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By: Shivani Dahiya
Where Does the Customer Fit in a Service Organization?
Consumers rarely involved in manufacture of goods
but often participate in service creation and delivery
Challenge for service marketers is to understand how
customers interact with service operations
Flowcharting clarifies how customer involvement in
service encounters varies with type of process
“Service Marketing” | CONFIDENTIAL 2010
25 March 2012
What is the service encounter? 3 That period of time during which a consumer interacts directly with the service organisation (Shostack 1985) Dyadic interaction between a customer and service provider (Solomon & Suprenant 1987) “Service Marketing” | CONFIDENTIAL 2010 25 March 2012 .
Service Encounter High Contact Services: 4 Customers visit service facility and remain throughout service delivery Active contact customers and personnel Includes most processing services between service people- “Service Marketing” | CONFIDENTIAL 2010 25 March 2012 .
g.Service Encounter Low Contact Services: 5 Little or no physical contact with service personnel Contact usually at arm’s length through electronic or physical distribution channels New technologies (e. Web) help reduce contact levels “Service Marketing” | CONFIDENTIAL 2010 25 March 2012 .
Levels of Customer Contact with Service Organizations 6 High N ur si n g H om e Emphasizes encounters with service personnel M a na g e m e n t Con su lti n g H a i r Cut 4 .) Te l e p h on e Ba n k in g Re ta il Ba n k i n g M o te l Ca r Re p a i r I n sur a n ce D r y Cl e a n i n g Fa st Food Movie Theater Ca b l e TV Subway • Internet Banking Mail Based Repairs Emphasizes encounters with equipment “Service Marketing” | CONFIDENTIAL 2010 Internet-based Services Low 25 March 2012 .Sta r H ot e l G oo d Re sta ur a n t Ai r l i n e Tr a ve l ( Eco n .
Managing Service Encounters-1 7 Service encounter: A period of time during which customers interact directly with a service Moments of truth: Defining points in service delivery where customers interact with employees or equipment Critical incidents: specific encounters that result in especially satisfying/dissatisfying outcomes for either customers or service employees 25 March 2012 “Service Marketing” | CONFIDENTIAL 2010 .
expected. role model desired behavior Thoughtless or badly behaved customers can Must educate customers. manage behavior clarify what cause problems for service personnel (and other customers) is “Service Marketing” | CONFIDENTIAL 2010 25 March 2012 . coach.Managing Service Encounters--2 8 Service success often rests on performance of junior contact personnel Must train.
The Purchase Process for Services Awareness Needs Information Search 9 Define needs Explore solution Identify alternative Service suppliers Pre-purchased Stage Evaluating of alternatives •Review documentation •Consult people •Service supplier Service from chosen supplier Service Delivery Evaluating the Service Performance Future Intentions “Service Marketing” | CONFIDENTIAL 2010 Service Encounter Stage Post-Purchase Stage 25 March 2012 .
The Purchase Process for Services Pre-purchase Stage 10 Awareness of need Information search Evaluation of alternative service suppliers Request service from chosen supplier Service delivery Evaluation of service performance Future intentions Service Encounter Stage Post-purchase Stage “Service Marketing” | CONFIDENTIAL 2010 25 March 2012 .
unexpected extra costs Temporal – wasted time. damage to possessions Psychological – fears and negative emotions Social – how others may think and react Sensory – unwanted impacts to any of five senses 25 March 2012 “Service Marketing” | CONFIDENTIAL 2010 . delays lead to problems Physical – personal injury.Perceived Risks in Purchasing and Using Services 11 Functional – unsatisfactory performance outcomes Financial – monetary loss.
consequences of delays) “Service Marketing” | CONFIDENTIAL 2010 .Perceived Risks in Purchasing and Using Services Type of Risk Functional Risk Financial Risk (Monetary Loss. unexpected cost) (unsatisfactory outcome) 12 Example of Customer Concern’s Will the drycleaner able to remove stains from this jacket? Will I incur a lot of unanticipated expenses if I go on this vacation? Will I have to wait in line before entering the exhibition? Will the renewal of my houses be completed before our friends come to stay with us? 25 March 2012 Temporal (wasting time.
Perceived Risks in Purchasing and Using Services Type of Risk Physical Risk (Personal injury or damage to possessions) Psychological (personal fears & emotions) Social (how others think & react) 13 Example of Customer Concern’s Will the contents of this package get damaged in the mail? How can I be sure that this aircraft won’t crash? Will my business colleagues disapprove of my selection of an unknown solicitor? Sensory (unwanted impacts on any of the five senses) “Service Marketing” | CONFIDENTIAL 2010 Will the coffee at breakfast taste disgusting? 25 March 2012 .
Benefits of customers satisfaction & Service quality Insulates customer from competition Can create sustainable advantages 14 Encourage for Purchase & loyalty Customer satisfaction Reduces failure cost Lowers costs of attracting new customers “Service Marketing” | CONFIDENTIAL 2010 Enhances / promoter Towards of mouth 25 March 2012 .
Factors that Influence Customer Expectations of Services Personal Needs Desired Service Beliefs about What Is Possible Word-of-Mouth Past Experience 15 Explicit & Implicit Service Promises ZONE OF TOLERANCE Perceived Service Alterations Adequate Service Situational Factors “Service Marketing” | CONFIDENTIAL 2010 Predicted Service 25 March 2012 .
Components of Customer Expectations 16 Desired Service Level: wished-for level of service quality that customer believes can and should be delivered Adequate Service Level: minimum acceptable level of service Predicted Service Level: service level customer believes firm will actually deliver that Zone of Tolerance: range within which customers are willing to accept variations in service delivery “Service Marketing” | CONFIDENTIAL 2010 25 March 2012 .
and Quality Control Problems Make Services Hard to Evaluate Search attributes – Tangible characteristics that allow customers to evaluate a product before purchase 17 Experience attributes – Characteristics that can be experienced when actually using the service Credence attributes – Characteristics that are difficult to evaluate confidently even after consumption Goods tend to be higher in search attributes. services tend to be higher in experience and credence attributes Credence attributes force customers to trust that desired benefits have been delivered 25 March 2012 “Service Marketing” | CONFIDENTIAL 2010 .Intangible Attributes. Variability.
Continuum of Evaluation for different type of products 18 Most Goods Most Services Easy to evaluate Clothing Chair Foods Motor vehicle Haircut Restaurant meals Computer repair Legal services Entertainment Lawn fertilizer Complex surgery Difficult to evaluate High in search attributes “Service Marketing” | CONFIDENTIAL 2010 High in experience attributes High in credence attributes 25 March 2012 .
price/quality tradeoffs. compare it to expectations Satisfaction judgments are based on this comparison Positive disconfirmation if better than expected Confirmation if same as expected Negative disconfirmation if worse than expected Satisfaction reflects perceived service quality. observe service performance. personal and situational factors Research shows links between customer satisfaction and a firm’s financial performance 25 March 2012 “Service Marketing” | CONFIDENTIAL 2010 .Customer Satisfaction is Central to the Marketing Concept 19 Satisfaction defined as attitude-like judgment following a service purchase or series of service interactions Customers have expectations prior to consumption.
. joy.. excitement) Positive affect (e.g.g. or happiness) Is it possible for customers to be delighted by very mundane services? Progressive Insurance has found ways to positively surprise customers with customer-friendly innovations and extraordinary customer service 25 March 2012 “Service Marketing” | CONFIDENTIAL 2010 .Customer Delight: Going Beyond Satisfaction 20 Research shows that delight is a function of 3 components Unexpectedly high levels of performance Arousal (e. surprise. pleasure.
and personnel Service Delivery (front stage) Where “final assembly” of service elements takes place and service is delivered to customers Includes customer interactions with operations and other customers Service Marketing (front stage) Includes service delivery (as above) and all other contacts between service firm and customers “Service Marketing” | CONFIDENTIAL 2010 25 March 2012 . Includes facilities. comprising three overlapping subsystem. Service Operations (front stage and backstage) Where inputs are processed and service elements created. equipment.Service as a System 21 A service business is a system.
etc.e. Phone Calls. Random Exposure to Facilities / Vehicles Technical Core Equipment The Customer Service People Backstage (invisible) Front Stage (visible) Other Customers Chance Encounters with Service Personnel Word of Mouth “Service Marketing” | CONFIDENTIAL 2010 25 March 2012 . Faxes.g.Service Marketing System (1) High Contact Service-.. Hotel Service Delivery System Service Operations System Interior & Exterior Facilities Other Customers 22 Other Contact Points Advertising Sales Calls Market Research Surveys Billing / Statements Miscellaneous Mail.
g.. Personnel Word of Mouth Front Stage (visible) 25 March 2012 . Credit Card Service Operations System 23 Service Delivery System Other Contact Points Advertising Mail Technical Core Self Service Equipment Phone. Web site etc.e.Service Marketing System (2) Low Contact Service-. Fax. Backstage (invisible) “Service Marketing” | CONFIDENTIAL 2010 The Customer Market Research Surveys Random Exposures Facilities.
Service as Theater 24 “ All the world’s a stage and all the men and women merely players. They have their exits and their entrances and each man in his time plays many parts” William Shakespeare As You Like It “Service Marketing” | CONFIDENTIAL 2010 25 March 2012 .
may wear special costumes.The Dramaturgy of Service Delivery 25 Service dramas unfold on a “stage”--settings may change as performance unfolds Many service dramas are tightly scripted. employees have roles. others improvised Front-stage personnel are like members of a cast Like actors. behave in specific ways Support comes from a backstage production team Customers are the audience—depending on type of performance. speak required lines. may be passive or active “Service Marketing” | CONFIDENTIAL 2010 25 March 2012 .
Role and Script Theories 26 Role: A set of behavior patterns learned through experience and communication to be performed by an individual in a certain social interaction in order to attain maximum effectiveness in goal accomplishment Role congruence: In service encounters. employees and customers must act out defined roles for good outcomes The extent to which each person acts out his prescribed role during service encounter. Employees: fulfill customer expectation Customers: must play by rules or they will create problems for Employees Other customers 25 March 2012 “Service Marketing” | CONFIDENTIAL 2010 .
enhance experiences 25 March 2012 “Service Marketing” | CONFIDENTIAL 2010 .g.Role and Script Theories 27 Script: A sequence of behavior to be followed by employees and customers during service delivery Script are learned EXPERNICES EDUCATION COMMUNICATION WITH OTHER Some scripts (e. others flexible Technology change may require a revised script Managers should reexamine existing scripts to find ways to improve delivery. increase productivity. teeth cleaning) are routinized.
Role and Script Theories 28 For Standardized services Tightly scripted performance For : highly customized services: Services script is flexible May vary by situation/ customer Services firm as teacher The services firms can educate the customers in different ways: Brochures Posted instructions Advertising By service providers Other customers 25 March 2012 “Service Marketing” | CONFIDENTIAL 2010 .
THANK YOU CORE JAVA .