Customer experience, satisfaction and brand relevance : a South African grocery retail context perspective

Abstract: Retailers often compete in the market by focusing on achieving customer satisfaction by providing good in-store shopping experiences. South African shoppers are however argued to be very brand conscious, and therefore, the relevance of a retail brand may in addition influence this experience and satisfaction relationship. This study seeks to uncover the relationship between customer experience and customer satisfaction and explores the moderating role of brand relevance on the relationship between customer experience and satisfaction. Using a quantitative approach, a total of 395 responses were collected from South African grocery retail shoppers. An SEM analysis is conducted with the variables “Sense”, “Think” and “Feel” as the predictors of customer experience, and their resulting influence on customer satisfaction tested. The variable “Think” was the only experience variable that had a significant influence on customers’ satisfaction levels, whilst “Brand relevance” demonstrated potential as a predictor of customer satisfaction, rather than a moderator between experience and satisfaction

Impact of artificial intelligence adoption on online returns policies

The shift to e-commerce has led to an astonishing increase in online sales for retailers. However, the number of returns made on online purchases is also increasing and have a profound impact on retailers’ operations and profit. Hence, retailers need to balance between minimizing and allowing product returns. This study examines an offline showroom versus an artificial intelligence (AI) online virtual-reality webroom and how the settings affect customers’ purchase and retailers’ return decisions. A case study is used to illustrate the AI application. Our results show that adopting artificial intelligence helps sellers to make better returns policies, maximize reselling returns, and reduce the risks of leftovers and shortages. Our findings unlock the potential of artificial intelligence applications in retail operations and should interest practitioners and researchers in online retailing, especially those concerned with online returns policies and the consumer personalized service experience

Informative advertising with discretionary search

We examine a market for a search good in which consumers are uncertain about the firm’s product quality, but may search to gather information before buying. We show that credible information can be conveyed to consumers even when the firm faces a market with little or no preference heterogeneity. Rather, differences in willingness-to-pay arise from the endogenous search decisions by consumers. A fundamental assumption is that search is not required for purchase and consumers may bypass it altogether. In this case search induces a dispersion in preferences that is detrimental for the firm’s ability to capture value. This provides an incentive for the firm not to overstate its quality. When quality is common knowledge (but product fit is uncertain before search), increases in quality lead to a higher market price, but firm profits and consumer surplus are non-monotonic because of changes in the search regime. In particular if quality is high enough for search to be worthwhile the firm faces downward pressure in prices and consumers become better off. These effects reverse at higher levels of product quality. Surprisingly, when product quality is unknown but credible information is available consumers become worse off with the probability of facing a high type firm, because this firm prefers to target high value consumers and not serve those who do not find that the product fits their needs.preprintinpres

Emerging Operational Contracts in Competitive Markets.

This dissertation consists of three essays, each dealing with an emerging type of operational contracts. The first essay considers a resource exchange model where the effects of collaboration and competition are intertwined. Exchanging resources often improves utilization and is intended to increase profitability of involved firms. However, it does not guarantee success in competitive settings. More efficient use of resources might actually leads to increased competition. We explore how resource exchange contracts impact the firms and consumers. The results indicate that the resource exchange tends to benefit both firms and the consumers in most situations, except for the extreme situations where simultaneously competition is strong and the purchasing cost is either very low or very high. The second essay focuses on vertical pricing control contracts that manufacturers use to coordinate online and offline retailers. Resale Price Maintenance (RPM) policy requires all retailers to sell at the price suggested by manufacturers. Minimum Advertised Price (MAP) policy is less strict, as it allows retailers to sell at lower prices than the manufacturer suggested, as long as these lower prices are not advertised. This essay studies which of these two policies is more beneficial to each member of the supply chain. We show that manufacturers prefer MAP policy when the customers' valuations vary significantly and the information search requires significant effort. The MAP policy is also favorable to retailers and consumers under similar market conditions. The third essay concerns the contractual issues when energy service companies (ESCOs) provide energy efficiency projects to residential clients. While performance based contracts have been proven successful in public, commercial, and industrial sectors, ESCOs face challenges in the residential sector. Residential clients often change consumption behavior after the project, which makes the real energy savings difficult to measure. Additionally, residential clients are much more risk averse and vulnerable to uncertain outcomes of projects. We show that piecewise linear contracts perform reasonably well. To further improve profitability, ESCOs can either reduce uncertainty of technology involved or develop the ability to verify post-project energy efficiency. We also make recommendations in monetary incentives and regulations from policy makers' perspective.PhDBusiness AdministrationUniversity of Michigan, Horace H. Rackham School of Graduate Studieshttp://deepblue.lib.umich.edu/bitstream/2027.42/133457/1/lgding_1.pd

Accessibility-Related Service Failures Online: Examining Their Effect on Avoidance Behaviors for Disabled Consumers and Their Social Networks

This three-part study examines how online accessibility-related service failures adversely impact a retailer through avoidance behaviors by directly offended disabled consumers (30 million Americans), their proximal networks learning of the service failure by both direct and indirect word of mouth, and those who have no existing relationship with a disabled person learning of incidents through direct and indirect online communication, e.g., blogs and reviews. A preliminary test sheds light on the widespread issue of inaccessible websites by rating the top 100 retailers on accessibility conformance using globally accepted standards for accessible site design. The first study develops a scale based on the concept of "consumer normalcy" which is composed of four dimensions: (1) ability to participate in the marketplace, (2) demonstrating competence and control, (3) achieving distinction, and (4) being perceived as an equal. This important new construct can be used as a tool to more fully understand the experience of an individual who feels he or she has been discriminated against in the marketplace based on demographic characteristics such as gender, ethnicity, sexual orientation/preference, or disability. The scale is tested in six different populations including the LGBT, African American, and disabled communities respectively, as well as a random student population, and two random non-student samples where one sample shows how Consumer Normalcy is directly connected to complaint behavior, repurchase intention, and word of mouth. Using blind and vision impaired participants, the second study compares the differences in avoidance behaviors toward a retailer due to accessibility-related and non-accessibility related service failures by using high and low effort online service failure conditions to elicit feelings of disconfirmed expectations of "consumer normalcy, and how this effect is mediated by the negative emotions of anger and frustration. In addition, we analyze how these avoidance behaviors are moderated by prior expectations of accessibility, feelings of helplessness, living alone versus living with others, and prior patronage versus no prior patronage. In an effort to examine how NWOM is received when the receiver could not share the experience being relayed, in study three the disabled participants from study one email the survey to non-disabled people in their proximal networks such as family, friends, and coworkers. After learning about the service failure either from direct communication where the disabled person who is known or unknown to the receiver, or from indirect electronic word of mouth where the source is again unknown or known to the receiver, we proffer that the relationship to the disabled consumer, along with the perceived closeness of the relationship with that disabled individual, will lead to higher levels of substitutional empathy than general empathy resulting in greater levels of avoidance behavior toward the retailer. We propose "substitutional Empathy" occurs when person A learns of the plight of unknown person B which could not be shared by person A. Person A then substitutes known person C who could share the experience of person B into the role of unknown person B, instead of typical empathy studies where person A puts themselves in the role of person B. Additional tests seek to examine differences in reactions between proximal or nonexistent relationships by having random participants asked to read about an accessibility-related service failure imagining that they learned of the failure either directly from someone they know or don't know, or from indirect E-WOM where the source is known or unknown. We predict the existence of substitutional empathy to be the driving force behind empathetic reactions when the source is unknown to the receiver, and levels of avoidance behavior will be determined based on the strength or absence of a relationship with a disabled person. Both studies are replicated in the Transgender community where Transgender individuals share the survey with non-Transgender individuals they know as well as testing the theory in a random sample. Extensions of assimilation-contrast, attribution, and intergroup contact theories are presented to better understand potential outcomes of the studies. Finally, we discuss current disability legislation along with the societal and economic impacts of online accessibility issues. Our goal is to show that an accessibility-related service failure can adversely impact a retailer not only by the directly affected disabled consumer but also by those individuals in his or her social network who will empathetically change their purchase behavior with that retailer.Ph.D., Business Administration -- Drexel University, 201