The influence of Customer Experience on Customer Loyalty in e-retail
Student: Shamiryan Flora
Supervisor: Elena Panteleeva
Faculty: Faculty of Management
Educational Programme: Master
Year of Graduation: 2014
<p style="text-align: justify;"><strong>This paper investigates the effect of Customer Experience on Loyalty in the context of e-retailing. It has been proven that the Customer Experience affects both the emotional and behavioral loyalty. The key factors in explaining customer loyalty are <em>Competitiveness, Call – Center, Web Site Usability </em>and<em> Receipt of goods.</em></strong></p><p style="text-align: center;">-----------------------------------------</p><p style="text-align: justify;">The task of retaining customers is relevant for almost all companies, in particular for online - shops. Customer satisfaction has ceased to ensure loyalty. In this connection, in 1999 Pine and Gilmore claimed about the transition of the service economy to a new level - the Experience Economy. Consumers are bored with ordinary products, they want to receive unusual sensations, emotions and impressions. In the framework of Experience Economy there is a concept of Customer Experience Management, CEM. CEM aims to create a better customer experience at all levels of customer interaction with the company and its products.</p><p style="text-align: justify;">The novelty of the concept causes absence of an established definition of Customer Experience and scale to measure it. Customer Experience expresses the customer's attitude to the company which was formed during repeated contacts among the consumer and the company, its products and services.<br />Since research papers about the effect of Customer Experience on online loyalty are very few (Oldenburge, et. 2008), the <em>purpose of this study</em> is to evaluate the impact of Customer Experience and its components on the loyalty of internet – shop clients on the bases of 123.ru. <em>The main tasks</em> are to create the Customer Experience measurement scale for the sphere of e-retail and identify the key drivers of Customer Experience in the explanation of loyalty.</p><p style="text-align: justify;">Empirical study includes a search component - conducting focus - group aimed at identifying consumer insights relative to the points of contact with the internet - shop and descriptive component - conducting online survey on the measurement of Customer Experience and its impact on client loyalty of 123.ru .</p><p style="text-align: justify;">Literature analysis and focus group results allowed to develop a questionnaire on assess the Customer Experience and have identified the following hypotheses: the processes of (H1) search and selection <em>(Competitiveness, Website Usability),</em> (H2) ordering <em>(Ordering, Call-center, Online payment),</em> (H3) Order Confirmation, (H4) Order Execution <em>(Receipt of the goods),</em> (H5) aftermarket (<em>Customer Service , Refund/Exchange)</em> significantly and positively affect the Customer Experience and (H6) Experience has positive effect on loyalty.</p><p style="text-align: justify;">Data analysis of the online survey (response rate- 16%) in the SPSS package confirmed the hypothesis H1 , H3, H4 and H6. Hypotheses H2 and H5 were confirmed in part, due to lack of valid data on the factors <em>Online Payment</em> and <em>Refund/Exchange</em>.<br />Impact of the Customer Experience on emotional loyalty was higher than on behavioral. Predictive models of Customer Experience and emotional loyalty are also very similar. Experience prediction required <em>Competitiveness, Call - Center, Web Site Usability </em>and<em> Order Confirmation</em>, and the prediction of emotional loyalty - <em>Competitiveness, Call - Center, Web Site Usability </em>and<em> Customer Service</em>. To predict behavioral loyalty one can use only two factors – <em>Competitiveness </em>and<em> Receipt of goods.</em></p><p style="text-align: justify;">Although the correlation analysis showed the importance of all the factors in explaining Customer Experience and loyalty, the analysis of predictive models led to the conclusion that the most important factors in predicting the marketing results of online - shops are <em>Competitiveness, Call - Center, Web Site Usability </em>and <em>Receipt of goods</em>. And the factor <em>Competitiveness </em>(justice of prices, the possibility of obtaining discounts, payment terms and delivery terms, completeness and usefulness of the reviews on the site) is the key factor.</p>
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