From: Journal of Research for Consumers
Issue 19, 2011 - Transformative Consumer Research Special Issue
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Introducing Transformative Services Marketing to Consumers
AUTHOR(S): Laurie Anderson, Canan Corus, Ray Fisk, Andrew Gallan, Martin Mende,
Mark Mulder, Mario Giraldo, Amy Ostrom, Steven Rayburn, Mark Rosenbaum, Kunio Shirahada
Jerome Williams
ABSTRACT
This article introduces the concept of transformative service research to consumer research and explains how service researchers may engage in research activities that promote human well-being. The authors offer several reasons as to why some consumers may look negatively towards marketing, and especially to service industries, such as banking, finance, and health care. To correct this marketing-consumer rift, the authors put forth a new research agenda that considers factors such as quality of life and consumer well-being as managerially relevant outcomes. Although this task may appear challenging, many service industries possess transformational qualities by their inherent design, while other services have transformational aspects that researchers need to thoroughly explore.
ARTICLE
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Introduction
Redefine the Dream: Marketers want us to believe that “more stuff makes us happier.” But are they right? Or does the American dream stand for opportunity—a promise of a better life for us and our children? (The Center for a New American Dream 2011).
This poignant quote, which appears on The Center for a New American Dream’s (www.newdream.org) webpage, illustrates the disillusionment that many Americans hold towards the marketing field. From our academic perspective, we find this quote appalling and enlightening because it was never our intention as academics to become alienated from consumers or to harm their quality of life in any manner.
As academics, we teach future and current managers how to develop and execute marketing actions that a firm’s customers will perceive as value laden, with value being defined in terms of benefits received and sacrifices provided (Zeithaml, 1988; Rust, Lemon, and Zeithaml 2004). Although pundits may claim that we attempt to extort monetary resources from hapless consumers, in reality, we encourage students and practitioners to shift maintain a customer relationship focus. That is, we view customers as having the potential to become partners with a firm (Johnson and Seines 2004), even “attached” to a firm often by participating in customer communities that focus upon a product, brand, or place (Fournier and Lee 2009; Rosenbaum et al. 2007). In sum, we encourage managers to build and to sustain long-term commitments to customers that are based upon quality, service, and innovation (Webster 1992).
Marketers sell goods and services
The emphasis upon building long-term customer relationships, as opposed to focusing on short-term marketplace transactions, in conjunction with perspectives that encourage marketers to offer customers value and meaningful brands, is part and parcel of services marketing (Rust, Zeithaml, and Lemon, 2000). In actuality, the selling of intangible services, as opposed to the selling of tangible goods, dominate the American economy, representing 76.7% of the nation’s gross domestic product (GDP), a percentage which America shares with several other industrialized economies (Central Intelligence Agency 2010).
Given the scope of service industries in industrialized countries, services research can have a significant impact for the future of consumers, communities, and even nations. To a considerable extent, services define the realities and norms in consumers’ day to day lives and shape societal structures that bound individuals and communities. Services’ fundamental roles are even evident in their significant share of the GDPs of developed countries, as well as their influence on societal outcomes such as public health and safety (Ostrom et al. 2010; Hill and Macan 1996). Moreover, the extensive use of resources required to deliver services, their political implications, and their pervasive role in citizens’ lives make services an integral element for any effort for societal change (Hill and Macan 1996; Adkins and Corus 2009).
Defining services marketing
One may consider that unlike a good, a service represents a time-perishable, intangible experience performed by a service provider for a customer, who is acting as a co-producer, to transform a state of the client (Spohrer and Maglio 2008). This definition reveals essential characteristics of services; namely, customer play active, rather than passive roles, in co-production service activities, and they are integral players in the co-creation of value, along with service providers. To understand how customers act as co-producers of value in services, consider their active participation in service industries such as health care, education, banking, insurance, beauty, air transportation, as well as all Internet-based transactions. In all of these aforementioned examples, customers engage with service providers, who are either people, self-service equipment (e.g., ATM machine), or cyber-based (e.g, weightwatcher.com. eharmony.com) to transform their own states, and if they fail to do so, they will not fully attain the benefit or value of the service (Spohrer and Maglio 2008).
Understanding Consumer Disregard for Service Marketers
Given that America is a service economy and that services represents co-production activities between service providers and their customers that transforms their states, perhaps, our dismay towards customers envisioning marketing as a self-serving, deceitful ploy to sell consumers things that they do not want is understandable. How did this bifurcation between consumers and marketing academics happen?
On the one hand, marketing academics and practitioners are culpable for emphasizing a “selling orientation,” a method of thinking which began after WWII and continued until about 1970 (Kotler et al. 2009). This orientation encouraged marketers to focus primarily on the selling and promotion of particular tangible goods during short-term marketplace exchanges.
On the other, over the past 40 years, marketers, especially those in services, have shifted their thought to building long-term customer relationships that promote longevity by implementing strategies that promote value, favorable views towards a brand, and that foster relationships (e.g., loyalty programs, interactive websites, customer clubs; Rust et al. 2004; Vogel, Evanschitzky and Ramaseshan 2008). Today’s marketers are attuned towards selling customers products, both goods and services, in a manner which yields customer satisfaction, encourages long-term customer loyalty, and which benefits all stakeholders involved in marketplace exchanges; including customers, employees, organizational shareholders, and society in general (Heskett et al. 1994).
Financial, banking, health care, retailing, and restaurants: A dark side
However, consumers do not seem to realize that service marketers are no longer keen on merely selling them products during single transactions or on developing relationships with them; in fact, most would probably consider this revelation as folly. Contemporary consumers attribute the recent global recession, if not depression, to banking and financial service providers who provided mortgages to people who could ill-afford them, and who, through further deception, sold these as receivables to global investors. Consumers learned that Main Street would subsidize Wall Street, as the term, “too big to fail,” became part of the American vernacular.
Beyond the current financial service crises, service organizations in general are often criticized for undeserving communities in need, their top down and patronizing style of service delivery and degrading policies of segmentation and targeting (Fisk 2009; Williams and Henderson 2011). For example, the economic disparities in healthcare contribute to the reinforcement of the marginalization of already underprivileged consumers (Williams and Henderson 2011; Newman and Vidler 2006). Grocery chains are often reluctant to open establishments in lower-income urban areas, creating food deserts, essentially urban areas in which consumers lack access to affordable fruits, vegetables, whole grains, low-fat milk, and other foods that make up the full range of a healthy diet (CDC 2009; Mitchell 2011). CNN (2008) exposed the fact that racial discrimination remains alive and well in Ameircan retailing, as African-American consumers are commonly victims of accusatory actions associated with “shopping while black.” Similarly, Cracker Barrel restaurants also have a history of discriminating both African-American and gay customers in their establishments (New York Times, 2011). Clearly, much effort is required for better serving the “unserved and underserved” consumers (Fisk 2009, p.1) and for improving the welfare of societies.
Understanding how to mend the consumer-marketing rift
We suggest that the consumer derision towards the marketing field, academics, and practitioners may stem from our philosophy of research methodology. Marketing academics may have wrongly assumed that by engaging in empirical research that primarily focuses upon understanding why organizational customers hold favorable attitudes towards them (e.g., satisfaction/delight; Oliver 1999) or display future behavioral intentions towards them (e.g., commitment to patronage, positive word-or-mouth, pay more; Zeithaml, Berry, and Parasuraman 1996), we were also enhancing consumer well-being. That is, academics may have incorrectly assumed that satisfied consumers and loyal consumers would logically be happy consumers, who were pleased with their marketplace experiences and who viewed them in a favorable manner.
Perhaps, as academics, we thought by helping future and current managers solve real managerial problems, we resultantly would improve consumer welfare. In actuality, service-oriented academics and managers became increasingly less important to consumers and to providing them with scientific research that transformed their well-being (Mick, 2006). Indeed, while most service researchers consider future behavioral intentions worthy of exploration, few service researchers contemplated factors such as well-being or quality of life as noteworthy managerial outcomes (Dagger and Sweeney 2006)
Transformational service research conceptualized
To correct this problem, we encourage service academics and practitioners to engage in transformational service research (TSR) and activities. TSR strives to solve real problems that consumers confront in service exchanges, and, consequently, augments consumer welfare (Mick 2006 by applying marketing techniques and tools to enhance the lives of individuals and communities.
As a research paradigm, TSR investigates how and why service exchanges may promote or create transformational (i.e., positive and uplifting) changes and improvements in the well-being of individuals involved in these exchanges, including consumers, employees, families, social networks, communities, cities, nations, collectives, and ecosystems (Anderson, Ostrom, and Bitner 2011). Thus, TSR is represents a call for services research that relates to, and advocates for, personal and collective wellbeing of consumers and societal members in general. TSR builds on the notion of a transformative service economy, which improves the relationships among social, economic, and environmental systems through respectful, collaborative and sustainable interactions.
Transformative initiatives
TSR encourages researchers to explore issues like social justice, consumer agency, and ecological stability. It relates to contemporary concepts such as sustainability, green marketing, and triple bottom line, which encourages researchers to consider economic, social and environmental outcomes (Ostrom et al. 2010). The dynamic nature of services offers substantial transformative potential, due to the direct, often dialogic interaction between the service provider and consumer. TSR explores multifaceted outcomes of service interactions including those that may be intentional and overt (e.g., physical health benefits from services at a clinic) as well as outcomes that may be unintended or overlooked by providers and consumers (e.g., enhanced well-being from a clinic’s support group). TSR invites researchers to focus on mitigating consumer vulnerability and improving consumer agency, which is often an issue when consumers find themselves in a position of lesser knowledge and expertise during a service interaction (Adkins and Corus 2009). Marginalized groups and disparities in the quality of services offered to different groups are particularly emphasized. Also of interests are the contexts and service environments that promote physical health and emotional and mental well being (Jamner and Stokols 2001; Rosenbaum et al. 2007).
Although this call may appear daunting, most services have transformational potential; which await discovery by researchers. Many service industries, such as health care, education, not-for-profit firm are transformational by their organizational intent; service researchers simply need to begin considering them as relevant managerial outcomes. Other service industries, such as retailing, hospitality, and entertainment, do not possess a commercial intent that is by design transformational; however, we put forth that all services have transformational possibilities. We will now review these two types of service industries in more detail.
Transformational services
Health care represents a service which strives to transform well-being; however, service researchers in management, operations, and marketing, have by-and-large neglected to study this domain (Berry and Bendapudi 2007). As service researchers, we ironically know considerably little about service providers, including health professionals, volunteers, and non-government organizations (NGOs), that are integral in providing people with medical, psychological and spiritual support, especially for those living at the “bottom of the pyramid” or who reside in developing, third-world countries. Along these lines, pioneering theoretical and empirical work also resides in understanding the role that non-profit organizations (NPO; Rosenbaum, Sweeney, and Windhorst 2009), private voluntary organizations, and political lobbyists, may assume in respecting, upholding, and improving consumers’ lives in relationship to the consumption of goods, services, and information.
Services that have transformational potential
Although the aforementioned service providers seem unsurprisingly adept at transforming their customers’ well-being, we put forth that the majority of commercial service industries, which many consumers commonly experience as part of their daily routines, also possess the ability to transform their customers’ lives via consumption activities. For example, sociologists, human ecologists, environmental psychologists, gerontologists, and service researchers, have a rich history of exploring how loosely-connected, social relationships that naturally form in service settings, such as neighborhood diners, fast-food restaurants, beauty shops, bars, video arcades, often transform human well-being by providing people with social supportive resources in their time of need (Cowen 1982, Rosenbaum 2006 for review). Thus, if researchers look beyond the commercial intent of many services, they may discover their transformational potential.
Along these lines, Sherry (2000) puts forth that we have looked at places and exchanges as inert and homogeneous. Consequently, he argues that marketers have not been attentive enough to the animistic beliefs and rituals that consumers (or designers) employ to vivify consumption settings. To mend this rift, researchers will have to explore not only the financial and economic impact of services (see Zeithaml, Bitner, and Gremler, 2009) but also the quality of life and subjective sense of well-being that services often have on individuals, social groups, communities, and so forth.
Perhaps, service researchers have to create a new balanced scorecard (Kaplan and Norton 1992), one that considers humanistic perspectives, such as impact on human health and environmental well-being, as essential as measuring financial outcomes, customer satisfaction, organizational innovation, and employee development. This scorecard would encourage service providers to foster relationships with their customers that are respectful, collaborative, and sustainable.
Transforming society
Although the image of the consumer stands at the heart of the attempts to transform service research, it is worth emphasizing here that TSR implications hardly limited to individual outcomes. Consumers’ individual actions, along with firms’ policies, often have communal outcomes. For example, increased consumer agency may have consequences beyond better personal health. At a macro level, implications may also include better community access to health services, competition between healthcare institutions and perhaps even resulting revisions of organizational policies (Newman and Vidler 2006). Similarly, higher consumer financial literacy may not only enhance personal financial decisions but might also improve distributive justice in a community or a nation. Moreover, consumer experiences are influenced not only at a micro level by their own agency but also at a macro level by the socio-economic context and larger structural forces (Giddens 1990). Thus, TSR studies should include analyses of micro and macro outcomes of services on consumer welfare. As a case in point, more recent transformative studies have started focusing on collective service outcomes, by exploring the collaboration between service providers and underprivileged communities (Ozanne and Anderson 2010).
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