Allocation of Resources to Customer Satisfaction and Delight Based on Utilitarian and Hedonic Benefits

Abstract

In this article, a strategic typology is introduced to improve a firms’ return on investment (ROI) based on understanding whether to devote additional resources to improve customer satisfaction and increase delight. The framework is based on the recognition that customers seek two types of benefits—utilitarian and hedonic—from the products and services. Companies need to determine when resources devoted to customer satisfaction and delight for a particular product or service will produce sufficient achievements in loyalty, word-of-mouth, and purchase behavior. By understanding when firms need to focus on improving customer satisfaction and delight, firms can make a judicious strategic decision about their resource allocation to improve either customer satisfaction and/or customer delight.