The consequences of genre-spanning on audience’ expectations and their consumption choices in the context of Dutch Music Festivals

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and their consumption choices in the context of Dutch Music

Festivals

Student Name: Cristina -Teodora Mihalea

Student Number: 10825177

Date: 19-06-2017

MSc. Business Administration, Entrepreneurship and Management in the

Creative Industries Track

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Statement of originality

This document is written by student Cristina-Teodora Mihalea who declares to take full responsibility for the contents of this document.

I declare that the text and the work presented in this document is original and that no sources other than those mentioned in the text and its references have been used in creating it.

The Faculty of Economics and Business is responsible solely for the supervision of completion of the work, not for the contents.

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Acknowledgments:

I would like to use this opportunity to express my gratitude towards my thesis supervisor, Dr. F.B Situmeang who provided me with considerable valuable advice on my work and stimulating suggestions and encouragement along these six months. Moreover, I would like to thank prof. Dr. N.M Wijnberg and Dr. J.J Ebbers for their aspiring guidance, constructive criticism, and friendly advice during the most enjoyable courses I had throughout the entire MSc. Program. Besides, I would like to thank Dhr. M.R.H. Mossinkoff for his motivational words and his willingness to share with me his broad knowledge and interest in the sphere of creative industry.

Furthermore, I would like to thank my parents and my husband for the unconditional support and love through the learning process of this master thesis.

Last, but not least, I would like to thank my enthusiastic and supportive colleagues from Hilco Industrial, Amsterdam for always believing in me and giving me the opportunity to work with many interesting people.

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Abstract

This research investigates the role of expectations on audience decision-making process in the context of music festivals, by contributing to the theories of categories and category spanning. Previous research ascertains that producers dedicated to multiple categories lack legitimacy, are less appealing to the overall audience and therefore, have reduced chances to succeed. Moreover, researchers in the field considered the role of consumers’ expectations within the satisfaction formation process, however, little is known about the effect of expectations in predicting audience’ consumption decisions. The main purpose of this study paper is to investigate the interrelationships between category spanning, clarity of audience’ expectations and consumption decisions by questioning whether or to what extent these expectations mediates the relationship between category spanning and audience attention (willingness-to-visit) as well as the audience appeal (willingness-to-pay). The empirical setting of this study is the music festival market in The Netherlands.

Furthermore, this research study claims that the degree to which category spanning practice influences audience expectations depends on category similarity. Whenever there is high dissimilarity between the categories spanned, the audience might get confused and their expectations become more unclear. In this respect, the customers do not know what to expect from a product or service and so producers’ offerings become difficult to interpret.

The findings of the current research study provide verifiable evidence that category spanning has negative effects on the audience consumption choices. Additionally, it has been proven that this happens mainly because consumers encounter difficulties in making sense of their expectations before the actual consumption of the creative good.

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1. Introduction

In recent years, creative industries have come to economists' attention and become one of the primary focuses of researchers, due to its significant contribution to society by generating wealth and consistently supporting and exploring creative and innovative ideas. This growing economy has already gained a lot of interest worldwide due to its capacity to offer a totally fresh vision to both society and the economy in general, and overall it has become a diverse and innovative sphere.

In 2016, the total music industry revenue reached US $15.0 billion, representing the most considerable growth in the last two decades. Beside the digital music consumption that is exploding globally and brings in a significant contribution of more than half of total revenues, the market of music festivals has experienced an upward trend as well. Only in the Netherlands, there are around 924 music festivals. In the summer time, the audience can choose from a large variety of almost twenty festivals in one single day, depending on the period, and for more than half of those, the attendees must pay an entrance fee (The Festival Atlas, 2015). These facts and figures obviously make the competitive scene of music festivals even more challenging for producers.

For this reason, many researchers contributed to the academic literature in this particular area. Leenders et al., (2005) is focusing on the success factors of a music festival. Frey (2000) claimed that music festivals have come to prominence and that in these later days, consumers are allocating a considerable budget to cultural consumption. However, even if music festivals are receiving a lot of attention and importance lately, there is still much more to discover about the determinants or the impediments of a successful festival in terms of attracting the audience members. We can observe an upward trend regarding researchers’

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involvement in studies on the festival market, however on the Dutch cultural scene further consumer research is needed.

As previously stated by Paleo and Weinberg (2006), popular music festivals are referred to as events with festive and entertainment purposes offering experiential value and knowledge. The two academics explained the importance of stylistic innovation as one of the most significant sources of competitive dynamics in this sector. Their study refers to the music industry as an organizational field where the economic value can be assessed in relation to the competition. Like any other organization, music festivals must face the rivalry with similar players in the market that deliver the same outcome and accomplish the same economic position. Achieving this goal relies mainly on producers’ potential to bring a certain degree of novelty to their offerings, as well as their capability to differentiate themselves in the eyes of the audience and at the same time gain legitimacy. Therefore, the delivered experience should be the prime focus of the producers and festival organizers alike, as lately, repeated consumption is to a large extent triggered by a high level of interaction between the production and market side.

Nowadays, consumers’ tendency of spending a considerable part of their income on music consumption has increased over time as social status is no longer exhibited only by economic security and prosperity but more by culture and lifestyle (Chan and Goldthorpe, 2007). Since festivals symbolize culture and social status, attending it represents a real opportunity of signalling certain rank, improving life's quality as well as overall welfare through interaction (Stockley and Holloway, 2002).

The experience of a music festival is mostly intangible and complex in nature, and the audience finds it complicated to express their expectations and so, producers encounter difficulties in satisfying consumers’ needs as well as exceeding their expectations (Bourdeau,

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De Coster, and Paradis, 2001). Expectations are described as the way in which customers would desire a certain product to perform, an ideal vision of what the best experience of using a product or service should look like, or which characteristics they should meet (Zeithaml and Parasuraman, 1993). First, the expectations are formed based on different significant features and traits relevant to the category in question, this one playing the role of a cognitive tool. Secondly, expectations are relevant when customers are making post-purchase product’ performance evaluations, serving as a reference system when assessing the overall satisfaction level (Halstead, Hartman and Schmidt, 1994). Moreover, the expectations consumers hold influence their satisfaction level directly and indirectly through disconfirmation, satisfaction being the outcome of a comparison process (Youjae Yi, 1993). That being said, customers will evaluate their level of satisfaction towards a product or a service in relation to their expectations on how that product is going to perform or what needs it is going to fulfil.

Satisfaction within the sphere of cultural consumption arises mostly from the emotional experience, and levels of satisfaction can only be determined after the overall hedonistic experience is at its end. The expectancy theory reveals the fact that satisfaction level can be assessed by analysing the correlation between customer's expectation regarding a certain product or service and the actual product performance evaluation. It has been proven that in cases when product or service performance meets customer's expectations this will result in a gratitude feeling for the customer, whereas a disconfirmation of the client expectation will lead to dissatisfaction (Swan and Combs, 1976). Still, there is much to find out about the role that expectations play before the consumption process.

Categories may guide customers in making sense of their expectations as well as in evaluating a product performance and coming to a decision regarding the final consumption choice. In the same time, clear and well-developed expectations guide consumers in their purchasing decision and choice (Hannan, et al., 2007). Their consumption intensions might

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depend on the benefits or quality they expect to get and the overall judgements of the audience might rely on the perceptions they hold, prior to consumption.

However, for the expectations to arise, a certain degree of familiarity is needed and here is where categories interfere, playing the role of informative labels. Many researchers in the field indicate the fact that the informational content of category labels might ease customers’ job in identifying their preferences within an assortment as well as evidencing clear differences between options (Alba et al. 1991; Bettman 1979; Chakravarti and Janiszewski 2003; Huber and Kline 1991; Mogilner, Rudnick and Iyengar, 2008). In definition, category membership instructs a mutual understanding between the production and consumption side by clarifying the expectations for both sides.

As a conclusion, both consumption considerations as well as satisfaction judgments rely often on category expectations. Satisfaction judgments distinguish between tangible and intangible products or utilitarian vs. hedonic goods, the last one being much harder to measure (Churchill and Surprenant, 1982; Parasuraman, Zeithaml, and Berry, 1985). In hedonic consumption and particularly in the case of music festivals, consumer choices are made based on their preference and taste for particular music categories which determine the worth and quality of the aural product. In some cases, there is no objective way of judging a product performance. Therefore, consumers might subjectively judge it according to their prior expectations. Self-Perception Theory emphasizes the fact that in cases where consumers are confronted with vague information they tend to rely mainly on internal cues, like for instance, prior expectations (Youjae Yi, 1993). However, music festivals cannot be easily categorized or classified based on the role it plays. As DiMaggio (1987) mentioned concerning the music industry, genres represent taste at the social level. When speaking of aural goods, fitting into a well-established genre increases legitimacy and helps the audience distinguish between various genre' characteristics, features, and functions, therefore helping to define taste.

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Moreover, as stated by Barsalou (1992), consumers show an interesting pattern in the sense that they are naturally and involuntarily grouping different objects into categories. Based on these classifications they become able to distinguish product characteristics from one another and thus, they can more easily make choices in their interest. While searching for available information or relying on past experiences, consumers might encounter facts that contradict their current notions or ideas about the certain product. Thereby, it may lead to overloaded confusion which may affect their behavioural intentions. This discrepancy can occur to the extent to which producers and consumers may make their judgements using different comparative criteria and various information structures (Giesler, 2008). As producers and consumers come with different knowledge backgrounds and act in totally different spheres, they are prone to perceive differentiation and substitutability of products in a different way (Steinman et al., 2000). Another significant factor regarding product categories that has an impact on the clarity of information exchanged between producer and consumer is the lack of compatibility or similarity between their demands as well as producers’ capability to stick to predetermined category schemas. (Kuijken et al., 2016; Hsu and Hannan, 2005; Zuckerman, 2004). Prior research shows that gaps in the classification system between the production and market side are more likely to occur in industries where products differ a lot from one edition to another or producers choose to be members of multiple categories, like in the case of music festivals. There is consensus between these previous research outcomes which emphasize that difference in classification of the same product by both producers and consumers may have negative consequences on market performance. This issue occurs mainly because of the producers’ inability to efficiently activate consumers in considering their offer in the first place (Kuijken et al., 2016; Zuckerman et al., 2013). Finally, there have been study papers which analyse the effects of category spanning on consumer' evaluations and performance. It has been proven that category spanners face the risk of being ignored and penalized as these practices

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might confuse the audience, whereas other researchers in the field disagree with these findings and found positive effects on performance (Paolella and Durand, 2016; Hannan and Freeman, 1989).

However, little is known about the mediating effect of audiences’ expectations in the relationship between category spanning and audience attention, like consumers’ willingness to visit or the audience appeal measured by their willingness to pay. It is important to notice that the previous research on this topic was dedicated to the post-consumption setting while this current research will focus on ante-consumption of the creative good, in this case a music festival.

The above leads to the following research question: What is the role of audiences’ expectations in the relationship between multiple category offerings and audience consumption choices in the context of a music festival?

The empirical setting of this study is the music industry, more specifically a music festival experience. Experiential products compared to the tangible ones cannot be returned to the store if it proves to be a failure or disappointment, a fact that urges the consumer to analyse twice the cost benefit in the final choice stage (Kuijken et al., 2016). That is the reason why products with a more experiential value are prone to face consumer reluctance in the case that category ambiguity occurs (Noseworthy and Trudel, 2011). Like in the case of music festivals, producers might encounter the challenge of classifying each festival into one specific genre as every genre is related to a certain type of spectators and their individual taste. Whenever producers engage in multiple category membership, novel and unforeseen knowledge and information may result in distrust from the consumer perspective as they perceive producer messaging as confusing (Sirdeshmukh et al., 2002). Hence, this might lead not only to a negative product evaluation but it might also affect consumers’ visit and purchase intent.

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Firstly, the purpose of the research paper is to contribute to the general approach on the theories of categorization and category spanning of creative goods and its effect on audience expectations and further on consumers’ attention and appeal. By studying at the same time categorical spanning, audience expectations and their willingness to visit and to pay for attending a music festival, this paper illustrates the mediation effect of the expectations of the category spanning and consumption choice relationship. Moreover, in this study, I investigated the moderating effect of genre similarity on the relation between producers' strategy of combining different categories within the same music festival edition and the clarity of expectations. Particularly on the level of ante-consumption of creative goods, the thesis offers a fresh viewpoint and opens new perspectives for future research. All this being said, the outline of this paper is as following: first, the relevant literature on categorization and classification spanning as well as the theory on music festivals is revised. Based on the literature, a total of four hypotheses are formulated. Then, the empirical setting is depicted together with the data collection and assessment.

In the results section, outcomes are exhibited. A detailed analysis will be assessed in the discussion section.

2. Theoretical Framework

The literature review begins with the relevant theories on categorization with the centre of attention on the meaning of genre classifications in the context of a music festival and what issues producers may come across when classifying their products. Afterward, the concept of category spanning is introduced and assessed with respect to its effects on consumers’ expectations and further on its effects on consumption choice measured in terms of attention and appeal towards a certain market offering. The literature review concludes with exhaustive

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theories on genres and music festivals relevant to the empirical setting of the research paper. Moreover, the hypotheses are established in this chapter.

2.1 Categorization

In the last decade, research on consumer behaviour and responses to different market offerings has experienced an upward trend as organizations encounter difficulties in gaining the attention of the relevant public as well as obstacles in becoming part of a well-established and commonly recognized and accepted market niche (Hannan et al., 2007). The extent to which the audience is positively reacting to new products and services and making purchasing decisions depends on their cognitive limitations, the available information and prior knowledge or the pre-existing logic across markets. Here is where the role of categories and classification systems intervene in helping the consumers reach a consensus concerning market offerings.

Definition – Categorization in a broad sense is defined as the audience ability to rank and relate

to different objects, events and experiences based on certain common features that help in differentiating offerings one from another. Hannan et al. (2007) and Negro et al. (2010), describe categorization as a collective, social agreement that the general audience is using as a label, settled and attached to the different assortment of products. An appropriate classification, as well as category memberships, act as mechanisms that ensure harmony between the market players and stimulate the consumers to develop prior expectations concerning organizations' offerings.

Reflecting on definitions provided by different researchers in the field it comes out that a proper market structure requires that actors use a valid system of reference and criteria for mutual understanding and common sense. For this purpose, categories play the role of a socio-cognitive classification tool applied by different market players (Hsu and Hannan, 2005; Durand and Paolella, 2013; Zuckerman and Kim, 2003). Fitting into a category helps producers

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to gain legitimacy. Therefore, those who lack an explicit and identifiable category fit will create confusion as well as destructive behaviour and contradicting emotions among the audience. Moreover, category ambiguity will lead to negative feedback and producers risk being ignored, whereas a clear categorization serves customers in processing market information by efficiently handling the variety of options (Paolella and Durand, 2016; Chakravarti and Janiszewski 2003; Diehl, Kornish, and Lynch 2003).

Moreover, different scholars demonstrate that classifications involve hierarchical rankings, whereby some categories might be perceived as more important and prestigious than others. These rankings can, for instance, be used to define certain social hierarchies and set boundaries to differentiate between these groups (Hitters and Van de Kamp, 2010). Besides, audience expectations, as well as those of producers, may reach an equilibrium point if there is a fit between the categorical membership of the products (Granqvist, Grodal, and Woolley, 2013). In this sense, categories serve as an information pool for bilateral understanding among market actors, gathering organizations which show similar features and leaving apart those who don’t (Hsu and Hannan, 2005; Rosa, Porac, Runser-Spanjol and Saxon, 1999; Durand and Paolella, 2013; Rosch and Mervis, 1975). Moreover, categories serve as regulating structures or prototypes with well-defined boundaries which impose certain limits to organizations (Hannan et al., 2007). Zuckerman (1999), emphasizes the fact that categories’ role is to mitigate the differences between members of the same category and at the same time to maximize similarities between different category members. The purpose, as previously mentioned, is to avoid categorization issues by loudly clarifying its limits and boundaries. Clear boundaries between categories play a substantial role in foreseeing future misunderstandings between producers and consumers as well as in easing market interaction (Hannan et al., 2007; Zuckerman, 1999). However, these boundaries are not easy to determine (Vergne and Wry, 2014). Category boundaries refer to the extent to which an offering fulfils all the category

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conditions and characteristics to be considered part of that particular category and to successfully fit within category boundaries.

Main issues - In classifications, the term ‘category' is a socially constructed organizing

principle which matters for producers and consumers alike. However, sometimes producers fail to position themselves clearly enough in the eyes of the customers and their offerings might end up being misinterpreted. What producers have in mind when speaking of a ‘category’ may be different from what consumers have in mind. There are cases where different interpretations of the same offerings occur (Hsu et al., 2009). The research study of Kuijken (2013) about how producers versus consumers perceive and evaluate the same offerings differently, concluded that category memberships of a product are very important as it may trigger negative consequences and outcomes. The paper exemplifies the case when producers fit their products within a certain category while the audience may look on it with completely different eyes as they may hold totally contrasting information structures and backgrounds. To avoid the situation, both producers and consumers should reach a collective agreement which makes things less complex and easy to understand for both parties alike.

Besides that, producers that are not complying with pre-established category templates and choose to span existing categories in order to diversify their products and services are at risk of misleading consumer perceptions about the offering’s overall fit within the classification scheme (Zuckerman, 1999; Zuckerman et al., 2003). By classifying and grouping offerings into categories, organizations can improve consumers’ level of understanding and their ability to process and respond in a timely manner to a large amount of information and become able to make sense of the social world (DiMaggio, 1997).

Past research in the field illustrates the fact that consumers are more attracted to producers that explicitly establish their focus and rather favour those products that clearly fit

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into one main category (Hsu, 2006; Hsu, Koçak, & Hannan, 2009). In addition, producers that employ themselves in addressing more than one category did much more badly in the sale process as they lack appropriate denomination for their products or the proper elements meant to describe product or service functions (Hsu et al., 2009). Hannan & Freeman (1989) assume that there is a trade-off between companies' niche width and their potential for performance. Therefore, producers always face the complex issue of deciding whether to focus on a generalist versus specialist position.

Categorization and Music Festivals

Categorization research has been done in various contexts and industries from the movie industry (Hsu, 2006), music industry (Kuijken et al., 2016), gaming industry (Poels et al., 2012) to the food industry (Rao et al., 2005; Tuorila et al., 1998), wine industry (Negro et al., 2010) or even the corporate law market (Paolella and Durand, 2016), stock market (Zukerman, 1999), product market (Rosa et al., 1999), and so on. Categorization is detrimental for both understanding and analysing consumer knowledge and information processing structures. Most of the time, consumers’ perceptions are developed based on associations with certain category prototypes and so, according to this, they interpret and react to different market offerings. On the one hand, categories usually allow individuals to foretell even before the actual consumption which are the benefits that the category has to offer as well as its attributes and the expected performance. On the other hand, if category knowledge is very low, this will slow down consumers’ judgement and their evaluation ability (Sujan, 1985). For experiential products, evaluating an offering is not that easy to perform and consumption choices are less rational compared to utilitarian products. In the current study, the empirical setting is the music festival industry and categorization is performed according to musical genres. Within the music industry, musical genres play the role of sense-making constructions (Kuijken et. al., 2013). In a music festival setting, genre classifications trigger the audience affective reactions as well as

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their consumption decisions, serving as a cue concerning the outcome of the creative event. Moreover, similar to other industries, in the case of cultural consumption, the audience possesses well-defined taste and preferences, and therefore categorization represents a basic framework for information structuring and assimilation. Music festivals in general target a very specific audience as the public usually prefers a particular music genre which fits their individual taste and holds clear genre-based expectations (Leenders et al., 2010 and Hsu, 2006).

Consumers perceive festivals as a reason to celebrate, music being the core of the overall experience and the common cause that brings the audience together (Paleo and Wijnberg, 2006). According to the authors, music festivals represent a special segment of cultural goods where consumption takes place in a definite period of time, which makes its economic value unique and difficult to predict or to asses. Producers use generic classifications in order to give significance to the performing act and denote its characteristics and worth (Hannan et al., 2007; Negro et al. 2010). Here is where categories arise to feed participants with relevant cues and information that help them reach consensus and form expectations (Durand and Paolella, 2013). In this way, the audience will become able to anticipate the quality of the event and the performance, the overall experience or the circumstances in which the festival is going to take place. Categories are believed to be triggers of consumers’ actions (Sujan, 1985). All the category attributes and knowledge contribute to the audience excitement and to their willingness to participate in a music festival. Compared to other industries, in the context of the music industry, category labels signal taste and appreciation by highlighting the similarities and dissimilarities between various musical genres and the related audience (Kuijken, 2013). In the case of live performances, the audience perceive the aural experience based on categorical features, however it is unlikely that the overall performance will be compatible with each individual preference. Some festivals try to appeal to a broader public by including various category labels, whereas others totally dedicate to a single category. In any

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case, a broad-genre music event cannot be appraised and likely judged by the same audience as their taste might vary a lot as well. Every audience member joins the event for a specific musical category or the line-up and cannot be equally delighted by each of the artistic representations.

Moreover, music festival visitors state that besides music, one of the principal reasons for attending such events is the opportunity to connect with the other participants who share the same values and culture as they do (Packer and Ballantyne, 2011). However, in the situation where producers span multiple musical genres within the same music festival edition, the targeted audience and their taste may be less homogeneous than the case when a music festival is exclusively dedicated to one main musical genre and thus, a public with more of a similar collective taste. Therefore, the expected experience quality might be affected through the socialization dimension, mainly the visitors’ opportunity to be around, meet and talk with people who share the same cultural taste and level of involvement or belong to the same social structure. Besides, DiMaggio (1987) mentioned in his paper about classification of art and the social significance of taste: “people use culture to make connections with one another”. This accentuates the fact that artworks represent a good occasion for social interaction and group affiliation. Distinctions between different genres are specially created and ritualized with the purpose of signalling taste and defining activities of social groups. As a conclusion, classification systems within the sphere of cultural industries is significantly contributing at societal level by structuring social relations and the related artistic taste and consumption patterns. The categorization of music festivals into genres allow both producers and the audience form a collective understanding of different kinds of musical events and facilitate the act of making assumptions prior to the event regarding both performance and experience.

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2.2 Category Spanning

Definition – A significant part of the relevant theory on categorization is dedicated to

the category spanning issue, as category memberships are known to play the role of valuable cognitive criterion for consumers and producers alike. Previous research studies define category spanning as an organization’s simultaneous involvement in more than one category or several types of activities at the same time with the purpose of introducing valuable offerings and targeting a broader audience (Paolella & Durand, 2016; Hsu, 2006). Moreover, this practice allows producers to combine different characteristics of already established categories in a completely novel and innovative way (Hannan and Freeman, 1989).

In this current research, we refer to category mixing in a music festival setting. This method serves producers to successfully put together various acknowledged genres in ways that diverge from standard offerings. However, opinions concerning category spanning practice are divided. While some researchers in the field consider that category spanning practices have positive effects on the overall performance, as category spanners are believed to fit better with complex demands and to deal much more easily with sophisticated consumers' requirements, others suggest that category spanning might be harmful to the organizations as it might confuse the audience. So, consumers become sceptical, and they start avoiding producers assigned to multiple categories as they cannot immediately grasp offerings that are not clearly matching a single main role (Paolella & Durand, 2016; Negro, Hannan & Rao, 2010). For instance, some music festivals display a wider assortment of music genres like pop and rock in the same edition to attract a larger group of attendees, whereas others tailor their offerings based on the distinct taste of an audience that is visiting for a particular music genre. All these actions might have a negative influence on audience reactions as well as it might cause severe consequences on performance.

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Effects on audience’ clarity of expectations

Previous research studies refer to expectations as the believed or desired standards of an individual product or service quality, characteristics and performance (Zeithaml et al., 1993; Oliver, 1980). The importance of service expectations was recognized and appraised by several academics. On the one hand, expectations are prediction standards, like for example the forecasted value to be achieved through the use of a certain service; and on the other hand, expectations are ideal standards, which stand for the best situation or outcome in the eyes of the consumer or the circumstances in which he will feel the most satisfied (Miller, 1997; Swan and Trawick, 1980). Expectations have been conceptualized in a series of different approaches within the consumer satisfaction literature. For example, for measuring the effect of consumers’ expectations on post purchasing-outcomes, disconfirmation paradigm becomes the dominant setting in assessing satisfaction process. However, this study tries to investigate the relevance of expectations for an ante-consumption setting and, consequently the role that clarity of expectations plays on the audience consumption choices and decisions. Whenever audience members come across offerings that integrate and combine features from various other categories, they may get confused and may find it difficult to interpret certain producers on the market. Acknowledged categories usually help consumers understand producers’ offerings and form expectations. Therefore, these offerings must be in concordance with consumers’ expectations, otherwise, producers might be at risk of losing fundamental resources for organizational survival (DiMaggio and Powell, 1983). Through their offerings, producers make sense of the opportunities and impediments encountered in the market that they are trying to target (Porac et al., 1995). Especially when discussing experiential goods, meeting customer expectations become more of a complex issue, as these involve not only human interaction but also a high degree of engagement from both production and consumption sides. Moreover, in the case of cultural consumption, expectations are formed based on a clear cognitive framework

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structured by various categorical information. Subsequently, audience consensus with market offerings consist of their ability to clearly comprehend its signals, and this fluctuates per niche width (Hsu, 2006).

Organizations make use of category membership to structure their offerings better, gain legitimacy and to efficiently conduct the production efforts in a way that helps them differentiate from the competition (DiMaggio and Powell, 1983; Kennedy, 2008). In this context, some producers choose to completely stick to the traditional structures and position themselves based on a pre-existing market pattern, whereas others are seeking novelty and compete for the audience attention by combining a variety of offerings (Baum and Haveman, 1997). However, the last ones are prone to receive negative social and economic feedback as their mixed offerings are harder to interpret by the audience compared to those who are making pure-category offers (Hsu and Hannan, 2005). In the case of cultural offerings and more specifically in the case of music festivals, categorical relevance is built upon genres which are playing the role of sense-making factors. A clear positioning of existing offerings helps producers to attract a broader audience by adjusting to a socially constructed order (White, 1981). However, there are cases when producers can label their song as pop, whereas the public will interpret it as rock style. Therefore, a fuzzy positioning might confuse the consumer, and the final product or service might be less appealing to them (Kuijken et al., 2013). According to Ordanini and Parasuraman, (2011), consumers usually tend to appreciate more the products that meet their current expectations and satisfy their existent needs, finding it problematic to imagine future consequences related to the immediate situation. For example, audiences would rather visit and pay for a festival with clear musical genre-based expectations, where additional novelty elements affect these expectations in a positive way.

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In the Netherlands, the music festival market is saturated due to the fierce competition that intensified in the last decade (Leenders et al., 2005). More than that, music festivals editions differ considerably from one edition to another as the music industry is a very dynamic environment and so changes the audience' taste (Faulkner and Anderson, 1987). In this case, category-membership schemes start to notably diversify regarding the information that is being communicated. This is the reason why, in some situations, producers that choose to stick with the initial layout, enjoy a lot of benefits (Zuckerman, 2004; Hannan and Freeman, 1989). Many researchers in the field, emphasized the fact that whenever a market purpose is clearly and transparently defined, it automatically stimulates the audience' perceptions and level of understanding by helping them to develop well-defined expectations. Like many other creative industries, in the music industry, audience taste for different music genre such as jazz, reggae, classical music, rock, etc., represent different segments of the market that should be treated accordingly to its customized needs and preferences (Hsu, 2006). In contrast, spanners encounter reluctance from the consumer side as their offering doesn't fit with consumers' expectations (Carroll et al., 2005; Zuckerman et al., 2003; Hsu and Hannan, 2005).

Furthermore, when categories are not clearly stated and established, producers not only lack legitimacy, but all their production efforts and organizing activities are tangled and difficult to make sense of (Clemens and Cook, 1999). Most of the time, consumer expectations are formed based on previous experiences and knowledge about certain products and services, the expectations even being able to influence consumers’ reactions to certain offerings (Cardello, 1994). Therefore, when category memberships are less intelligible and the information conveyed is fuzzier, market signals are becoming difficult to interpret by the audience, and the clarity of their expectations is affected. During the stage of gathering and ruminating available information concerning the product and service they want to buy, consumers might come across information that doesn't meet their expectations. Apart from this,

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the audience might feel overloaded with ambiguous information which might be difficult to process (Wang and Shukla, 2013). In the case of a music festival, when producers are more likely to span category boundaries, we assume that this practice will influence the clarity of consumers' expectations and therefore, the greater the variety of associated categories the less clear the expectations of the public will be.

Hypothesis 1. Category spanning negatively affects the clarity of audience’ expectations in the context of a music festival

Generally speaking, producers who combine categories in manners that are not consistent with previously established norms, risk confusing the audience (Hsu & Hannan, 2005; Hannan et al., 2007). This means that potential customers of creative goods are not able to make sense of the cultural offerings of which categorical membership is not well-enough defined to be able to form clear expectations. Musical genre heavily affects consumer expectations as it represents one of the main reasons audience may consider visiting a specific music festival. Before coming to the decision of whether to purchase or not a product or service, consumers go first through the collection and interpretation phase of existing information (Alba and Hutchinson, 1987). Before consumption, rising expectations regarding producers' offerings support and stimulate market exchange. By referring to the empirical setting of this research, we can assume that festivals that span categories and address its offerings to a larger population, fail to gain the publics’ favour by mismatching with their personal taste and identity.

Furthermore, researchers expand on categorical spanning issue and measure the impact of it reflected by the degree of similarity or contrast among the category offerings. This research study tries to support the idea that the effects of category spanning on consumers’ clarity of expectations depends on the level of similarity between categories/genres within the same offering, in this case, a music festival edition. Besides the fact that consumers are very hard to

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convince regarding the generalists’ abilities to meet their needs, these feelings might be moderated by the categorical similarity of the offerings. Producers that span categories are characterized by atypicality for each category spanned, they show inconsistency, and thus, fail to convince the audience about their expertise as they become unsuccessful in establishing a clear positioning and role. This risk becomes even more significant when categories spanned are totally opposite and exhibit various heterogeneous characteristics (Hannan et al., 2007). In these situations, producers may encounter lack of consideration from the market side since consumers cannot count on fixed category diagrams to be able to make sense of the offerings. This being said, the degree to which genre similarity moderates the relationship between category spanning and audience' expectations by helping them in overcoming cognitive disorders and easily make sense of producers' offerings is worth taking into consideration.

In general, producers dedicated to multiple categories enjoy less positive overall reactions from the consumers and so, fewer chances to succeed and to survive the competition. Kovács and Hannan (2010) argue that the effect of category spanning on audience’ attention and their level of understanding depends somehow on the contrast between the spanned categories. They emphasize the fact that consumers get less confused in the case when spanning categories are less contrasting, and so the economic and social consequences related to it are less harsh. It is believed that weaker boundaries of spanned categories reduce the intensity of punishments (Rao et al., 2005). Then again, in the case of higher contrast between the categories spanned, the consumers will encounter obstacles interpreting producers' signals as well as in determining their expectations. Moreover, due to the confusion that category spanners create among the targeted audience, this starts doubting the producer's ability to meet their needs and expectations and therefore avoid involving in transactions with them. Consumers start questioning producer's skills and expertise as it is believed that each category requires for specific competencies. In addition, Leung and Sharkey (2009) stated that producers

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who use multiple categories at the same time might score lower on the know-how in each category and could end up being underestimated by the audience. Whether mixing categories creates a disaccord between the production and the market side depends very much on the similarity vs. contrast of category members. We assume that contrasting category offerings are more likely to create confusion among the audience members and lead to more issues than mixing similar ones, so we predict the following:

Hypothesis 2. The negative effect of category spanning on the clarity of audience expectations is moderated by genre similarity. The effect is stronger when there is a low

similarity between the genres spanned rather than a high similarity.

As has been mentioned before, category spanners are being automatically perceived or judged as less competent as they exhibit a lower commitment to each of the categories spanned and therefore, fail to convince the audiences about their skills (Phillips and Zuckerman, 2001).

Categorization and consumption choices - Even though consumers generally opt for

focused producers instead of going for category spanners, organizations still adopt the strategy of combining categories either to improve their business portfolio or to show some degree of innovativeness. However, this practice might create an imbalance between audience expectations and their fit with equivalent producers, as category systems change over time or new categories arise (Granqvist, Grodal, & Woolley, 2013). In the case of hedonic consumption, consumer taste and demand have become more and more complex in the last few years, so category spanners are striving to meet those market needs with the risk of receiving negative evaluations. Every music festival addresses a particular type of audience by focussing on a particular musical genre or even combining different music categories to attract a broader audience and more visitors (Shuker, 2001). By doing so, combining multiple forms of

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entertainment, even if they will benefit from attracting larger audiences, they indirectly expose themselves to a mismatching of consumers' preferences, and so might end up being ignored.

Further on, classification might have considerable implications for customer satisfaction. For instance, Hsu (2006) demonstrates that being a ‘generalist' and targeting a wider audience might lead to a larger consumer appeal but lower satisfaction in an audience, compared to being a specialist and targeting a narrower audience. Targeting a wider audience could be understood as classifying your product more broadly while targeting a narrow audience could be understood as classifying your product more precisely. Thus, Hsu's (2006) findings demonstrate that classification can have implications for both the competition and the overall performance of the organization. According to Paleo and Weinberg, (2006) in the case of music festivals, organizational activity and interaction take place involving both production and consumption side. Like any other organization, producers and organizers of music festivals fight to achieve economic value and competitive advantage, a fact that is mainly determined by the preferences and choices of the consumers. When deciding whether to purchase certain products or services, consumers hold several expectations based on both category memberships or prior experiences. Consequently, these expectations play a determinant role when the audience expresses their consumption choices and decision. Since this current research paper is conducted in an ante-consumption setting, its main focus is on whether category spanning affects audience attention and appeal through clarity of expectations. The primary concern of producers starts from whether to maintain the original genre boundaries which meet customers' expectations by providing valuable associations and clear perceptions about the upcoming music event or attempting to obtain a bigger attendance and make themselves visible to a larger public by adopting a category spanning strategy. Some festivals target larger groups by offering a greater variety of music categories at once, which increases the attractiveness as well as the number of participants. Some researchers emphasised that category spanning practice has a

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positive influence on consumer’s attention (Hannan, 2010). Yet, these festivals targeting a broader audience are neglecting those customers with a particular taste that will prefer niche festivals (Hannan and Freeman, 1989).

Additionally, consumers encounter difficulties in interpreting multiple category offerings and genre-spanning will result in audience confusion as well as distorted interpretation and expectations. As category memberships shape expectations, it is assumed that spanning genres will challenge audience level of understanding and the accuracy of their interpretations (Durand and Paolella, 2013). Hence, in the case of spanning multiple genres in the same music festival edition, the level of attraction and the willingness of the consumer to attend the creative event will be negatively affected (Zukerman, 1999). Moreover, producer’s potential to exclusively dedicate to each category ‘s audience is diminished in the case of a generalist position, so consumers appeal is declining considerably. In conformity with previous research studies, consumers favour offerings that are easy to make sense of, or easy to handle with and keep away from the ones they cannot clearly evaluate (Hsu, 2006). Thus, as consumers make use of cognitive information when making the final consumption decisions, we predict that the negative effect of category spanning on the consumers’ attention or consumers appeal for a product or service is mediated by the incapacity of the audience members of shaping clear expectations and hypothesize as following:

Hypothesis 3a. Clarity of audience expectations mediates the relationship between category spanning and the audience attention.

Hypothesis 3b. Clarity of audience expectations mediates the relationship between category spanning and the audience appeal.

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The conceptual model outlined below is based on and supported by various theoretical backgrounds and tries to explain the issues and the relations to be investigated in the current research. The general idea behind it is to study consumers attitudes towards music festivals with simultaneous membership in two or more musical genres. Specifically, the current research claims that category spanning has a negative effect on both audience attention and appeal. Hence, the paper wants to argue that category spanning not only negatively affects consumers’ attention (i.e. willingness to visit) or their appeal (i.e. willingness to pay) for the offering, but also influences to some degree the preliminary phase, before actual consumption, when they are able to form expectations regarding the upcoming event (clarity of audience expectations). Consequently, we may assume that offerings that are vaguely assigned to different categories can create confusion among the targeted audience and so, expectations associated with those categories suffer. As previously discussed by Hsu (2006), producers or offerings that span categories find various difficulties in establishing their market position, and are less able to communicate their identity, a fact that slows the audience ability to form clear perceptions and achieve consensus. Thus, we forecast that classification spanning results in less consensus, thus less clear audience expectations which causes a negative effect on audience attention and appeal. Another fact that is being tested is the moderating effect of similarity between spanned genres, namely whether the genre similarity strengthens the relationship between the variables in the model. As category judgments are assessed based on similarity patterns or even more explicitly, the similarity may affect consumers’ reasoning processes, we believe it is worth including and test this key moderator. Similar characteristics between categories help the consumers to compare and evaluate musical offerings more efficiently. The higher the similarity between categories spanned, the clearer the audience expectations will become. Further on, the conceptual model is presented and all four hypotheses are summarized.

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Hypothesizes:

Hypothesis 1. Category spanning negatively affects the clarity of audience’ expectations in the context of a music festival.

Hypothesis 2. The negative effect of category spanning on the clarity of audience expectations is moderated by genre similarity. The effect is stronger when there is a low

similarity between the genres spanned rather than a high similarity.

Hypothesis 3a. Clarity of audience expectations mediates the relationship between category spanning and the audience attention.

Hypothesis 3b. Clarity of audience expectations mediates the relationship between category spanning and the audience appeal.

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3. Methodology

The main focus of this section is the empirical setting of the research study which is comprised of four main parts: the research setting, data collection, the operationalization of variables and lastly, the method.

3.1 Research setting

The empirical setting of this research is the Dutch Music Festival industry. Music Festivals in The Netherlands are well-known and appreciated worldwide for their remarkably wide variety of music styles. Even though live performances are still considered one of the primary sources of income in the industry, a couple of festivals started experiencing hard times in retaining the audience or attracting new visitors like in the case of Pinkpop and Lowlands where the festival organizers were stuck with thousands of unsold tickets (Maatjens, 2003). Similar to other experiential products, these problems might arise because most of the time consumers make choices based on the experience they expect to get and the type of music or genre they expect the producer to play (Bowen and Daniels, 2005). Consumers usually are not positively evaluating those music festivals that are extending to a wide variety of music genres and favour the ones that are targeting their specific music taste. Hence, issues on categorization and category spanning in the music industry are often assessed based on genre’ membership, this playing the role of generating consumer interest before the release of the musical event.

A quantitative study is being conducted to test the four hypotheses raised in this study. By observing the music festival industry in the Netherlands, this research investigates the effect of multiple category offerings on customer clarity of expectations and further on audience attention and audience appeal. Bettman et al. (1998) emphasized the fact that consumers always choose the short and easy way in their decision-making process, so they might perceive unforeseen or unclear information as the barrier that slows their purchasing choice. This means

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that fuzzy communication and understanding concerning producers’ offerings might lead to a lower quality evaluation and will decrease consumer attraction towards the event and their willingness to attend or pay for visiting. According to the conceptual model and the hypotheses, the independent variable is genre-spanning, which has an impact on the mediating variable, mainly the clarity of consumer expectations, on whose interaction the moderation effect of genre similarity is tested. Besides, the dependent variables are the following: audience attention measured by their willingness to visit, and audience appeal measured by their willingness to pay for the upcoming event. Furthermore, to test the four hypotheses, a questionnaire is conducted. A questionnaire is a research instrument for data collection where all the respondents are answering the same set of questions in a systematized order (Saunders and Lewis, 2012). However, because of poorly designed surveys, the number of consumers willing to participate in a survey study has experienced a descendant trend in the last couple of years. For this reason, it is very important for the researchers to avoid asking useless questions and design enjoyable and motivating questions (Bradburn et al., 2004).

To be able to measure the variables in the conceptual framework and assess the general conclusions of the study, I chose to distribute the questionnaire and gather the data via the Web. By conducting an online questionnaire, participant’s viewpoints on multiple-genre music festivals within the Dutch market is well conveyed. Moreover, the main mean of gathering the information is by sending out an objectively designed questionnaire. Collecting primary data through the medium of a questionnaire has many fundamental advantages such as simplicity, versatility and low cost as well as the fact that the collected responses are standardized (Cooper and Schindler, 2003).

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3.2 Data Collection

In the current research study, the primary data will be gathered by employing an online survey. To be able to come up with the right questions, various research papers examining issues on categorization, audience expectations and consumption decision were reviewed and adapted to the current context, specifically, a music festival experience. The designed questionnaire, which can be found in Appendix 1, incorporates four parts. In part one, the respondents are asked to profile themselves by answering their age and gender, education background and living area. Part two establishes the profile of the respondent as a music festival attendee: how often a respondent visits a music festival, to name some music festivals genres he/she prefers visiting the most, and a primary reason for visiting a music festival. Moreover, in part three, we try to assess the importance of genre when attending a music festival by asking the respondent to evaluate it on a seven-step scale. Further on, we asked if he/she prefers music festivals with broader genres over those with specific genres or how many genres they prefer listening to at a music festival. Finally, part four consists of questions measuring the expectations that consumers hold for multiple genres festivals experience, their willingness to attend such festivals and their willingness to pay for visiting.

All the survey respondents are randomly selected from the online survey, and a total of 160 questionnaires are gathered. The questionnaires which are incomplete are not considered valid. All the respondents are currently living in The Netherlands, and they visited a Dutch music festival at least once. More specifically, the sample consists of 59 males (36.9%) respondents and 101 females (63.1%) respondents. Regarding kurtosis, all the variables proved a normal univariate distribution (all values are acceptable as they are in the -2; +2 range). As far as the skewness is concerned all the variables have values near the acceptable value of 0 for a normal symmetric distribution. Please, see Table 1 and 2 below.

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Frequency Percent Valid Male 59 36.9 Female 101 63.1 Total 160 100.0 Table 1: Gender N Valid 160 Missing 0 Mean 5.0250 Std. Deviation 1.83245 Skewness .925 Std. Error of Skewness .192 Kurtosis .932 Std. Error of Kurtosis .381

Table 2: Mean, SD, Skewness and Kurtosis

Moreover, information concerning age, education and living area are exhibited in Table 3 and 4. As displayed hereunder, respondents age is in between 18 to 27 years old and older. Most of the respondents are in the third age category, between 24-26 years old (M= 2,92, SD= 1,05). Within this age interval are manly students or young working adults who represent the perfect target audience for events like music festivals. Afterwards, the level of education of the respondents ranges between HBO and WO, with the majority of respondents holding a HAVO degree (M= 2.86, SD= 1,72), therefore we can conclude that most of the respondents have a higher education background.

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N Minimum Maximum Mean

Std.

Deviation Skewness Kurtosis Statistic Statistic Statistic Statistic Statistic Statistic

Std. Error Statistic Std. Error Age of participant 160 1.00 4.00 2.9250 1.05538 -.499 .192 -1.034 .381 Gender of participant 160 1.00 2.00 1.6312 .48398 -.549 .192 -1.720 .381 Education level of participant 160 1.00 6.00 2.8625 1.72473 .580 .192 -.988 .381 Living area of participant 160 1.00 12.00 5.0250 1.83245 .925 .192 .932 .381 Valid N (listwise) 160

Table 3: Age, gender, education and living area statistics

Next, we can add that from a total of 160 respondents, most of the respondents are living in North Holland (64.4 %), followed by South Holland with 21.9 % and Utrecht 6.3 %. Fewest of the respondents (0.6%) reported to come from Drenthe, North Brabant and Limburg.

Frequency Percent Valid Groningen 4 2.5 Drenthe 1 .6 North Holland 103 64.4 Flevoland 2 1.3 South Holland 35 21.9 Utrecht 10 6.3 Gelderland 3 1.9 North Brabant 1 .6 Limburg 1 .6 Total 160 100.0

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3.3 Operationalization of Variables

The questionnaire tests all variables in the conceptual framework. We have one independent variable, one mediating variable, two dependent variables and a moderator. All these variables will be depicted below.

Independent variable – Category spanning

Category spanning practice in the context of a music festival refers to the extent to which the producer combines various genres and elements within one edition. By spanning categories, producers are believed to take into consideration a broader audience but still fail to fit their individual taste and preferences. In these cases, consumers encounter difficulties in interpreting producers’ identity. On the contrary, those producers who reach consensus among audience perceptions on fit, enjoy greater attention and appeal (Hsu, 2016). Following the same approach employed by previous studies (Kuijken, et al., 2016; Paolella and Durand, 2016), this variable is operationalized by calculating a festival category spanning for the both sources where the festival was listed. These labels were collected from www.partyflock.nl, www.mojo.nl, as well as by questioning the consumption side of the market, mainly the genres mentioned by consumers when filling in the questionnaire. Then, an average category spanning was computed by averaging the values obtained across both sources for each music festival.

Mediating variable – Consumer’ clarity of expectations

Consumers usually make purchase decisions based on their previously gathered information and clues about the products or services they have to pay for. Before making the actual investment, they put their thoughts all together to be able to form current expectations and decide whether the products or services are worth buying or not (Bettman, et al., 1998; Kuijken et al., 2016). However, customers hold different expectations for service performance compared to product performance. As the service sector has more of an experiential value and

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nature, knowing what customers expect when measuring the benefit of using a particular service is detrimental to the success and competitiveness of any business (Zeithaml and Bitner, 2003). Moreover, as opposed to consumers’ perceptions of goods quality, the assessment of service quality is considered to be more ambiguous and difficult to determine due to its intangibility and heterogeneity (Parasuraman, Zeithmal, and Berry, 1985). Past research emphasized that the less tangible the service is, the more complex its evaluation will become.

Like in many other creative industries, in the case of the music industry, particularly a music festival experience, some standardized features are being shared and shape audience expectations such as music, activities, and entertainment similarities as well as homogeneous rules which are unique to the genre (Hsu, 2006). In the case of a category spanning, producers include more than one genre in the line-up of a particular performance, a thing that might affect audience’ expectations in a negative way. According to Altman, (1999), through genres, producers target a particular segment of the market. Thus, the practice of mixing genres might create confusion among the targeted consumers, so they end up misinterpreting the offer. Moreover, as consumer taste also differs among various genres, the producer might find it difficult to make sense of audience’ needs, which makes this practice of spanning categories even riskier (Situmeang et al., 2016).

To better understand the influence that the inclusion of multiple genres within one music festival has on consumers’ expectations, I collected information regarding the corresponding genre for each music festival in our database indicated by the two different sources. As previously done by Hsu (2006), to measure the degree to which the audience can make sense of their expectations regarding the genre/s a music festival is comprising of, a pairwise similarity analysis across the two sources is effectuated. I investigated whether the music festivals were assigned the same genres by both the website and the consumer, or if the music festival encountered no consensus regarding its overall fit. I used Jaccard’s coefficient

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to measure the similarity between the classifications in each set of sources for the festivals mentioned by the audience in the questionnaires as well as the music labels used by music websites on www.partyflock.nl or www.mojo.nl. This measure reflects the proportion of binary classifications that match between two sources, excluding those classifications that are missing from both sources. The Jaccard coefficient takes the following form:

In this formula, a reflects the sum of similar classifications between the two pairs, b stands for the sum of cases in which there was a positive classification by the first and a negative classification by the second, and c reflects the cases in which the first has a negative and the second one a positive classification.As in the case of the current research, the music festivals taking part in the study were classified only according to two sources. Genre classification was done both by the participants in the survey study and the second ranking was taken from Partyflock.nl. Under the circumstances mentioned above, the level of audience consensus was measured by calculating the pairwise similarity between the two sources. For example, we calculated the similarity in genre classification for Pinkpop Festival. The respondent assigned Electronic and Rock genres, while on Partyflock the festival is regarded as Electronic, Rock, Funk, Hip-Hop, Pop. This results in a pairwise similarity between respondents’ classification and Partyflock which is equal with 2/5 and gives the measure of the audience clarity of expectations.

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Moderating Variable – Genre similarity

In this study, one moderating variable was used. This moderating variable is genre similarity. The moderator is operationalized by asking the respondents how similar or dissimilar (contrasting) they perceived the genres spanned in the music festival. They could answer from completely dissimilar to completely similar (7 scales; 1=completely dissimilar and 7=completely similar).

Dependent variables – Audience attention vs Audience appeal

The first and most relevant dependent variable is the audience attention. Attention in this case measures the consumer’s level of attraction towards category-spanning festivals. Respondents were asked if they would like to visit the next season’s festival. By using a Likert-type question, respondents were asked how likely they are to visit the next seasons of the festival. They could answer from very likely to very unlikely (4 scale; 1=very likely and 4=very unlikely). This dependent variable is important for explaining differences in audience' clarity of expectations.

The second dependent variable is the audience appeal. Appeal is measured by the audience perceived quality and their willingness to buy a certain product or service. Respondents were asked on a scale from 1 to 4 (1=very likely and 4=very unlikely) to give their willingness-to-pay for the tickets. Moreover, they have been asked how much they are willing to pay to attend it on average.

3.4 Proposed data analysis

All four formulated hypotheses are being covered by the survey. To be able to test the four hypotheses, a linear regression model is being conducted. This statistical method implies a mathematical equation which examines if the independent variable/s regarded as the predictor variable/s can be accountable for the changes in the dependent variable/s regarded as the