Complaining at the store or through social media: the influence of the purchase channel, satisfaction, and commitment

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1 Complaining at the store or through social media: the influence of the purchase channel, satisfaction, and commitment Marta Frasquet, Maria José Miquel, Alejandro Mollá University of Valencia Abstract. In the current omnichannel retail environment, customers have multiple channels to interact with firms to search for information, purchase, and after-sales. Within those channel social media can play a significant role, particularly as complaint channels. The aim of this paper is to analyze whether the choice to complain face-to-face or through social media depends on the purchase channel chosen and the satisfaction and commitment with the retailer. With data from an online panel our results show that the complaint channel tends to be the same as the channel chosen for purchase; moreover, satisfaction is positively related to complaining at store and negatively related to complaining through social media, and commitment is only positively related to complaining through social media. Keywords. Multichannel, complaint, social media, online purchase, satisfaction, commitment 1 Introduction Nowadays, shoppers are offered different channels, such as brick and mortar stores, websites, call centers and social media, to interact with a retailer to search information, purchase, and for post-sales activities such as return products, and complain (Dalla Pozza, 2014). Our study focuses on the post-sales stage of shopping and we contribute to the literature by considering social media, which previous research had not included as an alternative when choosing a complaint channel (e.g. Mattila and Wirz, 2004; Lee and Cude, 2012), but that Robertson (2012) pointed out as future research. The role of social media as a support channel in post-sales stage has been explored by Clark (2013), Svari and Olsen (2012) or Dalla Pozza (2014), which also suggest the opportunity to continue advancing our knowledge on the role of social media as a complaint channel. A theoretical contribution of our paper is to integrate consumer complaint behaviour literature and multichannel literature to analyse the antecedents of the choice of complaint channel. Only a few studies analyse multichannel behaviour including the post-sales stage (Gensler et al., 2012; De Keyser et al., 2015; Frasquet et

2 2 al., 2015), and these have not considered the choice of social media as a complaint channel dependent on the choice of purchase channel. Attempting to contribute to this research gap, this study aims to analyse if the choice to complain face-to-face at the retail store and to complain through social media are explained by the choice of purchase channel and the satisfaction and commitment with the retailer. The structure of this paper is organised as follows. After this introduction, Section 2 provides theoretical background for the hypotheses and our research model; Section 3 and 4 present the methodology and data analysis; finally, the discussion part, managerial implications, and limitations are included in Section 5. 2 Literature review 2.1. Multichannel shopping behaviour Verhoef et al. (2015) claim that retailing has moved from multichannel to omnichannel business models that facilitate customers interaction through multiple channels and media. The challenge for retailers is to understand the customer experience throughout increasingly complex shopping journeys (Lemon and Verhoef, 2016). Shoppers have different needs at each purchase stage and different channels are differently able to satisfy those needs. Literature has examined channel choice across the stages of the shopping process, with most studies focusing on the search and purchase stage and discussing the behaviours of webrooming or research shopping, and showrooming (e.g. Verhoef et al., 2007; Konuş et al., 2008). These channel usage patterns are explained by the lack of lock-in of the channel or the ability to retain shoppers across the shopping process, and by the existence of cross-channel synergies or the benefits of combining channels. Some recent papers have recognised the call to investigate the post-sales stage as part of the omnichannel customer journey (Gensler et al., 2012; De Keyser et al., 2015), and they set the bases for further research that considers specifically social media as a channel Social media as a complaint channel According to literature, complaint behavior can be sorted into two categories: private and public complaint (Singh, 1988). In the private complaint customer voices his complaint only directly to the company, whereas in public complaint his voice goes beyond the company domain, as the individual tries to warn other customers, or just seeks revenge (Svari and Olsen, 2012). Nowadays, technology is changing the way customers complain as they are afforded new channels to seek support and voice their complaints (Snellman and Vihktari, 2003). While and webform are classified as a remote channels in opposition to interactive channels such as face-to-face or call centers, social media is defined as a semi-interactive channel as it is distant and interactive (Clark, 2013). Technology, consumer habits, and firm s strategies have combined to con-

3 3 solidate social media as a complaint channel that is used in combination with or as a substitute to more traditional interactive channels. Although many companies are using social media channels to interact with current and potential customers, when it is the customer who initiates the contact, Dalla Pozza (2014) found that social media is used very rarely to ask for information about product and services and most often it is used for after-sales support. Social media allows the customer to interact with the firm and give publicity of this action to other consumers. The publicity of the complaint action and its power to affect the reputation of the company means that firms are dedicating significant resources to address the complaints voiced through social media. Although we can find researches analysing the use of social media for negative word-of-mouth, there are very few ones focusing specifically on analysing social media as a complaint channel. In this regard, in a qualitative study to explore the reasons for choosing social media as a complaint channel among Millenials, Clark (2013) found that social media is often used as a channel for venting anger and to assert power over organizations. According to Svari and Olsen (2012), when the customer considers that the issue of the complaint is wholly attributed to the company, the customer prefers complaining directly to the company whereas when the incident is wholly or partly responsibility of himself, the customer will be more likely to complain anonymously through social media. Thus omnichannel retailers are challenged by the social and interactive nature of social media and the faster spread of negative word-of-mouth online than offline Hypotheses development Our research model establishes the choice of complaint channel as dependent on the choice of purchase channel and the customer satisfaction and commitment. Drawing from the channel literature and the complaint behaviour literature we believe that customers will tend to complain in the same channel where they have purchased. The channel literature has discussed the channel lock-in or spillover to refer to the extent a channel is able to keep shoppers from one stage of shopping to the next (Verhoef et al., 2007). There is some initial evidence that the choice of one channel in one stage has an influence in the choice of channel in the subsequent stage of shopping (Gensler et al., 2012). The offline channel in particular shows a strong lock-in as it is able to keep shoppers along the shopping process (Verhoef et al., 2007). Within the consumer complaint behaviour (CCB) literature, Lee and Cude (2012) obtained that offline and online purchasers differ in the channels they use to complain, being online buyers more likely to complain online. Offering an option to complain in the online medium, eliminates the barrier of not knowing where to go for those shoppers not familiar with the offline stores (Snellman and Vihtkari, 2003) or those who look for convenience. Thus, our first two sets of hypotheses state: H1: The more likely the shopper is to purchase online, (H1a) the less likely to complain at a store, and (H1b) the more likely to complain in social media.

4 4 H2: The more likely the shopper is to purchase offline, (H2a) the more likely to complain at a store, and (H2b) the less likely to complain through social media. The CCB literature clearly identifies the degree of satisfaction-dissatisfaction as the basic reason consumers complain over products or services (Thøgersen et al., 2009). This link has also been found in the online shopping context (Wu, 2013). Lee and Cude (2012) compare the effect of satisfaction on the choice of offline versus online complaint channel. The authors confirm that when online shoppers are very dissatisfied they tend to use online channels to complain, but they cannot confirm that the level of satisfaction affects offline shoppers. We believe that when shoppers are more satisfied with a retailer they will tend to complain faceto-face as this offers more chances of solving the issue and keeping alive a satisfactory relationship. On the contrary customers that are in a satisfactory relationship will tend to avoid social channels to complain as they can believe this could not help to solve the issue. Hence, H3: The higher the satisfaction with the retailer, (H3a) the more likely the shopper is to complain at a store, and (H3b) the less likely the shopper is to complain through social media. Commitment is considered an essential ingredient for successful long-term relationships (Morgan and Hunt, 1994), as its development is based on positive emotional bonds and an affective social identity (Dholakia et al., 2004). Moorman et al. (1992) defines it as an enduring desire to maintain a valued relationship, and literature supports its positive influence in consumer loyalty and behavioural intention (Cheung and Lee, 2009; Mukherjee and Nath, 2003), among which wordof-mouth communication appears (Morgan and Hunt, 1994). According to Turri et al (2013) committed consumers are often willing to stay in an exchange relationship and to put forth effort to maintain that relationship. Consequently, one could expect that if the customer has something to complain about the retailer, he will complain directly to the retailer in order to save the relationship. Considering that Brown et al. (2005) demonstrated that for higher-commitment customers, positive word-of-mouth behavior is less dependent on the satisfaction level, we posit: H4: The higher the commitment to the retailer, (H4a) the more likely the shopper is to complain at the store, and (H4b) the less likely the shopper is to complain through social media. 3 Methodology An online survey was undertaken. Participants belonged to a nationwide online panel under the management of a professional market research institute. The interviewees were multichannel shoppers in the apparel product category living in Spain. This is a hedonic product category where multichannel shopping is more

5 5 evident (Kushwaha and Shankar, 2013). We got a final sample of 702 respondents. A structured questionnaire with 7-point Likert scales was used. One single item per scale was used to measure the likelihood to buy online, to buy at store, and to complain at the store and through social media. A four-item scale adapted from Brakus et al. (2009) measured satisfaction with the retailer, and for commitment to the retailer, a three-item scale taken from Coulter et al. (2003) was used. To answer the questionnaire, respondents had to choose their most-visited retailer from an exhaustive list of multichannel retailers operating in Spain. All the retailers considered were originally offline retailers that had become multichannel retailers, and all of them were single-brand retailers. 4 Results Before estimating the structural model proposed, psychometric properties of the scales were assessed, exceeding all of criteria the minimum threshold suggested by relevant literature. The proposed theoretical model was estimated using a robust methodology in EQS 6.1. Results are shown in Table 1. Table 1. Hypothesis testing Hypotheses Structural relationship β t value Contrast H1 H1a Online Purchase Compl. Store ns H1b Online Purchase Complain SM ** Accepted H2 H2a Offline Purchase Compl. Store ** H2b Offline Purchase Compl. SM n Accepted H3 H3a Satisfaction Complain Store ** H3b Satisfaction Complain SM ** Accepted H4 H4a Commitment Complain Store ns H4b Commitment Complain SM ** Rejected S-B χ2 (34 d.f.) = (p<.000); BBNFI=.975; BBNNFI=.975; CFI=.986; IFI=.986; MFI=.968; RMSEA=.044 **= p <.01; ns non significant Three of the hypotheses are accepted (H1, H2 and H3), and only one (H4) is rejected. According to our data, (H1) the more likely the shopper is to purchase online, (H1a) the less likely to complain at a store, and (H1b) the more likely to complain in social media. In fact, there is no relationship between purchasing online and complaining at a store. The same reasoning can be considered for the offline channel: (H2) the more likely the shopper is to purchase offline, (H2a) the more likely to complain at a store, and (H2b) the less likely to complain through social media. Regarding satisfaction, as H3 suggested, the higher the satisfaction with the retailer, (H3a) the more likely the shopper is to complain at a store and (H3b) the less likely the shopper is to complain through social media. However, it is relevant to consider the sign of both relationships; whereas there is a positive relationship between satisfaction with the retailer and complain at a store (what means that less satisfaction leads to a minor complaint at a store), the relationship between satisfaction and complain through social media is negative what means

6 6 that less satisfied customers will probably choose complaining through social media. Finally, H4 is rejected: the higher the commitment to the retailer, (H4b) the more likely the shopper is to complain through social media, but no relationship appears between commitment and complaining at a store, as H4a suggested. 4 Conclusions In the current competitive environment retailers are aware of the relevance of the consequences of the company failure; dissatisfied customers, negative worth-ofmouth and customer defection are some of those consequences (Michel, 2001) so companies make every effort in service recovery. It is more urging if we take into account that online word-of-mouth information has become an important information source for shopping, affecting the behaviour of potential customers (Yoo et al, 2013). A better knowledge of the customer and his shopping process can help to manage that recovery. This study analyses if the choice to complain face-toface at the retail store and to complain through social media are explained by the choice of purchase channel and the satisfaction and commitment with the retailer. Our results provide support to Gensler s et al. (2012), as they suggest that those customers more prone to buy online will complain online (in our research through, social media), and those more inclined to offline shops will tend to complain at a store. This result is relevant as most of the sales of multichannel retailers still come from the offline channel. In this regard, for complaints made at the store, the retailer has the opportunity to manage them in a more focused and controlled way, due to the expressive richness of face-to-face interactions, the immediate feedback from the customer, and the private sphere of the interaction. Complaints through social media can be more painful and harmful for the company, as social networks foster explicitness (Venturini, 2007). The semi-interactive and public nature of the complaints through social media together with the fast spread on information online, make them a powerful means for consumers to exert power (Clark, 2013). However, those public complaints can also be used as a strategic tool for the company: it is a good opportunity for the company to show it is customer-oriented and willing to solve any issue in the best possible way. Regarding satisfaction, our data suggest that those customers more satisfied with the retailer will tend to complain at a store, which is good for the company, as mentioned before. So, having satisfied customers favors a direct knowledge of their complaints, and a private sphere regarding of that complaint limited to the company and the consumer. Regarding the influence of commitment with the retailer, we find that those customers more committed will complain through social media, and not at the store. Although this result is initially surprising, emotions could explain it. The tendency to complain via negative word-of-mouth through social media increases with high levels of emotions, regardless of whether these emotions are internal (the individual blames himself) or external (the individual blames the company) (Svari and Olsen, 2012). As mentioned before, commitment is based on emotional bonds so,

7 7 when the individual experiences a failure in his relationship with the retailer, those emotions are affected, and he experiences the need to vent his feelings in a relatively risk-free manner (Svari and Olsen, 2012, p.279). If the failure is the individual s fault, the anonymity of social media will prevent customer from an excessive humiliation, whereas if is it the retailer s fault, the complaint will help individual to warn others, or just will serve as revenge (Svari and Olsen, 2012). Our research just considered two possible complaint channels, so future research could include other channels. It would also be interesting to analyze differences in the after-sales behavior when the product can be bought in multi-brand stores, or exclusively in the retailer's stores. A possible limitation of the present research could be based on the way of gathering the information: although the panel is composed of multichannel buyers, the use of an online survey could lead to a certain bias in the results when considering online and offline shopping models. Acknowledgments: This research has been financed by the Spanish Ministry of Economy and Competitiveness (Project ref.: ECO ). References Brakus, J.J., B.H. Schmitt and L. Zarantonello (2009). Brand experience: what is it? How is it measured? Does it affect loyalty?, Journal of Marketing, Vol. 73(3), Brown, T.J., T.E. Barry, P.A. Dacin, and R.F. Gunst (2005). Spreading the word: investigating antecedents of consumers positive word-of-mouth intentions and behaviors in a retailing context. Journal of the Academy of Marketing Science, Vol. 33(2), Cheung, C.M.K. and M.K.O. Lee (2009). Understanding the sustainability of a virtual community: model development and empirical test, Journal of Information Science, Vol. 35(3), Clark, J. (2013). Conceptualising social media as complaint channel, Journal of Promotional Communications, Vol. 1(1), Coulter, R.A., L.L. Price and L. Feick (2003). Rethinking the origins of involvement and brand commitment: Insights from postsocialist central Europe, Journal of Consumer Research, Vol. 30(2), Dalla Pozza, I. (2014). Multichannel management gets social, European Journal of Marketing, Vol. 48(7/8), De Keyser, A., J. Schepers and U. Konuş (2015). Multichannel customer segmentation: Does the after-sales channel matter? A replication and extension, International Journal of Research in Marketing, Vol. 32(4), Dholakia, U.M., R.P. Bagozzi and L.R.K. Pearo (2004). A social influence model of consumer participation in network- and small-group-based virtual communities, International Journal of Research in Marketing, Vol. 21(3), Frasquet, M., A. Mollá, A. and E. Ruiz, E. (2015). Identifying patterns in channel usage across the search, purchase and post-sales stages of shopping, Electronic Commerce Research and Applications, Vol. 14 (6), Gensler, S., P.C. Verhoef and M. Böhm. (2012). Understanding consumers multichannel choices across the different stages of the buying process, Marketing Letters, Vol. 23(4), Konus, U., P.C. Verhoef and S.A. Neslin, S.A. (2008). Multichannel shopper segments and their covariates, Journal of Retailing, Vol. 84 (4),

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University of Groningen. Essays on multichannel customer management Konus, Umut

University of Groningen. Essays on multichannel customer management Konus, Umut University of Groningen Essays on multichannel customer management Konus, Umut IMPORTANT NOTE: You are advised to consult the publisher's version (publisher's PDF) if you wish to cite from it. Please check