Customer Engagement Consequences for Firms

Purpose: Customer engagement (CE) is a customers’ voluntary resource contribution to firms’ functions, and it goes beyond transactions during customers’ behavioral manifestations toward the brand or firm’s offerings or activities. The effective CE management requires to understand the potential CE effects, and leverage the potential benefit and threat of CE, however negative consequences or risks of CE have remained unexplored in existing literature. Therefore, this paper explores both negative and positive consequences of customer engagement for firms. Methodology: Based on computer-assisted telephone interviews with 402 firms operating in the field of consumer goods and services, descriptive statistics and structural equation modelling were used in this study. Findings: This study recognizes firm-level risks of CE associated with customer resource integration and reveals the linkages between those risks and firm-level benefits of engaging customers by firms. Originality/value: The paper proposes realistic view on firm-level consequences of CE and provides insights into how firms should manage CE by understanding the dark-side of CE resulting from integrating customers’ resources in business processes.