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Traditionally, marketing activities have focused on success in the product marketplace by examining the physical aspects of products and services such as quantity, quality, functionality, availability, accessibility, delivery, price and customer support. More recently, marketing managers have shifted their emphasis to creating value for their customers (e.g. Clutterbuck and Goldsmith, 1998; Fudenberg, 2000; McAlexander et al., 2002). The current trend in marketing is to create engaging and lasting experiences for the customers (Macmillan and McGrath, 1997; Carbone, 1998; Pine and Gilmore, 1998; Rowley, 1999; Wyner, 2000; Calhoun, 2001; Arussy, 2002; Berry et al., 2002; Gilmore and Pine, 2002; Lamperes, 2002). About 85 percent of senior business leaders interviewed in a recent study agreed that differentiating solely on the traditional physical elements such as price, delivery and lead times is no longer an effective business strategy (Shaw and Ivens, 2002). The new differentiator today is customer experience.
The competitive battleground of differentiators is also changing. In the 1970s, the differentiator was quality or functionality; in the 1990s it has been brand and price; in the early 2000s, it is service, information and delivery (Shaw and Ivens, 2002, p. 2). All these attributes are considered as givens today; that is, customers take them for granted and feel entitled for them. Currently, in the mid‐2000s, it is customers' emotional attachment with the brand, the brand community and the brand company via customer experience that is gaining importance in the literature (Anderson et al., 2006; Barber and Strack, 2005; Bendapudi and Bendapudi, 2005; McGrath and Macmillan, 2005; Mascarenhas et al., 2004; Narayandas, 2005; Selden and Macmillan, 2006).
Delivering total customer experience (TCE) goes beyond mere customer satisfaction and is a relatively new concept since satisfied customers could still defect (Jones and Sasser, 1995). In the past, companies have primarily focused on the physical aspects of the product, while totally neglecting the emotional and value aspects and hence, losing many customers in the long run (Nunes and Cespedes, 2003). To compete successfully in this customer experience territory, a growing number of organizations are systematically applying the principles and tools of TCE to generate, strengthen and sustain enduring lasting customer loyalty. Marketers today believe that engineering TCE and lasting customer loyalty (LCL) are important for maintaining customer...