By J. N. Halm
Researchers have long understood that customer satisfaction is not a simple equation. Every interaction a customer has with a business is like a delicate dance. It is a complex interplay of various factors that can differ dramatically depending on where and how the interaction occurs.
Sometimes, the interaction happens in a physical store, sometimes through a website, but always with a complex set of expectations and experiences. The business has expectations, and so does the customer.
In our increasingly digital world, understanding how the differences in the location of the dance affects the quality of the experience has become more crucial than ever. Every business needs to find out what determines whether the dance between the business and the customer ends in harmony or discord.
A ground-breaking study has begun to unravel this intricate mystery. The study was titled “Designing Satisfying Service Encounters: Website Versus Store Touchpoints”, and its report was published in the August 2021 edition of the Journal of the Academy of Marketing Science.
The study in question, which examined service encounters for a global retailer involving 2.4 million customers, reveals something fascinating about how customers experience service in different environments. To get deep into the nuanced world of customer interactions, the researchers used the Touchpoint, Context, Qualities (TCQ) Framework as well as the Construal Level Theory (CLT).
By the way, CLT is an interesting social psychology theory that suggests that people think about objects and events that are close to them in concrete terms while thinking about distant objects and events in abstract terms. In other words, psychological distance affects how people think and behave.
Imagine two scenarios: A customer walking into a physical store versus the same customer browsing a website. Intuitively, we might think the experience is similar. The research proves otherwise.
Online customers, it turns out, approach service encounters differently from in-store customers. They weigh cognitive and behavioural qualities more heavily. This means that when interacting online, customers care more about the logical flow of information, the ease of navigation, and how efficiently they can accomplish their tasks. This is to be expected. Without a customer-facing employee on standby to answer the customer’s questions and without the benefit of holding the product or merchandise in one’s hands, the online customer’s experience is set to be markedly different.
In contrast, in-store customers place more emphasis on emotional and sensorial qualities. Walking into a physical store is an experience that engages multiple senses. The lighting, the layout, the ability to touch and feel products, and the interpersonal interactions—these become crucial factors in determining satisfaction. There are enough studies on how just the aroma and smell of a place can go a long way to affect the behaviour of customers.
This is not just academic speculation. For businesses operating in a global, omnichannel environment, these findings are nothing short of revolutionary. It suggests that a one-size-fits-all approach to customer service is not just ineffective—it is potentially harmful.
The research revealed something even more intriguing. The impact of service quality is not uniform across different countries and stores. Each location has its unique clientele effects. What works in one market might fall flat in another.
Think about a global retail brand like H&M or Zara. A customer browsing the company’s website in New York might have completely different expectations compared to a customer in Tokyo or Mumbai. Even within the same country, different segments of the market react differently to different service factors. The cognitive qualities that matter to a tech-savvy customer in Silicon Valley might be different from those important to a customer in a more traditional market.
For businesses, this presents both a challenge and an opportunity. Limited resources mean companies cannot invest equally in every possible service quality across all touchpoints. They must make strategic choices.
The guidance is clear: Customise your approach based on the touchpoint and the specific market. For online platforms, invest heavily in cognitive qualities. Ensure your website is intuitive, information is easily accessible, and customers can accomplish their tasks with minimal effort and friction. In designing the customer’s experience for countries where internet connectivity is not the very best, it is important to ensure that the website or online store does not have features that would make browsing slower than normal.
In physical stores, the focus should shift. Here, emotional and sensorial qualities take centre stage. In the physical space, it is about creating an experience, not just facilitating a transaction. The layout, the staff interactions, the ambient environment—these become critical.
The truth is that the customer’s experience within the physical space became even more crucial post-COVID-19. This is because customers had to rely more on online avenues to satisfy their shopping needs. Things have almost returned to normal for many businesses. However, with more and more avenues opening up for online shopping, customers coming into the physical stores will not be as in times past. What this means is that when the customer comes in, the experience must be top-notch.
This does not mean completely segregating online and offline experiences. The modern customer moves fluidly between these worlds. With the magic of the mobile phone and other smart devices, today’s customer is a different animal. The challenge for businesses, therefore, is to create a seamless, coherent experience that adapts to different touchpoints while maintaining a consistent brand essence.
Consider a customer who first discovers a product online, then visits a physical store to examine it, and finally completes the purchase through a mobile app. Each of these touchpoints requires a nuanced approach that understands the specific qualities most important in that context. Today’s customer can even browse different items and their different prices while standing right in the physical store.
For global businesses, this research offers a roadmap. It is no longer enough to have a generic customer service strategy. Companies must develop sophisticated, data-driven approaches that recognise the unique characteristics of different markets and interaction points. Enough funds must be invested in good research to ensure that each market is tackled with the right information.
The implications of this study extend beyond retail. Any business with multiple customer touchpoints—be it banking, hospitality, or technology services—can benefit from this understanding. It is about recognising that customer satisfaction is not a monolithic concept but a dynamic, context-dependent experience.
Technology plays a crucial role in enabling this level of customisation. Advanced data analytics, artificial intelligence, and machine learning can help businesses understand and adapt to these nuanced customer expectations in real time. The potential for technology to help in providing customised services for specific segments of the market is truly enormous. Smart businesses know this and so many are investing heavily in these advanced technologies.
But as I have emphasised time without number, technology is just a tool. The real key is a mindset that values understanding. Businesses must invest in research, in listening to their customers, and in continuously evolving their approach to service encounters.
In this vein, the job of the frontline employee, being the direct intermediary between the business and the customer, would become more and more critical to the fortunes of the business. The frontline employee must be one who can glean important information from the frontline and relay the same to those who can make the best of that information.
For managers and business leaders, this research is a wake-up call. Customer satisfaction is not about ticking boxes. It is about creating meaningful, contextually relevant experiences that resonate with customers across different touchpoints and markets.
As we move further into the digital age, the businesses that will succeed are those that can dance most gracefully between the physical and digital worlds. They will be the ones who understand that each interaction is an opportunity to create not just a transaction but a connection.
The future of customer service is not about standardisation but about intelligent customisation. It is about recognising that in the complex world of customer interactions, context is king. The future is about ensuring that every single touchpoint touches the customer in such a way that is truly touching.
