Today we identify service articles published in Marketing, Management, Operations, Productions, Information Systems & Practioner-oriented Journals in the last months.
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Henkens, B., K. Verleye and B. Larivière (2021): The smarter, the better?! Customer well-being, engagement, and perceptions in smart service systems, International Journal of Research in Marketing, 38(2), pp.425-447
Smart service systems – that is, configurations of smart products and service providers that deliver smart services – are striving to increase the smartness of their offering, but potential consequences for customer well-being are largely overlooked. Therefore, this research investigates the impact of smartness on customer well-being (here, self-efficacy and technology anxiety) through (1) customer engagement with different smart service system actors (here, smart products and service providers) and (2) customer perceptions (here, personalization and intrusiveness perceptions) and their associated importance (here, need for personalization and intrusiveness sensitivity). A scenario-based experiment (n = 730) – which is preceded by a systematic review to conceptualize smartness – shows that customers perceive more personalization than intrusiveness in case of higher levels of smartness, resulting in customer engagement with the smart product and to some extent with the service provider. Via customer engagement with the smart product, higher levels of smartness stimulate self-efficacy, especially for customers with a high need for personalization. When customers’ need for personalization is high and their intrusiveness sensitivity is low, higher levels of smartness also reduce technology anxiety via customer engagement with the smart product. Hence, the conclusion is: “The smarter, the better!”, whereby the relationship between smartness and well-being (here, self-efficacy and technological anxiety) is significantly influenced by customer heterogeneity. These findings help business practitioners in boosting customer well-being by increasing customer engagement through higher levels of smartness of their service system. • Higher levels of smartness improve customer well-being through customer engagement. • Customers perceive more personalization than intrusiveness when smartness increases. • Personalization and intrusiveness affect engagement with smart service system actors. • Customer engagement with smart products boosts customer well-being. • Smartness–well-being relationship is subject to customer heterogeneity.
Moon, S., M.-Y. Kim and D. Iacobucci (2021): Content analysis of fake consumer reviews by survey-based text categorization, International Journal of Research in Marketing, 38(2), pp.343-364
As the influence of online consumer reviews grows, deceptive reviews are a worsening problem, betraying consumers’ trust in reviews by pretending to be authentic and informative. This research identifies factors that can separate deceptive reviews from genuine ones. First, we create a novel means of detection by contrasting authentic versus fake word patterns specific to a given domain (e.g., hotel services). We use a survey on a crowdsourcing platform to obtain both genuine and deceptive reviews of hotels. We learned the word patterns from each category to discriminate genuine reviews from fake ones for positively and negatively evaluated reviews, respectively. We show that our All Terms procedure outperforms current benchmark methods in computational linguistics and marketing. Our extended analysis reveals the factors that determine fake reviews (e.g., a lack of details, present- and future-time orientation, and emotional exaggeration) and the factors influencing people’s willingness to write fake reviews (including social media trust, product quality consciousness, deal proneness, hedonic and utilitarian consumption, prosocial behavior, and individualism). We also use our procedure to analyze more than 250,000 real-world hotel reviews to detect fake reviews and identify the hotel and review characteristics influencing review fakery in the industry (e.g., star rating, franchise hotel, hotel size, room price, review timing, and review rating).
Dowling, K., P. Manchanda and M. Spann (2021): The existence and persistence of the pay-per-use bias in car sharing services, International Journal of Research in Marketing, 38(2), pp.329-342
A key benefit of using car sharing services (relative to car ownership) is that they are more cost effective. Car sharing firms offer a menu of pricing plans to make this happen. The two most common plans are flat-rate and pay-per-use pricing. However, little is known about how consumers choose among these pricing plans. In this study, we analyze consumers’ choices between pay-per-use and flat-rate pricing using data from a car sharing provider in a large European city. In contrast to previous research, we find a prevalent and time-persistent pay-per-use bias. Specifically, depending on the definition of the bias, 21% to 32% of customers exhibit this bias. This bias also persists over time within customer. We propose three potential explanations for the existence and persistence of this bias. First, we suggest that customers underestimate their usage. Second, we propose that customers have a preference for flexibility, leading them to pay more. Finally, we show that the physical context, such as weather, increases the likelihood of a pay-per-use bias. Our findings suggest that more research into consumer response to pricing in the Sharing Economy is needed.
Wu, Y., R. W. Hamilton, N. Y. J. Kim and R. K. Ratner (2021): Navigating Shared Consumption Experiences: Clarity About a Partner’s Interests Increases Enjoyment, Journal of Marketing Research (JMR), 58(3), pp.439-455
Consumers frequently engage in activities with others, such as visiting an art gallery with a friend or going to a sports match with a family member, and they tend to assume that sharing experiences with another person will make these activities more enjoyable. However, navigating a shared experience—making decisions about pacing, sequencing, and interacting with another person as the experience unfolds—can take consumers’ attention away from the activity, potentially reducing their enjoyment. In a series of studies in which consumers engage in real consumption experiences, the authors show that lack of clarity about a partner’s interests can distract consumers, making it difficult for them to focus on the shared activity and reducing their enjoyment of shared experiences relative to solo experiences. Notably, simple interventions can increase clarity of a partner’s interests and consumers’ enjoyment of shared activities, providing tools for service providers who want to retain customers and benefit from positive word of mouth.
Figueiredo, B., H. P. Larsen and J. Bean (2021): The Cosmopolitan Servicescape, Journal of Retailing, 97(2), pp.267-287
[Display omitted] • We theorize the cosmopolitan servicescape, contrasting it to other servicescapes. • We conduct an ethnographic study of a quintessentially cosmopolitan servicescape. • The servicescape works as a playground for encounters with cultural difference. • Servicescape elements enables consumers’ display of cosmopolitan competence. • We detail four specific ways the servicescape supports cosmopolitan performances. Marketing scholars have developed a solid literature on servicescapes, the physical environments where services are performed, delivered and consumed, with a particular interest in themed retail environments. Themed servicescapes rely heavily on signs and symbols and emplaced ideologies to build brands, attract consumers, and increase sales. We extend this literature by introducing, defining and theorizing the cosmopolitan servicescape , one that emplaces the cosmopolitan ideology by supporting performances of consumer cosmopolitanism. By drawing on an ethnographic examination of a quintessential cosmopolitan servicescape, Red Rooster Harlem, and applying an analytical lens grounded in the cultural understanding of retail spaces, we conceptualize the cosmopolitan servicescape in relation to other themed environments. Cosmopolitan servicescapes provide consumers a playground for encounters with cultural difference through enlisting cultural resources that shift out in time, place, and identity, thus enabling the performance of cosmopolitan competence. In addition, cosmopolitan servicescapes juxtapose cultural resources to create incongruent meanings, promote heteroglossia, and appeal to different levels of cosmopolitan competence. Finally, cosmopolitan servicescapes use decoding cues to facilitate cosmopolitan engagement and recognition cues to frame the environment as cosmopolitan. These findings contribute to the themed retailing literature and provide guidelines for managers and servicescape designers interested in creating an emplaced strategy for attracting cosmopolitan consumers.
Sunar, N., Y. Tu and S. Ziya (2021): Pooled vs. Dedicated Queues when Customers Are Delay-Sensitive, Management Science, 67(6), pp.3785-3802
It is generally accepted that operating with a combined (i.e., pooled) queue rather than separate (i.e., dedicated) queues is beneficial because pooling queues reduces long-run average sojourn time. In fact, this is a well-established result in the literature when jobs cannot make decisions and servers and jobs are identical. An important corollary of this finding is that pooling queues improves social welfare in the aforementioned setting. We consider an observable multiserver queueing system that can be operated with either dedicated queues or a pooled one. Customers are delay-sensitive, and they decide to join or balk based on queue length information upon arrival; they are not subject to an external admission control. In this setting, we prove that, contrary to the common understanding, pooling queues can increase the long-run average sojourn time so much that the pooled system results in strictly smaller social welfare (and strictly smaller consumer surplus) than the dedicated system under certain conditions. Specifically, pooling queues hurts performance when the arrival-rate-to-service-rate ratio is large (e.g., greater than one) and the normalized service benefit is also large. We prove that the performance loss due to pooling queues can be significant. Our numerical studies demonstrate that pooling queues can decrease the social welfare (and consumer surplus) by more than 95%. The benefit of pooling is commonly believed to increase with system size. In contrast, we show that when delay-sensitive customers make rational joining decisions, the magnitude of the performance loss due to pooling can strictly increase with the system size. This paper was accepted by Terry Taylor, operations management.
Lu, S., K. Rajavi and I. Dinner (2021): The Effect of Over-the-Top Media Services on Piracy Search: Evidence from a Natural Experiment, Marketing Science, 40(3), pp.548-568
This paper examines the effect of over-the-top media services on consumers’ search for pirated video content in the entertainment industry The rise of over-the-top (OTT) video streaming services has raised the question of how this new form of digital media affects consumer search for pirated content. We address this question by using Netflix’s unexpected announcement of a global market expansion in January 2016 and the subsequent block by the primary telecommunications firm in Indonesia as an exogenous shock to the supply of OTT services in that country. Using synthetic control methods, we compare the change in piracy search between Indonesia and 40 Asian countries where Netflix simultaneously entered and remained available. Netflix’s failure to launch in Indonesia leads to a 19.7% increase in search for pirated movies and TV shows in Indonesia, relative to the other countries, suggesting a net substitution of piracy for OTT services. Comparison of treatment effects between exclusive and nonexclusive content shows that the treatment effect is driven by both a combination of an expansion of the market for piracy and a substitution between piracy and OTT services. We also find that the treatment effect is stronger for less dialogue-oriented content, which is consistent with the greater appeal of dialogue-light content to non–English-speaking consumers.
Berry, L. L., R. L. A. Awdish, S. Letchuman and K. D. Steffensen (2021): Trust-Based Partnerships Are Essential — and Achievable — in Health Care Service, Mayo Clinic Proceedings, 96(7), pp.1896-1906
When people think about trust in the context of health care, they typically focus on whether patients trust the competence of doctors and other health professionals. But for health care to reach its full potential as a service, trust must also include the notion of partnership, whereby patients see their clinicians as reliable, caring, shared decision-makers who provide ongoing “healing” in its broadest sense. Four interrelated service-quality concepts are central to fostering trust-based partnerships in health care: empathetic creativity, discretionary effort, seamless service, and fear mitigation. Health systems and institutions that prioritize trust-based partnerships with patients have put these concepts into practice using several concrete approaches: investing in organizational culture; hiring health professionals for their values, not just their skills; promoting continuous learning; attending to the power of language in all care interactions; offering patients “go-to” sources for timely assistance; and creating systems and structures that have trust built into their very design. It is in the real-world implementation of trust-based partnership that health care can reclaim its core mission.
Liwei, C., J. J. P.-A. Hsieh, A. Rai and X. Sean Xin (2021): HOW DOES EMPLOYEE INFUSION USE OF CRM SYSTEMS DRIVE CUSTOMER SATISFACTION? MECHANISM DIFFERENCES BETWEEN FACE-TO-FACE AND VIRTUAL CHANNELS, MIS Quarterly, 45(2), pp.719-754
To attain customer satisfaction, service firms invest significant resources to implement customer relationship management (CRM) systems to support internal customer service (CS) employees who provide service to external customers in both face-to-face and virtual channels. How CS employees apply sophisticated CRM systems to interact with customers and how the mechanisms through which their CRM usage affects customer satisfaction vary across service channels and bear important implications. We approach these issues by investigating the concept of infusion use, defined as CS employees’ assessment of the extent to which they use a CRM system to its fullest potential to best support their work in the CRM-enabled service interaction context. Drawing on the IS success framework and expectation confirmation theory, we first formulate a baseline model that explains the direct and indirect mechanisms through which CS employees’ infusion use of CRM systems leads to customers’ expectation confirmation, which in turn affects customers’ satisfaction. We then draw on the lenses of media richness and communication adaptation to theorize why these two mechanisms exert differential influence in face-to-face and virtual channels. We test the hypotheses by collecting multiwave data from CS employees, customers, and firm archives of a Fortune 500 telecom service firm. We find that (1) CS employee infusion use can directly contribute to customer expectation confirmation and indirectly do so through CS employees’ satisfaction with the system (i.e., user satisfaction), and (2) the direct mechanism plays a more critical role in the face-to-face channel, whereas the indirect mechanism is more important in the virtual channel. Our findings inform managers of the avenues through which employees’ infusion use promotes CRM-enabled service success across face-to-face and virtual service channels.
Ayvaci, M. U. S., H. Cavusoglu, K. Yeongin and S. Raghunathan (2021): DESIGNING PAYMENT CONTRACTS FOR HEALTHCARE SERVICES TO INDUCE INFORMATION SHARING: THE ADOPTION AND THE VALUE OF HEALTH INFORMATION EXCHANGES (HIES), MIS Quarterly, 45(2), pp.637-692
Recent initiatives to improve healthcare quality and reduce costs have centered around payment mechanisms and IT-enabled health information exchanges (HIEs). Such initiatives profoundly influence both providers’ choices in terms of healthcare effort levels and HIE adoption and patients’ choice of providers. Using a game theoretical model of a healthcare setup, we examine the role of payment models in aligning providers’ and patients’ incentives for realizing socially optimal (i.e., first-best) choices. We show that the traditional fee-for service (FFS) payment model does not necessarily induce the first-best solution. The pay-for-performance (P4P) model may induce the first-best solution under some conditions if provider switching by patients during a health episode is socially suboptimal, making provider coordination less of an issue. We identify an episode-based payment (EBP) model that can always induce the first-best solution. The proposed EBP model reduces to the P4P model if the P4P model induces the first-best solution. In other cases, the first-best inducing EBP model is multilateral in the sense that the payment to a provider depends not only on the provider’s own efforts and outcomes but also on those of other providers. Furthermore, the payment in this EBP model is sequence dependent in the sense that payment to a provider is contingent upon whether the patient visits a given provider first or second. We show that the proposed EBP model achieves the lowest healthcare cost, not necessarily at the expense of care quality or provider payment, relative to FFS and P4P. Although our proposed contract is complex, it sets an optimality baseline when evaluating simpler contracts and also characterizes aspects of payment that need to be captured for socially desirable actions. We further show that the value of HIEs depends critically on the payment model as well as on the social desirability of patient switching. Under all three payment models, the HIE value is higher when switching by at least some patients is desirable than when switching by any patient is undesirable. Moreover, the HIE value is highest under the FFS model and lowest under the P4P model. Hence, assessing the value of HIEs in isolation from the underlying payment mechanism and patient switching behavior may result in under- or overestimation of the HIE value. Therefore, as payment models evolve over time, there is a real need to reevaluate the HIE value and the government subsidies that induce providers to adopt HIEs.
Struwe, S. and D. Slepniov (2021): Conflict by design and why institutions matter in service design: A case of a German Creative Agency in China, Journal of Business Research, 130(), pp.124-136
This paper set out to advance our understanding of how to improve service design and service provider–customer relationships in business-to-business (B2B) environments. Drawing on the theoretical lenses of service-dominant logic, service design and institutional theory, we investigate how and why the dark side manifests itself in B2B relationships between service co-creating actors in professional service settings. Additionally, we propose how these problems can be avoided. The study takes place in an international environment. It employs an in-depth single embedded case study of the relationship between a German creative agency and a German industrial client operating in China. Our work chronicles how their relationship developed over time, eventually resulting in a breakdown. The findings captured in the framework highlight an array of contributing factors. Propositions are made on how a more stable and robust agency–client relationship can be built and the dark side of B2B relationships defeated.
Lee, K., A.-M. Hakstian and J. D. Williams (2021): Creating a world where anyone can belong anywhere: Consumer equality in the sharing economy, Journal of Business Research, 130(), pp.221-231
The platform model of business has allowed peer-to-peer interactions that expand the universe of opportunity for providers and users of goods and services. In addition to the numerous benefits of the platform model, it has been fraught with its share of unanticipated challenges to consumer equality – a critical measure of the social welfare. Grounded in the Power-Responsibility Equilibrium framework, this study examines the most aggressive form of consumer action, filing a lawsuit against the platform company, in response to discrimination experienced by consumers on the platform. An analysis of the five legal cases brought by consumers against Roommates.com, Airbnb, and Uber highlights how current laws may be ineffective in addressing the problem of discrimination in the online marketplace against members of protected categories such as race, sexual orientation, and disability. We provide implications for platform companies and public policy makers for changes to promote equality in the sharing economy.
Jung, J., J. Yu, Y. Seo and E. Ko (2021): Consumer experiences of virtual reality: Insights from VR luxury brand fashion shows, Journal of Business Research, 130(), pp.517-524
Virtual reality (VR) offers a new medium for marketing communications, where consumers are immersed into technologically synthesized ‘real-use’ experiences of products and services. In this study, we theorize and investigate empirically how consumers derive meanings from VR experiences. Using the ZMET technique, we uncover three themes: VR as democratization, VR as embodied escapism, and VR as actualized anxiety. Our focus on the consumption meanings of VR experiences provides an illuminating entrée into the discussion of how this technology is likely to shape marketing communications and consumer behavior in the foreseeable future.
Jang, K. K., J. Bae and K. H. Kim (2021): Servitization experience measurement and the effect of servitization experience on brand resonance and customer retention, Journal of Business Research, 130(), pp.384-397
Servitization, the convergence between new services with the existing products, creates significant value-in-use for both customers and firms. The current study develops measures of servitization experience based on the service-dominant logic and investigates their effect on customer retention, mediated by value-in-use of servitization and brand resonance. First, servitization measures were developed across five stages. Next, the effect of servitization experiences on customer retention was demonstrated. The results show that integrated servitization experience, customized servitization experience, relational servitization experience, and playful servitization experience are the measures of servitization experience, and this servitization experience has a positive influence on customer retention. Additionally, value-in-use of servitization and brand resonance fully and serially mediated the effect of servitization experience on customer retention. Servitization measures help scholars and marketers understand the importance of servitization experience and provide an empirical demonstration of the effect of servitization experience on customers and firms.
Belanche, D., L. V. Casaló, J. Schepers and C. Flavián (2021): Examining the effects of robots’ physical appearance, warmth, and competence in frontline services: The Humanness‐Value‐Loyalty model, Psychology & Marketing, (), pp.1
Because of continuous improvements in their underlying technologies, customers perceive frontline robots as social actors with a high level of humanness, both in appearance and behavior. Advancing from mere theoretical contributions to this study field, this article proposes and empirically validates the humanness‐value‐loyalty model (HVL model). This study analyzes to what extent robots’ perceived physical human‐likeness, perceived competence, and perceived warmth affect customers’ service value expectations and, subsequently, their loyalty intentions. Following two pretests to select the most suitable robots and ensure scenario realism, data were collected by means of a vignette experimental study and analyzed using the partial least squares method. The results reveal that human‐likeness positively affects four dimensions of service value expectations. Perceived competence of the robot influences mainly utilitarian expectations (i.e., functional and monetary value), while perceived warmth influences relational expectations (i.e., emotional value). Interestingly, and contrary to theoretical predictions, the influence of the robot’s warmth on service value expectations is more pronounced for customers with a lower need for social interaction. In sum, this study contributes to a better understanding of customers’ reactions to artificial intelligence‐enabled technologies with humanized cognitive capabilities and also suggests interesting research avenues to advance on this emerging field.
Ozuem, W., S. Ranfagni, M. Willis, S. Rovai and K. Howell (2021): Exploring customers’ responses to online service failure and recovery strategies during Covid‐19 pandemic: An actor–network theory perspective, Psychology & Marketing, (), pp.1
While the debate on online service failure and recovery strategies has been given considerable attention in the marketing and information systems literature, the evolving Covid‐19 pandemic has brought about new challenges both theoretically and empirically in the consumption landscape. To fully understand customers’ responses to service failure during a crisis we asked 70 millennials from three European Countries—Italy, France, and the UK—to describe their responses to service failure during the Covid‐19 pandemic (30 completed a 4‐week diary and 40 completed a 4‐week qualitative survey). Drawing on phenomenological, constructivist, and hermeneutical approaches, and utilizing an actor–network theory perspective, the current study proposes a new framework for understanding customers’ responses to online service failure and recovery strategies during the Covid‐19 pandemic. Conclusions highlight implications for theory, policy, and management practice through extending comprehensions of service failure recovery processes by examining how marketing policies generate different social impacts during a crisis situation which facilitate the achievement of customer satisfaction and positive outcomes.
Ling, E. C., I. Tussyadiah, A. Tuomi, J. Stienmetz and A. Ioannou (2021): Factors influencing users’ adoption and use of conversational agents: A systematic review, Psychology & Marketing, 38(7), pp.1031-1051
As artificially intelligent conversational agents (ICAs) become a popular customer service solution for businesses, understanding the drivers of user acceptance of ICAs is critical to ensure its successful implementation. To provide a comprehensive review of factors affecting consumers’ adoption and use of ICAs, this study performs a systematic literature review of extant empirical research on this topic. Based on a literature search performed in July 2019 followed by a snowballing approach, 18 relevant articles were analyzed. Factors found to influence human‐machine cognitive engagement were categorized into usage‐related, agent‐related, user‐related, attitude and evaluation, and other factors. This study proposed a collective model of users’ acceptance and use of ICAs, whereby user acceptance is driven mainly by usage benefits, which are influenced by agent and user characteristics. The study emphasizes the proposed model’s context‐dependency, as relevant factors depend on usage settings, and provides several strategic business implications, including service design, personalization, and customer relationship management.
Hernandez‐Ortega, B. and I. Ferreira (2021): How smart experiences build service loyalty: The importance of consumer love for smart voice assistants, Psychology & Marketing, 38(7), pp.1122-1139
Smart voice assistants (SVAs) have emerged as new artificial intelligence service platforms. They have the capacity to act like actual human assistants and modify traditional forms of human–computer interactions. So, consumers relate to their SVA as though it was a person, despite knowing that they are interacting with a machine. Based on the stimulus‐organism‐response framework, this paper examines feelings of love that consumers develop for SVAs when they are interacting. It proposes that these feelings act as the psychological mechanism to transmit the effect of consumers’ experiences with the technology (i.e., smart experiences) on their service loyalty. Feelings of love are conceptualized following the triangular theory of love that considers three components: passion, intimacy, and commitment. Service loyalty refers to consumers’ intentions to continue using SVAs in the future and to recommend SVAs to other people through physical and/or electronic word of mouth communication. The results show that smart experiences influence consumers’ passion for technology, while passion explains their intimacy and commitment. Consumer intimacy and commitment for SVAs lead to service loyalty. Therefore, this paper contributes to research focusing on the importance of consumers’ feelings for SVAs and shedding light on the process that drives to service loyalty.
González‐Gómez, H. V., S. Hudson and A. Rychalski (2021): The psychology of frustration: Appraisals, outcomes, and service recovery, Psychology & Marketing, (), pp.1
This study fills a gap in the consumer emotions literature regarding customer frustration in a customer service setting. Most research on customer emotions has examined anger, happiness or affect in general, largely ignoring the particularities of frustration. Consistent with appraisal theory, we use five experiments to explore the different appraisal dimensions that define frustration and its relation to customer loyalty and satisfaction. Contrary to common belief, we show that frustration is not simply the result of goal‐blocking, but rather of a more complex combination of appraisals which differentiate it from anger and lead to distinct effects on satisfaction and loyalty. We also examine how the effects of frustration on loyalty and satisfaction are mitigated by service recovery in a further experiment and an event reconstructive method. Our results test appraisal theory, inform theory on customer emotions and have important implications for our understanding of customer satisfaction and loyalty following frustrating customer service encounters.
Esch, P., Y. Cui and S. P. Jain (2021): Self‐efficacy and callousness in consumer judgments of AI‐enabled checkouts, Psychology & Marketing, 38(7), pp.1081-1100
In a retail setting, two field studies and one controlled online experiment show that compared to self‐service checkouts, artificial intelligence (AI)‐enabled checkouts temporarily activate perceived shopping convenience. This leads to more favourable attitudes and higher purchase intent, but only for consumers who have higher levels of self‐efficacy (Studies 1 and 2). Furthermore, we find that this positive effect of AI‐enabled checkouts conditional on consumers’ self‐efficacy, is diminished for consumers who show a low level of callousness (Study 3). This study introduces a novel variable to consumer literature, callousness, a subconstruct of psychopathy and features the unexplored tripartite “AI–physical–human” ecosystem, which adds a significant layer to the incipient AI literature and serves as a theeoretical framework for continued inquiries.
Antonetti, P., B. Crisafulli and S. Maklan (2021): When doing good will not save us: Revisiting the buffering effect of CSR following service failures, Psychology & Marketing, (), pp.1
Past research offers inconsistent evidence on whether CSR is an effective service recovery strategy. Current debates overlook the signals that service failures send about the company, and their interplay with CSR. We propose a moderated mediation model showing that CSR’s effectiveness for service recovery depends upon failure type. For failures signaling a lack of skills and expertise, CSR enhances warmth which in turn lowers revenge. Warmth further increases perceived competence which influences conciliatory responses. CSR, however, does not help if the failure signals a lack of moral integrity. Both warmth and competence explain the CSR’s buffering effect. Our study demonstrates that “doing good” helps only to the extent that service failures that do not raise doubts about the character of the company. Even in these circumstances, however, the buffering effect of CSR is observed only in case of customer–firm communal relationships. Consistent evidence from three experiments revisits more optimistic assessments of the ability of CSR to act as a recovery strategy and shows that CSR can help only under very circumscribed conditions. Managerially, we show how and when the CSR buffer applies in service contexts, offering insights on how managers can best reap the potential benefits of service brands’ involvement in CSR.
Zhang, Z. G. and X. Yin (2021): Designing a Sustainable Two‐Tier Service System with Customer’s Asymmetric Preference for Servers, Production & Operations Management, (), pp.1
This study considers a public service system consisting of two service providers with different service capacities and qualities, such as healthcare or transportation systems. Such a system is called a two‐tier service system (TTS). The service provider with higher service capacity and quality charges a higher price and is called a “charge service provider,” denoted by CSP, while the other service provider charges a lower price and is called a “free service provider,” denoted by FSP. We study the TTS where customers prefer the CSP to the FSP in spite of the higher price of CSP. The strong preference of CSP to FSP, which can be due to bounded rationality, leads to imbalanced workload for the TTS which implies an inefficient use of limited resources. Although both can offer a common set of services, the CSP is overly demanded and highly congested, while the FSP is under‐utilized. We first study analytically an extreme case where the preference for CSP is so strong that customers choosing the CSP are delay insensitive and those choosing the FSP are delay sensitive. Then, we extend our analysis to more general cases where customers are delay sensitive in both channels and have asymmetric preferences for service providers. Using a stylized queueing model and equilibrium customer choice analysis, we show that under certain conditions, the two‐tier system may reduce congestion and the total social cost in the system. This study offers social planners the guidance in designing less congested, more cost‐efficient, and sustainable public service systems.
Ma, Q., B. Shou, J. Huang and T. Başar (2021): Monopoly Pricing with Participation‐Dependent Social Learning About Quality of Service, Production & Operations Management, (), pp.1
The quality of many online services (such as online games, video streaming, cloud services) depends not only on the service capacity but also on the number of users using the service simultaneously. For a new online service, the potential users are often uncertain about both the capacity and congestion level of the service, and hence are uncertain about the quality of service (QoS). In this study, we consider users’ participation‐dependent social learning (PDSL), that is, learning of the QoS through participants’ online reviews. The key difference from the traditional social learning mechanism is that the learning object (QoS) is not a fixed value, but instead, it depends on the number of review participants. We study how such a new learning process affects the service provider’s dynamic pricing strategy in four different market scenarios, depending on whether the decisions are for two periods or infinite periods and whether users are aware of the congestion effect or not. Our analysis yields several key insights. First, the presence of PDSL significantly affects the provider’s optimal pricing policy. In a two‐period market with congestion‐unaware users, the provider would always set a flat price when there is no PDSL; in contrast, when there is PDSL, the optimal price can either increase or decrease, depending on the capacity and the prior mean QoS belief. Second, users’ congestion‐awareness causes the provider to set a non‐decreasing pricing policy in the two‐period market, while the provider’s steady‐state pricing policy in the infinite‐period market increases with the capacity and the prior QoS belief. Third, the existence of PDSL increases the provider’s profit in all four market scenarios as long as the provider’s capacity is larger than users’ prior mean QoS belief.
Legros, B. (2021): Agents’ Self‐Routing for Blended Operations to Balance Inbound and Outbound Services, Production & Operations Management, (), pp.1
This study aims to evaluate the cost of agents’ self‐routing in a service system with inbound and outbound customers. We assume that inbound customers arrive over time depending on the waiting time offered, while outbound customers can be contacted at all times. Furthermore, agents are in control of routing decisions and are aware of the state of the system. Accordingly, they decide whether to serve an inbound or outbound customer, or to idle. The system manager seeks to provide a suitable trade‐off between agents’ choice of serving inbound and outbound customers by incentivizing their actions through linear payouts. Hence, there arises a problem of determining the cost of agents’ self‐routing, which can be interpreted as a variant of the principal‐agent problem where the agents’ efforts are directed toward selecting their routing policy. Through a Markov decision process, we show that the agents’ optimal policy is a reservation threshold policy for inbound customers, and express the compensation parameters that minimize staffing cost. We conclude that motivating idling decisions through linear payouts incurs high costs. This justifies the current practice of using automated routing in call centers. Moreover, paying for idling cannot reduce staffing cost. However, discriminating between delayed and non‐delayed customers in the reward structure presents a high potential of reducing agents’ pay. Finally, in situations where agents do not know the status of their colleagues, our analysis argues in favor of not revealing the state of the system to them through delay announcements when the objective waiting time is low.