Professional Documents
Culture Documents
• Understanding service
– Distinctive characteristics, Framework of
analysis, Customer experience
• Strategic Issues
– STP, The loyalty effect, Managing Demand
• Tools ( Marketing Mix)
– Creation and delivery, Value addition
through supplements
What is Service
DISTINCTIVE CHARACTERISTICS
Distinctive Characteristics of Services
Intangibility
Inseparability
Heterogeneity
Perishability
Distinctive characteristics of services
• Intangibility
– To a large extent, abstract & intangible
• Heterogeneity
– Non standard and highly variable
• Inseparability
– Typically produced and consumed simultaneously,
with customer participation in the process
• Perishability
– Not possible to store in an inventory
Intangibility
• Cannot be touched, Ephemeral performances
• Cannot be produced or displayed ahead of time
• Reducing intangibility
– Through stress on professionalism
– Providing tangible cues (physical facilities,
appearance and demeanor of staff, stationary, logo)
– Building a strong corporate image
Heterogeneity
• Not exact replica of past experience
(Raises risk factor)
• Reducing variability risk
– by standardization, training to follow defined
procedure or automation (But protecting
against the attributes being right of the
services) or through service guarantees
(preferably unconditional – Not like Lufthansa
– on time arrival)
Inseparability
Promotion Price
Physical
Evidence
Place People
Process
Tangible Elements in Service Mktg.
• Personnel
– (sales representatives, staff)
• Facilities/Equipment
– (Building, Ambience)
• Non-personal Communication
– (Brochure, Advtg, Signals)
• Other people
– (Fellow customers, Word of mouth)
Service Mix
• Tangible goods with accompanying Service
– (Automobile, Computer)
• Hybrid
– (Restaurant)
• Major service with minor goods
– (Airlines)
• Pure Service
– (Lawyer, Dentist)
Framework of Analysis
Levels of Contact
• High Contact
– (Hospital, College Education, Star hotels)
• Medium Contact
– (Fast food, Laundry, Retail Banking)
• Low Contact
– (Insurance, Auto repair, Electronic
banking)
Customer’s Evaluation of Service
• Physical products evaluated by
search qualities
• Service products evaluated by
experience qualities
• Specialized service (like medicare)
evaluated by credence qualities
Importance of Service ‘Encounters’
• Creates Impression of service providence
• Combination of positive negative
interactions will leave customers feeling
– unsure of the service quality,
– doubtful of consistent service delivery and
– vulnerable to competitors’ appeal
Types of Service ‘Encounters’
• Remote Encounters
– Bank ATMs, Automated ticketing machines, Ordering retail
merchandises through internet
• Phone Encounters
– Conveyance of various promotional offers, Confirmation of
service delivery
• Face to face Encounters
– Direct interactions ( A theme park may have multiple direct
interactions i. e. ticket sellers, maintenance personnel, ride
personnel, character entertainers, food and beverage servers
etc.)
Service Encounter Sequence
• Service Encounters = ∑Transactions = ∑Tasks
• Poor quality in one task can taint the perception
of quality for the entire sequence
-- Service Encounter --
Recovery: Adaptability:
Employee Response Employee Response
to Service Delivery to Customer Needs
System Failure and Requests
Coping: Spontaneity:
Employee Response Unprompted and
to Problem Customers Unsolicited Employee
Actions and Attitudes
Recovery
• Satisfactory
– Hotel lost my room reservation voucher but the
Manager gave me the VIP suite at same price
• Dissatisfactory
– For weeks I did not receive my Mutual fund dividend
cheque. I personally went to their office. I was asked to
wait for half an hour when the staff was checking. Then,
came the excuse that it is in the mail.
Adaptability
• Satisfactory
– Went to a doctor without appointment with
aggravated sickness. Despite long queue,
attending staff seeing my condition apologized
to others to give me priority and took me to the
doctor within 15 minutes
• Dissatisfactory
– My young son was sent to Mumbai under the
escort of the airhostess who left him alone at the
destination airport
Spontaneity
• Satisfactory
– While serving food , the flight attendant noticed a
stain on my shirt collar and removed it without
damaging the texture
• Dissatisfactory
– The receptionist at a reputed business school kept
me waiting for over 10 minutes as he was having
lighter moments with his friend over phone
Coping
• Satisfactory
– An intoxicated passenger was shouting in the flight at the
in-flight crew. The chief flight supervisor politely told him
that on arrival at the destination, he would be arranged a
meeting with the Airways managing director as a VIP
frequent flier and write now he could write a complaint
which will be communicated to the MD’s office right then
by the pilot.
• Dissatisfactory
– In the same situation, the supervisor raised her voice and
got co-pilot to physically knock him on the seat threatening
of dire consequence
General Service Behaviours– Do’s
and Don’ts
• Recovery
– Do’s
• Acknowledge Problem
• Explain causes
• Apologize
• Compensate/ upgrade
• Lay out options
• Take responsibility
– Don’ts
• Ignore / blame customer
• Leave customer to fend for himself
• Downgrade
• Act as if nothing is wrong
• Pass on the buck
General Service Behaviours– Do’s
and Don’ts
• Adaptability
– Do’s
• Recognize seriousness of the need
• Acknowledge
• Anticipate
• Attempt to accommodate
• Adjust the system
• Explain rules/ policies
• Take responsibility
– Don’ts
• Ignore
• Promise but fail to follow through
• Show unwillingness to try
• Embarrass / Laugh at the customer
• Avoid responsibility
• Pass on the buck
General Service Behaviours– Do’s
and Don’ts
• Spontaneity
– Do’s
• Be alert to opportunity
• Take time
• Anticipate need
• Listen
• Provide information
• Show empathy
– Don’ts
• Exhibit impatience
• Get carried by routinized mentality
• Ignore
• Yell/ Laugh/ swear
• Discriminate
General Service Behaviours– Do’s
and Don’ts
• Coping
– Do’s
• Listen
• Try to accommodate
• Explain
• Opt for least controversial remedy
– Don’ts
• Take customer’s dissatisfaction personally
• Allow customer’s dissatisfaction affect others
• Lose cool
CUSTOMER EXPECTATIONS
OF SERVICES
Customer Expectations of
Service
Desired Service
Zone of
Tolerance
Adequate Service
Zones of Tolerance VARY for
Different Service
Dimensions
Desired Service
Level
of
Zone of Desired
Expectation Desired Service
Tolerance Service
Adequate Service
Zone
of
Tolerance
Adequate
Adequate Service
Service
Enduring Service
Intensifiers
Desired
Service
Personal Needs
Zone
of
Tolerance
Adequate
Service
Factors that Influence
Adequate Service
Transitory Service
Intensifiers
Desired
Perceived Service Service
Alternatives
Zone
of
Tolerance
Self-Perceived
Service Role Adequate
Service
Situational
Factors
Factors that Influence
Desired Service
• Personal needs include physical, social,
psychological categories
Implicit Service
Promises
Desired Word-of-Mouth
Service
Zone
Past Experience
of
Tolerance
Adequate Predicted
Service Service
Satisfaction
Service Received
minus
Service Expected
Satisfaction - Loyalty Curve
Apostles
80 Affection
Zone
Loyalty (Retention)
60
40
Indifference
Zone
20
Defection Zone
0
1 2 3 4 5
Satisfaction Level
Factors Influencing
Customer Satisfaction
• Product/service quality
• Product/service attributes or features
• Consumer Emotions
Service Quality
Service Quality
=
Perception
minus
Expectation
Service-quality Model
Word of mouth Past Experience
Communication
Personal needs
Expected service
GAP 5
Perceived service
GAP 1
GAP 4 External
Service Delivery
Communication
GAP 3
GAP 2 GAP 23
1
4 NotKnowing
Not deliveringright
selecting
matching to
service
what customer
performance
standards
designs
to Expects
promises
/ standards
Management Perception
Gap Model of Service Quality
• Customer GAP
• Gap 5: Customer Perceptions - Customer Expectations
• Provider GAP
• Gap 1: Not Knowing What Customers Expect
➲ Company Perception of Customer Expectations – Actual
Increased Revenue
Increased profits
Blue print for Service Management
Focus the organization
Listen to customer
Improve service
Take a position:
1. Product and service marketing are
fundamentally different.
2. Product and service marketing are highly
related.
Assignment
• Think of a time when, as a customer, you had a
particularly satisfying (dissatisfying) interaction with
an employee of
• Describe the incident .
• When did the incident happen?
• What specific circumstances led up to this situation?
• Exactly what was said and done?
• What resulted that made you feel the interaction
was satisfying (dissatisfying)?
Exercise to
Identify Service Attributes
Pick a services industry below and brainstorm 3 specific requirements of
customers in each of the five service quality dimensions. Be certain the
requirements reflect the customer’s point of view.
Choices: Airline, Fast Food, Upscale Restaurant, Auto Repair, UNM,
Exterminator
Reliability:
Assurance:
Tangibles:
Empathy:
Responsiveness
:
Questions
STUDY SLIDES
Theatre as a Metaphor for Service
delivery
• Theater is a good metaphor as service delivery
consists of a series of events that customers
experience as a performance
• Particularly useful in high-contact service
providers such as physicians, educators, hotels
and restaurants, and for businesses that serve
many people simultaneously, such as
professional sports, hospitals, and entertainment
• Not that relevant in individualized / personalized
services like tax consultancy, legal services etc.
Theatre as a Metaphor for Service
delivery
• Due to intangibility and simultaneity of
production and consumption of services,
customers often have difficulty in
assessing quality of services they receive.
Hence the ‘encounters’ and aspects of
‘tangibalisation’ provide important cues to
the excellence of service rendered
Theatrical nature of Service
Experiences
• Performance
– Describes an actor’s activity when in continuous contact
with an audience. To create / communicate believable
experience, actors employ various expressive devices lie
set, light, personal appearance, behavioural manner
(dress, facial expression, gestures, personality portrayal
etc. )
• Service Experiences are performances
– Reflect efforts on the part of service provider to satisfy
customer need in pursuit of excellence in an appropriate
servicescape and through scripting and following
commensurate service design / delivery
Theatrical nature of Service
Experiences
• Performance Teams
– Sets of actors respect each others’ role and co-
operate with each other to create a single
response to which the audience responds. One
bad performance can spoil the drama.
• Service Providers need similar teams
– Require co-ordination / understanding among all
the employees of the scripted service design to
deliver the set standard. A single employee may
mar the entire contemplation.
Theatrical nature of Service
Experiences
• Theatre needs appropriate setting, front
stage and backstage co-ordination for
successful show
• Typical service experience occurs in a
setting marked by distinct front and back
stage operations in sync
Theatrical nature of Service
Experiences
• Actors of a theatre are impression
managers as their presence /behaviour
/performance fashion the show
• Service Experiences rely on the
impression management expertise of the
workers
Theatrical nature of Service
Experiences
• Every theatrical performance is designed
to appeal to a particular audience. Great
performances are sometimes lost on the
wrong audience. Individuals expecting a
comedy get disappointed if there is a
tragedy enacted on the stage
• For service experience to be successful,
segmenting right customers is important
Air travel as a model
• Act 1
– Departure (ticket checking, seat allotment, baggage
check, departure)
• Act 2
– Flight (crew reception, escorting to seat, hand
baggage loading, food servicing)
• Act 3
– Destination arrival ( transportation to the lounge,
baggage clearance, escort to connecting flights