Please use these tree papers and write the paper , expecting a paper of 8 pages excluding title and references

CONCEPTUAL/THEORETICAL PAPER

Customer engagement in service

V. Kumar1,2,3,4 & Bharath Rajan1 & Shaphali Gupta1,5 & Ilaria Dalla Pozza6

Received: 1 February 2017 /Accepted: 20 September 2017 /Published online: 7 October 2017 # Academy of Marketing Science 2017

Abstract We develop a framework to facilitate customer en- gagement in service (CES) based on the service-dominant (S- D) logic. A novel feature of this framework is its applicability and relevance for firms operating both in developed and emerg- ing markets. First, we conduct a qualitative study involving service managers from multinational companies (MNCs) across the developed and emerging markets to understand the practitioner viewpoints. By integrating the insights from the interviews and the relevant academic literature, this framework explores how interaction orientation and omnichannel model can be used to create positive service experience. We also iden- tify the factors that moderate the service experience, and

categorize them as follows: offering-related, value-related, en- abler-related, and market-related. Further, we also propose that perceived variation in service experience moderates the influ- ence of service experience on satisfaction and emotional attach- ment, which ultimately impacts customer engagement (CE). From these factors, we advance research propositions that dis- cuss the creation of positive service experience. One of the study’s key contributions is that MNCs can focus their attention on the moderators to ensure consistency in positive service experience, in an effort to enhance CE.

Keywords Service experience . Customer engagement .

Developed markets . Emerging markets . Service-dominant logic

Introduction

The emergence of service activities globally can be observed at the firm level through the concept of customer engagement (CE). In such an environment, engaging with customers has been recognized as a viable way for enhancing brand and firm performance (Gartner 2014). For instance, Gallup research found that on a per-trip basis, Bfully engaged^ customers in the consumer electronics industry spent $373, compared to $289 by the Bactively disengaged^ customers (Sorenson and Adkins 2014). With financial performance at stake, service firms would, therefore, be more inclined to engage with their customers.

Research studies have identified CE as a key success factor for firms (Kumar and Pansari 2016; Verhoef et al. 2010). In this regard, value contribution from customers to the firms extends beyond just purchases transactions to also include non-purchase related customer behaviors (Kumar and Reinartz 2016). All these ways of customer value contribution

Satish Jayachandran served as Area Editor for this article.

* V. Kumar [email protected]

Bharath Rajan [email protected]

Shaphali Gupta [email protected]

Ilaria Dalla Pozza [email protected]

1 Center for Excellence in Brand & Customer Management, J. Mack Robinson College of Business, Georgia State University, Atlanta, GA 30326, USA

2 Huazhong University of Science and Technology, Wuhan, China 3 Hagler Institute for Advanced Study, Texas A&M University,

College Station, TX, USA 4 Indian School of Business, Hyderabad, India 5 Management Development Institute (MDI), Gurgaon, India 6 IPAG Business School, 75006 Paris, France

J. of the Acad. Mark. Sci. (2019) 47:138–160 DOI 10.1007/s11747-017-0565-2

to the firm have been accommodated in the conceptualization of CE (Kumar et al. 2010; Van Doorn et al. 2010). Recently, Pansari and Kumar (2017) identified the components of CE to be direct and indirect customer contributions, and the antecedents of CE to be satisfaction and emotion. Additionally, Hollebeek et al. (2016) and Brodie et al. (2011) have established the fit between CE and S-D logic theories to understand CE implications for marketing practice better. The current study adopts this line of investigation in understanding CE in a service context using the S-D logic.

Despite the CE conceptualizations, little attention has been given to the type of market firms operate in. We believe this to be an important aspect for two reasons. First, while studies have identified the drivers and moderators of CE in developed market settings, no comparable studies exist in the emerging markets. Second, there is insufficient information regarding the drivers and moderators of CE that are relevant in a service setting that can also be applied across emerging and developed markets. This study aims to address these two gaps by pro- posing a framework (that accommodates emerging and devel- oped markets) for establishing CE in the service setting.

Service as the study setting

Within the service discipline, topics regarding the classifica- tion and characteristics of service and the service-dominant (S-D) logic have been identified as core topics of research (Grönroos 2011). Further, the popular approach of distinguishing services from goods has been challenged with newer perspectives such as focusing on value-in-use, and moving away from a goods-focused exchange process. In this regard, the S-D logic has been proposed as a better way to offer value to customers by focusing on their operant re- sources (Vargo and Lusch 2004). Additionally, such a view considers service as performing a specific action for another party (i.e., firm performing an action to customers in exchange to create value), as opposed to a firm’s unit of output (i.e., goods vs. services). For the purpose of this study, we adopt the definition and context of service as provided by the S-D logic.

An important aspect of the service exchange between firms and customers is the customer service experience. Literature has studied customer experience as Bcustomer activity chain^ (Sawhney et al. 2004), extending before and after the purchase instance (Arnould et al. 2002), and a co-creation processes (Carù and Cova 2003), among others. For the purpose of this study, we define service experience as the overall customer experience that is borne out of all forms of customer interac- tions, communications, and transactions regarding the service offerings, over time. Given the limited attention, the Marketing Science Institute (MSI) Research Priorities (2014;; 2016) have identified customer experience to be an important research challenge. Regarding the service setting,

Ostrom et al. (2015) have identified Benhancing the service experience^ as a top service research priority and highlighted sub-topics of research on the service experience. In light of these prior studies, we choose service as the study setting and service experience as the variable of interest.

The market type

Marketers continue to focus on developing offerings for de- veloped and emerging markets that can create profitable and loyal customers, as listed in Table 1.

However, with differing business climates across emerging and developing markets it is important to better understand country differences when engaging with customers. For in- stance, China’s fragmented social media landscape has forced major firms to compete for subscriber base even at the region level (Chiu et al. 2012). In such cases, firms would need guid- ance on navigating competition and connecting with their cus- tomers. A country’s technological capabilities is another chal- lenge area for firms worldwide. For instance, research on emerging markets has shown that for every ten percentage points increase in internet penetration, the per capita GDP increases by 1.2 percentage points, and for every ten percent- age points increase in broadband penetration, the per capita GDP increases by 1.38 percentage points (Qiang et al. 2009). Additionally, Ostrom et al. (2015) identified Bunderstanding service in a global context^ as a top service research priority. In this regard, research has questioned prior wisdom to show that service experience matters more when the economy is performing better, and not worse (Kumar et al. 2014).

The overall goal of this study is to understand the function- ing of CE in service (CES). Pansari and Kumar (2017) have identified the antecedents of CE to be satisfaction and emo- tion, which is the result of positive customer experience. We build on their framework by focusing on:

& How can firms ensure a positive service experience that can lead to higher CE?

& What variables influence the creation of a positive service experience? Specifically, does the market type (developed vs. emerging) have any influence on service experience?

To answer these questions, we conduct a qualitative study, and review related research to understand the challenges and relevance of ensuring CE in service activities. Based on the information gathered, we propose a framework to establish CES, and advance testable research propositions. Specifically, we propose that an interaction orientation ap- proach by the firm and an omnicahnnel model will drive the service experience of customers. A positive service experi- ence, in turn, can result in creating CE. In this process, we identify and group the moderating variables between interac- tion orientation and omnichannel model, and service

J. of the Acad. Mark. Sci. (2019) 47:138–160 139

Table 1 Select CE-focused marketing actions in the developed and emerging markets

What’s being done? Who’s doing it in the developed markets? Who’s doing it in the emerging markets?

Loyalty program (LP) • Companies provide incentives to make customers ° buy more (e.g., store cards such as Kroger Plus, ‘InCircle’ from

Neiman Marcus, and ‘ExtraCare’ card from CVS) ° buy often (e.g., frequent flyer programs such as ‘All-New Rapid

Rewards’ from Southwest Airlines, Star Alliance, and Marriott Rewards)

° buy intensively (e.g., aimed at product promotions, incentivized actions, and own purchases—‘My Starbucks Rewards’, aimed at depth of purchases— ‘REI Membership’, and aimed at purchases across multiple channels— ‘Loyallist’ by Bloomingdales)

• Companies provide incentives to make customers ° buy more (e.g., store cards such as Big Bazar in India, ‘In

Circle’ from Tata Consumer Products, Bonus Link Program in Malaysia)

° buy often (e.g., ‘Preview Sales’ from Shoppers Stop, Smiles an e-commerce Frequent Flyer Program in Brazil, and ‘Papa John Free Pizza Meter’ in Russia)

° buy intensively (e.g., aimed at product promotions, incentivized actions, and own purchases— ‘My Starbucks Rewards’ in India & Russia, and program aimed at promoting use of public utilities—Smartclub program in Shanghai)

Integrated marketing communications

• IBM’s BSmarter Planet^ campaign spanned multiple platforms and modes of communication to help convey to their customers and prospects that technology can contribute to solving world’s problems.

• Lipton Ice Tea, South Africa—The ‘Never lose your cool’ IMC campaign featured a well-integrated mix of social, online and traditional marketing tactics including merchandising, promotion, publicity outreach, and co-branding.a

Co-creation • The Heineken Open Design Explorations Edition 1: The Club is a progressive pop-up club based on the theme of ‘Changing Perspectives’. Guests throughout the Design week are encouraged to share their vision, becoming part of the co-creation process so Heineken can give its consumers the opportunity to be part of this evolving project.

• Imlek is a large dairy company from Serbia. For one of their brands - Moja kravica, the company sought ideas from customers to develop a new package design and format.

• Tanishq, the jewelry arm of the Tata Group, has launched ‘My Expression’, which invites consumers to submit an idea for Mia—the new Working Women’s line from Tanishq. The winner will get to collaborate with designers at Tanishq to design the latest collection.

• Coca Cola in South East Asia used online co-creation to gather expressions of its brand promise BEnergizing refreshment^ through videos, animations, illustrations and photographs that could be used in its marketing campaigns worldwide.

Cross-selling offers • Jones Lang LaSalle cross-sell their facilities management/ outsourcing services to manage properties. They also up-sell their strategic consulting services to help the customer’s property acquisition and/or liquidation efforts.

• Garanti Bank in Turkey—For increasing its cross selling activities, Garanti bank design solutions for small and medium enterprises (SMEs) through partnerships with powerful brands and institutions .

Multichannel management

• To provide superior customer service, London’s Gatwick Airport uses a combination of Twitter (for real-time customer support), billboards (for public information), and review sites (for information/ratings about facilities and retailers in the airport).

• ASOS in UK: Leading UK-based online fashion retailer ASOS launched an integrated Facebook shopping application powered by Usablenet’s platform that combines shopping and social media by extending full e-commerce functionality to the ASOS Facebook community.

• Burberry in Asia - Its social media platforms go beyond Facebook, Twitter and Instagram to include China’s WeChat and Japan’s Line into live-streaming and real-time engagement with its fans. They have also experimented with Snapchat and Periscope for real-time engagement.

• Uniqlo in China - In-store shoppers could try on outfits in front of screens with global city backdrops. These images were then sent to the company’s WeChat account where users could share the image with friends. Fans could also send a selfie if they could not make it to a store.

Referral marketing • Many companies including Sprint and Scottrade offer incentives to the referring and the referred customers.

• Tesla’s referral program in China offers a USD1000 reward to Model S owners and buyers who take advantage of word-of-mouth referrals of the electric carsb

Solicited customer feedback

• KFC in Australia—They are currently incentivizing consumers to provide feedback by offering discounts on items in exchange for surveys.

• Airbnb in America—They use Net Promoter Score to evaluate stay experience and how it could be made better. They also bring hosts together at local events so that they can share best practices and creative solutions and achieve even better results for future customers.

• Xiaomi in China - Smartphone manufacturer Xiaomi succeeds because it places customers at the center of their market research. When Xiaomi designs new products, it works with consumers, to obtain feedback and use these opinions to refine the design. They encourage users to share their good and bad thoughts on forums, and they take them seriously. Feedback sessions are structured, open, honest and useful—leading to actionable changes.

Social CRM • JCPenney posts hauls (fashion videos made by teens) on YouTube to take advantage of the user generated content.

• Taylor Swift used Google Hangouts to announce the release of her 2012 album, Red.c

• South Africa tourism uses CRM tools to make big commitments to social networks to engage with their customers better during the 2010 FIFA World Cup d

• Movistar Argentina, an Argentine telecom service provider allows its customers to cancel their mobile account via Twitter @MovistarArg.e

a BIntegrated Marketing Campaign by Lipton Helps Thirsty Beachgoers^ [available at http://www.marketingtango.com/integrated-marketing-campaign- by-lipton-helps-thirsty-beachgoers/] b http://www.scmp.com/business/companies/article/1845133/tesla-offering-us1000-bounty-model-s-referral-sales c B4Ways to Use Google Hangouts in Your Business,^ U.S. Small Business Administration, February 13, 2013, http://www.sba.gov/blogs/4-ways-use- google-hangouts-your-business (Accessed on August 13, 2014) d http://www.tourismcambodia.com/news/worldnews/1031/south-africa-tourism-ramps-up-call-center-social-crm-for-world-cup.htm e http://www.socialmediatoday.com/content/latin-americas-movistar-fields-social-media-agents-globetrotting-socialcrm-interviews-jesus

140 J. of the Acad. Mark. Sci. (2019) 47:138–160

experience into four categories: offering-related, value-relat- ed, enabler-related, and market-related.

After identifying the variables that influence service expe- rience, we explore how service experience can lead to the creation of CE. In doing so, we use the approach offered by Pansari and Kumar (2017) to propose that service experience leads to the creation of satisfaction and emotional at- tachment, which in turn leads to CE. However, based on the qualitative study, we identify that perceived var- iation in service experience moderates the influence of service experience on both satisfaction and emotional attachment. On the specific focus on the service setting, a key contribution of this article is the attention to how the service experience of customers varies across eco- nomic markets. We expect such a perspective will spur future discussion and research in this important area of study. We conclude this article by stating the contribu- tions of this study and identifying future research directions.

Related research

Literature has covered several engagement concepts such as customer engagement (Kumar et al. 2010; Pansari and Kumar 2017; Verhoef et al. 2010), customer engagement behaviors (Van Doorn et al. 2010), consumer brand engagement (Hollebeek et al. 2014), and customer engagement marketing (Harmeling et al. 2017), among others. For the purpose of this study, we focus the review of the literature on the customer engagement concept. Within the CE concept, studies have investigated topics such as a customer’s direct and indirect contributions (Pansari and Kumar 2017), interactive and co- creative experiences (Brodie et al. 2011), value co-creation (Jaakkola and Alexander 2014), and consciousness (Grewal et al. 2017), among others.

In defining/explaining CE, studies have adopted various perspectives. For instance, Kumar et al. (2010) adopt a value-based perspective and define CE as Bactive interactions of a customer with a firm, with prospects, and with other customers, whether they are transactional or non- transactional in nature.^ Van Doorn et al. (2010) adopt a be- havioral perspective and define CE as Ba customer’s behav- ioral manifestation toward a brand or firm, beyond purchase, resulting from motivational drivers.^ Brodie et al. (2011) adopt a multidimensional perspective and define CE as a Bpsychological state that occurs by virtue of interactive, cocreative customer experiences with a focal agent/object (e.g., a brand) in focal service relationships.^ Finally, Hollebeek et al. (2016) extends Brodie et al. (2011) by adopting a S-D logic perspective to define CE as Ba cus- tomer’s motivationally driven, volitional investment of focal operant resources (including cognitive, emotional, behavioral,

and social knowledge and skills), and operand resources (e.g., equipment) into brand interactions in service systems.^ The CE concept has been effectively adapted and developed to conceptualize and investigate several topics. In this regard, Table 2 presents representative CE studies in the marketing literature.

Regarding a broader theme, the current study incorporates and builds on the work of Hollebeek et al. (2016) (which is an extension of Brodie et al. 2011) and Pansari and Kumar (2017). First, Pansari and Kumar (2017) undertake a holistic viewpoint toward CE that Bencompasses all customer activities^ (p. 295). Such an approach results in direct contri- butions (i.e., customer purchases) and/or indirect contribu- tions (i.e., customer referrals, customers’ online influence, and customer feedback) to the firm. In essence, they use the tenets of relationship marketing to understand better how all customers can engage with the firm. While they do posit that CE will be enhanced in the case of service industry (when compared to goods), they do not provide details on how it does, and how it can be managed. This study fills that gap by identifying that a perceived variation in service experience can explain the increases in CE. Further, this study also provides managerial insights on how to manage the variation in service experience.

Second, Hollebeek et al. (2016) firmly integrate CE and S- D logic to develop a revised set of S-D logic–informed fun- damental propositions of CE (based on Brodie et al. 2011). Since the S-D logic states in axiomatic terms that service is the fundamental basis of exchange (Vargo and Lusch 2016), it is ideally suited for our study’s focus on the service setting. Further, Hollebeek et al. (2016) demonstrate the relevance of adopting an S-D logic-informed perspective of CE by advanc- ing managerial insights that can aid in enhancing Bcustomer interactions, which over time, facilitate the development of superior customer relationships and lifetime value^ (p. 2). These studies serve as the ideal foundation for us to investi- gate CE in the service context.

Qualitative study

To better understand the importance of service experience in establishing CE, we adopted the grounded theory approach (Glaser and Strauss 1967). According to this approach, Bknowledge is seen as actively and socially constructed with meanings of existence only relevant to an experiential world^ (Goulding 1998). Therefore, managers who are directly in- volved in delivering/overseeing service experience across the developed and the emerging markets were approached for their opinions and insights. The appropriateness of this technique has been established in recent studies on customer experience management (Homburg et al. 2017) and CE (Hollebeek et al. 2016).

J. of the Acad. Mark. Sci. (2019) 47:138–160 141

T ab

le 2

R ep re se n ta ti v e C E S tu d ie s in

M ar k et in g

S tu d y

A cc o u n t fo r m ar k et ty p e

(d ev el o p ed

o r em

er g in g )

N at u re

o f st u d y

(c o n ce p tu al o r

em pi ri ca l)

R es ea rc h fo cu s

K ey

co n tr ib u ti o n s

B o w d en

(2 0 0 9)

N o

C o nc ep tu al

P ro p os e a C E fr am

ew o rk

b as ed

o n th e ex te n t to

w h ic h

cu st o m er s ar e ei th er

n ew

o r re p ea t p u rc h as e cu st o m er s

o f a sp ec if ic se rv ic e b ra n d .

A cc o u n tf o r th e d ep th o f cu st om

er s’ em

ot io n al re sp o n se s

to co n su m p ti o n si tu at io n s th at le ad

to lo y al ty

an d

re pe at pu rc ha se .

K u m ar

et al . (2 0 1 0 )

N o

C o nc ep tu al

P ro p os e th at th e cu st o m er ’s en g ag em

en t v al u e (C E V ) is

co m p ri se d o f th ei r p u rc h as e b eh av io r, in ce n ti v iz ed

re fe rr al o f n ew

cu st om

er s, b eh av io r to

in fl u en ce

o th er

cu st o m er s’ p ur ch as e b eh av io r, an d v al u e ad d ed

to th e

fi rm

b y fe ed b ac k .

S u g g es t ap p ro p ri at e m et ri cs

fo r m ea su ri n g th e v ar io u s

co m p o n en ts o f C E V , an d p ro p o se

re la ti o n sh ip s

b et w ee n th e d if fe re n t co m p o n en ts o f C E V .

V an

D o or n et al . (2 0 10 )

N o

C o nc ep tu al

D ev el op

a co nc ep tu al m od el of

th e an te ce de nt s an d

co ns eq ue nc es

of C E B s th at re la te to cu st om

er ,f ir m , an d

so ci et y.

P ro p o se

a C E B M an ag em

en t P ro ce ss

w he re

fi rm

s id en ti fy , ev al u at e an d re ac t to

k ey

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B ro d ie et al . (2 0 11 )

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E x p lo re

th e th eo re ti ca l fo u n d at io n s o f C E b as ed

o n th e

re la ti o n sh ip

m ar k et in g th eo ry

an d th e S -D

lo g ic .

Id en ti fy

fi v e fu n d am

en ta l pr o p o si ti o n s o f C E , an d

d is ti n g u is h th e co n ce p tf ro m o th er re la ti o n al co n ce p ts .

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et al . (2 0 1 2 )

N o

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o ti o n al ,

b eh av io ra l, an d so ci al el em

en ts , an d id en ti fy

th e

an te ce d en ts an d co n se q ue n ce s o f C E .

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co n n ec ti o n s w it h ea ch

o th er

re la ti v e to

th e b ra n d ,

re g ar d le ss

o f w h et h er

th ey

ar e p u rc h as in g o r ev en

co n si d er in g p u rc h as in g th e b ra n d .

H o ll eb ee k (2 0 11 a)

N o

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ex pl ai n th e re la ti o n sh ip s

b et w ee n cu st o m er

b ra n d en g ag em

en t (C B E ) an d o th er

m ar k et in g co n st ru ct s.

Id en ti fy

p o te n ti al ly

d if fe re n ti al co n su m er

b eh av io r

o u tc o m es

ac ro ss th e pr o p o se d se g m en ts o f cu st o m er s.

H o ll eb ee k (2 0 11 b )

N o

E m p ir ic al

C o n ce p tu al iz e C B E u si n g li te ra tu re

an d re se ar ch

te ch n iq u es .

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th e le ve l o f a cu st o m er ’s co g n it iv e,

em o ti o n al an d b eh av io ra li n v es tm

en ti n sp ec if ic b ra n d

in te ra ct io n s.

H o ll eb ee k (2 0 1 3 )

N o

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h o w C E m ay

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ge n er at in g cu st o m er

v al u e (C V ) an d en su in g lo y al ty

fo r u ti li ta ri an

an d

h ed o n ic b ra n d s.

F o u n d (a ) a cu rv il in ea r re la ti o n sh ip

b et w ee n C E /C V fo r

u ti li ta ri an

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a le v el ,

in cr ea si n g C E g en er at es

gr ea te r C V fo r h ed o n ic , th an

fo r u ti li ta ri an

b ra nd s.

Ja ak k o la an d A le x an d er

(2 0 1 4 )

N o

E m p ir ic al

C o n ce p tu al iz e C E B in

v al u e co -c re at io n w it h in

a m u lt is ta k eh ol d er

se rv ic e sy st em

. P ro p o se s th at C E B af fe ct s v al u e co -c re at io n th ro u g h

cu st o m er s’ re so u rc e co n tr ib u ti o n s to w ar d th e fi rm

/ st ak eh o ld er s th at au g m en t th e o ff er in g .

H o ll eb ee k et al . (2 0 1 6 )

N o

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in te g ra ti v e, S -D

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ed fr am

ew or k o f

C E co m p ri si n g th re e C E fo u n d at io n al p ro ce ss es .

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ed F P s o f C E ,

an d ap p ly

th e re v is ed

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C R M

to g en er at e

m an ag er ia l in si g h ts .

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N o

E m p ir ic al

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en g ag em

en t m ar k et in g , an d p ro p o se

a fr am

ew o rk

to sh o w h o w en g ag em

en t m ar k et in g d ri v es

lo n g -t er m

C E .

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en t

m ar k et in g , d if fe re n ti at e it fr o m

o th er

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st ra te g ie s, an d o ff er

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o f

en g ag em

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an d ex p er ie n ti al )

th at ca n d ri v e lo ng -t er m

C E .

G re w al et al . (2 0 1 7 )

N o

C o nc ep tu al

P ro p os e th at co n sc io u sn es s as

a fo u n d at io n al p h il o so p h y

ca n b e u se d b y fi rm

s to

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en g ag in g an d

m ea n in g fu l cu st o m er

ex p er ie n ce .

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th at co m p an ie s ca n en h an ce

th ei r cu st o m er

en g ag em

en t b y b u il d in g o n fo u n d at io ns

o f

142 J. of the Acad. Mark. Sci. (2019) 47:138–160

Data collection

We conducted in-depth interviews with 46 managers from 42 business-to-consumer service firms (after initially ap- proaching 52 firms) headquartered in North America (2 each from Canada, Mexico, and the U.S.), the United Kingdom (5 companies), Germany (5 companies), France (5 companies), Netherlands (5 companies), India (5 companies), China (5 companies), Brazil (5 companies), and UAE (5 companies). A total of 31 face-to-face interviews and 15 telephonic inter- views were conducted during an 8-month period. Since four of the companies in our study had offices in both developed and emerging markets, two managers from each company (the one responsible for the developed market, and the one respon- sible for the emerging market) were interviewed. The man- agers we interviewed had, on average, over six years of expe- rience in a leadership role in the organization, and were pro- ficient with service industry practices.

The sample of managers was identified from the list of executives who participated in various conferences in each of the countries. We solicited the conference chair(s) to reach out to the executives. To determine the eligibility of managers to be included in this study, we used the following selection criteria: (1) deliver/oversee the service processes in their re- spective firms, (2) have the authority to move/direct company resources as needed, and (3) be responsible for increasing firm profitability. All criteria had to be satisfied for managers to be included in the study. The typical titles of the managers in- cluded Chief Marketing Officer, Vice President-Marketing, Director Marketing, Head—Emerging Market Business Operation, General Manager—Business Operation and Customer Management, among others. While the titles of these managers varied, their job functions were similar. These managers were from Fortune Global 1000 firms that belonged to sectors such as hospitality, financial services, high technology, retailing, telecommunication, and tourism, among others. Web Appendix 1 provides the description of our sam- ple of managers.

Interview guide

The interviews averaged 60–75 min in length and were con- ducted in two stages. In the first stage, the participants provid- ed an overview that included details about their firm, their focal business, their marketing activities, their offerings, the market they operate in, and their competitors, among others. Learnings from this stage presented us with a good under- standing of each firm’s nature and level of operation on their service offerings.

In the second stage, the participants provided information specific to the service offerings and their attention to the cus- tomer experience during the service exchange. Our goal was to understand the concept of service experience that wasTa

b le 2

(c o n ti n u ed )

S tu d y

A cc o u n t fo r m ar k et ty p e

(d ev el o p ed

o r em

er g in g )

N at u re

o f st u d y

(c o n ce p tu al o r

em pi ri ca l)

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s to

d ev el o p b u si ne ss

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P ro p os e a C E fr am

ew o rk , an d id en ti fy

it s an te ce d en ts

(s at is fa ct io n an d em

o ti o n ) an d co n se qu en ce s (t an g ib le

an d in ta n g ib le o u tc o m es ).

W h en

a re la ti o n sh ip

is sa ti sf y in g an d h as

em o ti o n al

co n n ec te d n es s, th e p ar tn er s b ec o m e en g ag ed

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co n ce rn

fo r ea ch

o th er , as

ev id en ce d th ro u g h d ir ec t

an d th e in d ir ec t co n tr ib u ti o n s o f C E .

G u p ta et al .

(f o rt h co m in g )

Y es

C o nc ep tu al

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ew o rk

fo r en g ag in g cu st o m er s g lo b al ly .

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h o w cu lt u ra l an d ec o n o m ic fa ct o rs ,p la y a k ey

ro le in

cr ea ti n g g lo b al C E fo r M N C s.

P re se n t st u d y

Y es

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to en su re

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se rv ic es

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m od el ca n le ad

to th e cr ea ti o n o f po si ti v e se rv ic e

ex p er ie n ce , an d id en ti fi es

th e m o d er at o rs o f se rv ic e

ex p er ie n ce .A

ls o p ro p o se s th at th e p er ce iv ed

v ar ia ti o n

in se rv ic e ex p er ie nc e m o d er at es

th e ef fe ct o f se rv ic e

ex p er ie n ce

o n sa ti sf ac ti o n an d em

o ti o n al at ta ch m en t.

J. of the Acad. Mark. Sci. (2019) 47:138–160 143

rooted in the managers’ experience. So we structured the dis- cussion around three core areas: (1) how managers understood and approached the concept of service experience, (2) the factors that they thought can enhance or diminish (i.e., moderated) the service experience of customers, and (3) the role of the market type (i.e., developed vs. emerging) in deliv- ering a superior service experience. The interviews encour- aged the participants to share their experiences on issues they deemed relevant to the topic of service experience. We worded the questions in a manner that elicited responses in a nondi- rective and unobtrusive fashion and avoided Bactive listening^ (McCracken 1988). Recognizing that the data collection and the subsequent analysis are interrelated in this approach (Corbin and Strauss 1990), the interviews also included our follow-up questions and clarifications (toward the end of each session). In essence, the data collection and the related analy- sis were iterative, and it was reflected in the categories that emerged from our coding procedure. Such an interview struc- ture helped us uncover a variety of information regarding the developed and the emerging markets while providing ample scope for finer analyses within each of the three core areas.

Data analysis

All the interviews were recorded and subsequently transcribed verbatim. Two researchers involved in this study, indepen- dently analyzed the data using the coding approach suggested by Corbin and Strauss (1990). The independent analyses led to the development of zero-order, first-order, and second-order categories as demonstrated in recent studies (e.g., Homburg et al. 2017).

In open coding, we grouped similar intending responses into zero-order categories. In axial coding, we identified pat- terns and interconnections between the zero-order categories and grouped them into first-order categories. This was achieved by integrating supplemental information from aca- demic studies and business consulting reports which exempli- fied the relevant context for this study topic. In selective cod- ing, we regrouped the first-order categories into four second- order categories that were tighter representations of the con- cept being studied. The second-order categories also provided a clearer direction in understanding service experience. In this stage, we also integrated the coding approaches that were arrived at independently to ensure internal consistency (Ulaga and Reinartz 2011). Table 3 provides the coding results from our study.

Reliability assessment

To ensure the reliability of results, we performed the following three steps. First, we requested two scholars (not familiar with this study) to review our coding approach and results, and the categories we had identified. Based on their review, we

assessed their interjudge reliability using the index suggested by Perreault and Leigh (1989). The reliability reached 0.81, which was above the 0.70 threshold recommended for explor- atory research (Rust and Cooil 1994). Second, we shared the summary report with the study participants and invited their response regarding the overall conceptualization and the pro- posed categorizations. We received responses from 23 partic- ipants, with several participants suggesting minor changes to the wording of the categories and concepts. This ensured con- tent validity and conceptual clarity (Ulaga and Reinartz 2011). Finally, we presented our proposed framework along with the categories to academic and practitioner audiences in three conference venues. They commented on our conceptualiza- tion, provided suggestions, and reflected on the accuracy of the proposed framework in capturing actual industry practices. This step also helped us in eliminating a few previously iden- tified categories, as they were not explicative of the topic being studied.1 Such a coding exercise and the following re- liability assessment confirmed to us that the key variables presented in this framework are closely representative of the actual business practices involved in ensuring a superior ser- vice experience.

A framework for customer engagement in services

Based on prior research and the managerial interviews, we propose a CES framework. In doing so, we draw upon the following S-D logic-informed CE definition proposed by Hollebeek et al. (2016) to inform us: BA customer’s motiva- tionally driven, volitional investment of focal operant re- sources (including cognitive, emotional, behavioral, and so- cial knowledge and skills), and operand resources (e.g., equip- ment) into brand interactions in service systems.^ This defini- tion serves as the foundation for our proposed framework to investigate the establishment of CES.

Accordingly, the proposed framework suggests that the firm-related factors (i.e., interaction orientation and omnichannel model) determine the service experience of the customers, which then results in CE. In addition to firm- related factors, we also identify moderating factors that impact the establishment of CES. We identify and categorize them as (1) offering-related, (2) value-related, (3) enabler-related, and (4) market-related. Typically, these moderating factors operate in the immediate business environment of a company and influence the effect of firm-related variables on the service experience. Figure 1 illustrates the CES framework that cate- gorizes the firm-related factors responsible for the establish- ment of CE in services.

1 We also thank the reviewers for their valuable feedback in helping us better identify and refine the categories.

144 J. of the Acad. Mark. Sci. (2019) 47:138–160

The CE variable encompasses customer contributions through their direct purchases, and their indirect profit contri- butions to the firm such as their referral behavior, online in- fluence on prospects’ and other customers’ purchases, and review/feedback on the products and services they consume (Kumar et al. 2010). As established by Pansari and Kumar (2017), we expect a favorable service experience to increase the level of customer satisfaction and make the customers emotionally connected with the firm, thereby creating CE. However, as revealed through the qualitative study, we iden- tify a perceived variation in service experience to moderate the influence of service experience on satisfaction and emotional attachment. The identification of this moderator, also a novel contribution to this study, is found to be in line with the S-D logic adopted in this study. Table 4 provides the definitions of the constructs proposed in our framework.

Firm-related factors

Based on the managerial interviews, we identify the firm- specific factors to encompass the efforts undertaken by firms to create an improved service experience for their customers and ultimately lead to the creation of CE in services. We pro- pose that these factors can be viewed as interaction orientation and omnichannel model.

Interaction orientation

We propose that an interaction orientation approach in firm– customer relationships will work toward enhancing the ser- vice experience for customers (Ramani and Kumar 2008). This calls for modeling the customer–firm relationships around (1) placing customers as the pivotal point of all

Table 3 Coding results and category development

Zero-order categories First-order categories Second-order categories

For main effects:

Unit of all firm actions are at the customer level Interaction orientation Service experience

Information feedback from customers

Encouraging customers to engage with the firm constantly

Focus on managing individual customer transactions and value

Presence of multiple communication and transaction outlets Omnichannel model –

Integration of all outlets at the customer level

Ability to transition between outlets during interactions

For moderating effects:

Individual differences among customers Perceived offering complexity Offering-related

Cognitive and intellectual abilities

Evaluation possibility of offering

Customer need recognition Trust in the firm

Uncluttered information and offerings

Influence of social connections

Customer retention efforts Loyalty program participation Value-related

Design and redemption of rewards

Data analytics

Traveling just to obtain a service Customer effort

Effort expended in evaluating an offering

Effort expended in consuming an offering

Competitive pressures Technology adoption Enabler-related

Market expansion

Differentiated offerings

Providing relevant content Social media usage

Encouraging communication & information sharing

Creating networked groups

Infrastructure (physical, financial, technological, and social) Developed vs. Emerging market Market-related

Availability, access, and spread of information

Economic growth patterns and market potential

J. of the Acad. Mark. Sci. (2019) 47:138–160 145

marketing initiatives, (2) ensuring a continuous and consistent experience in every service instance by incorporating custom- er feedback on a dynamic basis, (3) providing opportunities for firm–customer interactions that in turn shape the service experience, and (4) measuring and maximizing the value con- tributed by customers. From our field data, this point was best explained as follows:

Earlier, we were just concerned whether the cus- tomers were contented with our offerings. We cannot afford to think along those lines anymore. Now, we view all of our efforts and initiatives from the cus- tomer standpoint. When developing and delivering our offerings, we now consider aspects such as how closely it resonates with our customer requirements on a real-time basis, whether it would make them talk positively about it to their friends and family, whether it would make them stay with us for a longer period, whether we can enhance our overall profitability, how to improve the offerings based on evolving cus- tomer needs and preferences, and so on. It [our offer- ings] is all about customers now. (ID 10)

Another participant offered that:

We take great care in making sure that every time a customer transacts and/or communicates with us, the overall experience is superlative. We realize that get- ting every contact occasion correct the first time around, is critical in reflecting our focus on cus- tomers. That way, we either get it right and hold on to them, or get it wrong and not likely see them again! (ID 23)

In line with our managerial interviews, support for a customer-oriented approach can also be observed from the S-D logic which proposes that the firm and the customer are always in an interactional and a relational context and that the value is essentially customer oriented (see FP6 and FP8) (Vargo and Lusch 2008a). An approach that focuses on customers and interactions with customers to develop marketing campaigns has also been shown to re- sult in superior financial performance (Venkatesan and Kumar 2004). Therefore:

P1: An interaction-orientation firm strategy leads to a positive service experience.

Omnichannel model

Traditionally, firms viewed access to customers from perspec- tives such as distribution channels and physical products (Moriarty and Moran 1990). Later studies stressed the impor- tance of employing multiple channels for customer transac- tions and interactions (Kumar and Venkatesan 2005), which then influenced the conceptualization of multichannel custom- er management (Neslin et al. 2006). Early studies in this area focused primarily on sales transactions and how they can con- tribute to a firm’s enhanced financial performance (Kumar and Venkatesan 2005; Venkatesan et al. 2007). Further, Kumar (2010) extends beyond the transaction aspect and integrates communication channels, to suggest the adoption of a strate- gic multichannel, and multimedia communication framework, which focuses on customer preferences and the creation of customer value.

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Fig. 1 A framework for studying customer engagement in service

Now, firms are moving toward an omnichannel model, wherein firms will be able to interact and engage with customers through innumerable channels (Rigby 2011). For instance, Macy’s has adopted the omnichannel strategy in a big way as expressed by former chairman Jeffrey Kantor, BWe’re always going to win with omnichannel. It all goes back to the customer, and customers like to shop different ways at different times. If we give them a good experience – whether they choose to shop online or in the store or from their mobile device – we believe they’ll choose to shop with Macy’s^ (Reda 2012). Further, com- panies such as Indochino (Smith 2016), and Finish Line (Whitler 2013) have appointed a Bchief omnichannel officer,^ thereby indicating the importance given to interaction.

Whereas the multichannel strategy primarily considers re- tail channels, the omnichannel strategy focuses more on the

interplay between channels and brands (Verhoef et al. 2015). In other words, the omnichannel extends beyond the typical channel management strategies to include seamless transition between channels, and superlative user experience (Brynjolfsson et al. 2013). This occurs with the firm playing the role of an integrator of channels. On the firm’s role as an integrator, the ninth foundational premise (FP9) of the S-D logic identifies resource integration as the essential role of the firm (Lusch et al. 2007). This thought was captured in our interview as:

Our operating philosophy is clear—our customers are here for superior service, and it is our priority to give them just that. To deliver on our priority, we strive to forge multiple ways by which we can institute a

Table 4 Variables used in the conceptual framework Variables used in the study Definition

Interaction orientation A composite construct that consists of an organization’s fundamental belief (the customer concept) and the relevant processes (interaction response capacity) and practices (customer empowerment and customer value management) that supplement this fundamental belief (Ramani and Kumar 2008).

Omnichannel model Synergetic management of the numerous available channels and customer touchpoints, in such a way that the customer experience across channels and the performance over channels is optimized (Verhoef et al. 2015).

Perceived offering complexity The breadth of knowledge and skills required, as perceived by the consumers, to understand and use a service offering.

Trust The feeling and understanding of the customers that the named firms will fulfill their needs (Anderson and Weitz 1989).

Loyalty program participation The enrollment in a loyalty program as observed through the ownership of a store credit card.

Customer effort The degree of effort exerted by the customer to access and consume a service offering.

Technology adoption The degree of receptiveness of an individual to accept and use technology-based resources to interact with the firm.

Social media usage The particular consumption of digital media or Internet that has little to do with traditional informational media use (Correa et al. 2010).

Developed market vs. Emerging market

Developed markets are characterized by a significantly high level of economic development and well-established political, legal, financial, administrative, and social infrastructures.

Emerging markets are characterized as those experiencing rapid informationalization under conditions of limited or partial industrialization (Societies 2008).

Service experience The overall customer experience that is borne out of all forms of customer interactions, communications, and transactions regarding the service offerings, over time.

Perceived variation in service experience

The difference in the experience of consuming a service, as perceived by the consumers, over successive service encounters.

Satisfaction The buyer’s s cognitive state of being adequately or inadequately rewarded in a buying situation for the sacrifice he has undergone (Howard and Sheth 1969).

Emotional attachment The emotion-laden bond between a person and a brand characterized by deep feelings of connection, affection, and passion (Thomson et al. 2005).

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harmonious two-way mechanism for interaction and communication between our customers and us. This al- so represents a change in our approach to court cus- tomers that was anchored around touting our low prices, to one that impresses on providing impeccable service and an enjoyable buying experience. It [the change in approach] has been challenging, but we are doing ev- erything to help us move in this direction. (ID 18)

An omnichannel setting enables customers to seek infor- mation through online or offline formats, and receive the ser- vices through in-store (e.g., fitness centers, children daycare centers) or have it delivered at home (e.g., personal fitness trainers, babysitters) formats (Brynjolfsson et al. 2013). Further, it has been identified that the Internet is a superior channel for searching for product information, while the retail store is a superior channel for service (Verhoef et al. 2007). These studies indicate that customers are likely to use multiple channels within a single purchase instance. Therefore, we propose that when firms put in place an omnichannel medium, it enables the easy and seamless exchange of communication between firms and customers, and aids the firm in delivering better service experience. Therefore:

P2: An omnichannel model leads to a positive service experience.

Moderating variables

In developing this framework, the managerial interviews helped us identify variables that moderate the effect of service experience from a customer perspective. Based on the inter- view responses and prior literature, we have identified and categorized these variables as offering-related (pertaining to the services offered by the firms), value-related (pertaining to the trade-off between what the customer gets and what they give up in experiencing the services), enabler-related (pertaining to how certain variables enable the consumption of the services offered), and market-related (pertaining to de- veloped market vs. emerging market).

With the market type being a key area of interest in this study, it is worth noting that all respondents asserted that emerging markets were important to their long-term financial success. Of these respondents, more than 75% admitted that the complexities posed by the emerging markets were over- whelming. Specifically, despite the MNCs being endowed with large capital structure, a diverse talent pool, rich experi- ence, superior research and development potential, and global brand awareness, they continue to face intense competition from local companies in the emerging markets. Further, while the untapped potential offered by the emerging markets was

lucrative, a Bone-size-fits-all^ approach to the emerging mar- kets would never work. In other words, the differences be- tween developed and emerging markets, and the diversity of the emerging markets were reportedly significant.

Offering-related variables

Perceived offering complexity This variable corresponds to the level of complexity, as perceived by the consumers, in understanding and consuming the service offering. While it is commonly understood that services range from low in com- plexity (e.g., hair stylists) to high in complexity (e.g., psycho- logical counseling), the perceived aspect warrants a focus for two important reasons. First, individual differences among customers play an important role. That is, whereas expert cus- tomers will be more adept at processing relevant information regarding the service offering, novice customers are not likely to be as well equipped. In this regard, prior studies have looked into variations in cognitive abilities (Malhotra 1982), and the level of knowledge (Alba 1983) in understanding individual differences among customers.

Second, the difficulty in evaluating a service pre- and/or post-consumption impacts the perceived offering complexity. That is, some services are difficult to evaluate before purchas- ing (e.g., child care services), and some services remain diffi- cult to evaluate even after consumption (e.g., medical care) (Berry 1995). Additionally, it has been found that customers who lack technical skills and knowledge will perceive a given service as more complex than expert customers (Patterson et al. 1996). Further, in professional service encounters, Mikolon et al. (2015) found that customers’ cognitive capacity is reduced at moderate levels of perceived complexity and that a lack of cognitive capacity decreases customer satisfaction with the service encounter and loyalty intentions toward the company.

Effect of perceived offering complexity on the relationship between interaction orientation and service experience Interaction orientation has been identified as a knowledge- based resource for firms as it enables the development of relevant processes and practices that are customer-focused (Ramani and Kumar 2008). When delivering complex offer- ings firms can face challenges in establishing processes and practices that are easy for customers to understand and appre- ciate. For instance, complex service offerings such as medical care and automotive services are typically high on routine processes and practices that are necessary (and even critical, in some instances) in fulfilling the delivery of the service. However, the energy expended in navigating through these processes can dampen the customer’s positive experience in consuming the service. Additionally, complex offerings can require consumers to process large amounts of information and/or highly technical information before consuming the

148 J. of the Acad. Mark. Sci. (2019) 47:138–160

offering. This may cause Binformation fatigue^ and thereby lead to a negative service experience. For instance, customers can suffer from an information overload (Jacoby 1984) and that the number of alternatives and the number of attributes of information that can be processed without experiencing the dysfunctional consequences of overload is limited (Malhotra 1982). Therefore, we propose that a complex offering can suppress the positive effect of interaction orientation on the service experience. This thought was reflected in the follow- ing quote:

We pride ourselves on the fact that our customers always stand by our offerings, despite the intricacies involved. This has been achieved by our constant attention to our customer needs and expectations, and the development of our offerings that precisely answers their needs. While we are clear on how this works, we do not take it for granted that this will happen all the time. One wrongly timed/executed service function is all it takes to upset the entire customer experience. (ID 2)

Therefore, we propose that:

P3a: The positive relationship between interaction orientation and service experience is diminished by the perceived offering complexity.

Effect of perceived offering complexity on the relationship between omnichannel model and service experience Customers of complex offerings typically go through a highly involved purchase decision process (Beach and Mitchell 1978). Further, the format and the load of information required has been identified as an important dimension in consumer task completion (Newell and Simon 1972). Regarding the information load, Jacoby (1984) identifies that it can be time-consuming for consumers to reach a decision and that it could result in a situation where they may overlook some critical information. The importance of interactivity in com- munication between firms and consumers has been identified to be a unique feature of the S-D logic (Lusch et al. 2007). In evaluating complex offerings, customers spend more time in seeking out information about the offering through multiple formats, and in interacting with the firm. This heightened level of involvement in understanding a complex offering can lead customers to make sub-optimal decisions, or even unsuitable decisions, which could result in negative experiences. We ob- served this from the following comment:

Let’s say that a viewer is watching our commercial on TV, and they happen to be in the market for our service. Look, we understand that we are not in a business where

customers make their decisions instantly. So what do they do? They reach out to gather more information about the service through as many ways as they can. So it is critical that we integrate all forms of our content; be it TV, website, mobile, etc.; to provide that viewer with a continuous and incremental learning experi- ence in our service, with the ultimate expectation that they would choose to shop with us. So this is what it boils down to—present the information re- garding our offerings in an easy-to-understand manner and make it readily accessible. If this is not done, getting them [customers] on board will be a huge challenge. (ID 5)

Therefore, we propose that:

P3b: The positive relationship between omnichannel model and service experience is diminished by the perceived offering complexity.

Trust in the firm Customer trust has long since assumed an important position in the development of relationship market- ing theory, and in commercial exchange relationships (Moorman et al. 1993). Studies in the services literature have found that trust positively influences loyalty (Harris and Goode 2004), and have theorized that trust positively influ- ences satisfaction (Gwinner et al. 1998).

Effect of trust in the firm on the relationship between in- teraction orientation and service experience Trust has been proposed to aid in the development of stronger firm–customer relationships (Berry 1995). On service experiences, Carù and Cova (2003) have established that while firms can offer customer-focused offerings that directly meet customer needs, it is customers who create the experience for themselves based on their trust in the firm offerings. Therefore, we expect trust to be generated by a deter- mination of customers’ confidence in the quality and reliability of the offerings. As a result, a higher level of customer trust in the firm can elevate their final service experience. This reasoning was also captured in our qualitative study by the following comment:

Our customers’ trust in us to offer solutions that work for them is something that we always keep an eye on. We take great care in devising solutions that customers can easily understand. So when they come to us, they know why they are here—exceptional offer- ings that resonate with them, every single time. Moreover, we see the result of our concerted effort in how they look forward to coming back to us, over our competition. (ID 32)

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Therefore, we propose that:

P4a: The positive relationship between interaction orientation and service experience is enhanced by the trust in the firm.

Effect of trust in the firm on the relationship between omnichannel model and service experience Research on multichannel management has produced several insights on developing and managing profitable firm–customer relation- ships (Neslin et al. 2006). For instance, trust in the firm has been found to be associated strongly with multichannel shopping (Kumar and Venkatesan 2005), and that the duration to adopt another channel is shorter when cus- tomers purchase more frequently (Venkatesan et al. 2007). Additionally, Morgan and Hunt (1994) argue that frequent customer interactions can lead to an increase in customer trust in the firm (or, reduce perceived risk) at a faster rate. We expect these results to also be appli- cable in an omnichannel setting. The reason being, a seamless transition between channels (made possible by an omnichannel setup) will offer customers more avenues to gather information and more channel choice for interacting with a firm. One of the study participants explained this at their company as follows:

We identified that maintaining a harmonious distribu- tion and fulfillment setup was key in providing our cus- tomers the best experience. We simply had to be where our customers were, and it was not possible from where our distribution center was located. Given that our cus- tomers expect nothing but the best from us, going the omnichannel route is the logical way forward for us, and a step that is paying off. (ID 41)

Therefore, we propose that:

P4b: The positive relationship between omnichannel model and service experience is enhanced by the trust in the firm.

Experience-related variables

Loyalty program participation In this study, we consider the ownership of a loyalty instrument (e.g., store credit cards) to be an indicator of loyalty program participation, and not just an accumulation and redemption of points. The reason being, the enrollment process in a loyalty program would involve considerable consumer effort (e.g., filling out application forms), and can be considered as a way of identifying and

relating with the firm (Reinartz and Kumar 2003). This also implies more opportunities for the firm to provide a superior service experience toward the development of long-term rela- tionships via a focused attention to the loyalty program struc- ture, rewards, program design, and the timing of rewards (Kumar and Shah 2004).

Effect of loyalty program participation on the relationship between interaction orientation and service experience Further, loyalty programs communicate and enhance the ex- perience of the firm’s offering to the customer (Woodruff 1997), and create an anticipation of future purchase instances (Lemon et al. 2002). Additionally, research has shown that after experiencing better ser- vice, behaviorally loyal customers focus less on price and instead shift their focus toward rewards and conve- nience, which translates into revenue gains for the firm (Umashankar et al. 2016). In this regard, a participant in our study provided the following comment:

We know that our customers have a great time shopping with us. Moreover, without a doubt, we credit our cus- tomer-focused way of doing business for that. The question then is; how do we communicate to our customers that this is what we do the best? How do we tell them that as long as they are with us (which I really hope they do), they will get to enjoy this superlative experience? We found the answer in our newly designed loyalty program. We are now able to know more about our cus- tomers than ever before and personalize their ex- perience. Basically, our loyalty program is the per- fect foil for all the wonderful experience that we are known for. (ID 20)

Therefore, we propose that:

P5a: The positive relationship between interaction orientation and service experience is enhanced by customer partici- pation in loyalty programs.

Effect of loyalty program participation on the relationship between omnichannel model and service experience Customer-initiated contacts are a good indicator of customer loyalty (Bowman and Narayandas 2001), can improve rela- tionships when the communication is timely (Moorman et al. 1993), and demonstrate customers’ familiarity with the offer- ings (Schoenbachler and Gordon 2002). Therefore, we believe that loyalty programs can enhance the effect of an omnichannel model on the experience of customers by en- abling them to stay longer with the firm, actively seek

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information from the firm, and interact in more ways with the firm. One of our participants described this in the following way:

Our loyalty program has helped us provide a wonderful experience for our customers. We have ready access to what our customers are looking at, through which mediums they are looking at, what actions they are taking, how they are executing it, and how it ulti- mately reflects in their shopping carts. We also tie this information to all of our push communication efforts that are reflected throughout and after the actual purchase. In essence, we want to get to that stage where everything comes together in one seamless motion, and I think we are closer to that goal now than before. (ID 13)

Therefore, we propose that:

P5b: The positive relationship between omnichannel model and service experience is enhanced by customer partic- ipation in loyalty programs.

Customer effort Cardozo (1965) defined customer effort as including physical, mental, and financial resources expended to obtain a product. In this regard, customer effort has been linked to co-producing a service (Chan et al. 2010), viewed from a cost-benefit standpoint in determining the value of offerings (Zeithaml 1988), and has been used as a behavioral measure to understand customer participation (Gallan et al. 2013).

Based on the managerial interviews, we classify customer effort into three categories—physical, cognitive, and affective. Physical effort pertains to the energy expended in commuting to the place where the service is offered (e.g., a Tesla owner driving for more than 30 min to get to a service station). Such hard demands can impact the service ex- perience of the customer. Firms have countered this by developing offerings that require limited physical effort from the customer (e.g., free pick-up service to the rent- al locations offered by Enterprise).

Cognitive effort pertains to the mental effort expended to process information regarding the service offering (e.g., understanding the legal clauses in an insurance con- tract). Here, importance should be given to the amount of information available to the customer, as too much or too little information would translate to a high cognitive effort for the customers.

Affective effort is the mental energy expended during a service experience (e.g., challenges faced by a sports fan in getting to the sporting venue due to traffic and weather con- ditions). To counter this, movie multiplexes in major Indian cities provide customers the option of pre-ordering food and

beverages along with their online ticket purchases and have them delivered to their assigned seats during the intermission.

Effect of customer effort on the relationship between in- teraction orientation and service experience Offerings that have been conceptualized using an interaction orientation ap- proach indicates that the individual customer is the unit of analysis and that marketing activities are conducted with the customers rather than for the customers (Ramani and Kumar 2008). This means that the offerings are highly relevant to the customers, and translates to monetary value for the firm. However, customers will still have to exert some amount of effort to access/enjoy the offering. A high level of customer effort required to access/enjoy the service may increase the customer’s level of uncertainty of the transaction (Auh et al. 2007). Additionally, customers may prefer not to exert a high level of effort to co-produce a service, and therefore may step away from the entire service transaction (Solomon 1986). Therefore, we believe that a high customer effort will diminish the effect of interaction orientation on the service experience. This was reflected in the following comment from one of the participants:

We get it. Customers exert themselves to reach us or get to our offerings, and it cannot feel good. To clamp down on that negative feeling, we aim to establish an emotional engagement at the brand level and strive to integrate that along all of our platforms. Once we have them experience our inclusive environ- ment and get them vested at the brand level, cus- tomers can interact better with us and enjoy our offerings better. (ID 7)

Therefore, we propose that:

P6a: The positive relationship between interaction orientation and service experience is enhanced when the customer effort is low.

Effect of customer effort on the relationship between omnichannel model and service experience Verhoef et al. (2015) argue for the inclusion of customer touchpoints in light of the inability to discern traditional channels from interactive channels. While the omnichannel model is marked by a high number of channels, and the blurred shopping lines while switching between channels, it focuses on providing wonder- ful experiences to the customers through a seamless transition between channels. In this vein, to be considered a positive experience, customers should be able to traverse through all the available channels with ease with regards to communica- tion and transaction. In other words, when customers realize that they can effortlessly switch between channels without any

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interruptions in the service interaction, it can enhance their overall service experience. One of the study participants pre- sented this thought in the following manner:

We realize that it should not be a chore for customers to have to get information, or even get in touch with us. This is the reason we have multiple lines of reaching out to us, and everything is linked to one another. We’d rather the customer spend time enjoying our service than spending time just trying to get to us or get to know about us. (ID 38)

Therefore, we propose that:

P6b: The positive relationship between omnichannel model and service experience is enhanced when the customer effort is low.

Enabler-related variables

Technology adoption While firms routinely use technology to develop, communicate, and deliver offerings, the adoption of technology by customers in their interaction with firms is critical in establishing CE. In this study, we consider the cus- tomers’ level of technology adoption to moderate service ex- perience. Additionally, studies have shown that (1) technology has a global appeal and applicability with respect to its rele- vance to real-time information (McLaughlin and Fitzsimmons 1996), (2) technology can render the time and place irrelevant for delivery of services (e.g., online banking) (Jayawardhena and Foley 2000), and (3) technology can strengthen branding efforts that can result in a competitive advantage for firms (Wright 2002). Therefore, the adoption of technology by cus- tomers in their interactions with firms can, ultimately, deter- mine the level of CE.

Effect of technology adoption on the relationship between interaction orientation and service experience Technology has been identified as an enabler in customizing service offer- ings, recovering from service failure, and instantly delighting customers (Bitner et al. 2000). Marketing practices have sig- nificantly transformed since the introduction of technology. For instance, the broadband Internet has integrated several of these mediums and present interesting options such as game consoles, mobile devices, smartphones, e-books, and virtual reality that continue to present new opportunities and chal- lenges for marketers. Therefore, technology can bolster a firm’s marketing capabilities to address a wide range of cus- tomer needs, yet provide the flexibility to respond to individ- ual customer requirements. These marketing actions can be administered at different points in time, made possible through

an aggregation of information over time. As one of our par- ticipants put it:

Don’t get me wrong. Technology is awesome. But for us, it’s more of a delivery mechanism. It is all about our understanding of our customers, and their expectations from us. We have a good picture of our customers and value them for what they have to offer us. Moreover, we want that aspect to shine through in any technology we implement. And true to its nature, technology has really provided us a ringside view of our customers. Now we can have a better view of them, and even how much will they be worth to us a few years from now. (ID 9)

Therefore, we propose that:

P7a: The positive relationship between interaction orientation and service experience is enhanced by the adoption of technology by customers.

Effect of technology adoption on the relationship between omnichannel model and service experience Companies continue to employ various forms of technology such as elec- tronic data interchange (EDI), email, telephone, mobile, inter- net, voice-over-internet protocol (VoIP), audio/video stream- ing, web servers, cloud computing, intelligent agent technol- ogies (IATs), radio frequency identification (RFID), QR codes, and web-enabled devices in an effort to enhance cus- tomer service experience. For instance, drone technology, once considered as a niche interest and social pastime, has now emerged as a viable form of delivery and aviation. With its promise in addressing the last mile delivery problem, the drone technology has evinced great interest from companies such as Amazon, Google, UPS, and Walmart in including drones as part of their distribution system. Other examples of technology that have created new user segments and service differentiation include the EZ-link contactless smart card in Singapore that can be used as a form of payment for certain services, the mobile money transfer system M-PESA in Kenya, wearable devices such as AngelSense which is the only GPS tracker for children with special needs, and ride- sharing services that use Internet and mobile technology to connect passengers and drivers. The successes of such tech- nology services indicate that technology can improve service offerings, and enable firms to focus on establishing CE. A manager presented this thought in the following way:

Let’s talk about our mobile technology for a minute. It has really been a game-changer for us. To begin with, we have been doing pretty well in servicing our cus- tomers’ needs. However, this mobile revolution has tak- en us places. The instances when we could have faced

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service issues or a missed sales occasion have now been prevented by the mobile interfaces we have. It has really thrown the spotlight on how better we can be. (ID 44)

Therefore, we propose that:

P7b: The positive relationship between omnichannel model and service experience is enhanced by the adoption of technology by customers.

Social media usage The emergence and prominence of social networks have been the focal point and the catalyst for the growth of CRM. Social networks are primarily used for busi- ness and social functions such as exchange of ideas, network- ing, content sharing, location services, product promotions, providing user feedback, and conducting opinion polls, among others, in both online and offline formats. The offline format of social networks includes end user groups, commu- nity gatherings, and professional groups, among others (Kumar and Rajan 2015).

Effect of social media usage on the relationship between interaction orientation and service experience Social net- works address three key dimensions that people typically look for while connecting with other people: who, when, and what. Further, questions like how and why they share, and from where they share, add to the understanding of the sharing patterns and the users’ psyche (Kumar and Rajan 2015). The customer empowerment element of the interaction orientation construct reflects the firm’s support in making customers (1) connect with the firm, and (2) connect and collaborate with each other by shar- ing information; praise; criticism; suggestions; and ideas about its products, services, and policies (Ramani and Kumar 2008). To improve their interaction orientation (via the customer empowerment element), it is crucial that firms be active on social networks. This was ob- served from the following comment by a participant:

So many channels, so many possibilities—that is how we see this whole social thing. Yes, we have the right technology and the right people to run our social media business. However, deep down, it all boils down to pro- viding a superlative personalized experience for our customers. The reason for that is simple—traditional communication approaches have become so cluttered that it is hard for us to stand out. Social isn’t so. It is non-intrusive and so much engaging. And the core of that relates to having meaningful interactions with our customers. That is really our end goal. In this, the social media is really a fantasyland that can help us create memorable experiences for our customers. (ID 34)

Therefore, we propose that:

P8a: The positive relationship between interaction orientation and service experience is enhanced by the usage of social media by customers.

Effect of social media usage on the relationship between omnichannel model and service experience On customers’ channel use patterns, Verhoef et al. (2007) show that it is related to the belief that people similar to them use that chan- nel. Bilgicer et al. (2015) find that customers’ adoption of offerings is influenced by other customers who live nearby and other customers who are similar and that social contagion influences the adoption of the Internet channel more than the retail store. Additionally, Risselada et al. (2014) find that similar consumers are more likely to share their experiences and communicate with each other. This is also reflected in how companies leverage social networks in the marketing programs. For instance, Maersk Line’s online presence in over ten social networking platforms form a unique ecosystem for their marketing actions (Wichmann 2013). Additionally, companies are making the transition from traditional media to focus more on social and online media. The Campbell Soup Company, for instance, has reallocated funds from core media such as TV and print and into digital marketing and commu- nications, that enables them to provide better customer service and experience, and track changes in consumer sentiment (KPMG 2016). Regarding the use of social networking, a manager provided the following comment:

We closely track the latest trends in social channels and try to be there. Recently, we ventured into social gam- ing. Sure, it’s a lot of fun to develop and play games. But really here, we are expecting that the player will check out our offerings through these games. That is what we’re really after. The reason they are here to play the games tells us about their personality. Also, those are the customers who will enjoy our offerings. Also, any of their peers that they might bring along will be a great bonus! (ID 12)

Therefore, we propose that:

P8b: The positive relationship between omnichannel model and service experience is enhanced by the usage of so- cial media by customers.

Market-related variables

Developed market vs. emerging market The type of market vis-à-vis firms and consumers relate to the varying degree of

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conformity to buying habits, tastes and preferences, attitudes, and market structures. Some of the market-specific differences between developed and emerging markets have been identi- fied that establish the case for considering the market type for understanding a firm’s success (Sheth 2011). The interest in studying the type of market arises, in part, due to the mixed financial success experienced by companies in the developed and emerging markets. Corstjens and Lal (2012) indicate that despite offering great value propositions, companies are not able to always create/replicate success across the developed and emerging markets. Further, Szymanski et al. (1993) find that the effects of competitive strategy and market structure generalize across most of the Western cultures; indicating that it may be possible for companies to standardize across Western cultures, but not across cultures that are noticeably different from the Western cultures. Therefore, it is important to consider the experience of firms across developed and emerging markets to better understanding the concept of ser- vice experience.

Effect of the market type on the relationship between in- teraction orientation and service experience Ramani and Kumar (2008) identify four key implications of adopting the interaction orientation approach, of which two are of particu- lar relevance on the market type. First, it advocates that indi- vidual customers be the unit of analysis for firms. Second, it suggests that marketing activities are conducted with the cus- tomer rather than for the customer. These two points collec- tively constitutes an in-depth understanding of customers and their preferences and collectively working toward its fruition. Unlike in the case of the developed markets, the emerging markets present a very different picture. For instance, it has been proposed that it is difficult to generate market intelli- gence in the emerging markets regarding current and future customer needs (Sheth 2011). This can serve as an impedi- ment for firms in securing an in-depth understanding of the emerging market consumers. Further, unlike in the developed markets, local firm/societal relations (e.g., guanxi in China, Ubuntu in Africa) have been found to be in prominence in the emerging markets. In light of the reasons mentioned above, an interaction orientation approach plays a more im- portant role in the developed markets than the emerging mar- kets. This was also expressed by a manager as follows:

Our experience has been very different in the developed and emerging markets. We are able to see our developed market customers through an individual customer lens. I know this is not possible for our counterparts in the emerging markets. So for us, we [in the developed mar- kets] can now design and integrate all of our channels in a manner that would deliver one cohesive experience. We are now able to understand better what clicks with our customers, and why it does so. We are also able to

quickly include newer insights on a real-time basis, in the hope that we will be able to say what will likely click with our customers in the future and deliver our offer- ings accordingly. (ID 25)

Therefore, we propose that:

P9a: The positive relationship between interaction orientation and service experience is enhanced in developed markets than in emerging markets.

Effect of the market type on the relationship between omnichannel model and service experience The enormous body of research on relationship marketing has highlighted the prevalence and relevance of customer profitability analysis at the individual customer level to be a major success factor for firms in the developed markets (Kumar and Reinartz 2016). However, the emerging markets are largely characterized by limited access to the markets, and thereby the existence of a large number of nonusers. Therefore, it is essential to create first-time users in the emerging markets by creating access to the offerings, and providing information needed to understand the offerings (Sheth 2011). For instance, farmers in India now have access to soil testing services to assist them in making crop decisions, and thereby higher prices in local crop auc- tions (Hammond et al. 2007).

Additionally, the quantum of the financial success of firms in the emerging markets, particularly the subsistence markets, has been studied. For instance, the existence of local sub- monopolies has been identified in the emerging markets that are a result of very low income levels, thereby suggesting that entering such markets may be difficult for firms (Viswanathan et al. 2010). This indicates that firms need to identify new ways of reaching customers. Sheth (2011) proposes that it is important to focus on a market development strategy in the emerging markets in an inclusive manner, where the focus must be on offering accessible and affordable branded offerings to all consumers. Alternatively, Atsmon et al. (2012) suggest that firms can focus on clusters of cities rather than bigger cities in extracting growth opportunities in the emerging markets.

Amidst the limited formal organizational channels, it is the social connection that often binds customers in the emerging markets (Chiu et al. 2012). This societal influence works in two ways. First, the post-purchase experience of friends and family acts as a reliable information resource and lowers search costs in the buying decision of the service offering. Second, consumers in the emerging markets are in the early stages of developing brand loyalty, with mature traditional regional brands being replaced by newer brands; and therefore rely on user reviews to converge their purchase decisions. These two influences serve as the foundation on which the

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consumer trust in a firm is built in the emerging markets. This observation can also be seen from annual McKinsey surveys that find that positive product recommendations from friends or family are nearly three times as important for consumers in Egypt as for those in the United States or Britain (Atsmon et al. 2012). From our study, we observed that:

When it comes to the emerging markets, we are all about cities and regions. Much of the market in emerging economies are so underserved, and in some cases even ignored, that we just have to go truly regional and local. This where our mobile strategy works wonderfully. Mobile has become a great unifying force in terms of social connections and has become a must-have, even exceeding in importance over other household items. This is an ideal situation for us to be in. Because think about it…when we sync our offerings that serve unmet needs with a way for easy and quick interaction between our customers, we have created a way to deliver a wholesome experience that they are sure to talk about. And that helps us maintain an active line of real-time interaction and access to the market. (ID 35)

Therefore, we propose that:

P9b: The positive relationship between omnichannel model and service experience is enhanced in emerging markets than in developed markets.

Perceived variation in service experience, satisfaction, and emotional attachment

As mentioned earlier, Pansari and Kumar (2017) have established satisfaction and emotion to be the antecedents of CE, which are in turn the result of a positive customer experi- ence. In light of these accepted findings, we do not explore these linkages in this study. However, reflecting the S-D approach adopted in this study, we propose that a perceived variation in service experience to moderate the effect of service experience on satisfaction and emotional attachment. Toward this end, we provide the supporting arguments in this section.

The S-D logic provides that the nature of value creation be interactional and experiential (Vargo and Lusch 2008a). This implies that customers participate in co-creation and that they (as the beneficiaries) determine the value of the offering, rath- er than the firm. Additionally, it has been established that the value determination inherently demands a cus- tomer orientation (Vargo and Lusch 2008b), and that the inherent focus on building relationships alludes to the importance toward interactivity and collaboration (Gummesson 1994). The proposed framework in this study has incorporated these facets to make a case for providing a superior service experience.

However, providing a superior service experience cannot be a one-time exercise for firms. Again, as provided by the S- D logic, service has also been conceptualized as a firm’s focus on a continuous series of social and economic processes (Vargo and Lusch 2004). In this regard, Vargo and Lusch (2008b) offer that Bmost social and economic processes have no beginning and end but continue, as one process feeds into another process^ (p. 34). Even from an integrated marketing communication (IMC) perspective, the S-D logic has been operationalized from a touchpoints perspective, wherein it has been postulated that a service is a communication experi- ence and an ongoing process of social and economic interac- tions (Duncan and Moriarty 2006). Further, a service ecosys- tem perspective has also been advanced through an actor- environment interaction (Vargo and Lusch 2016). In light of the above points, it becomes clear that for service experiences to lead to CE they have to be (1) a continuous and ongoing process, and (2) an organization-wide philosophy inclusive of the social and economic actors.

In any continuous endeavor, ensuring consistency (or lim- iting variation) is critical. In the case of a product purchase (e.g., salt, sugar), the experience is fixed and is expected to be the same across repeat purchases. However, with respect to a service purchase (e.g., tax preparation, beauty salon), the de- livery of the service is co-created by the actors, and can be influenced by the location and the variation in the demand for the service at different points in time. Hence, maintaining a constant service experience becomes a challenge. In the case of airline travel, the performance of actors providing the ser- vice can vary, thereby resulting in variation in service experi- ence (e.g., the recent service missteps by United Airlines). Thus, unlike in product purchases, where the mean level of experience is sufficient (given little to no variation), achieving consistent service experience in the service purchases is a challenge. Therefore, variability in service experience (even if the mean is high) dictates the subsequent engagement be- havior. Therefore, we propose that:

P10a: The positive relationship between service experience and satisfaction is enhanced when the perceived varia- tion in service experience is low.

P10b: The positive relationship between service experience and emotional attachment is enhanced when the per- ceived variation in service experience is low.

Discussion and implications

The primary goal of this paper is to propose a CES framework in a service setting. Using the service industry as the study context, we developed a CE approach that is rooted in the S-D logic of offering better value to customers using firm

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resources. The framework proposed in this study identifies that an interaction orientation approach and an omnichannel model results in the creation of a positive service experience. Further, we identify four groups of moderators (offering- related, value-related, enabler-related, and market-related) that influence a positive service experience. Subsequently, we argue that the positive service experience ultimately im- pacts CE by ensuring customer satisfaction, and creating emo- tional bonds with the firms. However, we also identify a mod- erating variable—perceived variation in service experience— to impact satisfaction and emotional attachment. Based on the framework, we advance testable research propositions on the various relationships between factors, moderating variables, and the resultant CES.

To our knowledge, this is the first study to integrate the characteristics of the market (i.e., developed and emerging markets) into investigating service experience. Based on the qualitative study, we propose that the type of the market can have a varying effect on the creation of a positive service experience. Further, this is expected to carry through to the ultimate creation of CE. Therefore, it is important to pay at- tention to the type of market in developing service strategies. For MNCs that are operating in developed and emerging mar- kets concurrently, the proposed CES framework will help them (1) consider the various direct and indirect linkages that impact service experience and CE in their respective markets of operation, and (2) revisit their approach to introduce customer-centricity in service encounters with their cus- tomers. Additionally, by extending the CE concept into the services literature, we contribute a more intuitive approach to investigating service experience. Collectively, we believe the fresh perspectives introduced in this study will be of inter- est to marketing scholars worldwide.

An over-arching question that many firms face is whether their marketing actions led to a positive service experience, and increased the level of engagement with customers. Based on this study, two key insights on service experience emerge.

Maintaining consistency in service experience

As with production, service exchanges do exhibit variations in outcome. In this regard, Parasuraman (1987) contends that the customer–employee interactions dominate the evaluations of services. Especially in the case of complex offerings, where the identification of the service offered and its subsequent evaluation can be difficult, the customer–firm interactions play a key role in establishing the nature of the service expe- rience. As a fallout of the service experience, five aspects are to be noted.

& Service experiences cannot be evaluated in isolation. Whereas facilitating a positive service experience can be an end-goal for any service instance, it is important to

recognize that the outcomes of such instances can have a cumulative effect on the customers’ overall engagement and outlook toward the firm. In effect, an investigation of service experience over a longer period, as against the most recent experience (as conducted in many customer surveys), is crucial in gaining a better understanding of service experience (given that it can vary), and how it can ultimately impact CE.

& Every service instance has to be evaluated. As an exten- sion to the previous point, focusing on the recency aspect of the service experience may not capture the entire cus- tomer experience with the firm. Evaluating every service instance, that is directed toward understanding any dis- crepancies from earlier instances, will lead to a better or- ganizational approach in managing variation in service experience.

& Service experience has to undergo constant improvements. Ideally, firms would like each of their ser- vice instances to be better than the previous instance. In other words, firms would like to ‘up the ante’ regarding service experience in every service instance. This can be seen from the customer surveys by many airlines, hotels, telecom companies, and financial institutions immediately after a service instance. The improvements over every service experience also account toward the variation in service experience, and informs the firm about their cur- rent trend (positive or negative) in delivering service experience.

& Positive variability is always good. While P10 and the earlier comment on not focusing on the recency aspect of service experience may seem paradoxical to the posi- tive variability discussion made here, in reality, it is im- portant for firms to ascertain any positive service improve- ments over the previous service instance. In other words, positive service variability is good for a firm. This expec- tation of firms can be understood as a monotonic property of service experience. That is, the service experience has to demonstrate a steady increase over time so that it can lead to a meaningful impact on CE.

& Variation in service experience can be tempered by focus- ing on the moderators. The moderators identified in this framework, apart from influencing service experience, can also help firms in reducing the variation in service expe- rience. For instance, firms that develop complex offerings such as child care services and personal finance typically have designated agents offering the service. This ensures that the customers seeking the service will interact with the same person(s), thereby minimizing variation in ser- vice. On building trust, investment management firms such as Prudential and ING offer investor tips and educa- tion resources on their website that can help customers gain a broader understanding of their financial options. While the content may not be personalized, they are

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designed to instill confidence in their customers by freely sharing a wealth of information that is relevant to their needs. Further, virtual assistants (e.g., Apple’s Siri, Amazon’s Alexa) use voice recognition technology to per- form certain tasks such as retrieve information from the Internet, and place online orders thereby delivering a pos- itive service experience for the customers. Finally, firms make their presence felt through social media portals, and routinely provide assistance such as information dissemi- nation, customer support, and public relations manage- ment, among others, that can serve as a ‘second line of defense’ in minimizing any variation in service.

The impact of service experience on customer satisfaction and emotional attachment

The impact of customer satisfaction has been studied in the marketing literature (Howard and Sheth 1969). The influential expectancy-disconfirmation theory (Oliver 1980) posits that consumers purchase with pre-purchase expectations about an- ticipated performance. Similarly, emotions have been identi- fied as a key affect component, and observed to play a role in service instances. Research has shown that emotions act as a better predictor of behavior than cognitive evaluations (Allen et al. 1992), and that emotions are inherently communicative (Parkinson 1995). That is, while the behavior can include purchases, it is more often the word of mouth and feedback that is influenced by emotions since the customer feels part of the firm (Pansari and Kumar 2017).

In light of the insights mentioned above on satisfaction and emotional attachment, successful service firms focus their ef- forts on reducing variability in service experience to maintain higher levels of customer satisfaction and emotional attach- ment. For instance, hotels (e.g., Ritz-Carlton) and airlines (e.g., Delta Airlines) provide highly personalized experiences for their most preferred customers which are an outcome of identifying (over time) and meeting the preferences of their high-value guests. This is to ensure that their experience re- mains positive and consistent at all times. Additionally, suc- cessful service firms also personally communicate with cus- tomers, especially after a service exchange, to (1) ensure whether the customers had a positive experience, and (2) serve as a reminder for the next instance the customers may need the service. Further, through marketing communications such as advertising, firms communicate and reiterate their value and offerings to ensure that they stay in the customers’ choice set.

Limitations and future research directions

Further research is needed to improve on ideas presented in this study. First, additional meaningful insights through

empirical testing and validation of the research propositions are required. Second, given the experiential nature of interac- tion adopted in this study, we expect some marketing mix variables to have an impact on the service experience. For instance, pricing strategies vis-à-vis levels of consumers in the economic pyramid (base, mid and top tiers), and relevant distribution strategies may play an important role in certain service settings, especially in the emerging markets (Prahalad 2012). Third, while factors like satisfaction or emotions may be challenging to validate empirically, this can be addressed by statistically analyzing the available attitudinal and behav- ioral data. For instance, the influence of emotions on actions can vary across customers, and that can be accounted for by capturing observed and unobserved heterogeneity in empirical analysis. Fourth, while we have accommodated factors that substantially represent the services industry in the developed and emerging markets (based on the interviews and academic literature), certain specific countries/geographic regions may warrant closer attention. This would call for a finer analysis of the factors and variables responsible for the creation of CES. Finally, the proposed framework was developed for the con- ventional service contexts (e.g., airlines, telecommunications, retailing, hospitality, etc.). However, its applicability to other organizational contexts such as education, non-profit, charita- ble trusts is unknown. This can be a case for future investigations.

Acknowledgements The authors thank the editor, the AE, and the three anonymous reviewers for their valuable comments during the review process. In addition, we thank the participants at the Thought Leaders in Service Marketing Strategy Conference held in HEC Paris in May 2016, Alok Saboo, Nita Umashankar, Sarang Sunder, Jennifer Preyss and Ericka Yates for their valuable feedback on this article. We thank Renu for copyediting this manuscript.

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