Journal of Marketing Management

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Dystopia and utopia in digital services

Charles F. Hofacker & Daniela Corsaro

To cite this article: Charles F. Hofacker & Daniela Corsaro (2020): Dystopia and utopia in digital
services, Journal of Marketing Management, DOI: 10.1080/0267257X.2020.1739454

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Published online: 24 Mar 2020.

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JOURNAL OF MARKETING MANAGEMENT
https://doi.org/10.1080/0267257X.2020.1739454

COMMENTARY

Dystopia and utopia in digital services

Charles F. Hofackera and Daniela Corsarob
a
College of Business, Florida State University, Tallahassee, FL, USA; bDepartment of Business, Law, Economics
and Consumer Behavior, Università IULM, Milano, Italy

ABSTRACT KEYWORDS
In this commentary we explore a set of paradoxes in digital services Technology; paradoxes;
that we call Truth versus Lies, Long Term versus Short Term, Fair versus dialectic; value exchange;
Unfair, Humans versus Machines, Return versus Risk, Coordination digital services; marketing
versus Competition, and Slow versus Fast. In each case the new digital and society
tools at the disposal of marketers can lead towards marketing utopia
or veer towards dystopia.

In marketing we like to believe that value exchange is good by definition (Vargo & Lusch,
2017) but this belief might be an oversimplification. In fact, value exchange is changing in
unpredictable ways as technology morphs from being a resource to be integrated by
actors, to being an actor itself (Hoffman & Novak, 2018). Technologies like smart devices,
artificial intelligence and cloud-based systems, like every other technology since the hand
axe, present society with a series of paradoxes (Mick & Fournier, 1998). As such, we are
pleased to follow the structure of this special issue which poses a contrast between Utopia
and Dystopia. In this commentary, we will present a series of Hegelian opposites,
a confrontation if you will, between a utopian technological outcome and a dystopian
result. Our list of Utopian-Dystopian pairs is Truth versus Lies, Long Term versus Short
Term, Fair versus Unfair, Humans versus Machines, Return versus Risk, Coordination versus
Competition and Slow versus Fast. We hope you will enjoy this trip between opposites
without getting whiplash as we careen from Utopia to Dystopia, section after section.

Truth versus lies

We begin with a simple anecdote that perhaps best exemplifies the tension between the
potential of what information technology can do for us and the painful, recent realisation that
information technology is neutral with respect to the truth value of the information that is
being processed. Back in the 1990s, the Flat Earth Society had a shrinking membership base
and was on the fast track to bankruptcy. And then along came the Internet. Currently the Flat
Earth Society Web site gets over 300,000 unique visits per day, and there are a variety of
seemingly successful social accounts and engagement platforms expounding their views
(Weber, 2018). As Utopian technology allows for the inexpensive dissemination of true

CONTACT Charles F. Hofacker chofack@business.fsu.edu Carl DeSantis Professor of Business Administration and
Professor of Marketing, Florida State University, College of Business, Tallahassee, FL 32306-1110, USA
© 2020 Westburn Publishers Ltd.
2 C. F. HOFACKER AND D. CORSARO

information, it also does the same for lies, misrepresentations, propaganda, fake news and
sheer nonsense. What can we trust?
Nor is this paradox restricted to media, it extends to sales channels as well since digitalisa-
tion profoundly changes the nature of transactions. Human-less transactions are growing in
number and frequency, and will need a totally different and more affordable recipe for trust
compared to today’s solutions. Trust is a necessary condition for any type of transaction, not
only those relating to a pure exchange of monetary value. It comes with a cost that we
regularly accept as a part of the price of goods and services. Sometimes the cost of trust is so
high that it obstructs the development of new business models and new service categories.
New forms of commerce generate new trust gaps that require innovative solutions to fill
them. It may be that new technologies such as the blockchain will help bridge trust gaps for
new digital services.

Long term versus short term

In marketing we teach that firms should take a long-term mentality. At the risk of over-
simplification, we might conceptualise the long versus short term dilemma utilising the
notion of customer equity. We would define customer equity as the present value of
future revenue streams by our customer base:

X
T
nt
CE ¼
t ð1 þ iÞt

where T is our planning horizon, i is the assumed interest rate, and nt is the expected
net profit from our customer base in year t. Some readers may have noticed that often
this equation is presented with T = ∞. This implies long-term thinking in terms of firm
decision-making. The interest rate is also relevant to decision-making: the lower the
assumed interest rate, the less that future income is discounted downwards by the
equation. In the limit, if i = 0, future net profit is considered equivalent to profit
accrued in the current time period. In effect, dystopian firm decisions might be
attributed to ignoring all but the current time period (setting T = 1), and behaviour
that assumes a large discount rate i. Conversely, utopian firm decisions assume
sustainable decisions (T = ∞) and that future revenue counts nearly as much as current
revenue (i close to 0). We contend that firms should look to the future, taking a long-
term perspective on value exchange, and making decisions accordingly. Instead, the
real economy often produces pressure for short-term thinking and slash-and-burn firm
behaviour.
Research is needed on why some firms choose to slash and burn while others
take a more long-term orientation. Certainly managers often claim to have a long-
term orientation even while they are obviously driven by short term profits. We
might ask whether technology itself leads to a short-term orientation or whether it
might be harnessed to the goal of moving managers’ time horizons further into the
future.
 JOURNAL OF MARKETING MANAGEMENT 3

Fair versus unfair

At the ecosystem level, the infusion of technology enables new forms and higher volumes
of co-creation but does not necessarily solve issues pertaining to value appropriation
(sharing outcomes) and thus fairness.
In complex technology-mediated systems, value creation by itself is insufficient. It is
also important to consider the extent to which agents are able to appropriate value in
a fair way with respect to their contribution (Corsaro, 2020). In a digital context, even more
than in traditional service settings, defining and identifying individual contribution is not
always straightforward. Some service processes might be hidden, benefits and costs
might be intangible, and the actual humans behind the various exchanges contributing
to value co-creation might not be evident. For example, since tangible goods carry, within
them, much of what is needed for value-in-use, the human inputs into such goods are not
present during consumption. Is my consumption of the good fair to me or the worker who
made it? How would I know when we are invisible to each other? Likewise, digital
exchange hides much of the human input, like computer coding, behind the other side
of the screen. The hidden nature of these sorts of exchanges increases risk perception,
decreases social presence, and thus pushes agents towards short term results and
opportunistic, unfair behaviour.
Externalities are a hallmark of digital platforms. By definition, an externality is a cost or
benefit to a third party not directly involved in a value exchange and not internalised by
the directly exchanging parties. Tech optimists always emphasise positive externalities:
my messaging app becomes more valuable when others use the same or compatible
apps. Thus the exchange between the tech firm that supplies the app and the user who
downloads it generates a benefit to other future users as the user base of the app grows.
Lately the presence of many negative externalities has become quite noticeable: the
anonymous use of a social media platform coarsens the discourse acceptable in society
and threatens others who can be attacked using the platform. In that case, trolls get
a (short term) benefit when they engage in anti-social behaviour but everyone in society
loses a little. Users enter into an exchange with platforms like Facebook but that exchange
produces costs to others in society, a society in which it becomes harder to talk to each
other and solve our differences.

Humans versus machines

Technology mediates many relationships these days both in social and business life.
Technologies like smart devices, artificial intelligence and cloud-based systems are reen-
gineering current best practices, leading to new forms of interactions between humans
and machines. However, there exists a paradox in building long term, trust-based relation-
ships since human trust is mediated by non-human technology. In fact, in some contexts
(Reynolds-McIlnay & Morrin, 2019), we could predict that customers might trust a machine
more than a human. One possible solution to this paradox lies in finding an equilibrium
between machine-based interactions and human-based ones. However, it is not at all
clear what combination of automation and social presence (or between machine and
human) generates the highest value customer experience and, as a consequence, builds
stronger relationships.
4 C. F. HOFACKER AND D. CORSARO

Many digital transformations fail because change is not accompanied by a proper

investment in people. For instance, imagine a bank that moves to a new distribution
model in which many activities carried out by front-line personnel have been automatised.
Employees might have been accustomed to providing customers with information and
executing operations for them with an approach that was very transaction-based. After the
transformation employees must switch to a totally different role, becoming ‘advisors’. The
new role requires completely different skills, like active listening, learning agility, ability to
find solutions in a creative way, attitude to establish relationship, and adaptive selling. In
many cases, employees would be resistant to this change, causing a failure in the imple-
mentation of the digital transformation. Thus, digital transformation must be accompanied
by a change in culture and processes. As another example, we turn to a traditionally human-
based retail service like a pharmacy. We imagine a pharmacy reducing its physical footprint
and requiring customers to access service through a digital screen and automated logistics
with very limited interaction with service personnel. However, this experiment might well
result in failure as consumers still value relationships with people, especially where it relates
to health. Even assuming the customer already knows the solution or has a good indication
of it, they might require interaction just to be reassured and relieved of tensions.
So it is clear that technology is not always the best choice for optimal customer
experience. There could be a relational value reduction associated with a loss of human
interaction, which in certain situations may satisfy a specific need, for instance, when the
consumer is troubled and nervous, or when he or she needs an urgent solution to
a problem, or in particular contexts like healthcare, where robots have been criticised as
being inferior to human care and contact. The human interaction with service personnel
may furthermore be a way of releasing anxiety and capturing value beyond the simple
purchase. We know that human interaction (Dabholkar & Bagozzi, 2002) is pleasant by
itself and can add value to the customer experience, value that may be enhanced by the
perception of being treated uniquely and in a personalised way. Interaction with
a machine also requires effort from the consumer and – at least initially – a certain amount
of cognitive work in order to learn to interact with the user interface (Cassidy et al., 2015).
Besides, there may well be customer concerns about privacy as machines function as
a black box, with a lack of evidence in terms of where data will be stored and who will
touch it. Retail studies, for instance, have shown that privacy becomes a touchy issue
when it comes to the adoption of a new technology in the store, and also that word of
mouth becomes an important driver of adoption (Inman & Nikolova, 2017).
In summary, many companies attempt to digitally transform themselves without
understanding customer desire to interact with humans or having a clear idea on when
and where technology will successfully scale. We might say that companies must learn to
look at technology through the customers’ eyes.

Return versus risk

In many cases (Belvedere et al., 2013; Kowalkowski et al., 2009) digital technologies play
an important role in improving existing service processes, leading to higher responsive-
ness and more efficient and effective decision making. Furthermore, it is acknowledged
that technological advancements that enable automated information gathering,
machine-to-machine communication, and the connection of intelligent products in an
 JOURNAL OF MARKETING MANAGEMENT 5

Internet of Things (IoT) foster the development of new, more advanced service offerings
and innovative business models. One presumes that consumers appreciate higher
returns in the form of superior service and have generally been willing to trade off
a potential loss of privacy and other forms of risk for the opportunity for higher returns
in the form of better service. Despite that, recently the trade-off has seemed less
appealing.
Despite those recent problems, surely there are many positive aspects to integrating
technology into the customer journey. For instance, the customer can perceive the
purchasing process as relatively simplified as compared to those times that human service
tends to be time consuming (Kansal, 2016). The customer might also appreciate custo-
misation through the reporting of what other customers purchased in association with
a certain product (Riel et al., 2001). Benefits might be realised in terms of reduced risk that
a loss or a danger may occur (Shamdasani et al., 2008), but also a reduced performance
risk where outcome variability is relatively important to the customer (e.g. financial
markets, legal services, insurance, medical services), and wherever human failure is
perceived as more likely than machine failure. In some cases, machines have superior
capabilities with respect to human capabilities and in those cases it is human performance
that carries the most risk

Coordination versus competition

We know from economic theory that actors in service systems seek to extract benefits
from other actors in the service system, and actors in service systems seek to push costs
and risk on to other actors in the service system. This can occur even when all agents in
a service system would be better served by cooperation and long-term thinking. In that
case marketers need to be clear on when technology-based service systems lead to
coordination, or rivalry.
The rules governing the sharing of resources is one example of cooperation which is of
increasing interest to researchers (McColl-Kennedy et al., 2012) with a goal to understand
the mechanisms of coordination, collaboration, and cooperation among those actors
engaged in value co-creation processes in service systems (Vargo & Lusch, 2016). In
service systems, both service provision and value co-creation result from the integration
of resources among multiple entities, which in turn requires communication and coordi-
nation to ensure the viability and evolution of those systems (Maglio & Spohrer, 2013).
This dynamic process highlights the pivotal role of institutions and institutional arrange-
ments in value co-creation aimed at fostering cooperative and coordinated behaviour
among actors in an evolving service ecosystem. Technology has enabled opportunities of
value co-creation and service for service exchange (Vargo & Lusch, 2008) by connecting
actors that would have been disconnected otherwise. The number of touchpoints among
customers has multiplied and new resource combinations have been generated
(Ramaswamy & Ozcan, 2016). Technological platforms have allowed the customer to be
part of the co-creation processes, making their competence at the disposal of companies,
and also allowing for more personalisation. However, such interactions often occur
among actors that are very heterogeneous in terms of goals, knowledge, perspectives,
and so on.
6 C. F. HOFACKER AND D. CORSARO

By determining reciprocal expectations about the behaviour of actors involved in

resource integration, institutions reduce the uncertainty of interactions and, conse-
quently, the cost of cooperation and collaboration, hence increasing the effectiveness
of value co-creation processes. Actors rely upon these and other social institutions (e.g.
monetary systems, laws, etc.) to regulate interactions and exchanges. It is important to
note that institutions not only impact resource integration in value co-creation, but also
influence the evaluation and determination of value that emerges from the integration
and exchange of resources. Thus, the consideration of institutions in value co-creation is
important for conceptualising the social context through which value is co-created and
evaluated (Edvardsson et al., 2011). In other words, resource integration, service provision,
and value creation change the nature of the system to some degree, thus also changing
the context for the next interaction and the determination of value creation.
Nevertheless, recent research (Salesforce, 2018) has shown that the main limit to
resource integration are companies not equipped with technological systems able to
integrate internal and external data. Due to the complexity of omnichannel systems and
the diffusion of collaborative platforms needed by IoT devices (Things, Sensors and
Beacons), these technologies now represent not just an opportunity but a necessary pre-
condition, an enabler for value co-creation processes.
Customer Relationship Management (CRM) systems, and even more, social CRM (i.e.
integrated with social media), are generating institutionalised practices of sharing data in
the ecosystem. These systems keep track of all contacts, opportunities, accounts, partners,
and competitors in one single platform that everyone can share throughout the organisa-
tion, allowing the sales division to function more efficiently no matter where they are
physically. The goal is to pivot the entire service system towards a better customer
experience. The platform enables companies to create a customer-centred business
from marketing to sales, customer service, and business analysis. It is simultaneously
a platform and an ecosystem, which creates a seamless single connected experience for
every user. This technology helps users work smarter by gaining deeper insights into their
customers and empowers the company to build apps in a flash to connect with con-
sumers. The company not only provides its business customers the basic tools to create
and manage strong relationships with the final leads, but they are also able to personalise
the way they engage their final customers through different combinations of apps, tools,
different levels of difficulty and extensions. Business opportunities can assume sense and
meaning through the continued participation of various persons who contribute to their
representation and thus definition.

Slow versus fast

Context is a key idea in the future of marketing as machines will be better able to assess
context and take it into account in personalised (contextualised) advertising, personalisa-
tion of the service experience and other uses. Context-aware digital processes will help
marketers produce the right message about the right product in the right location at the
right time. We imagine a feedback loop where marketing activities will modify the sense
that people assign to context, especially in its time dimension, meaning that consumers
will begin to anticipate ever faster marketing reaction to where they are, what they are
doing, and what time it is. Speaking of time, the use of digital technologies is contributing
 JOURNAL OF MARKETING MANAGEMENT 7

to the ‘culture of immediacy’, i.e. the idea that companies should be available 24/7 and
problems solved immediately. In many cases, the speediness of interaction brought by
technology contributes to shortening, if not eliminating, time between customer and firm
interaction. In a world where everything already seems to happen in real time, it is hard to
imagine even more immediacy in the firm-customer interaction. And yet, the Internet of
Things, more context-aware marketing processes and 5G speeds will make today’s
marketing look like catalogues delivered by postal mail in comparison. Among other
ways, marketers will achieve even lower latency thanks to the use of chatbots and virtual
assistants as well as local intelligence in the form of apps that move around with the
customer.
When everything in society becomes just-in-time; including inventory, manufacturing,
labour and consumption; time itself become an ever more critical resource. The consu-
mers in our markets lead ever more hectic lives, as they are less able to handle with time.
This tendency has a dark side because people’s ability to distinguish priority diminishes -
everything is urgent-. The anxiety so generated when all is urgent creates cognitive
dysfunction and many times worsens the quality of the problem-solving process.
The greatest luxury may well end up being slowness. Slow food, slow travel, slow
consumption and slow marketing.

Conclusions
Inspired by Mick and Fournier (1998) and the topic of this special issue, we have worked
our way through a set of paradoxical themes: Truth versus Lies, Long Term versus Short
Term, Fair versus Unfair, Humans versus Machines, Return versus Risk, Coordination versus
Competition, and Slow versus Fast. Having done this, we can safely predict that new
technologies will continue to emerge, marketers will continue to use those to achieve
organisational goals, and the technologies in combination with marketing actions will
continue to produce theses and antitheses, leading to new academic challenges.

Disclosure statement
No potential conflict of interest was reported by the authors.

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