A model for managing service encounters for neo-luxury consumers

Abstract

Purpose – This paper aims to explore a theoretical relationship among perceptions of consumer social class, the perceived legitimacy of customer requests for service and the delivery of intangible services. It focuses the discussion on service firm encounters with non-traditional consumers seeking to purchase from luxury brands. Design/methodology/approach – The paper reviews the literature for current trends in strategies of luxury brands and characteristics of evolving global and Asian consumer markets for luxury and neo-luxury goods and draws a theoretic model with propositions. Findings – Evidence suggests that service providers can improve efforts to expand services to the newly rich and trading-up neo-luxury consumer markets by focusing on the intangible elements of the service delivery system. Particular emphasis is placed on enhancing employee treatment of neo-luxury customers during service encounters by understanding the influence of employee perceptions of consumer social class and evaluations of the perceived legitimacy of customer requests for service. Originality/value – The paper contributes to the theoretical discussion in luxury brand management by suggesting that employees are influenced by impressions of customer worth and other attributes when determining responses to customers during service encounters. Implications for practitioners and future research directions for academics based on the framework are presented.