Customer education or the extent to which firms are seen as providing customers with the skills and abilities to utilize criticalinformation is often considered a valuable augmentation to a firm’s service offerings. Yet, many firms are hesitant to invest incustomer education efforts for fear that it will equip customers with the skills to shop around and possibly switch providers. Thepurpose of this research is to understand the circumstances under which customer education ties customers more closely to afirm or encourages customers to leave. Specifically, our studies show that an understanding of this paradox of customer educationlies in the specificity of customer expertise that is built as a result of customer education initiatives. The results demonstratethat educating customers for firm-specific expertise leads to increased loyalty, while building market-related expertise maydecrease customer loyalty. A critical practical implication of our findings therefore is the need for managers to understand thevarying effects of enhancing customers’ firm-specific versus market-related expertise and to consider customer educationinitiatives proactively.
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