Abstract
Negative Word-of-mouth (NWOM) communication, often used as term to denote the negative feedback given by consumers on public online platforms, has emerged to be an important area of study. However, an important dimension of NWOM has so far been ignored in academic literature – the experiences and attitudes of customer service executives towards online consumer complaints. In studying these attitudes and emotions, the current study uses Davidow’s six dimensions of managing and handling complaints by organizations as a theoretical justification. More than half of the six dimensions involve communication between employees and customers. Hence, the employee attitudes and the impact of those attitudes on complaint management is significant. Competition is controlled by conducting a cross-sectional study and during a time period when there are no new entrants into the market.
Through a questionnaire survey, this study seeks to explore the attitudes of customer service executives towards negative consumer feedback. It seeks to survey 200 customer service executives, randomly sampled through their replies on Facebook to online consumer complaints. The study also tries to establish a relationship between company loyalty and negative attitude towards negative feedback. Company loyalty will be measured in terms of length of employment and satisfaction with employer. Descriptive and inferential statistics will be used to analyse data and test hypotheses.
Chapter 1
Online Interactivity: A Double-Edged Sword
Introduction
In 2010, Dutch cabaretier Youp van 't Hek used his twitter account to urge all his fans to come to him with their stories if they had negative experiences with T Mobile, Netherlands. His call for social media ammunition against T Mobile was preceded by his own dissatisfaction with the way T Mobile responded to his negative tweets of the T Mobile helpdesk services. The entire episode cost EUR 300,000, according to a newspaper article. In another, more recent story, India’s first online shopping website, Flipkart.com, invited thousands of negative reviews on social media platforms when their Black Friday- modelled sale became a logistical disaster. The number of customers vowing never to use Flipkart again was so large that it prompted the company’s founders to write a public apology to its online consumers. In an apology email to its customers, Flipkart founders admitted that they were not prepared for the immense response it would generate and did not source enough products to meet everyone’s demands.
The power of internet-powered, interactive social media communication in tarnishing reputations of companies cannot be discounted. Even though Dellarocas (2003) has argued that these online feedback mechanisms help build trust in online trading environments, the case of Flipkart.com shows how easily it can backfire on the organization. This brings immense pressure on both online and offline businesses to tread a fine line between consumer trust and effective feedback responses. The issue becomes even more serious since previous research has shown that potential customers find more credibility in the experiences of existing customers, and depend on social media to find the same (Henning-Thurau et al., 2004). Bickart and Schindler (2001) even argue that most potential consumers find this more reliable than public relations material circulated by an organization.
Most studies deal with consumer complaints and online complaint management, while there is very little research to show the attitudes developed by employees, over a period of time, about the online complaints, the company which they work for, and the experience of those employees dealing with consumers on a regular basis.
It is in this context that the current study seeks to understand the experiences of employees who, on a daily basis, interact with consumers with negative experiences. This research aims to study the extent to which employees of an organization are affected by negative consumer complaints on social media platforms. It relies heavily on the conceptual framework of NWOM communication. NWOM, expanded as negative word-of-mouth, is a concept that encompasses the scope of online expression or narration of negative experiences in a networked platform. Another concept that is being employed in the study is that of service encounter. A service encounter is defined by Bitner (1990) as either that time period when a customer directly interacts with a service or that in which the customer experiences all aspects of an organization. This study uses the ‘service encounter’ framework, in exploring the attitudes of those executives who have these ‘encounters’ with customers on a day to day basis.
The objectives of this research are
In line with these objectives, this study seeks to answer two important questions relating to employee experiences with online consumer complaints
RQ1: What attitudes do employees hold towards negative word-of-mouth communication?
RQ2: To what extent does the loyalty to employer affect these attitudes?
Chapter 2
Literature Review
Introduction
As a major research area, Consumer Complaint Behaviour (CCB) encompasses all responses that arise out of a negative experience with the purchase of a product (Singh and Howell, 1985). These responses result in various actions from the consumer while seeking redress, including going back to the seller or deciding never to buy a particular brand again. Research on traditional means of consumer complaint behaviour shows the necessity of encouraging consumers to voice out concerns (Davidow and Dacin, 1997). Firms have devised different strategies for handling consumer complaint. Davidow (2003) summarizes them succinctly in his study on organizational responses to consumer complaints. He argues that organizational responses can be categorized into six; “timeliness, facilitation, redress, apology, credibility and attentiveness” (p.1). Timeliness is the speed with which an organization responds to a particular complaint, while facilitation involves the systems in place to handle customer complaints. Redress involves the positive outcomes for a customer in redress of a complaint, while apology is the one given by the organization. Credibility is the extent to which the organization is willing to acknowledge a customer’s problem. Attentiveness rates the extent to which the interpersonal communication between the consumer and an employee is smooth (Davidow, 2003). These six dimensions become an important justification for the current study, as more than half of the dimensions involve a response from those employees who do a consumer-facing role. Even then, there is very little research done into employee attitudes and responses to online consumer complaints.
Estelami (2000) argues that employee behaviour is an important predictor of customer satisfaction. He goes on to describe different qualities that an employee interacting with a customer should exhibit, including politeness and empathetic listening. Estelami (2000) further concludes that the “proper interaction between the employee and the consumer may be more critical in handling consumer complaints” (p. 289).
In studying factors that affect the outcome for the consumer, Estelami (2000) takes into account determinants other than employee behaviour. These include the competitive intensity between organizations, the extent of consumer loyalty, the amount or kind of compensation that a customer receives as an aggrieved party and promptness of response.
Customer Relations Management in the Online World
Electronic Customer Relations Management or e-CRM is generating an immense amount of interest in both business and academic circles (Cho et al., 2002). It is increasingly seen as a way of generating customer loyalty. Cho et al. (2002) has modelled the dimensions of e-CRM in Figure 1.
With the emergence of the internet and the increased use of social media by business organizations, interactivity has increased in terms of consumer complaint behaviour (Hong and Lee, 2005). Consumers are increasingly using social media platforms like Facebook and Twitter and availing of tools like hashtags to bring their complaints to the notice of the companies or organizations (Ward and Ostrom, 2006).
As seen in Figure 1, resolving consumer complaints is an important aspect of customer relationship management in the online world. However, if employees are not properly equipped or trained to deal with angry, often vicious customers online, it might feed back into a negative cycle with the organization’s reputation spiralling out of control. This aspect of employee experiences forms the core of this study.
Kim, Wang and Malthouse (2014) categorises online consumer complaints into three platforms in their presence – a company’s website, its social media platforms and third-party complaint websites. Research is rich on the motivations of consumers to voice their complaints on a public forum like a social media platform. Word-of-mouth or WOM is the generally accepted term used for informal, consumer-generated forms of communication on social media platforms (Liu, 2006). Lee and Cranage (2012) argue that WOM drives consumer behaviour and influences brand loyalty. They also argue that negative WOM, or the process of giving negative feedback through online platforms generate more interest and have more influence than positive WOM.
Termed as negative word-of-mouth or NWOM, many studies have explored various aspects of consumer behaviours, attitudes, organizational responses and their impact on the organization. On one hand, Lee and Cranage (2012) found that a consensus of negative opinion about an organization online had influenced the decisions of potential new customers. They talk about two ways in which organizations can initiate interventions for negative opinions. These interventions, termed Webcare, can be either reactive (italics mine) in terms of specific responses to specific requests, or proactive (italics mine) with the organization offering a response even without a request from the consumer. Lee and Cranage (2012) argue that both these have the potential of positively influencing the reputation of an organization.
On a similar note, positive and immediate organizational responses to online complaints from a consumer were found to increase customer loyalty and positively impact the reputation of the organization, as Breitsohl, Khammash and Griffiths (2010) found in their study of online perceptions of credibility. Noort and Williams (2011) found in a similar study that organizational interventions to negative word-of-mouth will reduce the negative brand evaluations generated by the negative word-of-mouth.
However, there is a major gap in literature when it comes to employee responses and attitudes to online negative word-of-mouth towards an organization. In fact, there is very little or no research at all in terms of the initial emotional reactions experienced by the employees and their attitudes towards online consumer complaint behaviour. This study seeks to address this gap by exploring the emotions and attitudes of customer-service executives responsible for replying to the complaints and serving as mediators between consumers and the company.
Chapter 3
Methodology
Introduction
The current study has strong post-positivist, critical-realist leanings in its ontological and epistemological approach. The central argument of positivist epistemology is that the purpose of research is to describe the world as it is, and refrain from interpreting it. However, the critical realism paradigm brings in room for error in observations and measurement. In using a critical realist approach, this study seeks to explore existing phenomena – attitudes of employees – through empirical testing.
Research Design
This study uses quantitative approach to studying the attitudes and emotions customer-service executives.
Explanation of key terms
Negative Word of Mouth (NWOM) communication – the process by which consumers dissatisfied with a purchase use a social media platform to communicate negative feedback about their experience
Attitude – A set way of thinking about something. For this study, it means the way in which employees emotionally respond to, and the way in which they think about online consumer complaints
Service Encounter – a direct encounter between customer and a customer service executive in a social media platform. For this study, the social media platform used will be Facebook.
Employee attitude is regularly used by organizations to understand the behaviour patterns, motivation levels and loyalties of employees towards their employers. These surveys are often used as a method to retain good employees by addressing their problems. Hence, surveys become an important part of the current study.
Traditional research indicates that loyalty towards an organization is built either through a long association with it, or through satisfaction of the work experience and the work environment. Based on these assumptions, the following hypotheses are formed.
H1: The longer an employee has worked for an organization, the more likely he\she is to have negative attitude towards online consumer complaints
H2: The more satisfied an employee is with the employer, the more likely he\she is to have negative attitudes towards online consumer complaints
Surveys
This study seeks to employ a survey method to explore the attitudes of employees towards NWOM. Surveys are useful when collecting information about attitudes, beliefs, motives and intentions. They are also a time and cost effective way of collecting large amounts of data and demographics (Wimmer and Dominick, 2006). Survey will include demographic dimensions such as employee age, gender, years worked in an organization, years worked in the current role etc. The years worked in the current role might indicate a relation to the way in which responses and attitudes are formed. For example, an employee who has been handling customers for a few years is less likely than a new employee to be affected by NWOM. The survey will also include attitudinal dimensions such as loyalty to organization, commitment to organization, satisfaction with organization, usefulness of online complaints and responses to online complaints. Employee attitude surveys -especially those conducted internally by organizations - measure attitudes on various dimensions such as creativity, innovation, management, expertise, satisfaction and loyalty to the organization.
Respondents will also be asked to evaluate their emotions on encountering particular NWOM communications and these emotions will be categorised into negative or positive .
Population and Sample
The population for the current study is those customer service executives who publicly respond to online complaints from customers on Facebook. A simple random sample of 200 such executives on Facebook will be chosen for the survey.
Reliability and Validity
It is suggested that a small pilot survey is conducted with 30-50 respondents to test the questionnaire for its reliability and validity. With the pilot, the questionnaire has to be tested for its actual measurement of concepts that it purports to measure, and its generalizability.
Research Ethics
Since the survey is to be administered online, there are obvious limitations to getting a consent form signed. It is however proposed that the survey start with an online consent form which the respondent can tick to give consent.
Data Analysis
Descriptive and inferential statistical analysis will be used to draw conclusions for this study. Cross tabulations between demographics and attitudes will help test the two hypotheses, while a regression analysis will test the relation between employee demographics and attitude towards online consumer complaints.
Chapter 4
Scope and Limitations of the Study
The results of this study may prove very important to organizational and management responses to NVOM communication. The study seeks to build awareness among senior managers of the need to carefully train employees on managing NVOM communication. The lack of research in this area shows the lacunae in awareness of the way NWOM communication affects employees. As more than half of the six dimensions of consumer complaint managing techniques by organizations require employees to respond to consumers, it is important that they be trained in their emotional responses and attitudes. The anonymity offered by social platforms often lead to extremely harsh comments from consumers (Gelb and Sundaram, 2002), and it is highly essential that employees who deal with them on a regular basis be properly trained for that.
The obvious limitation of this study is its use of just one social media platform, which is Facebook. The study also limits itself to those employees who are manning the ‘front-end’ of customer services online. It does not explore the attitudes of those employees who are more actively involved in complaint resolution like repairing a default product. The study also does not take in to account the relationship dynamics between the manufacturer and the retailer when it focuses itself only on the customer service executives who reply to online complaints.
Estelami (2000) found that competition had a direct impact on the speedy redress of complaint and high levels of customer satisfaction for complaint redress. The effect of competition on the organization and the employees has not been accounted for in this study. However, the study is cross-sectional, and conducted at a time when there are no new entrants to the market in the organizations studied. Hence, it is argued that competition is controlled for the study, and that Estelami’s (2000) study also accounts for other aspects that influence consumer outcomes. These include employee behaviour, promptness in response and compensation given to consumers.
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