not a new notion in the marketing and management literature. Theories of customer activism constitute particular anchors for systemizing the knowledge on customer engagement. Drawing on the contributions of two influential metatheories, such as value co-creation and network management, and related concepts (including service-dominant logic, customer participation, prosumption, customer integration, or user and open innovation) Żyminkowska recommends realistic view on CE phenomenon and suggests the adequate terminology to describe the role of CE in firm-level value creation. The recommended term of ‘value co-formation’ encompasses both positive CE consequences for firm (i.e. value co-creation with active customer) and potential negative outcomes or risks (i.e. value co-destruction by active customer).

Keywords

Customer engagement theoretical foundationsCustomer activismRealistic view on customer engagementCustomer engagement in interactive value co-formation
End Abstract
The phenomenon of customer activism, which is the inevitable feature of customer engagement concept, is not a new notion in the marketing and management literature. There are at least a few theoretical concepts that offer the explanation of how and why individual customers may act as firm’s active partners, what are the frameworks of managing such an activism by firms, and what are its firm-level outcomes. While developing any novel marketing theory related to the customer activism (including customer engagement), those achievements need to be taken into consideration as a broader context. Otherwise, when the new ideas are developed in isolation from existing ones, the researchers face the risk of ‘reinventing the wheel.’ Therefore in this retrospective chapter we discuss the concepts of customer activism, indicating its potential for the exploration of CE phenomenon in the marketing management field.
The concepts of customer activism, that form foundations for customer engagement theory development, are generally associated with two influential metatheories that have broadly impacted contemporary marketing management and have been diffused within this field. These are the value co-creation and the network management macro constructs that are discussed in the next sections. The theoretical achievements within these metatheories and related concepts (see Fig. 1.1) constitute particular anchors for enhancing the marketing management perspective on CE in the broader, theoretical context.
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Fig. 1.1
Concepts of customer activism—theoretical foundations for understanding customer engagement phenomenon

1.1 Value Co-creation Phenomenon and Related Concepts

The activism of a customer in value co-creation relates to the new consumer role in a society forecasted by Alvin Toffler and termed as a prosumer. Prosumers, that is, proactive consumers, were common consumers who were predicted to become active to help personally improve or design the goods and services of the marketplace, for themselves or other customers (Toffler 1980). Prosumption involves both production and consumption rather than focusing on either one or the other separate sphere. A series of recent social changes, especially those associated with the internet and Web 2.0, have made prosumption a common phenomenon. The development of self-service technologies is also a key driver of prosumption since customers are empowered to perform tasks that traditionally were completed by firms’ staff (Fisk et al. 2008). However, prosumption is quite a challenging phenomenon from a managerial point of view. As Ritzer and Jurgenson (2010) suggest, firms have more difficulty controlling prosumers than producers or consumers, and there is a greater likelihood of resistance on the part of prosumers who are against being asked to contribute to corporations without pay. This would implicate that some customers may also be resistant to engaging them in any interactions with firms or brands, and the customers’ activism (including engagement) may not be a common phenomenon.
Prosumption notion has been reflected in the new model of the market termed ‘the market as forum.’ According to the traditional meaning, the main market function was to exchange the value between a firm and a consumer. This function was separate from value creation process. The new market concept pervades the entire system of value creation, instead of being outside the value chain system. The value is co-created during the consumer experiences at different points of interactions, where products, distribution channels, technologies, and employees are viewed as experience gateways. Therefore consumers are active partners in the joint value creation process, not just simple passive recipients of the value creation of others (Prahalad and Ramaswamy 2004). The idea of market as a forum explains the essence of value co-creation with active, engaged customers. The significance of this idea, based on value co-creation metatheory in marketing at large, has been contributed mostly by service marketing achievements (Grönroos 2006; Vargo and Lusch 2004), including customer participation issues. Then recognizing those achievements shed light on the contextual understanding of customer engagement phenomenon on consumer markets. Services are actions or performances, typically produced and consumed simultaneously. In many situations customers, employees, and other people in the service environment interact to produce the ultimate service outcome (Zeithaml et al. 2009). Hence customers are participants in service production and delivery, and value co-creation is an inevitable feature of service marketing. Customer participation means that the customer has impact on the service s(he) perceives, and becomes a co-producer of the service, and thus also a co-creator of value for himself (Grönroos 2007). However, the levels of customer participation may vary. According to Zeithaml et al. (2009), those levels may differ across various services: from low, when customer presence is required during service delivery (e.g. motel stay), through moderate, when customer inputs are required for service creation (e.g. full-service restaurant), to high, when customer co-creates the service (e.g. personal training). Moreover the levels of customer participation are related to the different modes of relationships that customers prefer. If transactional mode is preferred, customers are looking for solutions to their needs at an acceptable price, and they do not appreciate contacts from the supplier or service provider in between purchases. Customers may also prefer the relational mode, either active or passive. Customers preferring the active relational mode are looking for opportunities to interact with the supplier or service provider in order to get additional value. A lack of such contacts makes them disappointed, because the value inherent in the relationship is missing. If preferring passive relational mode, customers are looking for the knowledge that they could contact the supplier or service provider if they wanted to. In this sense they too are seeking contact, but they seldom respond to invitations to interact (Grönroos 2007). Then, there is the implication for customer engagement issues, since the customer’s willingness to engage or be engaged may probably vary, likewise in the customer participation case. Level of customer engagement may also vary across the customer segments and product categories involved, and may be associated with customer’s individual preferences and attitudes towards the relationship with firm or brand.
Participating customers may play various roles: helping oneself, helping others, and promoting the company (Bowers et al. 1990). So customers are referred to as partial employees of the organization and they contribute to the organization’s productive capacity. This requires managing customers as partial employees (managing customer participation), that is, recruiting, educating, and rewarding customers (Zeithaml et al. 2009). Hoffman and Bateson (2006) distinguish the following stages in customer participation management : developing customer trust, promoting the benefits and stimulating trial, understanding customer habits, pretesting new procedures, understanding the determinants of consumer behaviour, teaching consumers, and monitoring and evaluating performance. While putting customer to work companies must identify the work that customers perform best, understand why customers choose to work for (or against) a brand and what they expect in return, design and manage customer jobs, and identify the potential unintended negative consequences (Heskett et al. 2008). Thus, the broad body of knowledge on customer participation management implicates perceiving active customer (also engaged customer) through his/her role as partial employee of the firm and an object of management.
However, from a managerial point of view, customer participation is associated with a number of advantages and disadvantages. The primary advantage is that customers may customize their own service and produce it faster and less expensively (Hoffman and Bateson 2006). So customer participation may result in increased efficiency and productivity, and decreased production costs. Positive outcomes of customer participation also include increased perceived quality and value, higher customer satisfaction and loyalty, as well as lower price sensitivity and better service recovery (Mustak et al. 2016). On the other hand, customer participation is perceived as a major source of uncertainty and, as customer participation increases, the efficiency of the operation may decrease. This is due to the fact that firm is losing control of quality and the waste may increase, which increases the operation costs (Hoffman and Bateson 2006). Sometimes additional costs appear, when new or changed inputs are needed (Fließ and Kleinaltenkamp 2004), and also increased job stress or role conflicts for service providers’ front line employees (Mustak et al. 2016; Hsieh et al. 2004). Above-mentioned findings within the customer participation issues reveal the need for realistic view on the customer activism (and then customer engagement), and its ...

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