Why Online Retailers Should Study Philosophy
E-commerce has changed the way consumers across the globe shop, access goods and experience customer service. By ordering products through a website such as Amazon, the in-store experience is eliminated, but the customer’s experience is still impacted by a number of variables. Some of the most common issues that affect satisfaction include the timely arrival of what was ordered and, of course, whether the product arrives intact.
Lei Song (LeBow PhD ‘15), LeBow marketing professors Srinivasan Swaminathan and Rolph Anderson, and co-authors set out to examine the cross-cultural differences in people’s reactions to positive or negative e-commerce experiences. To arrive at their findings, published in Journal of Marketing Channels, they surveyed 216 students in the United States and China.
For the survey, students were asked questions related to their feelings about an e-commerce service based on factors such as whether a package arrived on time or late – these outcomes are referred to as being either positively or negatively disconfirmed, respectively.
What they found is that customers in the United States are much more reactive. A single positive or negative experience will greatly influence their satisfaction, loyalty and word of mouth. Chinese customers are much less likely to make a decision based on a single purchase or interaction. They tend to factor in all their experiences over the long term.
The team believes that their findings can be explained through cultural/philosophical differences. “Chinese customers have a Confucian philosophy which suggests a middle way,” explains Song. “They keep their emotions flat when experiencing positive or negative customer service out of a desire to achieve social harmony.”
Americans, by contrast, are likely to be influenced by Aristotelian thinking that emphasizes positive or negative reactions and excludes the middle. The U.S. customer’s focus is on the individual experience, with much less consideration for the long term.
The team of researchers feels that their findings have some direct implications for how e-commerce giants like Amazon should do business in different markets. “Chinese customers focus less on superior service quality and more on low prices. Therefore, based on our study, we suggest that Amazon should focus less on providing superior quality services to Chinese customers and should explore alternative ways (e.g., product discounts) to achieve customer satisfaction,” says Song.
For international retailers entering the American market, Song says the greatest challenge is avoiding negative word of mouth: “E-tailers selling to U.S. markets should focus primarily on consistently providing superior service quality to achieve customer satisfaction.”
In a global economy, customers have access to goods across borders, but cultural factors are still vital to understanding how to best serve them.