The importance of customer participation for high-contact services: evidence from a real estate agency

Abstract

The concept of customer participation has emerged as an important factor for the success of service firms. Customers have become increasingly empowered in choosing the extent of a service they want to produce for themselves; consequently, service firms may find that they have no choice but to embrace customer participation in organising their service delivery. However, the number of studies related to customer participation in high-contact services remains considerably limited. This study develops an integrated model of customer participation management and is empirically tested in a real estate agency. The research model has four variables, including customer participation, customer satisfaction, customer–company identification, and customer loyalty. A survey questionnaire was employed to collect data for testing the hypotheses contained in the proposed model. Through structural equation modelling analysis, the results indicate that customer participation can be both a driver and a moderator for managing customer relationships. Customer–company identification, other than customer satisfaction, provides an additional way to increase customer loyalty. Important theoretical contribution and managerial implications are also provided in this study.