The role of psychological distance in value creation

Purpose - The field of service research has devoted considerable attention to the customer's role as value creator, but there is a lack of research on understanding customers' psychological processes in value creation. The purpose of this paper is to highlight the importance of psychological distance in value-creation processes. Psychological distance is the customer's perceived distance from service interactions in terms of spatial distance, temporal distance, social distance and hypothetical distance. Critically, psychological distance influences cognitive processes and can influence how customers think and feel about the service interaction. An appreciation of psychological distance within service contexts can help managers to tailor the interaction in order to facilitate value creation. Design/methodology/approach - In this conceptual paper, the authors build on psychology research and service research to develop seven propositions that explore how psychological distance can operate within service interactions and how this might influence value creation. Findings - The authors divide the propositions into three sections. The first concerns how perceived psychological distance from the service interaction can act as a barrier to entering a service interaction. In particular, the authors consider the influence of social distance and spatial distance within the context of service interactions. The second section examines how psychological distance to the expected point of service use can influence how customers construe the service and the value creation. The third aspect addresses customer-specific characteristics that can impact on value creation by influencing perceived psychological distance toward the service. Research limitations/implications - Existing research suggests that customers ultimately decide if value is created in the interaction. This paper proposes that perceived psychological distance influences customers' value creation by examining the service interaction from the customer perspective. The authors suggest that complex context-specific features of the service interaction can be understood by considering psychological distance from the service interaction and from the service itself and evaluating how this impacts on value-creation processes. Practical implications - From a practical point of view, the paper helps managers to better understand how to manage the service interaction with customers by identifying psychological antecedents of customer value creation. Originality/value - The paper introduces the notion of psychological distance into service research about value, proposing that the customer's role in creating value in interactions with the service provider is influenced by the psychological distance to the interaction and to the service offered in this interaction.