UNDERSTANDING CUSTOMER

REQUIREMENTS
Listening to customers through
research
By
DR S Sena
Senior Lecturer
Business Studies Department
5-1
Provider Gap 1

CUSTOMER
Expected
Service

COMPANY
Gap 1: Company
The Listening Gap Perceptions of
Customer
Expectations

5-2
Key Factors Leading to Provider Gap 1

5-3
 Listening to Customers
through Research
 Using Customer Research to Understand Customer
Expectations
 Elements in an Effective Service Marketing Research
Program
 Analyzing and Interpreting Customer Research Findings
 Using Marketing Research Information
 Upward Communication

5-4
Objectives for Chapter 5:
Listening to Customers through Research
 Present the types of and guidelines for customer
research in services.

 Show how customer research information can and

should be used for services.

 Describe the strategies by which companies can

facilitate interaction and communication between
management and customers.

 Present ways that companies can and do facilitate

interaction between contact people and management.
5-5
Common Research Objectives for
Services
 To identify dissatisfied customers

 To monitor and track service performance

 To assess gaps between expectations and

perceptions

 To gauge effectiveness of changes in service

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

5-7
Criteria for an Effective
Service Research Program
 Includes both qualitative and quantitative research
 Includes both expectations and perceptions of
customers
 Balances the cost of the research and the value of the
information
 Includes statistical validity when necessary
 Measures priorities or importance of attributes
 Occurs with appropriate frequency
 Includes measures of loyalty, behavioral intentions, or
actual behavior

5-8
Portfolio of Services Research:
Research Is NOT Just Surveys!
 Customer Complaint Solicitation
 Critical Incident Studies
 Requirements Research
 Relationship and SERVQUAL Surveys
 Trailer Calls or Post transaction Surveys
 Service Expectations Meetings and Reviews
 Process Checkpoint Evaluations
 Mystery Shopping
 Customer Panels
 Lost Customer Research
 Future Expectations Research
5-9
Common means for answering questions

 Ask customers directly

 mail, phone, face-to-face, online
 one-on-one, in groups, formal/informal
 Observing customers
 anthropological tools, qualitative depth
 Get information from employees and front line service
providers
 Database marketing research
 use customer information files
 “capture” behavior through data analysis

5-10
 Figure 5.1
Criteria for an Effective
Service Research Program

McGraw-Hill/Irwin ©2003. The McGraw-Hill Companies. All Rights Reserved

Elements in an Effective Customer Research
Program for Services
Complaint ●
To identify and attend to dissatisfied customers
To identify common service failure points
solicitation
●

Critical incident ●

●
To identify “best” practices” at transaction level
To identify customer requirements as input for quantitative studies
To identify common service failure points
studies
●

●
To identify systemic strengths and weaknesses in customer-contact services

Relationship ●

●
To monitor and track service performance
To assess overall company performance compared with that of competition
To determine links between satisfaction and behavioral intentions
surveys
●

●
To assess gaps between customer expectations and perceptions

Posttransaction ●

●
To obtain immediate feedback on performance of service transactions
To measure effectiveness of changes in service delivery
To assess service performance of individuals and teams
surveys
●

●
To use as input for process improvements; to identify common service failure points

●
To identify/attend to dissatisfied customers
Social media ●

●
To encourage word of mouth
To measure the impact of other advertising

5-12
 Portfolio of Services Research
Research Objective Type of Research
Identify dissatisfied customers to attempt recovery;
identify most common categories of service failure
Customer Complaint
for remedial action Solicitation
Assess company’s service performance compared to
competitors; identify service-improvement priorities; track “Relationship” Surveys
service improvement over time

Obtain customer feedback while service experience is still Post-Transaction Surveys

fresh; act on feedback quickly if negative patterns develop

Use as input for quantitative surveys; provide a Customer Focus Groups

forum for customers to suggest service-improvement
ideas
Measure individual employee service behaviors for use in “Mystery Shopping” of
coaching, training, performance evaluation, recognition and
rewards; identify systemic strengths and weaknesses in Service Providers
service

Measure internal service quality; identify employee-

Employee Surveys
perceived obstacles to improve service; track
employee morale and attitudes

Determine the reasons why customers defect Lost Customer Research

To forecast future expectations of customers
To develop and test new service ideas
Future Expectations Research
McGraw-Hill/Irwin ©2003. The McGraw-Hill Companies. All Rights Reserved
Elements in an Effective Customer Research
Program for Services (continued)
●
To research customers in natural settings
Market-oriented ethnography ●
To study customers from other cultures in an unbiased way

●
To measure individual employee performance for evaluation, recognition, or
Mystery shopping rewards
●
To identify systemic strengths and weaknesses in customer-contact services

●
To monitor changing customer expectations
Customer panels ●
To provide a forum for customers to suggest and evaluate new service
ideas

●
To identify reasons for customer defection
Lost customer research ●
To assess gaps between customer expectations and perceptions

●
To forecast future expectations of customers
Future expectations research ●
To develop and test new service ideas

5-14
Sample Questions for Critical Incident
Studies
 Think of a time when, as a customer, you had a
particularly satisfying (dissatisfying) interaction with an
employee of ______________.

 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)?
5-15
SERVQUAL Attributes
RELIABILITY
 Providing service as promised
 Dependability in handling customers’
service problems
 Performing services right the first time
 Providing services at the promised time
 Maintaining error-free records
RESPONSIVENESS
 Keeping customers informed as to when
services will be performed
 Prompt service to customers
 Willingness to help customers
 Readiness to respond to customers’
requests
ASSURANCE
 Employees who instill confidence in customers
 Making customers feel safe in their transactions
 Employees who are consistently courteous
 Employees who have the knowledge to answer
customer questions
EMPATHY
 Giving customers individual attention
 Employees who deal with customers in a
caring fashion
 Having the customer’s best interest at heart
 Employees who understand the needs of
their customers
 Convenient business hours
TANGIBLES
 Modern equipment
 Visually appealing facilities
 Employees who have a neat,
professional appearance
 Visually appealing materials
associated with the service
5-16
Using Marketing Research Information

 Understanding how to make the best use of

research – to apply what has been learned to
the business – is a key way to close the gap
between customer expectations and
management perceptions of customer
expectations.

5-17
Upward Communication

 Research for upward communication

 Executive visits to customers
 Executive or management listening to customers
 Research on intermediate customers
 Research on internal customers
 Executive or management listening approaches to
employees
 Employee suggestions

5-18
 6-19

Stages in the (Marketing) Research

Process

STAGE STAGE STAGE STAGE STAGE STAGE

1: 2: 3: 4: 5: 6:

Define Develop Implement Collect Interpret Report

Problem Services Research and and Findings
and Research Measurement Program Tabulate Analyze
Objectives Strategy Data Findings