The transformational potential of Latin American retail experiences

Abstract

Purpose: The purpose of this paper is to investigate if retail services have a transformative potential to improve the well-being of customers in a Latin American market. Transformative studies have been conducted mostly in developed countries, and consumer well-being in a Latin American supermarket context has not been addressed previously. Specifically, this study aims to understand if customer satisfaction with a supermarket experience in Chile leads to positive customer well-being. Additionally, it is examined if customer well-being influences firm outcomes, such as customer loyalty, word-of-mouth (WOM) communication or retailer equity. Design/methodology/approach: A conceptual model was developed, and data was collected through an online survey from 866 customers of a large supermarket chain in Chile. Hypotheses were tested with structural equation modeling. Findings: The findings of this study support all the hypotheses of the model and confirm that customer satisfaction has direct and indirect effects on customer loyalty and other firm outcomes through customer well-being. Research limitations/implications: This research is among the few studies in the academic literature that considers retail experience and well-being outcomes for supermarket customers in a Latin American context. Limitations derive from the cross-sectional nature of this study. Practical implications: There are implications from this study contributing to the literature on customer retail experience, in terms of the potential to transform supermarket shopping in a Latin American country. This is particularly relevant in Latin America as the extent to which for-profit organizations acknowledge their relevancy of the individuals’ well-being is still at its infancy. Social implications: This research provides empirical support to the importance of not only looking at traditional measures such as WOM, equity and loyalty but looking into the impact services have for customers’ life and well-being. Originality/value: This study contributes to the services literature and addresses a gap in it by exploring the transformative potential of supermarket shopping on customer well-being and in turn the role of customer well-being in retail firm outcomes. The findings also contribute in considering Chile, a Latin American context that has been overlooked in the transformative services studies. This provides managerial implications for domestic and global companies that offer grocery retailing for consumers in this region.