Summary of essays

This thesis comprises three essays. Next the central ideas and findings of each essay are briefly presented.

4.1 Essay 1: Customer experience management in online news

channels

In Essay 1, the relevance of customer experience in the online context is discussed and the key components of customer experience leading to e-loyalty of an online news channel are determined. The study considers the online customer experience (OCE) in the media industry as a cumulative outcome of the consistent use of an online news site (Rose et al., 2012).

Although customer experience management seems critical for any company operating in the Internet (Novak et al., 2000; Verhoef et al., 2009) and in traditional commerce (Grewal et al. 2009; Puccinelli et al., 2009), relatively little is known about the factors that make consuming an online site a compelling experience for its users (Rose et al., 2012). Even less is known about the experience of consuming online news. However, measuring the customer experience reveals the true value components of the relationship for the customer and provides knowledge for the company of the most critical online service components for the business. The key to success in an online environment such as the news business seems to be in managing the customer relationships based on the customer experience online and real time (Schefter & Reichheld, 2000, Picard, 2008; Holmberg et al., 2013). In this regard, the study furthers the recent research discussion about changes in media management (Järventie-Thesleff et al., 2014; Mierzejewska & Shaver, 2014; Saksena & Hollifield, 2002), multi-platform and paid content strategies (Goyanes & Dürrenberg, 2014), consumer preferences in regard to news content (Kanuri, et al., 2014) and the relevance of brand in the media market (Malmelin & Moisander, 2014).

As no directly applicable model to measure OCE in the news channel context exists, the study extends the prior work of Constantinides (2004) on content, psychological and functional factors as the “main building blocks of web

experience”. The study presents a framework of customer experience components and their attributes critical to customer loyalty in an online news channel. Based on the framework presented by Constantinides (2004), the article uses two identical web surveys (n=212 and n=180) and 10 personal interviews to examine the significance of different experience components and explicates the critical attributes for online loyalty. The surveys were conducted before and after a

development of the site. Customer interviews in the primary target group of the site were made in between the two customer surveys. The results and analysis of the interviews form the core of the study.

As a result of the study, six attributes were identified as critical for superior customer experience of online news: 1) preference,2) integrity of journalism, 3) structure, 4) navigation of the site, 5) brand, and 6) “fear of missing out”, earlier linked only to social media, but now evidently also relevant in online news consumption. The study regards integrity in journalism as the most important content factor for customers. This means that to win and keep subscribers in the fierce competition with the available free options for news in Internet, an online news channel must at all times deliver insightful, analysed and investigative journalism showing professionalism and in-depth understanding of news backgrounds.

Figure 4 presents, based on a prior framework (Constantinides, 2004), the three factors forming the cornerstone for OCE: Content, Psychological and Functional

factors and the eight components of these factors (Information, Creativity, Marketing/ Trust, Credibility, Emotions/ Usability, Interactivity). It also presents 20 attributes explaining the eight components in practice, likewise found from literature and used as the structure of analysis of the web surveys and interviews. In Figure 4, the underlined attributes (6) present the outcome of the study. Base on a case study of an online news channel customers, these attributes were found critical for customer loyalty. The determinants to evaluate online customer loyalty include Continued use, Paying Intent and Advocacy (Gentile et al., 2007), are shown on the right

Figure 4. Empirically tested framework for OCE of a news channel

Factors of OCE Components of OCE Attributes of OCE

Online Customer experience OCE Content factors Psychological factors Information Creativity Marketing Trust Credibility Emotions Paying intent Advocacy Continued use Functional factors Usability Interactivity Preference Integrity Visuals Consistency Price-level Products Online security Data Safety Brand Cognition Affect FoMo Speed Structure Search Navigation Convenience Networking Help-Desk Personalisation

4.2 Essay 2: Organizing a framework for customer value

management in online media relationships

Essay 2 argues from the company perspective that in order to manage the value of customer relationships, the existing and potential value of relationships needs to be identified first. The value generated by the customer to the firm usually indicates the monetary value, based on purchases. However, in the digital business environment, besides monetary, also relational value (Grönroos, 2008) becomes increasingly important for firms. In the Internet, customers are connected to each other, forming networks of consumers, where thoughts and consumption experiences can easily be shared with a great number of people (Domingos & Richardson, 2001). Relational value indicates also the active role of the participative consumer, who takes part in company actions, such as promotions, customer service or new product development (Bowden et al., 2014; (Wu et al., 2014; Chan et al., 2010 Thackeray et al., 2008).

The study aims at building a basis for customer value management for online news channels and encourages managerial focus on CRM to build a long-term vision rather than short-run profits of customer relationships. Today managers prefer to consider also non-monetary social rewards for co-creating value and to enhance customer relationships (Vargo & Lusch, 2010). Online relationships have become multi-faceted, and customers create value for the company in online transactions but also in many other ways, which also need consideration in order to understand the full potential of an online customer.

Based on academic literature and prior research on CRM, CEM and customer engagement value (CEV), the study deepens understanding of the value creation of online customer relationships and suggests monetary, social, as well as visitor value to be gained for the company from online relationships. The article takes a stand on the wide availability of customer data, which enables companies to acquire a truly holistic view of customer relationships, including new relational and economic aspects of customer value. Furthermore, the article considers the availability of monetary and relational data on customer relationships as a major asset for the development of customer value management in the online environment.

The article presents a framework for managing customer value, which provides a holistic view to relationship value, recognizing visitor value as one of the key aspects of online relationships. The emphasis is on exploiting the value creation of customer relationships in the media industry. Nine value components are presented, which all have an impact on customer relationship value for firms. Transaction value and customer lifetime value refer to the monetary value of customers. Referral value, knowledge value, influencer value and co-creation value all refer to socially active customers who benefit the firm by being active members of bulletin boards, Internet forums and social networks such as Facebook, LinkedIn, or Twitter. Customers gain visitor value for the firm through their active visitorship on site and often visitor value mainly refers to the expected, potential value of customers than to the present value.

Nevertheless, visitor value is becoming a more important value concept in the online environment and deserves clarification as a central issue in this thesis, discussed in Essays 1 and 2. For a typical online retailer, only 1-2% of visits convert into purchases (Brownlow 2001) and the shift from purchase-intensive

incorporating prior visit behaviour, individual –level customer visiting data, in the analysis of the online customer-firm relationship. The visiting data, which is typically ignored (Moe and Fader 2004a), could reveal individuals' intensions or objectives when visiting a site or online store. The low conversion rate compared to offline stores is argued to be due to the low cost to visit a store online, lack of social and sales pressure, and lack of a clear purchase objective online (Brownlow 2001; Moe and Fader, 2004a). However, from a firm's perspective, conceivable value is created when an individual visits the web site, regardless of whether a transaction (purchase) is made during the visit. To clarify this argument more, the value of a visitor to the firm can be captured through the following three facts: first, many online news channels and some e-commerce sites depend partially on advertisement models to bring in revenue. Under such circumstances, customer visits to a web site are closely equivalent to a purchase in offline settings as it derives financial value for the firm in terms of page impressions. As customers actively visit on site and browse the content, they produce page impressions, which form the inventory for advertising sales.

Second, even for firms that depend mainly on sales to generate revenue, repeated visits could lead to higher awareness of the firm. Retailers with strong customer awareness are able to charge prices that are 7% to 12% higher than those of lesser- known retailers (Brynjolfsson & Smith, 2000; Smith et al., 2000). Third, increasing the number of visitors to a web site increases the chance of referral visits, which expands the firm's potential customer base. Loyal visitors, regardless of their purchase history, are more likely to be satisfied with the web site service and are therefore more likely to refer the site to friends (Lin, 2004).

In short, visitor value is generally a valuable concept to regard in CRM for customer retention and targeting. Even when the firm focus is on customer purchases as the ultimate goal of the firm-customer relationship, the social and visiting behaviour online should not be neglected. Specifically, in Essay. 2 session duration (time on site) and number of pages viewed (page impressions) reflect the “Volume of use” of a customer. The number of visits indicate the “Frequency of use” and time of last visit the “Recency of use”. Monetary, social and visitor value components are all essential in reflecting customer enagagement in an online service. Figure 5 presents a framework for managing the customer value of online news channel relationships.