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Service Marketing

Service Marketing

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Published by: asifzaib on Sep 26, 2010
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The service encounters ± the foundation of satisfaction and service quality

It is the ³moment of truth´ Occurs any time the customer interacts with the firm Can potentially be critical in determining customer satisfaction and loyalty

Service encounter cascade for hotel visit
CheckCheck-In Bellboy Takes to Room Restaurant Meal Request Wake-Up Call WakeCheckout
It is in these encounters that a customers receives a snapshot of organization¶s service quality each encounter contributes to the customers overall satisfaction and willingness to do business with the organization again.

e. voice.g. Types of service encounters --1. Remote encounter [advent of internet applications] 2. efficiency] 3. Face-to-face encounter Face-to- .Importance of service encounters Any encounter can potentially be critical in determining customer satisfaction and loyalty. Phone encounter [tone. For every organization certain encounters are key to customer satisfaction. repair of house appliance. knowledge.

Sources of pleasure and displeasure in service encounters GOAL:  understanding actual events and behaviors that cause customer dis/satisfaction in service encounters dis/satisfaction Critical Incident Technique stories from customers and employees identification of themes underlying satisfaction and dissatisfaction with service encounters METHOD:  DATA:  OUTPUT:  .

you had a particularly satisfying (dissatisfying) interaction with ______________. as a customer.Sample Questions for Critical Incidents Technique Study Think of a time when. 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)? What could or should have been done differently? .

Common Themes in Critical Service Encounters Research These four common themes have been identified as sources of customers dis/satisfaction in a memorable service experience. dis/satisfaction Recovery employee response to service delivery system failures Adaptability employee response to customer needs and requests Coping employee response to problem customers Spontaneity unprompted and unsolicited employee actions and attitudes .

Recovery ± employee response to service delivery\ delivery\ system failures Instances of failure of the service delivery and employee is required to Respond in some way to consumer complaints and disappointments. DO Acknowledge problem Explain causes Apologize Compensate/upgrade Lay out options Take responsibility DON¶ Ignore customer Blame customer Leave customer to fend for him/herself Downgrade Act as if nothing is wrong ³Pass the buck´ .

but fail to follow through Show unwillingness to try Embarrass the customer Laugh at the customer Avoid responsibility ³Pass the buck´ . DO Recognize the seriousness of the need Acknowledge Anticipate Attempt to accommodate Adjust the system Explain rules/policies Take responsibility DON¶T Ignore Promise.Adaptability ± employee response to customer needs and requests How adaptable the service delivery system is when the customer has special needs or requests that place demand on the process.

being treated like royalty. receiving something nice but not requested). DO Take time Be attentive Anticipate needs Listen Provide information Show empathy DON¶T Exhibit impatience Ignore Yell/laugh/swear Steal from customers Discriminate .Spontaneity ± unprompted and unsolicited employee actions (special attention.

Coping . DO Listen Try to accommodate Explain Let go of the customer DON¶T Take customer¶s dissatisfaction personally Let customer¶s dissatisfaction affect others .employee response to problem customers Behavior that is required by the employees to handle problem customer encounters.

human  Contact employees  Customer him/herself  Other customers Process Physical Evidence  Tangible communication  Servicescape  Guarantees  Technology  Website . standard  Technology vs.The evidence of the service People  Operational flow of activities  Steps in process  Flexibility vs.

. Many firms aim for ³zero defects´.Strategies for influencing customer perceptions Measure and manage customer satisfaction and service quality Aim for customer quality and satisfaction in every service encounter. or 100% satisfaction in every encounter. clear documentation of all points of contacts between customer and organization. development and understanding of customer expectation.

and when and how to explain to customers why a particular request can not be granted. there are things that an organization can do to encourage positive spontaneous behaviors and discourage negative behaviors. . Encourage spontaneity this theme appears to be somewhat random and uncontrollable. Facilitate adaptability and flexibility the existence of this encounter theme suggests a need to know when and how system can be flexed.Strategies for influencing customer perceptions Plan for effective recovery need for service process and system analysis to determine the root cause(s) of failure so that a redesign can ensure higher reliability.

. employees need appropriate coping and problem solving skills to handle difficult customers as well as their own feelings in such situations.Strategies for influencing customer perceptions Help employees cope with problem customers customer isn¶t always right.

Chapter # 05 Understanding Customer Expectations and Perceptions Through Market Research .

CUSTOMER Expected Service COMPANY Listening Gap Company Perceptions P r ptions of Consumer pectations .Using Market Research to Understand Customer Expectations Marketing research is a key vehicle for understanding customer expectations and perceptions of the service.

Stages in Research Process STAGE 1:` Define Problem and Research Objectives STAGE 2: Develop Services Measurement Strategy STAGE 3: Implement Research Program STAGE 4: Collect and Tabulate Data STAGE 5: Interpret and Analyze Findings STAGE 6: Report Findings .

9. To discover customer requirements or expectations for service. 3. 4. and rewards. To identify dissatisfied customers. To forecast future expectations of customers . 2. so that service recovery can be attempted. To determine customer expectations for a new service. To monitor changing customer expectations in an industry. To assess overall company performance compared with that of competition. 6. recognition. To monitor and track service performance. To gauge effectiveness of changes in service delivery. 8. 5. 7. To appraise the service performance of individuals and teams for evaluation. To assess gaps between customer expectations and perceptions.Research Objectives for Services 1. 10.

Research Objectives for Services contd«. . Services research is different: Service research must continually monitor and track service performance because performance is subject to human variability and heterogeneity. Services research is used to consider and monitor the gap between customer expectations and perceptions about the service. contd«.

2. 3.Criteria for an Effective Services Research Program 1. 7. 4. Includes measures of loyalty. Includes both expectations and perceptions of customers. Includes both qualitative and quantitative research. or actual behavior. Measures priorities or importance of attributes. Includes statistical validity when necessary. 6. Balances the cost of the research and the value of the information. . behavioral intentions. 5. Occurs with appropriate frequency.

or behaviors of customers empirically and to test specific hypothesis that a service marketer wants to examine. .Criteria for an Effective Services Research Program 1. Quantitative research in services is designed to describe the nature attitudes. customers compare their perceptions with their expectations of encounter. Includes both perceptions and expectations Expectations serve as a standard or reference point for customers. Includes both qualitative and quantitative research Qualitative research is used to clarify problem definition and prepare a more formal empirical research. 2. In evaluating service quality.

4. Balances the cost of research and value of information The costs must be traded off against the value of information to the company in terms of better decision making. Includes statistical validity when necessary Research used to track the overall service quality that will be used by organization for bonuses and salary increases. Not all forms of research have statistical validity. retained customers and successful new services launches. . and not all forms need it. Most forms of qualitative research for example do not possess the statistical validity.Criteria for an Effective Services Research Program 3.

Criteria for an Effective Services Research Program 5. therefore research must document priorities of customers. Measuring the relative importance of service dimensions and attributes helps managers to channel resources effectively. . 6. Includes measures of loyalty and behavioral intentions An important trend in services research involves measuring the positive and negative consequences of services quality along with overall satisfaction or service quality scores. Services marketing research should be an ongoing process to fully understand the markets acceptance of the company¶s service. Measures priorities or importance Customers have many service requirements but not all are equally important. Occurs with appropriate frequency A single study of service provides a snapshot view of one moment in time. 7.

qualitative depth Observing customers  Get information from employees and front line service providers Database marketing research   use customer information files ³capture´ behavior through data analysis .Common Means for Answering Questions Ask customers directly   mail. formal/informal anthropological tools. online face-toone-onone-on-one. phone. in groups. face-to-face.

identify systemic strengths and weaknesses in service Measure internal service quality. identify most common categories of service failure for remedial action Assess company¶s service performance compared to competitors.Services Research Portfolio Research Objective Identify dissatisfied customers to attempt recovery. develop and test new service ideas Type of Research Customer Complaint Solicitation ³Relationship´ Surveys Post-Transaction Surveys Customer Focus Groups ³Mystery Shopping´ of Service Providers Employee Surveys Lost Customer Research Future Expectations Research . identify service-improvement priorities. track employee morale and attitudes Determine the reasons why customers defect Forecast future expectations of customers. training. act on feedback quickly if negative patterns develop Use as input for quantitative surveys. track service improvement over time Obtain customer feedback while service experience is fresh. provide a forum for customers to suggest service-improvement ideas Measure individual employee service behaviors for use in coaching. performance evaluation. identify employeeperceived obstacles to improve service. recognition and rewards.

It¶s a powerful and vivid tool in eliciting customer requirements. . the research emerges with a list of desirable and undesirable employee behaviors in those service encounters. In the conclusion. Not only do the listen to the complaints ± they also seek complaints as communications about what can be done to improve their service and their employees.Elements in an Effective Service Marketing Research Program Complaint solicitation: Good organizations take complaints seriously. Companies must solve both individual customer problem and seek overall patterns to eliminate failure points. Critical Incident studies: Customers provide verbatim stories about satisfying and dissatisfying service encounters.

Relationship and servqual surveys: These pose the questions about all elements in the customer¶s relationship with the company.Elements in an Effective Service Marketing Research Program Requirements Research: This type of research is very critical as it determines the types of questions that will be asked in surveys and ultimately improvements that will be attempted by the firm. examine existing research]. [structured brainstorming. . This approach can help a company to diagnose its relationship strengths and weaknesses. It can also play an important role to identify the service aspects needing performance improvements.

Mystery shopping: Companies mostly outsource this function and send people to service establishments and experience service as if they are customers. These panels can represent large segments of end customers. Mystery shopping keeps the workers on their toes.Elements in an Effective Service Marketing Research Program Trailer calls or post transaction surveys: The objective is to gauge the overall relationship with the customer. Customer panels: These are ongoing groups of customers assembled to provide attitudes and perceptions about a service overtime. [frequent travelers. Necessarily takes customer feedback on one or all service encounters experienced during the survey encounter. entertainment industry] .

Elements in an Effective Service Marketing Research Program Lost customer research: Deliberately inquiring customers for reasons of quitting/ leaving company service. [features research. Future expectations research: This type of service research is highly recommended in service industries which are volatile and intensely competitive. Open ended questions are encouraged. lead user Research]. .

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