GETTING FIT FROM THE LIVING ROOM - DIVA
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Getting fit from the living room A qualitative study on how the digitalization of fitness services have impacted the customer experience Author: Jenny Månsson Tutor: Frederic Bill Examiner: Anders Pehrsson Semester: VT2021 Topic: Business Administration Level: Advanced Course code: 4FE25E Date: 2021-06-07
ABSTRACT Purpose The purpose of this study is to get insights in how the digitalization of fitness services has affected the customer experience, this with a focus on fitness services such as dance classes and PT-sessions online. Theoretical background The theory has its foundation in both the customer journey where different touchpoints are perceived and the factors affecting the customer experience. Many studies have been done in the subject of customer experience and five factors are categorized. First, the cognitive factors then the affective factors, sensory factors, social factors and last the conative factors. Methodology The study employs a qualitative research type with a cross-sectional research design. Primary data are collected through semi-structured interviews with four customers and one gym. Empirical findings and analysis Multiple differences and similarities between the digital and physical experience are presented. For example, physical gyms have more equipment than all of the respondents have in their home. At the same time, it can be a disadvantage that the internet connection and digital tools are required at the digital classes. However, the flexibility is higher when the classes are online, both because of the accessibility and the higher ability to choose time and place for the workout. Conclusion The digitalization of fitness services has affected the customer experience, both positive and negative. To what extent the change is positive or negative are based on personal preferences. For instance, some customers enjoy the lack of social interaction while some miss is, some may like the smell of the gym while some prefer the smell of their own home. Therefore, the ability to choose in the future is recommended and the gyms do need to work on the optimalization of the experience both for their digital and physical customers. KEYWORDS Customer experience, Customer journey, Touchpoints. Digitalization, Fitness industry, Fitness services.
ACKNOWLEDGEMENTS First of all, I want to thank the respondents of this study for participating and contributing with both your time and insights. Without you I would not have been able to get the desired information. Also thank you for being informative in your answers, this gave me deep understanding from your perspective. I would also like to bring a thank you to the examinator and tutor for giving me feedback and looking at the study with a critical view so I was able to make develop it. Last, I want to thank my classmates for inspiration and feedback that I could use for my own study. Jenny Månsson __________________ Jenny Månsson Karlskrona, 7/6–21 iv
TABLE OF CONTENTS 1. INTRODUCTION 1 1.1 Background 1 1.1.1 Digitalization in the fitness industry 1 1.1.2 Customer experience 2 1.2 Problem discussion 3 1.3 Research question 4 1.4 Purpose 4 1.5 Delimitations 5 1.6 Report structure 6 2. THEORETICAL BACKGROUND 7 2.1 Digitalization 7 2.1.1 Digitalization of fitness services 8 2.2 Customer journey 8 2.2.1 Touch points in the customer journey 9 2.3 Customer experience 10 2.3.1 Cognitive factors 12 2.3.2 Affective and emotional factors 12 2.3.3 Sensory factors 13 2.2.4 Social and relational factors 13 2.3.5 Conative factors 14 3. CONCEPTUAL MODEL 15 4. METHODOLOGY 16 4.1 Scientific approach 16 4.2 Research type 16 4.3 Research approach 16 4.4 Research design 17 4.5 Data collection 17 4.5.1 Primary and secondary data 17 4.5.2 Data sampling 18 4.5.3 Selection 19 4.6 Operationalization 19 4.6 Data analysis 22 4.7 Quality of research 22 4.7.1 Validity 22 4.7.2 Reliability 23 4.8 Ethics 23 5. EMPIRICAL FINDINGS 24 5.1 Digital services 24 5.2 Environment 26 5.3 Motivation 27 v
6. ANALYSIS & DISCUSSION 29 6.1 Digital fitness services 29 6.2 Customer journey 29 6.2.1 Touch points 30 6.3 Customer experience 31 6.3.1 Cognitive factors 31 6.3.2 Affective and emotional factors 31 6.3.3 Sensory factors 32 6.3.4 Social and relational factors 33 6.3.5 Conative factors 33 7. CONCLUSION & CONTRIBUTION 35 7.1 The digitalization of fitness services’ impact on the customer experience 35 7.1.1 Positive effects 36 7.1.1 Negative effects 36 8. LIMITATIONS, MANAGERIAL IMPLICATIONS AND FURTHER RESEARCH 37 8.1 Limitations 37 8.2 Managerial implications 37 8.3 Future research 38 Appendix 1 39 Appendix 2 43 Appendix 3 47 Appendix 4 50 Appendix 5 54 REFERENCE LIST 58 vi
TABLE OF FIGURES FIGURE 1 REPORT STRUCTURE 6 FIGURE 2 CONCEPTUAL FRAMEWORK 8 FIGURE 3 THE CUSTOMER ’S EXPERIENCE 9 FIGURE 4 THE MAIN COMPONENTS OF EXPERIENCE 11 FIGURE 5 CONCEPTUAL MODEL 15 vii
1. INTRODUCTION 1.1 Background 1.1.1 Digitalization in the fitness industry Digitalization is a phenomenon that is said to have reshaped the world. Both marketing and consumption patterns are constantly changing, but sometimes more radical shifts appear. Digitalization is one of the mechanisms that contributes to a more radical shift in marketing (Hultén, 2014). This concept has become increasingly important in recent decades. Digitalization, also called digital transformation, is usually defined as the application of digital technology, which affects all aspects of human society. Statistics have shown an increase of 260% of internet usage from 2005 to 2019 (Statista, 2020a). With digitalization, many changes have taken place, both in the actions of companies as well as the actions of customers. The transformation has, among other things, resulted in changes in how companies create and deliver value to the market, local as well as foreign. Besides this, the digitalization has also changed the customers’ purchase process (Yeganeh, Spais, Beheshti, & Rana, 2019), such as their behaviors and expectations (Bolton, McColl-Kennedy, Cheung, Gallan, Orsingher, Witell & Zaki, 2018; Yeganeh et al., 2019). The corona pandemic is another thing that has changed both customer’s lives as well as companies’ way of doing business (Post- och telestyrelsen, 2021). One of many industries that has been damaged by the pandemic is the fitness industry (Nordlund, 2020). The fitness industry includes gyms and health clubs (Miragaia & Constantino, 2019) and is a global industry with 201 thousand clubs 174 million members worldwide (Statista, 2021a). The year 2020 there were 1702 fitness clubs in Sweden (Statista 2020b) with a total of 2,2 million members (Statista, 2020c). Before the pandemic the fitness industry has had a constant increase in both number of clubs and members (Miragaia & Constantino, 2019). The number of clubs increased with 60% between the years 2009 and 2019 (Statista, 2020d). In Europe, an increase of 42% in the number of gym-members was stated the same years (Statista, 2020e). In January 2021, a new law, ‘the pandemic law’ came into force, the law includes restrictions that each client on the gym facility must have 10 square meter each (Folkhälsomyndigheten, 2021). Since then, the gym membership has instead decreased. As an example of the effects, one of the 1
largest gyms in Sweden ‘Friskis & Svettis’, has had a decrease of 59% in members compared to the year before the pandemic (Kvix, 2021). The gym ‘Actics’, shows similar patterns, with a decrease of 11% (Svt, 2021). In turn, an increase in demand for digital solutions has appeared (Blomqvist, 2021; Svt, 2021). More and more gyms are expanding their offerings with digital alternatives (Svt, 2021). For example, the gyms Friskis & Svettis (2021), Sats (2021) have expanded their digital services and the customers are getting more dependent on the digital services. However, the pandemic cannot be determined as the only factor for the increasing demand for digital fitness services. A survey made by Batrakoulis (2019) on ongoing fitness trends in Europe pointed at 20 existing trends with personal training, HIIT, body weight training, functional fitness training and small group personal training as the top five trends. The study also showed that 80% of the respondents admitted online and digital training as an upgoing trend. With the ongoing digitalization and the pandemic that has accelerated the evolution, it can be assumed that the customer experience in the fitness industry is getting more digital and will continue to be so even after the pandemic. 1.1.2 Customer experience Customer experience has been defined by many and in various ways. Meyer and Schwager, (2007) state that ”Customer experience is the internal and subjective response customers have to any direct or indirect contact with a company” (p. 2). Customer experience can also be understood as a broad concept that takes place in all exchanges of services, regardless of nature and form (Lemon & Verhoef, 2016). In terms of sensory marketing, Hultén (2014) describes that customer experience is created through marketing. The marketing provides feelings and activates the senses, in this way the marketing itself contributes to the experience. Tynan and McKechnie (2010) defines customer experience as the whole process, before and during the purchase but also as the memory it leaves in the customer's mind. This is often called the customer journey, where different touchpoints contribute to the whole customer experience (Witell, Kowalkowski, Perks, Raddats, Schwabe, Benedettini & Burton, 2020; Lemon & Verhoef, 2016). Touchpoints can be both in control of the company, the customer itself or other parties (Lemon & Verhoef, 2016). Thus, the customer value is created through the customer journey and is a result of the customer experience. Both the company and customer are involved in the whole process, where the company has the tools and the customer’s use it to create value (Hultén, 2014). The customer experience is thus about a chain of interactions between the customer and the company. What the customer experiences is seen as holistic and thus consists of several different interactions (Bolton et al., 2018). The servicescape, the place where 2
customer’s meet with the company, passes more and more to digital and virtual. One major difference between the servicescape online and physical is the two-way communication (Ballantyne & Nilsson, 2017). This also makes customers more individual with personalized demands. They know their preferences and know where to fulfill those needs. At the same time, people are more connected, it is easier to build networks and get in and stay in contact with other people (Hultén, 2014). The digital customers are often co-creators and more in control of the purchasing process (Ballantyne & Nilsson, 2017). Further, Chaffey and Ellis-Chadwick (2019) explains that online customer experience is based on previous experiences. When connecting digitally with customers it is important to work with customer experience management (Chaffey & Ellis-Chadwick, 2019). 1.2 Problem discussion Palmer (2010) state that it is crucial to gain a better understanding of the customer experience to get a better understanding of the customer itself which is also strengthened by McColl- Kennedy, Gustafsson, Jaakkola, Klaus, Radnor, Perks and Friman (2015). McColl-Kennedy et al. (2015) further describe that it is important to understand the dynamic holistic nature of it. To optimize the customer experience, the whole journey needs to be optimized and the different touchpoints in the customer journey is one way that the company can be in control over the experience. Anyhow the company cannot be in total control over the touchpoints since not only one party affect the customer experience, but also the customer itself and other parties. Still all of the touchpoints should be well thought through and it is important for companies to understand where the touchpoints are and who is affecting them (Witell et al., 2020). Further, having a focus on the customer experience can in addition effectively create value for the customer (Palmer, 2010). Wilson, Zeithaml, Bitner and Gremler (2016) further describe the customer experience as the foundation for both marketers’ and managers’ work. To study the customer experience can therefore provide benefits to companies, marketers, and managers in the form of new and relevant insights and tools. People, companies, and communities will also benefit from the digital environment that has now been created and they will probably increase convenience, access as well as come up with new solutions. The digitalization has been an ongoing evolution for the last decades and has 3
made people both more connected and visible. But it has also made companies more dependent on keeping up with technological and digital development (Leonardi & Treem, 2020). More and more work roles are getting replaced by digital services (Degryse, 2016). Elvin and Vsevolod (2020) made a study on the effects of digitalization on economic indicators. Their conclusion was that digitalization has changed the economy radically with both new opportunities and challenges (Elvin & Vsevolod, 2020). A company's ability to manage and utilize digital technology are becoming increasingly crucial to its competitiveness (Bolton et al., 2018). Therefore, it is important for companies to also improve their work with online customer experiences. A reason for specific companies in the fitness industry to increase their proficiencies when it comes to online customer experience is that there has been an increase in digital devices and apps related to fitness. Customers use digital platforms to register their training and also to find motivation and instructions (Roth Smith & Treem, 2016). There are also a high number of fitness equipment that are digital and online (Yuan, 2015). At the same time as the number of visitors to the gym has decreased by 35-40% from November 2019 to the same month the year after (Nordlund, 2020), the alternative services online, with digital training has instead increased, actually with hundreds of percent. A study made by Michael Dahlén showed that people do have a greater need for exercising (Svt, 2020). Post- och telestyrelsen (2021) believes that we have a lot to learn about this rapid and comprehensive digital transformation that we have just undergone and are undergoing. Many studies have been conducted on customer experience but not in the connection to the fitness industry and the digitalization of it. Thus, there is a need to study digitalization of services in the fitness industry. 1.3 Research question How is the customer experience affected by the digitalization of services in the fitness industry? 1.4 Purpose The purpose of this study is to get a greater understanding of the customer experience in the context of digital fitness services. 4
1.5 Delimitations This study has focused only on the Swedish market, to narrow the study down and to be able to find respondents representing the same market. Further, when it comes to the type of fitness services used in this study, instruction videos or classes are in focus. Some respondent had also used a fitness tracker app, but that was not the focus of this study. 5
1.6 Report structure Figure 1 Report structure This study starts with a theoretical background where previous research, explanation of concepts used and theories around the subject customer experience and digitalization are presented. After that comes a conceptual model to clarify what this study aims to focus on and 6
this was also the foundation for the analysis. This will be followed by a methodology chapter where the reader gets insight in the choices made for this study and motivation for choosing certain methods. Next the empirical findings are presented in the form of categories as an outcome from the semi structured interviews that has been conducted on five respondents - four customer and one gym. After this, an analysis together with discussion can be found. Here the author connects the empirical findings with previous research and theories. Out of this came different conclusions which can be found in the chapter after, to finish with a chapter about ideas for future research in the subject and recommendations to gyms who goes digital and wants to develop their customers’ experiences. Here limitation that occurred in this study will also be presented. Last, five appendixes are attached, with full questions and answers from the interviews. In the end of this study all the used references can also be found, in alphabetical order. 2. THEORETICAL BACKGROUND 2.1 Digitalization Digitalization can be defined as the change from physical to digital (Yoo, Lyytinen, Boland and Berente, 2010). It can also be described as the technological impact and changing shifts in society and people's lives (Leonardi & Treem, 2020). According to Vogelsang (2010) the concept of digitalization was introduced by Gottfried Wilhelm Leibniz and has been developed by many inventions such as computer, telephone and the internet. The digitalization has changed every part of the economy and the way people live their life. Verina and Titko (2019) has also made a study on digital transformation and came to the conclusion that among other things the customer experience is one of the factors that are affected by it. The result of that study is presented in figure 2. 7
Figure 2 Conceptual framework Illustrated by Verina & Titko (2019 p.724) 2.1.1 Digitalization of fitness services The process of implementing digital technology instead or at the side of physical services is called digital transformation and is something that right now is very actual in the fitness industry (Kossowski, Lenz, Heumüller & Richer, 2020). Roth Smith & Treem (2016) made a study on fitness apps' affection on customers’ communication and social interaction and confirmed that the digitalization has impacted people's way of communicating. The users of fitness apps can upload their achievements and comment on others, which for some people is motivating and for some have no use (Roth Smith & Treem, 2016). To succeed with a digital transformation the company needs to focus on the customers and the business model. The result of the digital transformation depends on how fast and competent the company can handle digital changes and how well this fit with the expectations set by the market and society (Kossowski et al. 2020). 2.2 Customer journey To create a mutual value between customer and company, it is important to look at the customer experience with a holistic view from the customer's perspective. The customer experience can be seen as a process consisting of three different steps. During all of these steps, the customer 8
thus assesses the experience. (Lemon & Verhoef, 2016; Tynan & McKechnie, 2009). Tynan & McKechnie (2009) also present a model of the customer experience process. In Figure 3 below all of the activities that the customer goes through during the different steps of the customer experience process is shown (Tynan & McKechnie, 2009). Figure 3 The customer’s experience – activities, value sources and outcomes Illustrated by Tynan and McKechnie (2009 p. 509) During the first step, the pre-experience stage, the customer prepares for his consumption. It is thus about activities such as imagining the experience, searching for information, and planning and budgeting. At the second stage of the process, the customer experience, thus the experience itself, the customer can experience a number of different values and meanings. At the last step in the process, thus after the experience, there is a result on the experience from the customer's perspective. If the experience is successful, it will have generated some entertainment and enjoyment. It may also have resulted in the customer learning something new or developing their skills. The customer can also associate the experience with nostalgia. In addition to this, the customer can also afterward fantasize about what the experience could have resulted in, for example, how it could have resulted in more knowledge. This result thus allows the customer to go beyond what is actually included in the experience itself. Finally, the customer can also after the experience evangelize, for example by persuading others to test the experience (Tynan & McKechnie, 2009). 2.2.1 Touch points in the customer journey Within the customer journey, different touch points can be identified of the customer experience. Throughout the experience, the customer can thus be seen as interacting with these 9
different touch points. The touch points can be categorized into four different types of points, namely brand-owned touch points, partner-owned touch points, social/external owned touch points and customer-owned touch points and (Lemon & Verhoef, 2016). Brand-owned touch points are about the actual customer interaction during the experience that is controlled by the company. These points include all branded media managed by the company, such as websites, loyalty programs and advertising as well as all parts of the branded marketing mix, such as service, sales force and price. This type of points has been shown to influence the customer's attitudes and preferences. Partner-owned touch points are instead about customer interactions that during the experience are controlled, designed and handled by the company through collaboration with other partners. These other partners can be, for example, marketing agencies, distribution channels, or communication channel partners. Customer-owned touch points can instead be explained as customer measures that are part of the customer experience. This means the total customer experience that takes place with the company, the partners involved and other parties who can be involved in controlling and influencing. Social/external touch points are about other customers, in addition to the customer, the company and the partner's role in the customer experience. These points of contact can be, for example, other customers, environments or independent sources of information. These social/external points are thus touched by the customer throughout the experience. For example, other customers have been shown to influence the customer's experience during the actual purchase of the product or service as well as after the actual purchase (Lemon & Verhoef, 2016). 2.3 Customer experience The customer experience is a well-studied subject and a review of different authors' definitions of it are to follow. The customer experience is individual and is affected by plenty of different factor’s dimensions are suggested as the affecting elements (Tynan & McKechnie, 2009). Godovykh and Tasci (2020) describe that the customer experience consists of four common components, namely affect, sensory, conation and cognition, which is shown in Figure 4 below. 10
Figure 4 The main components of experience Illustrated by Godovykh and Tasci (2020, p.5) Bleier, Harmeling and Palmatier (2018) describe four different dimensions of the customer experience, namely informativeness (cognitive), Entertainment (affective), Social Presence (social) and Sensory Appeal (sensory). Schmitt (1999) set a new perspective on marketing, focusing on the experience instead of only the product or service. Since consumers are both rational and emotional, their decisions and behavior are often based on different feelings and instincts. With this, Schmitt (1999), implemented a new concept of the customer experience, with the five different segments sense, feel, think, act and relate. Wilson et al. (2016) emphasizes the importance of creating a memory for the customer. Wilson et al. (2016) presents five different segments of the customer behavior, which affects how the experience is received. According to Palmer (2010) customer experience has become a way of differentiating on the market. Palmer (2010) has made a literature review and summarizes that the customer experience is being affected by emotional and relational factors as well as attitude factors. Three factors are presented to be the main factors of the customer experience; stimulus that triggers different senses of the customers, in what context the stimuli are perceived and the situation where it is sent, such as other customers and personal emotional contexts (Palmer, 2010). Peoples’ attitude is also something affecting the whole experience of a service that presents three components that the attitude consists of. Cognitive, affective and conative (Fill, 2011). 11
Another important factor is how the customer expected the visit at the company to be and how well it corresponds to reality. Here, continued contact is the key. Then the company can get insights in what the customer wants and the customer in turn be informed of what to expect (Wilson et al., 2016). Tynan and McKechnie (2009) explains that the customer can experience a utopian value, thus the relationship to place and space. Following each factor affecting the customer experience will be summarized and presented. 2.3.1 Cognitive factors The cognitive component signifies the learning and intellect part of customer experience, where the customer gets knowledge about the brand, product or service. In a marketing perspective this is often reached through advertising or other communications (Fill, 2011). Bleier et al. (2018) explains the cognitive dimension as the informativeness experiences, which are about result-oriented information. This experience can, for example, help the customer make a purchase decision. It is all about the functional value of the experience itself (Bleier et al., 2018; Tynan & McKechnie, 2009). Godovykh and Tasci (2020) explains that the cognitive component deals with terms such as thoughts, information, memory and knowledge (Godovykh & Tasci, 2020). In Schmitt's (1999) theory of customer experience the cognitive component is called think. This kind of marketing activates the cognitive behavior in people with a focus on the mind and analytic ability. 2.3.2 Affective and emotional factors The affective component implies emotional terms, such as the mood and feelings (Godovykh & Tasci, 2020). The emotional meaning extends to all the emotions that are experienced during the experience, thus not only if the customer likes or disapproves with it (Tynan & McKechnie, 2009). The entertaining experience is often about the experience itself, in other words, the immediate pleasure of the experience. This immediate experience can also create affective effects, such as emotional responses (Bleier et al., 2018). Schmitt’s (1999) part of the concept, ‘feel’ alludes to the emotional and affective part of experience. These are triggered by different stimuli, to obtain the desired feeling, marketers here need great insights and understanding in what kind of stimulus that triggers certain feelings (Schmitt, 1999). Mood is also a part of the affective experience. The current mood of the customer will affect how they perceive the service. If a customer is in a bad mood before or during the experience, it will not be optimally 12
perceived. This goes both ways, where the perception exaggerated, either positive or negative. Also, how people remember the experience is affected by how their mood was during it and how they felt about it. Emotions are often strongly remembered (Wilson et al., 2016). 2.3.3 Sensory factors Another factor in Schmitt’s (1999) theory is ‘sense’ where the customers’ senses are triggered by different stimuli that marketers can imply, which shapes the experience for the customer (Schmitt, 1999). Customers get value from sensory meanings. It can be about sensory factors such as through sight, sound, taste and touch that are associated with the experience (Schmitt, 1999; Tynan & McKechnie, 2009; Bleier et al., 2018; Godovykh & Tasci, 2020) The sensory component is also about feeling, sensation and (Godovykh & Tasci, 2020). It is thus about stimulating the human senses and these senses can be evoked physically as well as online (Bleier et al., 2018). Furthermore, the servicescape is a crucial factor for the customer experience. Included here is for example the temperature of the room or the smell and other stimuli that triggers different senses and feelings (Wilson et al., 2016). 2.2.4 Social and relational factors A value can also be achieved through relational aspects of the experience. This type of aspect can, for example, be of a social nature and include other individuals or groups (Tynan & McKechnie, 2009). Wilson et al. (2016) explains that the customers and other parties could be a part of the experience, where their performance affects the outcome. This can be other customers, people that appear near the experience or third part actors that could be stakeholders to the company providing the service. Wilson et al. (2016) especially points at the effect of other customers in events or other physical experiences where other people appear. Here homogeneous customers are presented as a tool for marketers to have more control over the experience (Wilson et al., 2016). The social dimension of the experience is about some form of presence or meeting with other people. It is thus about a feeling of a social presence, sociability, and feel contact with other people. This in turn has been shown to contribute to increased pleasure for the experience (Bleier, et al., 2018). The marketers here allude to peoples’ desire to find and express themselves (Schmitt, 1999). 13
Wilson et al. (2016) makes the connection between the theatre and the company, where the customer is the audience and the company is responsible for how the show is received. If the customer has direct contact with the personal or/and the competence of the personal, such as a fitness coach, is important, the contact is even more critical. The employee must be competent and professional to make the customers’ experience optimal. 2.3.5 Conative factors The conation component is instead about terms such as behavior, involvement or action (Godovykh & Tasci, 2020; Fill, 2011) and are seen as the last part of the process (Fill, 2011). In Schmitt’s (1999) theory the component is called ‘act’ and is explained to be where the decision is made and the action is taken. Here the change is in focus and the marketers should allude to peoples’ ability to make a change, by buying a product or service. Further, another factor from Wilson et al.'s (2016) theory that fits some types of services, including fitness services, is when the customer is the co-producer of the experience. If the customer does not perform well at the gym the results will not be as desired and the experience will not be as positive as if the customer would perform better. Here, the customer needs to be motivated and informed to be able to make the best out of the experience. The company and their employees also play an important role. 14
3. CONCEPTUAL MODEL Following is a conceptual model to conclude the theoretical framework for this study. This to show what the study will focus on. To answer the research question, these are the points that needs to be studied. Therefore, this model is the foundation for the questions in the interviews. With the different components of the model, the question how digitalization in fitness services has impacted customer experience. The model show that the digitalization has impacted different factors as well as the touch points in the customer journey, this in turn has an impact on the customer experience. The model can also be used to clarify and summarize the theories used. Figure 5 Conceptual model Illustrated by the author of this paper 15
4. METHODOLOGY 4.1 Scientific approach This study has had what Bryman & Bell (2013) explain as a hermeneutic approach. This since the researcher needed to be able to interpret the data and the outcome of the study, and since the purpose of the study was to get insights and understandings. Also, because the collected data was of a qualitative type, with words and not numbers that will be analyzed. 4.2 Research type There are two types of research that can be conducted, qualitative or quantitative. In this case a qualitative method has been used. A qualitative method focusses mainly on words and the interpretation of them and it is more appropriate when the purpose of the study is to get understandings, while the opposite method; quantitative, focus on facts and numbers (Bryman & Bell, 2013; Ghauri, Grønhaug & Strange, 2020). With a quantitative study, the researcher may have got a higher quantity of respondents and data, but since the aim of this study was to get understanding about elements such as feelings and perceptions and not on exact numbers or statistical facts, a qualitative study with less, but more in-depth information, was preferable. According to Ghauri et al. (2020) qualitative studies also give more insights from the respondents’ perspective, which also was a part of the purpose of this study. With a qualitative method the companies’ and customers’ opinions and interpretations of how they had experienced the shift in fitness services could be deeper understood. 4.3 Research approach Ghauri et al. (2020) presents three different research approaches a study can have. ‘Deductive’, with the theory as a starting point, ‘inductive’, with the collected empirical data as the foundation and ‘abductive’, which are a mix of both but also where the researcher goes back and forth between theoretical and empirical information. This study has used an abductive 16
approach, starting in the existing literature on the subject. From this, a research gap was found, which shaped the research question. The questionnaire was also based on existing theory. The goal of the study was still not to test hypotheses that is according to Ghauri et al. (2020) often the case in deductive reasoning. Instead, new theory was proposed and the author has gone back and forth between theoretical and empirical data. The author is aware that if the study would have been made completely deductive, the results could be seen as less biased, but the reason for choosing this approach was to be able to prepare as precise and appropriate questions as possible. This to be able to get the information needed to analyze and draw conclusions. 4.4 Research design As well as with research approach, there are also different types of research designs. To compare and see patterns that are not dependent on time and room (Bryman & Bell, 2013; Ghauri et al., 2020) a cross sectional design was conducted. A cross-sectional design can be explained as when the data is collected on different cases and by one time each and are often used when making semi structured interviews or surveys (Bryman & Bell, 2013). A disadvantage of this design is that data could change over time and that it could not be compared from one time to another (Ghauri et al., 2020). This was not needed in this study though, since the information that the respondents had were not dependent on different times, this because the questions was about one or more previous event/s. According to Ghauri et al. (2020) & Bryman & Bell (2013), the main advantage of cross-sectional design is that it is easier to generalize the data, since it is not collected on just one case or company. Bryman & Bell (2013) also explains that a cross-sectional design is useful when wanting to quantify data and connect them to the variables that later can be compared to each other to see the connection between them. The goal with this study was to see similarities to come up with a conclusion that could be generalized for different fitness centers, and therefore a cross sectional study was considered most appropriate. 4.5 Data collection 4.5.1 Primary and secondary data In data collection, there are two different types of data; primary, which is collected with the particular study as purpose, while secondary data has already been collected for another purpose 17
but are later used in second hand for another study (Bryman & Bell, 2013). For this study, primary data was collected through direct communication with the concerned respondents to get their point of view. Since this study is based on selected theories a primary research was to prefer, in this way as Ghauri et al. (2020) describe as the biggest advantage of using primary data, the questions could be designed out of the theoretical framework and purpose of the study. Thus, the results got connected to this specific research. Also, if secondary data would have been used, it would have been harder to get information from an emotional and affective perspective. 4.5.2 Data sampling The most common way to collect qualitative data is through interviews (Bryman & Bell, 2013). According to Ghauri et al. (2020) interviews actually are the best way to collect data in qualitative studies. There are three types of interviews, structured, with a questionnaire sent out with structured questions, unstructured, with open questions that opens up for a free discussion for the respondents with no implications from the researcher, and last, semi structured interviews, which can be seen as a mix of both, where questions are prepared but not limited to the prepared questions exclusively (Ghauri, 2020). This study has used semi structured interviews, to give the researcher information that is understandable and to have the ability to ask supplementary questions if something is unclear, this also strengthens the reliability of the study (Ghauri et al., 2020). Bryman and Bell (2013) explains that it is important to look at the perspective of the respondents and by asking supplementary questions and give the respondents freedom to explain what they mean, this can be achieved. Interviews have a disadvantage that the researcher is a part of the measurement process, and can therefore affect the results (Bryman & Bell, 2013). To avoid this, supplementary questions were used only in the most necessary cases and the interviewer had the goal to participate and be influential in the answers as little as possible. Also, the interviews were recorded, where you could hear both the respondents and the interviewers, which according to Bryman and Bell (2013) gives the researchers the ability to focus only on listening, questioning and understanding, without having to write the answers down. The respondents had ability to choose whether to participate on telephone or email. This to get higher number of participants, since the author faced some troubles with the willingness from people to participate. The author is well aware of the decreased ability to have a two-way 18
communication, that email-interviews contributes to (Bryman & Bell, 2013) but the author still made the decision that the email-option was needed to get as many respondents as desired. 4.5.3 Selection When choosing who to interview, the author chose what Ghauri et al. (2020) describe as homogeneous cases and contacted all gyms in Sweden that offer digital services as well as physical gyms, which was found on Google. In this phase, nine gyms were contacted through email. This to give them the opportunity to think of the offering before making a decision on participating or not. Furthermore, when contacting customers, a Facebook post on different groups were sent to find people that are interested in participating in the study. In this way according to Ghauri et al. (2020) a non-probability sampling was made. This is because not the whole population, which is customers that have tried both physical and digital gym services, were reached, but only the ones that were reached by the Facebook post. The goal with the sampling was to reach as many people as possible but the author was not able to contact the whole population. Also, when facing problems with finding respondents, to get even more opportunities, people known by the author was contacted. This can be seen as a convenience sampling, where the sampling is made on people near at hand (Bryman & Bell, 2013) and this was also something that the author found necessary to get the desired number of respondents. 4.6 Operationalization Following table show how the theory was used and what the questions aimed to collect information about. Note that the questions are here translated from Swedish to English, during the interviews the respondents’ native language, Swedish was used. This to eliminate the risk of linguistic misunderstandings. Table 1 Operationalization 19
Theory Question Digitalization To what extent do you use digital and physical fitness services and what services? Is it just strength exercises on all digital services or is it different? Have you been to any physical gyms, as well? Brand-owned touch points How have you heard about the services? What is the main reason why you have used the digital services? What do the gyms/companies do to get you motivated to carry out the sessions? For example, motivational text messages or competitions. If you think about smell, sight, touch, temperature and so on. How would you say it's been affected by it becoming digital? (Pros and cons). Partner-owned touch points Do you have access to the service at any time? Or are those specific times when the passes go? Do you have a greater opportunity to adjust the environment if the training takes place remotely? Such as temperature, smells and air conditioning? social/external touch points When you use the digital services, are other people involved or are you performing them yourself? 20
If you perform them yourself: How would you say that the experience is affected by the fact that there are no other customers on site as it is in a gym? customer-owned touch points Have you ever postponed a workout due to mood or similar emotional aspects? Do you find it easier or harder to get to grips with the training when it is digitally available? Cognitive factors How have you heard about the services? Affective factors Do you have access to the service at any time? Or are those specific times when the passes go? Have you ever postponed a workout due to mood or similar emotional aspects? Sensory factors Do you have a greater opportunity to adjust the environment if the training takes place remotely? Such as temperature, smells and air conditioning? If you think about smell, sight, touch, temperature and so on. How would you say it's been affected by it becoming digital? (Pros and cons). Social/relational factors When you use the digital services, are other people involved or are you performing them yourself? If you perform them yourself: How would you say that the experience are affected by the 21
fact that there are no other customers on site as it is in a gym? Conative factors What do the gyms/companies do to get you motivated to carry out the sessions? For example, motivational text messages or competitions. Do you find it easier or harder to get to grips with the training when it is digitally available? 4.6 Data analysis The analysis method used in this study was what Bryman and Bell (2013) describe as a thematic content analysis. This is something that is often used in qualitative studies (Bryman & Bell, 2013). This was the most preferable method to fulfil the purpose of getting insights and see the data from a holistic perspective (Braun & Clarke, 2006). When the data was collected, it was transcribed. To get selective information, the author reduced the data to consist only of information relevant to the subject. After this, a coding was made, which Ghauri et al. (2020) describe as finding similarities and patterns between the different data and from that make categorize that consist of information. To make the data to information, an interpretation of the data had to be made, with the base in the theory. This is something that needs to be done to be able to generalize and come up with conclusions from the data (Ghauri et al., 2020). 4.7 Quality of research 4.7.1 Validity It is important to clarify what to measure and with which measurements. Also, to be sure that what wants to be measured is really measured (Bryman & Bell, 2013; Ghauri et al., 2020). Since this study measures qualitative elements, the author decided which elements to examine to see 22
the customer experience, Therefore the conceptual model was made, with five different components that customer experience consist of. This both to clarify what is meant by customer experience in this study, and to be able to measure each component of the experience. To find out which factors affecting customer experience an in-depth literature review was made on customer experience. This is something that is preferred, especially in qualitative studies, and should consist of plenty of different studies, to make sure that the variables are valid (Ghauri et al., 2020). The result of this is shown in the conceptual model. In some literatures, more factors than others are described, but five factors can be concluded as similar for a majority of previous studies. 4.7.2 Reliability Reliability means that the study can be duplicated and still get the same results. Since qualitative research is based on opinions and interpretations, this is often unachievable in qualitative studies (Bryman & Bell, 2013). The author of this study has still aimed to create as high reliability as possible. This by being transparent with the methods used and the questions asked. To get a high reliability it is important to be consistent when measuring variables. In this study the questionnaire was the same for all respondents, this to be consistent when measuring, which Ghauri et al. (2020) explain as an important part of reliability. 4.8 Ethics According to Bryman and Bell (2013) the following ethical issue needs to be thought of when developing a qualitative study. Information requirements In agreement with this issue, the respondents got information about what the study’s purpose is and what their answers will be used for. This to make sure that they felt secure with what they participated in. 23
Consent requirements To make sure that this issue was covered, emails were sent out to the participants, where they were asked to participate or not, in the email it made clear that their participation would be appreciated but not in some way a compulsion. They also had the ability to choose rather to make the interview on email or phone. Anonymity and confidential requirements This study only handled information relevant to the purpose of the study and therefore personal information was left out. All the respondents were also asked if they wanted to be anonymous. Utilization requirements The data collected from the participants will only be used for the purpose of this study and the respondents have copyright on the recorded information. However, the author of the study has copyright on the transcribed results. False pretenses The participants were well informed about what the study was about. Also, no participants should be damaged by the effects of the study, which is something that the author has made sure is not a risk. Further, according to Ghauri et al. (2020), another ethical issue to take into account is to let the respondents see the results of the study. To be extra sure of the reliability of the study and to be sure that the researchers have interpreted the answers right, the result was sent to the respondents before the final draft was sent in, if there would have been any contradictions, the results would have been corrected to comply with the right interpretation. 5. EMPIRICAL FINDINGS 5.1 Digital services The following table summarize information about the services that each respondent has used. Table 2 Services used by respondents. 24
Respondent Physical Digital services Source of recognition of the service gyms Filip Yes Armed force’s app Ads from FMTK & Youtube is commonly FMTK & Youtube known Morris Yes Armed force’s app FMTK, recommendations from family FMTK, Youtube & members & Youtube are commonly used. Runkeeper Maria Yes Youtube & Instagram WOM & ’explore-functions’ on the apps Hannah Yes Wellness studio’s Email from Wellness studio & their app digital classes Friskis & Yes Friskis & Svettis’s Webpage, membership letters, digital Svettis digital classes & PT- screens on the physical gym & social media sessions Regarding the type of digital services that the respondents used/offered there is a wide variation. Two of the respondents both had used the Swedish Armed Force’s fitness app. Three of the respondents had used YouTube as a platform, with a main focus on instruction videos. One respondent had beyond YouTube, used Instagram, for instructions and motivation. Also, the fitness tracker app Runkeeper was used by one respondent. Another respondent had mainly used the Swedish gym Wellness studio’s digital services, where the customers can follow dance- and strength training classes recorded by instructors from the gym. The gym Friskis & Svettis described that they offer similar classes online. Beyond this, they also offer PT-sessions online. Further Friskis & Svettis offer to some degree digital classes in their physical gyms. All of the respondents had experience from physical gyms and answered that they had chosen the digital solution because of the restrictions which is an outcome of the pandemic. When it comes to the reason for using the digital services, the pandemic was mentioned multiple times. Beyond the pandemic, inspiration, motivation and education were other reasons that the respondents described. The aspect of saving time and flexibility were also described as one of the reasons for choosing the digital services. 25
All of the respondents had access to the digital services at any time of the day. Which was mostly described as an advantage. All of the respondents lifted the importance of flexibility and the ability to exercise whenever they have the time and willingness. All of the respondents except Maria also mentioned that they previously have skipped training because of a certain mood or other emotional aspects. This is something that multiple respondents can avoid because of the ability to postpone the training to another time or day. Hannah, though, described this as both an advantage and disadvantage, since it could also stress you if you postpone it. This, according to Hannah, was easier to do when you do not have to fit it into a time schedule. 5.2 Environment When it comes to the environmental part of the service, the results vary. Some of the respondents explained that the ability to change factors such as room temperature and air freshness are higher from home, while other respondents considered the physical gyms to have greater control, and therefore the climate is better there. Irrespective of, this seems to be something the respondents have not paid attention to. Still, when the question was asked, some of the respondents explained that the smell is something that is easier to control from home, while the temperature is instead controlled by the employees at the gyms, which leads to a better temperature at physical gyms than at home, where it is harder to control the temperature. Further, Friskis & Svettis explained that they think it is easier for customers to control the training environment since they have the ability to exert the service wherever they want. Friskis & Svettis further described that when it comes to the customers’ sight, the difference from physical services to digital is that it is dependent on the internet connection, which will affect the whole experience if it is not optimally perceived. Also, Friskis & Svettis explained it to be harder to connect and reach out to customers through the screen than physically. Friskis & Svettis further explained: "To create a nice feeling and a feeling that it is a group that trains together, which it is not" [own translation]. All the respondents explained that when they use the digital service it is done alone, while at the gym there are other people around. Regarding this, Friskis & Svettis said: ”The fact that the participants are cheered by each other falls away, in our digital classes” [own translation]. Both Filip and Morris said that they missed the inspiration and motivation from other participants. Filip explained that he gets motivated to perform better if he sees that someone else is doing a 26
great workout and for Morris it is more about feeling pressured to move forward in the exercise and finish it more quickly if other people need the requirements. Contrary to this, Maria explained that she performs better when working out at home and Hannah, who has an eating disorder, described the lack of other participants as only an improvement, since she doesn't have to compare herself to others and feel insecure about herself. Both Maria and Hannah said that they do not see any disadvantages with the lack of other participants. Further, Friskis & Svettis also mentioned that it can be an advantage for the participants to decide their environment themselves, where and when they want to exert. They also mentioned the lack of disturbances from other participants as a positive aspect of digital training. 5.3 Motivation When it comes to motivation, on the question rather it is harder or easier to find motivation to exercise when the workout is digital Hannah said: “Both, both harder and easier” [own translation]. She explained that it is easier because she doesn't have to get to the gym, which is something that Filip also mentioned as an advantage of digital fitness services. He said: “No time to pass or anything like that. The transport distance, like getting from the bedroom to the living room to work out is less than getting on the bike and cycling down to the gym." [own translation]. Hannah on the other hand also mentioned a disadvantage with the flexibility, that it is easier to postpone the training when you do not have a specific time when you need to be at the gym. Further, both Morris, Maria & Friskis & Svettis explained the digital service to have exclusively negative impact on the motivation. Morris said that he doesn't like the digital dependence you have when performing the workout online, he likes to be without digital devices when exercising. Maria explained that she gets more motivated to go to the physical gym since it is overall more fun for her and also because of the access to requirements that the physical gyms offer, unlike the digital services. Friskis & Svettis agreed that they had experienced the customers to get less motivated by the digital transformation, they said that the lack of other people supporting and motivating is something that has led to a decrease in exercising for many people. In conclusion, when it comes to how the gyms work to motivate their customers seems to differ a lot. Filip explained that he had not noticed any motivated communication from the physical gym, while the digital services do. He continued "If you have written that you should train three 27
times a week and so maybe they send that: now when you are going to run a workout today then you have only done one session this week" [own translation]. Regarding this, Morris explained that the gym he has a membership in, which is a different gym than Filip’s, informs and motivates their customers to use their digital services but not to go to the physical gym. Further, Maria’s gym has a loyalty program where the customers get points for each exercise they perform. This isn't something that motivates her though. Maria gets her motivation from her own goals and influencers on Instagram. Hannah’s gym also has some programs to motivate their customers. Hannah explained this to be challenges in different ways, mostly focused on walking or running challenges. But Hannah personally would appreciate if there were a wider range of challenges, for example where you do not have to go outside to participate. Another thing that would motivate Hannah is if the gyms send out recommendations based on previous activities. She further stated "For example 'now this passport is available' - send out an email - 'now this is available and now I can try it' or something like that” [own translation]. When it comes to the gym’s perspective, Friskis & Svettis explained that the only thing they do is to inform their customers about their classes but that challenges are soon to be presented, starting with a six-week program with three classes per week. 28
6. ANALYSIS & DISCUSSION 6.1 Digital fitness services As Yoo et al. (2010) describe, digitalization is the shift from physical to digital, and as Kossowski et al. (2020) mentions, there is an ongoing rapid transformation from physical to digital in the fitness industry. This can be confirmed by the empirical findings of this study, since all of the respondents explain that they have increased the use of digital fitness services instead of physical. The data declared the main reason for the shift to be the pandemic and the restrictions which it has brought. However, the literature speaks for an ongoing digitalization even before the pandemic. Verina and Titko (2019) presents plenty of reasons in their model, such as progress in technology, development of e-business, recognition of the role of digital technologies among leaders etc. The results confirm what Roth Smith and Treem (2016) writes about apps where customers can publish their achievements. As most of the respondents talked about some kind of challenges. The respondents did not mention anything about communication with other customers though. 6.2 Customer journey According to Tynan and McKechnie (2009) the customer journey is what leads to the customer experience and should be taken into considerations when developing it. This study has only touched some parts of the pre- and post-experience, but the outcomes of the main customer experience Tynan and McKechnie (2009) describe to be enjoyment, entertainment, learning, skills, nostalgia, fantasizing and evangelizing. According to the results of this study, the respondents liked the digital services for educational, and skills purposes. connected to the empirical findings, one of the main reasons for using the digital services is the flexibility and the ability to exercise whenever you want. Another advantage with the digital services was described that it is approachable. This can be seen as an improvement in the pre-phase where searching, planning and expectations play an important role (Tynan & McKechnie, 2009). The digital service does not require as much planning as if there was a time to catch at the physical classes. The expectations can also be more realistic since the customer is in control of the environment chosen for the exercise and the participants joining them. 29
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