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Beyond virtuality: From engagement platforms to engagement ecosystems

Article  in  Journal of Service Theory and Practice · November 2014

DOI: 10.1108/MSQ-08-2013-0158

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Breidbach, C., Brodie, R. & Hollebeek, L. (2014), Beyond Virtuality: From Engagement
Platforms to Engagement Ecosystems, Managing Service Quality, 24(6), 592.

BEYOND VIRTUALITY: FROM ENGAGEMENT PLATFORMS TO

ENGAGEMENT ECOSYSTEMS

1
Abstract

Purpose – Understanding the role and implications of Information and Communication

Technology (ICT) in service has been identified as the key research priority for service
science and the management of service quality. We address this priority by providing
insights into the role of ‘engagement platforms,’ physical or virtual customer touch points
where actors exchange resources and co-create value. Despite an emerging body of
literature that explicitly emphasizes the importance of understanding customer
engagement in technology-enabled contexts, engagement platforms remain ill-defined
and nebulous in the literature to date. Specifically, little is known about the particular
types of engagement platforms, their characteristics, and implications on the performance
of service ecosystems and managing service quality.

Methodology/approach – This paper is based on two illustrative case studies and adopts
an inductive theory building approach to investigate the characteristics and dynamics of
engagement platforms in virtual/physical contexts, and to identify if, how and to what
extend configurations of individual engagement platforms may enhance resource
exchange within and across service ecosystems.

Findings – By building on emerging research at the service/engagement interface, we

introduce the notion of the ‘engagement ecosystem,’ as a configuration of individual,
mutually-dependent engagement platforms that represent specific interactivity-facilitative
loci. We explicate the relevance of our model and highlight opportunities for future
research in this emerging field of inquiry.

Research implications – Our work addresses the call for research at the intersection of
ICT and service science and, through the concept of engagement ecosystems, provides a
theoretical contribution and foundation for future research in this highly relevant area of
inquiry.

Practical implications – We guide managerial decision-making regarding the

implementation, adoption, and utilization of engagement ecosystems. Furthermore, the
nature of ‘engagement’ as a bridging concept implies that our work can help managers to
operationalize service-centric thinking.

Originality/value – By showing how individual engagement platforms can be used to

form engagement ecosystems, and thereby bridge theory and practice, the paper offers
new insight in the realm of practical application of the S-D logic.

Key words – Engagement ecosystem, Engagement platform, S-D logic, taxonomy

Paper type – Research paper

2
“The more high technology is around us, the more the need for human touch.”
Naisbitt (1982, p. 52)

1. Introduction

Improving our understanding of the role and implications of Information and

Communication Technologies (ICTs) in service has been identified as the top research

priority for the progression of service science and managing service quality (Chesbrough

and Spohrer, 2006; Ostrom et al., 2010). Information Systems (IS) and service scholars

alike called for research at the ICT/service interface, in order to establish cross-

fertilization between these two rapidly evolving fields (Meyronin, 2004; Raj and

Sambamurthy, 2006; Hyötyläinen and Möller, 2007). For example, Huang and Rust

(2013) drew attention to the information-intensive nature of ICT-related service:

“IT-related service is information-intensive. The ability to communicate (firm-to-

customer, firm-to-firm, and customer-to-customer) anytime, anywhere, and to

anyone, is significantly facilitated by the advance of IT” (p. 1).

Research addressing the role of ICT in service should therefore explore the

rapidly changing nature and dynamics pertaining to specific firm-to-customer, firm-to-

firm, and customer-to-customer interactions (Huang and Rust 2013). In the last decade,

‘traditional’ services, such as financial- and retail services, which relied on direct face-to-

face interactions with customers, shifted or expanded their customer-firm interactions

from physical into virtual realms (e.g. Tesco’s traditional bricks-and-mortar stores

supplemented with emerging virtual Tesco retail platforms); thus generating new online

self-service environments (Bitner, Ostrom, and Meuter, 2002; Campbell, Maglio and

Davis, 2011).

3
 Today, a reverse and seemingly paradoxical trend can been observed as

technology-enabled service firms begin to expand their previously entirely virtual

customer-firm interactions, into the realm of additional, physical environments. To

illustrate, Microsoft and, according to some analysts, Google, are in the process of

introducing bricks-and-mortar retail outlets complementing these brands’ otherwise

exclusively virtual presence (e.g. Efrati, 2013). This observation may be, in part,

explained with reference to Burke’s (2002) earlier work, which suggest that customers,

typically, look for distinct benefits from physical, versus virtual (online), stores. Burke’s

(2002) work, however, does not provide any insights into differences between previous

shifts from physical-to-virtual or, as we are beginning to observe now, virtual-to-physical

movements. Dahlström and Edelman (2013) somewhat address this issue by predicting

that customer experiences spanning physical and virtual environments will become the

new norm. This particular shift is likely to result in the formation of new, potentially

unique customer experiences and behaviors; thus requiring the development of new

conceptual models and lenses that allow us to understand these novel dynamics.

Although scholars provided substantial insights into the previous transition of

service from physical to virtual environments (e.g. Davis, Buchanan-Oliver and Brodie,

1999), research exploring the shift from entirely virtual, to integrative virtual/physical

environments is lacking to date. Thus, the objective of this paper is to examine this shift

through the concept of ‘engagement platforms’ (Sawhney, Verona and Prandelli, 2005;

Ramaswamy, 2009). The engagement concept in general, and customer engagement, in

particular, is considered most suitable when fostering an enhanced understanding of focal

customer-firm interactions within ICT-mediated environments (Sawhney et al., 2005;

4
Bogatin, 2006). Customer engagement reflects an actor’s cognitive, emotional and

behavioral investments in focal interactive experiences (Brodie et al., 2011). Further,

based on Sawhney, Verona and Prandelli (2005) and Ramaswamy (2009) we define

‘engagement platforms’ (EP) as physical or virtual touch points designed to provide

structural support for the exchange and integration of resources, and thereby co-creation

of value between actors in a service ecosystem. As such, EPs are centred on a focal

engagement object and attempt to enhance an actor’s ability to experience engagement

with such focal object.

Despite Brodie et al.’s (2011) call for further research, both engagement platforms

and the application of the engagement concept in ICT driven contexts, remain ill-defined,

and empirical contributions in this area are limited. We posit that developing further

insights into the shift from entirely virtual, to integrative virtual/physical touch-points

through the concept of engagement platforms will contribute to the development of an

enhanced, more holistic understanding of both engagement platforms and integrative

virtual/physical customer experiences. This understanding will help managers to

operationalize service-centric thinking, and contribute to the effective management of

service experiences. Within this work, we therefore address the call for more research at

the ICT/service interface by focusing on the nature and dynamics of firm-to-customer

interactions that occur within physical/virtual contexts (Chesbrough and Spohrer, 2006;

Raj and Sambamurthy, 2006; Ostrom et al., 2010; Huang and Rust, 2013). Specifically,

we explore why service firms shift from purely virtual engagement platforms to

integrative virtual/physical configurations, and attempt to understand what are the key

characteristics and dynamics typifying such configurations are.

5
 Our study contributes to the extant literature as follows. First, we present insights

drawn from two illustrative cases in the ICT industry, which provide insights into the

changing nature of physical/virtual customer-firm interactions. Second, contrary to

previous work that focused on a singular engagement platform as the unit of analysis, we

extend our current understanding of this domain by introducing and exploring the notion

of the engagement ecosystem into the nascent literature. Specifically, the framework that

we develop suggests that, by moving beyond a singular perspective, and towards a

holistic understanding of engagement ecosystems that includes every actor touch-point,

we are able to explain if, how and why individual engagement platforms may enhance

resource exchange and integration within and across service ecosystems. Specifically, we

draw, and contribute to, the discourse on service ecosystems that has recently become

central in the theoretical discussions within S-D logic (Vargo and Lusch 2010). Finally,

we define the limitations of our study and delineate resulting implications for future

research that conclude this paper.

6
2. Literature Review

Engagement in Service Systems

The ‘engagement’ concept has been subject to scholarly scrutiny across a wide

range of disciplines, including organizational behavior (Saks, 2006), sociology (Jennings

and Zeitner, 2003), and marketing (Heath, 2007; Bowden, 2009). However, despite an

increasing number of contributions, which suggests the existence of multiple engagement

sub-concepts like ‘customer engagement,’ ‘brand engagement’ or ‘media engagement’

(Gambetti and Graffigna, 2010), the concept, until recently, lacked a clear definition in

the marketing and service literatures (Van Doorn et al., 2010; Brodie et al., 2011).

A number of authors refer to customer engagement as reflective of an individual’s

focal psychological state (Patterson, Yu, and De Ruyter, 2006; Mollen and Wilson, 2010;

Vivek, 2009), or by particular customer behavior outcomes, including commitment,

loyalty or purchase intent (Resnick, 2001; Bowden, 2009; Van Doorn et al., 2010). Given

our focus on engagement platforms that intend to facilitate physical and virtual customer-

to-firm or customer-to-customer interactions in service ecosystems, this study is centered

on the specific sub-concept of ‘customer engagement.’ Table 1 provides an overview of

selected ‘customer engagement’ definitions.

Insert Table 1 about here

7
 The notion of ‘engagement subjects’ and ‘engagement objects’ represents a

conceptually suitable lens through which to view the present research, as these concepts

reflect what Brodie et al. (2011, p. 259) identify as the key hallmark characterizing

‘engagement,’ that is; “[The undertaking of specific] interactive experiences [between] a

focal agent [i.e. ‘engagement subject;’ e.g. a customer] and object [e.g. a brand, product

or organization] within specific service relationships” and systems.

Brodie et al. (2011) recognize that customer engagement occurs within a

dynamic, iterative process of service relationships that exist due to their intention to co-

create value. From a service-dominant (S-D) logic perspective, Lusch and Vargo (2010)

posit that focal interactive, co-creative experiences may be interpreted as particular forms

of ‘engaging.’ As such, engagement reflects interactivity extending beyond “[individual]

transactions” (Van Doorn et al., 2010: p. 254; MSI, 2010); thus suggesting that further

research into engagement from an S-D logic-based perspective, as adopted in the present

study, is necessary. Most importantly, the customer engagement concept is considered

particularly applicable when fostering an enhanced understanding of focal customer-firm

or customer-to-customer interactions within ICT-mediated environments (Sawhney et al.,

2005; Bogatin, 2006). Mollen and Wilson (2010: p. 1), for instance, predict the

emergence of engagement as the “definitive umbrella term” for virtual interactions. Early

work conducted in the context of online consumer experiences (Mollen and Wilson,

2010), or product innovation drawing on focal customer-to-customer interactions

(Sawhney et al., 2005) further supports the relevance of this emerging field of inquiry.

8
Engagement Platforms

‘Engagement platforms’ (EPs) are “purpose-built, ICT-enabled environments

containing artefacts, interfaces, processes and people permitting organizations to co-

create value with their customers” (Ramaswamy, 2008, 2009a, 2009b; Ramaswamy and

Gouillart, 2010). By differentiating between digital EPs, processes, tools, and physical

spaces, Nenonen et al. (2012) provide a more inclusive definition, and argue that

understanding EPs is crucial when managing co-creation processes. However, and despite

Nenonen et al’s (2012) extension of EPs beyond virtual realms (i.e. into physical

environments), our understanding of EPs is limited to-date. For example, Ramaswamy

and Gouillart (2010) describe, rather than define, EPs by focusing on their perceived

characteristics of transparency, access, dialogue and reflexivity: first, ‘transparency’

implies that an actor’s interactions with a particular EP are visible to a wider audience

engaging in specific co-creation processes (e.g. on specific social networking sites).

Second, ‘accessibility’ enables actors to integrate resources into the platform, for

example, by adding or sharing content; thereby modifying the nature and characteristics

of the EP itself. As such, EPs are designed to facilitate dialogue amongst actors, since the

exchange of resources is considered a pre-requisite for value co-creation (Prahalad and

Ramaswamy, 2000; Ramaswamy, 2008, 2009a, 2009b; Ramaswamy and Gouillart,

2010). Third, ‘reflexivity’ implies an EP is capable of adapting to changes from within.

Within the marketing literature, Henning-Thurau et al. (2004) identify a set of

factors motivating actors to engage within virtual brand communities, which can be

considered a type of EP. Their work supports Oldenburg (1999) and Figallo’s (1998)

findings, by emphasizing social benefits like trust and commitment that individual actors

9
may experience here, and that also represent key consequences of customer engagement

(Brodie et al., 2011). Overall, despite a growing scholarly interest in EPs and calls for

further research in this emerging area, empirical contributions in this area remain limited,

which may be a direct result of the lacking systematic conceptualization of EPs to date.

In this work, we define ‘engagement platforms’ as “physical or virtual touch

points designed to provide structural support for the exchange and integration of

resources, and thereby co-creation of value between actors in a service system. EPs are

centred on a focal engagement object and attempt to enhance an actor’s ability to

experience engagement with such focal object”. Of particular interest to this study is the

emerging divide between physical and virtual engagement platforms that Nenonen et al.

(2012) already highlighted, and which led to new constellations of virtual and physical

engagement platforms.

From Physical to Virtual Engagement Platforms - and Beyond

American futurist and visionary John Naisbitt (1982, p. 52) foresaw in the 1980s

that “the more high technology [is] around us, the more the need for [a] human touch.”

Less than two decades later, as the Internet became available to the majority of the

population in industrialized nations, the service landscape transformed tremendously. Up

until this point, the adoption of ICTs in service had been limited, and most service firms

followed the principle of “high touch, low tech” (Bitner, Brown, and Meuter, 2000, p.

138). This implied that interactions between human service providers and customers

occurred via interpersonal, physical, interfaces only.

10
 Researchers since acknowledged that the advancement, ubiquity and

sophistication of modern ICTs transformed the nature and scope, not only of focal

customer-to-firm, but also customer-to-customer interactions (Parasuraman, 2000;

Zeithaml, Parasuraman, and Malhotra, 2002). Specifically, the shift towards technology-

mediated customer-to-firm interfaces has been viewed not only to be prevalent, but likely

inevitable; and is expected to continue to influence the ways in which actors in service

systems exchange and integrate resources (Froehle, 2006; Froehle and Roth, 2004).

Prominent examples where ICTs have contributed to “diminish[ing] personal, human-to-

human interaction in service” (Walker and Johnson, 2004, p. 564) include online banking

and shopping. Here, customers independently perform tasks through a service provider’s

ICT infrastructure, for example via specific web-based interfaces (Bitner, Ostrom and

Meuter, 2002, Campbell, Maglio and Davis, 2011).

While the Information Systems (IS) literature assumed ICTs would be of an

inherently transformative and evolutionary nature (Orlikowski, 2000), a new generation

of businesses emerged at the turn of the twenty-first century. Based on their online

presence, companies run by digital natives (Vondanovich et al., 2010) including Google,

Facebook, and eBay, were unprecedented at the time of their inception; that is, they did

not experience, or require, any technology-induced shift from a physical, bricks-and-

mortar, towards a virtual customer interface that traditional service firms, including

Walmart or retail banks, undertook in order to remain competitive within an evolving

business landscape (Lee and Park, 2009). Surprisingly though, these digital natives are

now beginning to establish an organizational presence in the physical world.

11
 Service researchers long speculated if traditional face-to-face service interactions

would be replaced by technology-based service (Edvardsson et al., 2010, p. 566).

However, opposing trends emerge, which challenge the prevailing service landscape once

again. Today, as ICTs have become ubiquitous, we witness Naisbitt’s (1982) prediction

from almost thirty years ago. Specifically, in the next section, we present two illustrative

cases that exemplify the identified shift from a purely virtual, to an integrative

virtual/physical environment, which we and further investigate by drawing on the notion

of engagement platforms.

12
3. Illustrative Case Studies on Transitioning Engagement Platforms

Research Objective and Methodology

The objectives of this study are to, first, examine the changing nature of

physical/virtual customer-firm interactions, and to provide empirical insights into the

factors driving this phenomenon. Specifically, we ask why service firms shift from purely

virtual engagement platforms to integrative virtual/physical configurations. Second, to

address the relevant research gaps at the ICT/service interface by focussing on

engagement platforms more specifically. We thereby, third, intend to extend the current

singular perspective on engagement platforms, and to explore what the key characteristics

and dynamics of such emerging integrative configurations of multiple engagement

platforms in virtual/physical contexts are. As the performance of a service systems is

contingent on its ability to exchange resources and to co-create value (Prahalad and

Ramaswamy, 2004; Spohrer and Maglio, 2010), it is important to understand if, how and

why individual engagement platforms enhance resource exchange and integration within

and across service systems. Providing these insights is the final objective of this study.

Extending Sawhney et al. (2005), we adopt a multiple case-study approach for our

inquiry (Eisenhardt, 1989; Miles and Huberman, 1994). Specifically, case study research

has been recommended to generate theoretical insights when relatively “little is known

about a phenomenon” (Eisenhardt 1989, p. 546), as in the present research context. We

adopted a two case (i.e. Google and Microsoft), rather than a single case approach, based

on expected enhanced validity of the findings, relative to that attained under the adoption

of a single case study (Yin, 2011).

13
 Using publicly available sources that addressed the specific cases of Microsoft

and Google, we obtained secondary data such as news articles, investor statements and

industry publications. We selected these particular organizations for inclusion in the

study, based on their respective industry leadership positions, as well as their respective

alleged (i.e. Google), or realized (i.e. Microsoft) status in terms of having shifted from a

purely virtual, to an integrative virtual/physical EP approach; thus directly tying in with

our stated research objective and questions. Utilization of publicly available data sources

was necessary because, as we conducted this study in the spring of 2013, industry

speculations about Google’s plan to introduce physical retail outlets had just emerged; yet

these remained unconfirmed. Hence, interviewing or direct observation of Google store

employees, therefore, was not an option. Nevertheless, the exclusive deployment of

secondary data sources in qualitative case-based research is known to generate insights

just as rich and valid as alternate data collection methods, like interviews or observations

(Bowen, 2009; Yin, 2011). Specifically, we appointed a primary researcher who

performed the initial analysis, with support roles played by the other two authors.

Finally, we adopted Bowen’s (2009) procedure to guide our document analysis,

which helped us to identify themes and patterns in the data; that is, following the

principles underlying thematic analysis (Guest, 2012; Boyatzis, 1998). In contrast to pure

content analysis, thematic analysis incorporates the entire conversation as the potential

unit of analysis (Thomsen, Straubhaar, and Bolyard, 1998). The analysis was conducted

in two analytical stages, using the coding approach by Miles and Huberman (1994) as a

guideline. First, we utilized descriptive codes to segment the text into individual building

blocks, which varyied in length from several words to paragraphs. Second, using

14
interpretive codes, we summarized individual descriptive codes into clusters. This

iterative process led to the emergence of individual themes. Though interpretive, this

study is based on an inductive theory building approach (Colquitt and Zapata-Phelan,

2007), and culminates in a conceptual framework that describes the nature and dynamics

of individual engagement platform archetypes that, holistically, form a larger engagement

ecosystem The following sections outline the case studies of Microsoft and Google, and

provide the necessary description of the domain (Yin, 2011), before we discuss our

findings in the context of the nascent literature.

Google Case

Arguably the most prolific technology-enabled service provider of the twenty-first

century, Google revolutionized the market for online searching and advertising. To this

day, advertising remains a crucial revenue source, with Google reporting a 31 per cent

increase of its gross revenues to US$13.97 billion in the first quarter of 2013 (Patel,

2013). Google operates a variety of EPs that drive its revenues. While the company’s sole

EP was its search engine when founded on September 4, 1998, the firm substantially

expanded during the last decade, and introduced a variety of new services to its portfolio,

including web-based email (i.e. Gmail), cloud-based document management (i.e. Google

Drive), and maps (i.e. Google Maps).

After introducing its ‘Android’ operating system for mobile phones and tablets, in

addition to its personal computer operating system ‘Chrome,’ Google purchased

Motorola Mobility to launch its own technical devices, most notably the Android

smartphones and tablets, as well as the Chrome Book, a low-cost laptop. Google

15
fundamentally strives to control its customer’s experience by selling the required

applications through its ‘Google Apps’ store. Moreover, regardless of the specific

technical device used, Google provides prospective customers with the opportunity to

utilize its free focal web services, including Gmail, video sharing via its YouTube

platform, and social networking using Google+.

The remaining EP that Google has yet to capitalize on is that of physical retail

stores. In February 2013, several technology blogs, as well as the public media,

announced Google’s (alleged) plan to launch what was then referred to as ‘Google

Stores’ (Efrati, 2013). While the organization initially denied its intention to introduce

such retail outlets, the blogosphere remained undecided as to whether these claims held

truth. At the time, Google had already presented its technical devices (e.g. laptops and

smartphones) in temporary pop-up stores, which were distributed through outlets based at

for example, airports and through its own Chrome Zones; that is, stores-within-a-store

run in co-operation with retail chains Best Buy in the US, and PC World in the UK.

However, this store-within-a-store model may be obsolete if Google opens its own stores,

as alleged. In the current model, all financial transactions are managed by Best Buy and

PC World’s employees who, despite being trained by Google, operate based on pre-

defined sales targets. Conversely, employees in future Google stores could also perform

the role of educators, rather than act solely as salespeople.

According to an article in the LA Times, the introduction of ‘Google Glass,’ a

revolutionary wearable set of digital glasses, which blur the boundaries between the

virtual and physical realities for its user, represents a key driver behind Google’s alleged

decision to open retail stores for the 2013 holiday shopping season (Gates, 2013).

16
Google’s internal sources commented to the LA Times that the revolutionary nature of

‘Google Glass,’ combined with a relatively high retail price (i.e. US$1500), requires

potential customers to initially experience the device in a physical, rather than virtual,

environment. The notion of ‘try before you buy,’ which is more easily implemented in

physical (relative to purely virtual) retail outlets, has already been a recipe for success for

other technology firms such as Apple Computers. Google, therefore, would not be the

first technology company to materialize its existence by transitioning and expanding from

a purely virtual, to a physical domain. Microsoft, the Seattle-based software

conglomerate already operates its own retail outlets, as outlined in the next case.

Microsoft Case

Microsoft, the Seattle, WA based firm that pioneered the development of

operating systems for personal computers and personal computer software, including

Microsoft Windows, Microsoft Office and the Internet Explorer web browser, already

undertook a transformation not dissimilar to that, which Google is allegedly aspiring to.

From 1999 until 2001, Microsoft experimented with physical retail outlets, then called

‘microsoftSF’, and operated by Sony Retail in San Francisco, CA. Though initially

unsuccessful, after a transformative period in the mid-2000s, Microsoft opened its first

retail outlet, the ‘Microsoft Store’ in Scottsdale, AZ on October 22, 2009 (Slivka, 2009),

whilst launching its new Windows 7 operating system.

Microsoft attempted to establish a further foothold in the retail sector by

launching its Azure Services Platform, which represents the company’s entry into the

cloud computing market for Windows in 2008 (Fried, 2008). As of April 2013, the

organization operates approximately 40 stores within the US and Canada. The Microsoft

17
Store is a chain of bricks and mortar retail stores that are complemented by an online

shopping site owned and operated by Microsoft, which supplies computers, software and

consumer electronics products. The stores aim to “improve the PC and Microsoft retail

purchase experience for consumers worldwide and help consumers make more informed

decisions about their PC and software purchases” (Microsoft, 2009). Though often

critiqued for their similarity to Apple stores, Microsoft’s stores are a physical retail

platform offering consumer electronics, including the Xbox, Microsoft software

packages, as well as Windows phones and other Microsoft devices, including the

Microsoft ‘Surface’ tablets. Specifically, Surface was the first major initiative by

Microsoft to integrate its Windows operating system with its own hardware (Sullivan,

2012), an approach similar to Google’s Android operating system, smartphones, tablets

and laptops.

In Microsoft stores, potential customers are able to use and experience the various

technological products in a physical environment, and can also interact with Technical

Advisors and Specialists; that is, Microsoft staff members offering training with

Microsoft products, personal shopping experiences, and troubleshooting advice.

Specifically, such assistance is available on a walk-in basis, or by appointment. Just like

Google, Microsoft engages with its customers through a variety of EPs. However, unlike

Google, Microsoft’s business model is not based on advertising, but linked to a retail and

licensing model where revenues are generated through selling hardware and software

(Microsoft, 2012).

18
4. Conceptual Development, Discussion & Implications

Conceptual Development & Discussion

By drawing on the Google and Microsoft cases, we explored how these organizations

shift from purely virtual engagement platforms to integrative virtual/physical

configurations. As such, our investigation aimed at identifying the key characteristics and

dynamics of these configurations of EPs, and investigated if, how and to what extend

individual engagement platforms may enhance resource exchange within and across

service systems. Engagement platforms provide physical and virtual touch points which,

collectively, intend to improve the performance of service systems by enhancing

resources exchange and integration across focal customer-firm, as well as customer-

customer, networks. Understanding the relationship between a service system’s

performance and its individual EPs is crucial, as such knowledge could augment a service

firm’s ability to facilitate specific co-creative processes, and thus manage the quality of

the service experience (Sigala, 2004; Mele and Polese, 2011).

In this study, we expand Ramaswamy’s (2008) definition of EPs, which focuses

on specific, singular ICT-enabled customer touch-points, as well as Nenonen et al.’s

(2012) conceptualization, which differentiates between individual digital EPs, processes,

tools and physical spaces. In contrast, we suggest that enhanced insights can be generated

by moving beyond a singular perspective on individual EPs, and introduce a holistic

understanding of these configurations of actor touch points, through the concept of

engagement ecosystems. Figure 1 presents our conceptual model of an engagement

ecosystem that, by utilizing the Google case for illustrative purposes, explains the

characteristics of its individual EPs.

19
Insert Figure 1 about here

Engagement ecosystems allow us to gain holistic insights into the specific co-

creative interactions between actors in service systems across all touch points, by

considering the nature of each focal EP (i.e. physical or virtual interface), as well as the

purpose of each EP. Specifically, we differentiate between interactional (i.e. continuous

resource exchange), versus transactional (i.e. temporary or instantaneous resource

exchange) within each service ecosystem as the relevant factors. We define engagement

ecosystems are dynamic constellation of mutually-dependent EPs that, individually,

represent specific interactivity-facilitative loci. Put differently, engagement ecosystems

are constellations of physical and virtual engagement platforms used by a focal firm to

enable interactions with, as well as amongst its customers. An engagement ecosystem

may alter its composition over time, but always aims at enhancing customer engagement,

while being embedded in a wider service ecosystem (Vargo and Lusch 2010). This

approach allows us to identify four EP archetypes, namely (i) Operating; (ii)

Instrumental; (iii) Enabling; and (iv) Supplying platforms, and to explain their role,

characteristics and implications for service system performance. We provide an overview

of each of these EP archetypes and their key characteristics in Table 2.

Insert Table 2 about here

The fundamental role of operating EPs is to enable service firms to co-create

value with their customers; that is, any interaction intended to generate revenue for the

service provider, whilst co-creating a perceived benefit with customers during customer-

to-firm, or customer-to-customer interactions. In the case of Google, operating EPs like

20
Gmail or YouTube are entirely virtual, highly interactive, and designed to enable a

continuous exchange and integration of resources within actor networks, while revenues

are generated through advertising or customer subscriptions. To illustrate, Cowan (2013)

reports on the expansion of the Gmail widget, which enables the inclusion of, for

example, brands, thereby making it easier for customers to interact with firms. Depending

on the service provider’s revenue model, the operating EP can also shift into the physical

realm, yet remain highly interactional through customer-firm or customer-to-customer

interactions. For example, Microsoft’s physical and virtual stores represent the

company’s operating platform where revenues are generated through software and

hardware sales. On October 24th 2013, Microsoft announced record revenues of $18.53

billion for the quarter ended September 30, 2013. Chief Executive Officer Steve Ballmer

reported that Microsoft’s “devices and services transformation is progressing and we are

launching a wide range of compelling […] experiences this fall,” thereby further

emphasizing the engagement ecosystem strategy undertaken by the firm (Microsoft,

2013).

Instrumental EPs, on the contrary, represent a necessary prerequisite enabling

customer access to a service provider’s operating EP. These physical platforms are

designed to facilitate the continuous exchange of resources, either within specific

customer-to-customer, or customer-firm networks. However, instrumental EPs, such as

Microsoft and Google’s smartphones, tablets, or other devices need to be integrated with

applications or software enabling users to experience the full technical potential of a

technical device or instrumental EP. To illustrate, Newman (2012) reports on Google

Glass, a small computer in the shape of a pair of glasses containing an optical head

21
mounted display, which displays information in a smartphone-like hands free format to

the user, and can communicate via voice commands, with a range of new and existing

Google services (i.e. its operating EPs). Due to the revolutionary nature of the device,

Google Glass is suspected to be in high demand by customers but will only function

within Google’s infrastructure (i.e. Google’s engagement ecosystem), and be bedpendent

on applications or software provided by Google. These software application may be

available through a service provider’s enabling EP.

Google’s ‘App Marketplace’ is an example for an enabling EP, a virtual platform

designed for transactional, and relatively transient, customer-firm exchanges. The

enabling EP, therefore, further supports the performance of the operational EP, and

allows a service provider like Google to ensure that individual customers can access

applications, for example for Google Glass, in the appropriate form and quality. Finally,

supplying EPs, such as the prospective physical Google Store or the Microsoft Store, not

only facilitate the transition of the service provider from a purely virtual, to a more

integrative virtual/physical realm; but provide a touch-point for customer-firm and

customer-to-customer interactions that shape prospective customers’ experiences with

instrumental EPs, like Google ‘Glass’ or Microsoft’s Xbox One. Supplying EPs may also

evolve into operating EPs once established in the marketplace, as indicated in Table 2.

Efrati (2013) reports that inside Google, the idea of opening retail stores has been

discussed since the company acquired Motorola Mobility, a producer of smartphones and

tablets, and thereby became a provider of mobile devices itself. The question as to

whether or not Motorola Mobility should emerge as Google's retail arm, or whether

Google Stores should not promote Motorola devices, reportedly remains unanswered.

22
 Our illustrative cases collectively suggest that, if designed properly, engagement

ecosystems consisting of individual physical and virtual EPs can enhance an

organization’s ability to successfully exchange resources, and therefore to co-create value

with customers. This, in turn, would generate higher revenues and superior organizational

performance. Although the inclusion of additional, physical, EPs may not result in

superior organizational performance per se; we argue that, by introducing physical

operating or supplying EPs, service providers attempt to control: (1) The accessibility and

(2) reflexivity of their engagement ecosystem, both key success criteria for the

performance on engagement platforms according to Ramaswamy and Gouillart (2010).

Of course, from an academic point of view, shifting our focus from a singular perspective

on engagement platforms towards an integrative and holistic understanding of

engagement ecosystems provides multiple implications for research and practice alike.

Research Implications

This study is a direct response to Huang and Rust’s (2013) call for further research at the

intersection of ICT and service in general (Chesbrough and Spohrer, 2006; Raj and

Sambamurthy, 2006; Ostrom et al., 2010), and into the nature and dynamics of

technology-enabled firm-to-customer interactions, more specifically (Huang and Rust,

2013). Specifically, we explored the seeminly paradoxical shift from entirely virtual, to

integrative virtual/physical firm-to-customer interactions within supplying EPs. While

previous scholars investigated the transition of firm-to-customer service interactions from

physical to virtual environments (e.g. Davis, Buchanan-Oliver and Brodie, 1999),

insights into the phenomenon that is currently observeable is lacking to date. We

23
therefore adressed this gap in knowledge through an analytical lens rooted in the concept

of ‘engagement platforms’ (Sawhney, Verona and Prandelli, 2005; Ramaswamy, 2009), a

decision rooted in the fact that the engagement concept is considered particularly suitable

to advance our understanding of customer-firm interactions in ICT-driven contexts

(Sawhney et al., 2005; Bogatin, 2006). We thereby also address Brodie et al.’s (2011) call

for empirical work investigating the role of EPs within service environments, and add to

the emerging literature on engagement platforms (Ramaswamy and Goullard, 2010;

Nenonen et al. 2012) and service ecosystems (Vargo and Lusch 2010).

Our study makes a number of clearly defined contributions. First, by drawing on

findings from our cases, we provide insights into the changing nature of physical/virtual

customer-firm interactions. Our findings allow us to, second, delineate a taxonomy of

engagement platforms (cf. Table 2 and Figure 1), highlight their individual

characteristics, and thereby enhance our understanding of the nature of this emerging

concept. Third, we develop and introduce the ‘engagement ecosystem’ concept into the

service research literature, explain the nature of the concept’s theoretical association to

engagement platforms, and contribute to the wider discourse on service ecosystems that

has recently emerged in the discussion about the Service Dominant Logic (e.g. Vargo and

Lusch 2010). Through this theoretical contribution, we are able to, fourth, delineate

resulting implications for future researcher that can help to advance this emerging area.

Given the complexity of this emerging field, we recommend future empirical

research to take a pluralistic approach; that is, to integrate the use of qualitative and

quantitative methods (Hair et al., 2010). To date, Google has not yet decided to open

physical retail outlets. While gaining access may be challenging, any empirical work set

24
in this context could help to validate, advance, or refute the insights presented here.

Similarly, further research addressing the nature and dynamics of any interactions

facilitated by specific EPs also represents an important avenue. As discussed, the

emergence of omni-channel retailing provides a rich context for further empirical

research, and scholars could, for example, attempt to assess the relative importance of

each EP archetype presented here, especially in regard to their individual ability to foster

customer engagement as interactive emotional experience (Brodie et al. 2011).

While the roots of customer engagement and EPs lie within the domain of

relationship marketing and S-D logic (Vivek et al., 2012; Vargo and Lusch, 2008), future

scholars may wish to explore the potential relevance of alternate, or complementary,

perspectives relevant to engagement ecosystems and technology-enabled customer-to-

firm and customer-to-customer interactions. For example, the ‘connectivity’ metaphor

that Breidbach et al. (2013) recently introduced into service research could be employed

to generate novel insights into the performance and design of engagement ecosystems.

Understanding connectivity allows scholars and practitioners to assess and understand the

quantity and quality of socio-technical links between actors wo interact and exchange

resources by means of ICT within an EP. Scholars may, therefore, investigate how

engagement ecosystems should ideally be designed to achieve optimal, or requisite,

levels of connectivity.

The ‘transmedia’ concept may well provide another important perspective for

service researchers interested in investigating co-creation processes spanning multiple

physical/virtual realms. Introduced by Jenkins (2003), transmedia refers to stories that are

told across multiple media. However, transmedia does not imply that the same idea is

25
conveyed between actors via multiple physical or technical sources, but rather suggests

that each medium individually contributes to a holistic experience, which is similarly to

engagement platforms within a wider engagement ecosystem that individually perform a

distinct role. While transmedia has the potential as a new analytical approache (Scolari

2009), it has not yet been utilized in service research to date. We suggest that a

transmedia lens applied to engagement ecosystems could lead to new insights, and

encourage scholars to investigate the wider service/ICT interface through this novel lens.

Finally, this study is also subject to a number of limitations. The exploratory

nature and use of case studies implies we cannot claim our findings are context-

independent. While we selected the Google and Microsoft cases because these

organizations, to varying levels, underwent the shift from a purely virtual to an

integrative virtual/physical engagement ecosystem, other industries or organizations

might provide equally suitable contexts to investigate this phenomenon, which may also

result in the emergence of other EP archetypes. Similarly, as objective and value aware

individuals, we must acknowledge that any reality is only imperfectly apprehensible, and

that resulting findings are only probably true. Hence, “because of basically flawed human

intellectual mechanisms” (Guba and Lincoln, 1994, p. 205), we explicitly state that,

despite the fact that we followed best-practices outlined in the relavant literature (i.e.

Eisenhardt, 1989; Miles and Huberman, 1994), imperfect observations of the reality

under investigation may have occurred during data collection and analysis.

26
Managerial Implications

Burghin et al. conclude their industry commentary about “charting experiences where

digital meets physical” by stating that practitioners should identify areas within their

firms where “immersive experiences or interactive touch points” (2013, p. 25) can

stimulate engagement with customers. As customers and employees come to expect

interactions between heightened digital and physical offerings. based on our findings, we

suggest practitioners should consider the ideal configuration of their engagement

ecosystem with respect to facilitating customer engagement, knowledge sharing, and co-

creation processes (Ramaswamy, 2009). Payne, Storbacka and Frow’s (2008) and Payne,

Storbacka, Frow and Knox’ (2009) recent work on managing the co-creation of value

provides additional insight into these processes. Nevertheless, the initial implementation

of an engagement ecosystem is likely to represent a unique challenge. Practitioners

should pay attention to specific ‘engagement’ antecedents and consequences when

implementing their engagement ecosystems. The modeling of focal customer engagement

processes generates challenges, including both the development and dissolution of

specific customer engagement states, which requires an understanding of the specific set

of situational conditions generating differing levels of engagement.

Our study also generates managerial implications for the retail context, in which

the concepts of ‘multi-channel’ and ‘omni-channel’ have been introduced to explore the

current and future states of retailing (e.g. Verhoef, Neslin and Vroomen, 2007). Omni-

channel retailing integrate all retail channels for a consistent consumer-oriented shopping

experience (Rigby, 2011). Consistent with the concept of engagement ecosystems

developed in this paper, an omni-channel retailing system incorporates the advantages of

27
the physical store with the information-rich experience of online shopping. Thus, a key

challenge for retailers will be to manage the quality of connected consumers’ service

experiences derived from physical stores, websites, social media, call centres and other

channels. Our research provides the necessary foundation to develop a ‘touch point

architecture’ for customer engagement (Dhebar, 2013).

Another key question emerging from our findings is how practitioners can

guarantee the accessibility of an individual EP. For technology firms like Google, the

accessibility of their operating EP at the virtual/interactional interface is of the utmost

importance, since their advertising revenues are generated here. The prerequisite to

ensure the accessibility and usability of its operating EP lies in Google’s ability to control

both, the instrumental EPs at the physical/international EP (i.e. technical devices); as well

as the enabling EP at the virtual/transactional interface (i.e. software applications).

Managers likely need to understand how specific interactions between their own EPs

archetypes influence the performance of their own engagement ecosystem.

Organizations that are able ensure their customers’ positive experience within

their operating EP will likely be able to secure their customer’s continued use of the

value propositions offered (e.g. Gmail). Such positive use-experience, in turn, likely

result in enhanced levels of customer engagement and, subsequently improve firm

performance through cost reductions, sales growth, superior competitive advantage and

profitability, or company referrals (Kumar, Petersen, and Leone, 2010). In addition,

engaged customers can play a key role in organizational collaborative development and

innovation processes (Sawhney et al., 2005), and in co-creating experience and value

(Prahalad, 2004). Ultimately, managers could consider enhancing their ability to control

28
both the instrumental and the enabling EPs by introducing supplying EPs at the

physical/transactional interface (i.e. retail stores), if applicable within their organizational

boundaries. Here, customers can be introduced to novel technical devices (i.e. the

instrumental EP) and trained in their usage, which, in turn, improves their experience and

ensures the continued utilization of other, revenue generating value propositions at the

operating EP.

Furthermore, ensuring a continuous stream of advertising revenue requires almost

all digital organizations, like Google, to collect data about their customers’ behavior and

individualized preferences. Controlling the instrumental and enabling EPs, once again,

represents a necessary prerequisite for managers, as it enables the collection of large

customer datasets, which can be analysed using big data analytics (Huang and Rust,

2013). Ultimately, by generating an enhanced understanding of their customers,

practitioners may alter their relevant engagement ecosystems; most importantly the

operating EP. Specifically, such practice would ensures the reflexivity of the engagement

ecosystem, a key prerequisite for its success (Ramaswamy and Gouillart, 2010).

29
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Table 1: ‘Customer Engagement’ Conceptualizations
Author(s) ‘Customer Engagement’ Definition Key Hallmark

Kumar et al A customer’s active interactions with a firm, with Active

(2010, p. 297) prospects and with other customers, whether they interaction
are transactional or non-transactional in nature.
Van Doorn et al. A customer’s behavioral manifestations that have a Beyond
(2010, p. 254) brand or firm focus, beyond purchase, resulting transactions
from motivational drivers.
Vivek The intensity of an individual’s participation and Varying
(2009, p. 7) connection with the organization’s offerings and degrees of
activities initiated by either the customer or the participation
organization.
Patterson et al. The level of a customer’s physical, cognitive and Service focus
(2006, p. 1) emotional presence in their relationship with a
service organization.
Brodie et al. A psychological state that occurs by virtue of Interactively
(2011, p. 259) interactive, co-creative customer experiences with a generated
focal agent/object (e.g. a brand) in particular service customer
relationships. experiences
Mollen and A cognitive and affective commitment to an active Cognitive and
Wilson relationship with the brand, as personified by the affective
(2010, p. 919) website. customer
commitment
Bowden A psychological process that models the underlying Psychological
(2009, p. 63) mechanisms by which customer loyalty forms for process
new customers of a service brand, as well as the generating
mechanisms by which loyalty may be maintained customer
for repeat purchase customers of a service brand. loyalty

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 Table 2: Overview - EP Archetypes & Key Characteristics
Specific Case-Based
EP Archetype Purpose Key Characteristics
Illustrations
- Facilitates interactivity and value co-
Virtual platform enabling organizations to co- creation with customers.
create value with their customers by virtue of - Designed to generate revenue for the
- Google: Gmail, YouTube.
Operating EP any interaction intended to generate revenues, firm through continuous exchange of
(OEP) while co-creating a perceived benefit during resources.
- Microsoft: Virtual retail stores
customer-to-firm, and/or customer-to-customer - May comprise specific online (virtual)
interactions. and/or offline (physical) applications.

- Needs to be integrated with - Google: Chromebook (laptop),

Physical platform that enables customer to
applications/software to experience the Nexus (tablet), Glass (headset).
access to a service provider’s OEP. As such,
Instrumental EP IEP’s full potential.
possession or access to an IEP is a prerequisite
(IEP) - Designed to facilitate the continuous - Microsoft: Surface Pro (tablet),
for customers intending to co-create value with
exchange of resources within customer- Xbox (home entertainment),
the firm.
to-customer, or customer-firm. Windows phone (smart phone).
Virtual platform designed to facilitate - Further supports OEP performance - Google: App Marketplace.
Enabling EP transactional customer-firm exchanges. (e.g. allows service customer to access
(EEP) Enabling EPs are typically accessed by to specific applications/software). - Microsoft: windowsstore.com
customers through IEPs.
- Facilitate the firm’s transition from a - Google: Prospective Google
Physical platform providing a touch-point for
purely virtual, to more integrative Store
Supplying EP customer-firm and customer-to-customer
virtual/physical realms. - Microsoft: Physical retail stores
(SEP) interactions, in order to shape prospective
- Experiential and interactive (resource (when first launched).
customers’ experiences with IEPs.
exchange possible but not necessary).

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 Figure 1: Conceptual Framework of Google’s Engagement Ecosystem (for
Illustrative Purposes)

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