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Understanding the design and delivery of customer experience from multiple perspectives

A case study within luxury travel industry

Written by G. Anantharramu, P. D. Kaiser

Paper category

Master Thesis

Subject

Business Administration>Management

Year

2020

Abstract

Master Thesis: Introduction to customer experience About the past ten years, the term disruption has become synonymous with innovation. Companies use these disruptive technological innovations to transform and change their business models, thereby creating new trends, needs and expectations. According to a survey conducted by Gartner (2019), customer experience (CX) is one of three strategies for investing in marketing and services and implementing effective enterprise-level customer experience management strategies. Leaders in marketing are motivating their employees to resonate with customers and strengthen their interactions with customers. In addition, as CX has become a new battlefield in the marketing field, we have seen many companies create new positions, such as chief customer officer, chief experience officer, or CX vice president, to create and manage CX. The ever-changing e-commerce, internet connectivity, and smartphone availability have changed customer expectations, products or services that can be shopped 24/7 with just one click. Customers use multiple channels and media to establish contact with organizations or companies, leading to complex customer journeys. In addition, since all product or service information, specifications, images, and prices are available online, social media interaction and peer-to-peer sharing of CX and feedback create opportunities and challenges for organizations. Customer behaviors such as showrooms and online rooms present varying degrees of challenges, where one retail channel is used for planning, consideration, and search, while the other is used for actual purchases (Flavián, Gurrea, and Orús, 2020). All these multiple choices that modern customers have make it difficult for organizations to predict, control, and manage customer behavior and experience (Lemon and Verhoef, 2016). Customers are now more aware of the situation than in the past. They are responsible for their experience and want the organization to understand their individual needs. Solving the problem immediately is a thing of the past, because it is now expected to operate normally even during downtime, in a sense, proactively solve current and potential future problems or needs that may arise now. 2.2. Customer experience as defined by Verhoef et al. (2009), historically, CX is not regarded as a separate paradigm. Rather, it is part of the marketing, retail, and service management literature. However, scholars and practitioners do agree that CX involves multi-dimensional construction and conceptualization, and generating a tool that can measure all participants and determinants will be problematic. Some notable definitions of CX are as follows: Schmitt (1999) 2.3. The evolution of customer experience From the definition of CX, we understand that this is a complex multi-dimensional structure that integrates multiple concepts in the marketing literature. In order to let us understand and appreciate how the structure of CX evolved, Lemon and Verhoef (2016) traced its history and pointed out that the concept of CX has evolved over a period of time since the 1960s. We have summarized the important aspects of this article. Recognition and identification help CX.2.3.1. The customer purchasing behavior process model. Various integrated models developed in the 1960s focused on the customer decision-making process and its purchasing behavior (B2C), that is, from Identify the need for product purchase/want to evaluate the product purchased (Lemon and Verhoef, 2016). On the B2B side, some researchers discussed the buying behavior of commercial customers and the role of buying teams. These early customer buying behavior models are the foundation of CX, and in today's context, it is called the "customer decision journey or customer buying journey" (ibid.). 2.3.2. Customer satisfaction and loyalty The concepts that emerged in the 1970s are used to measure and monitor individual customers' perceptions and experience attitude responses to the products provided by the company (Lemon and Verhoef, 2016). Researchers have developed a variety of models or frameworks that can be used to measure customer satisfaction. One commonly used in today's environment is the Net Promoter Score (NPS). Customer satisfaction is another cornerstone of understanding and measuring customer experience. 2.3.3. Service quality In the 1980s, marketing shifted from products to services, that is, companies realized that selling products/commodities were not enough to gain a competitive advantage. Instead, they must include the elements of service provision in their products. Include claims for customer interactions and other intangible service-related activities (Lemon and Verhoef, 2016). Measuring the quality of this service has become critical, and the SERVQUAL measurement model has become more and more important during this period. Although there are many criticisms of the SERVQUAL model, the quality of service does help CX understand the possible context of the experience, the insight into the journey mapping, and CX.2.3.4. Relationship management In the 1990s, both B2B and B2C focused on their relationship Customers build strong relationships. In order to understand different aspects of customer relationships, several models and theories have been developed, such as "transaction cost theory", which includes structures such as trust, commitment, switching costs, relationship quality, etc. Read Less