Unit-6

Service Quality, Customer

Expectations, and Perception
 Expected Service: Two Levels of Expectations

1)Desired Service
 The level of service the customer hopes
to receive - the "wished for" level of
performance.
 Desired service is a blend of what
the customer believes "can be" and
"should be".
 Expectations, and Perception
2) Adequate Service
The level of service the customer will
accept.
Adequate service represents the
"minimum tolerable expectation."
It is the bottom level of performance
acceptable to the customer, and
reflects the level of service customers
believe they will get on the basis of
their experience with services.
Expectations, and Perception

Desired Service

Adequate Service

Dual Customer Expectation Levels

 Expectations, and Perception

The Zone of Tolerance

Services are heterogeneous.
The extent to which customers
recognize and are willing to accept
service variation is called the Zone of
tolerance.
If service drops below adequate service,
customers will be frustrated and their
satisfaction with the company undermined.
 Expectations, and Perception

 If a service performance is outside the zone of

tolerance at the top end where performance
exceeds desired service-customers will be very
pleased and probably quite surprised as well.
zone of tolerance is the range or window in
which customers do not particularly notice
service performance.
 When it falls outside the range (either very low or
very high), the service gets the customer's attention
in either a positive or negative way.
Expectations, and Perception
Desired Service

Zone of
Tolerance

Adequate Service
 Expectations, and Perception
Factors that influence desired service
1)Personal Needs :
 Those states or conditions essential to the physical or
psychological well-being of the customer ,pivotal factors that
shape what we desire in services.
 For Example’
 A fan who regularly goes to the baseball games right from
work ,and is therefore thirsty and hungry ,hopes and
desires that the food and drink vendors will pass by his
section frequently ,where as a fan who regularly has dinner
elsewhere has a low or zero level of desired services from
the vendors.
 A customer with high social and dependency needs may have a
relatively high expectations for a hotel’s ancillary services ,hoping
that the hotel has a bar with live music and dancing.
 Expectations, and Perception
2) Enduring Service Intensifiers
 Are individual ,stable factors that lead the customer to a heightened
sensitivity of service.
For Example

Derived Service Expectations:

 Which occur when customer expectations are driven by another

person or group of people
 A niece from a big family who is planning a 90 th birthday party for a
favorite aunt is representing the entre family in selecting a
restaurant for a successful celebration.
 Her needs are driven in part by the derived expectations from the
other family members.
 Expectations, and Perception
 A parent choosing a vacation for the
family,
 A spouse selecting a home –cleaning
service ,
 An employee choosing an office for the
firm
 All theses customers individual expectations are
intensified because they represent and must answer
to other parties who will receive the service.
 Personal Service Philosophy: the customer’s
underlying generic attitude about the meaning of
service and the proper conduct of service
providers elevates the desired service
 Expectations, and Perception
The five factors that influence adequate
service:
1) Transitory Service Intensifiers consists of
temporary ,usually short term ,individual
factors that make a customer more aware of
the need for service.
 Personal emergency situations in which the
service is urgently needed such as accident
and the need for automobile insurance or a
breakdown in office equipment.
 Expectations, and Perception
2)Perceived Service Alternatives
 Are other providers to choose from whom the
customer can obtain service.
 If customers have multiple service providers to
choose from ,or if they can provide the service
for themselves such as lawn care or personal
grooming, their levels of adequate service are
higher than those of customers who believe it is
not possible to get better service elsewhere.
 Expectations, and Perception
3)Customer Self-Perceived Service Role
 Customer Perception is the degree to which customers
exert an influence on the level of service they receive .
 In other words, customers expectations are partly
shaped by how well they believe they are performing
their own roles in the service delivery.
 One role of the customer is specifying the level of service
expected.
 A customer who is very explicit with a waiter about how
rare he wants his steak cooked in a restaurant will
probably be more dissatisfied if the meat comes to the
table overcooked than a customer who does not
articulate the degree of doneness expected.
 Expectations, and Perception
4)Situational Factors
 Situational factors are defined as the service
performance conditions that customers view
as beyond the control of the service provider.
 For Example,
 Where personal emergencies serious automobile
accidents would likely intensify customer service
expectations of insurance companies,
 Catastrophes that affect a large number of people at one
time-Tornadoes or earthquakes may lower service
expectations because customers recognize that
insurers are inundated with demands for their
services.
 Expectations, and Perception
Predicted Service
 Predicted Service is The level of service
customers believe they are likely to get.
 Sources of the Desired and Predicted Service
Expectations:
1)Explicit Service Promises :
 Are personal and non-personal statements
about the service made by the organization to
customers.
 The statements are personal when they are
communicated by salespeople or service or
repair personnel;

They are non-personal when they come from
advertsing , brochurs,and other written publications.
 Expectations, and Perception

2) Implicit Service Promises

 Are services –related cues other than explicit promises
that lead to inferences about what the service should and
will be like.
 Theses quality cues are dominated by price and the
tangibles associated with the service.
 In general the higher the price and the more impressive
the tangibles ,the more a customer will expect from the
service.
 Expectations, and Perception
3)Word-of-Mouth Communications
 Personal and non-personal statements made by parties other than
the organization convey to customers what the service will be like
and influence both predicted and desired service.
 Word of mouth communication carries particular weight as an
information sources because it is perceived as unbiased.
 Word of mouth tends to be more important in services that are
difficult to evaluate before purchase and direct experience of
them.
 Expectations, and Perception
4)Past Experience
 The customer’s previous exposure to service that is relevant
to the focal service force in shaping predictions and desires.
 The service relevant for prediction can be previous exposure
to the focal firms service's experience.
 For Example ,
 You probably compare each day in a particular hotel is

likely to be a very limited view of your past experience.

 You may also compare each stay with your experiences

in other hotels and hotel chains.

 Expectations, and Perception

Managing Consumer Expectations

Consumer buying decisions and

patronage are based on consumer
expectations.
The higher the expectations, the
greater the probability of purchase.
The lower the expectations, the
lower the probability of purchase.
 Expectations, and Perception
Service Marketers Dilemma
Promoting high expectations will increase
patronage but also increase the chances of
producing dissatisfied customers.
 Promoting lower expectations will ensure satisfied
customers, but the chances of getting customers to
buy the service are greatly reduced.
 The ideal goal is to promote the exact service
customers will receive and to provide the exact
service customers expect.
 If firms can match expectations and service,
customers are satisfied
 Expectations, and Perception

During the Pre-Purchase Phase

a) Learn what customers expect.

b) Tell customers what they can expect.

c) Consistently provide the service that

customers expect.
 Expectations, and Perception
During the Service Encounter
 The goal during this phase is to ensure the service being
provided matches the consumer’s expectations
1) Service personnel must communicate
with the customer during the service
encounter.
2) The service providers should modify
the service to meet the customer’s
expectations.
 Expectations, and Perception
During the Post-Purchase Phase

Managing consumer expectations does not stop after the

service is performed.
1) Companies should communicate with customers immediately
after the service is completed to see if expectations were
met.

2) Forms can be used for a follow-up program, such as an

evaluation survey sent to the customer through the mail or a
phone call.

3) Companies should have a procedure for dealing with

dissatisfied customers that will assist in managing future
expectations.
 Expectations, and Perception
The Goal During This Phase Is Two Fold.

1) The Primary Goal is to communicate

with customer to see if expectations
were met.
2) The Secondary Goal is to modify
future expectations to increase the
chances of repeat purchase.
Expectations, and Perception
Process Versus Technical Outcome Quality

1) Process of The Service/ Functional Quality

2) Outcome of The Service/ Technical Quality

 Expectations, and Perception

SERV QUAL
Consumers evaluated service quality by comparing expectations
with perceptions on ten dimensions (Parasuraman et al.,1985)
1) Tangibles
2) Reliability
3) Responsiveness
4) Communication
5) Credibility
6) Security
7) Competence
8) Courtesy
9) Understanding/knowing customers and
10) Access.
 Expectations, and Perception
The five generic service-quality dimensions
1) Reliability - Ability to perform the promised
service dependably and accurately.
2) Responsiveness - Willingness to help customers
and provide prompt service.
3) Assurance - Employees' knowledge and courtesy
and their ability to inspire trust and confidence.
4) Empathy - Caring, individualized attention given
to customers.
5) Tangibles - Appearance of physical facilities,
equipment, personnel, and written materials.
 Expectations, and Perception
 7 scale measures from SA to SDA

 “Perception-minus-expectation” scores called gap

scores.
G =P-E
Reliability
1) Providing services as promised.
2) Dependability in handling customers’ service performed.
3) Performing the services right the first time.
4) Providing services at the promised time.
5) Maintaining error-free records.
 Expectations, and Perception
Responsiveness

1) Keeping customers informed about

when services will be performed.
2) Prompt service to customers.
3) Willing to help customers.
4) Readiness to respond to customers’
requests.
 Expectations, and Perception
Assurance
1) Employees who instill confidence in
customers.
2) Making customers feel safe in their
transaction.
3) Employees who are consistently
courteous.
4) Knowledgeable employee to answer
customer questions.
 Expectations, and Perception
Empathy

1) Giving customers individual attention.

2) Employees who deal with customers in a
caring fashion.
3) Having the customer’s best interest at
heart.
4) Employees who understand the needs of
their customers.
5) Convenient business hour.
 Expectations, and Perception
Tangibles

1) Modern equipment.
2) Visually appealing facilities.
3) Employees who have a neat, professional
appearance.
4) Visually appealing materials associated
with the service.
 Expectations, and Perception

Limitations of the SERVQUAL Model (Buttle

and Sureshchandar et al. )
 Conceptualization
 Conceptualization of service quality as a disconfirmation
model of the gap between the actual service experience
and the expected service level does not have a strong
empirical grounds.

 Focus
 The emphasis of SERVQUAL is on the process dimensions involving
the human interaction, the soft side of service delivery, and the
functional service quality aspects with no adequate emphasis on
the technical outcome or the hard core service.
 Expectations, and Perception
Dimensionality
The five service quality dimensions cannot have a
universal application as they can’t be used
uniformly across all countries and sectors as the:
Organizational,
Technological,
Economic,
Social, and
Cultural factors may vary.
 Expectations, and Perception
SERVQUAL vs. SERVPERF (Cronin and Taylor)

 SERVQUAL is based on the “disconfirmation” perspective of

the service quality construct

 SERVPERF is based on the “performance only” perspective
and operationalized service quality as customers’
evaluations of the service encounter.
 SERVPERF uses only the performance items of the SERVQUAL

scale.
 Expectations, and Perception
Satisfaction Versus Service Quality
 Perceived service quality is a component of
customer satisfaction.
Internal and External Customer Perceptions
 Internal customers are employees within the
firm who, in their jobs, depend on others in the
organization for internally provided goods and
services.
 External customers are those individuals and
businesses that buy goods and services from
the organization.
 Expectations, and Perception
What is customer Satisfaction?
 Satisfaction is the consumer's fulfillment response.
 It is a judgment that a product or service feature, or the
product or service itself, provides a pleasurable level of
consumption-related fulfillment.
 Satisfaction is the customers' evaluation of a
product or service in terms of whether that product
or service has met their needs and expectations.
 Failure to meet needs and expectations is assumed
to result in dissatisfaction with the product or
service.
 Expectations, and Perception

Customer satisfaction will be influenced by:

Productor service features

customers' emotional responses
Customers attributions, and
Customers’ perceptions of equity
 Expectations, and Perception
Reliability

Responsiveness Situational
Service Factors
Quality
Assurance

Empathy Customer
Product Satisfaction
Quality
Tangibles

Price Personal
Factors
 Expectations, and Perception
Building Blocks of Satisfaction and Service Quality

 Service encounters or the "moment of truth" are

the "building blocks of satisfaction and service
quality.

 The service encounter or the moment of

truth is what is termed as interactive
marketing in the triangle.
Expectations, and Perception
 Service encounter is a "real-time marketing"
where promises are kept or broken.
 It is from service encounters the customers build
their perceptions.
 Each encounter presents an opportunity to prove
its potential as a quality service provider and to
increase customer loyalty.
 A Service Encounter Cascade for a Hotel

Checking

Bell person takes to

Room

Restaurant
Meal

Wake-Up Call

Checkout
A Service Encounter Cascade for Industrial Purchase

Sales Call

Delivery and
Installation

Servicing

Ordering of Supplies

Billing
 Expectations, and Perception

Types of Service Encounters

1) Remote encounters

2) Phone encounters and

3) Face-to-face encounters.
 Expectations, and Perception
i)Remote Encounters

 Encounters
can occur without any direct
human contact (remote encounters)
Example: The ATM

 Inremote encounters the tangible evidence of the

service and the quality of the technical processes
and systems become the primary bases for
judging quality.
 Expectations, and Perception
ii)Phone Encounters
 The most frequent type of encounter between an end

customer and the firm occurs over the telephone (phone

encounters).
 Tone of voice, employee knowledge, and
effectiveness/efficiency in handling customer issues become
important criteria for judging quality in these encounters.
 Expectations, and Perception
iii)Face- To- Face Encounter

 It occurs between an employee and a customer in

direct contact (face-to-face encounters).
 Both verbal and nonverbal behaviors are important
determinants of quality, as are tangible cues such as
employee dress and other symbols of service (e.g.
equipment, informational brochure, physical setting).
 In face-to-face encounters the customer also
plays a role in creating quality service through
the behavior during the interaction.
 Expectations, and Perception
Sources of Pleasure and Displeasure in Service Encounters
1)Recovery
 Employee response to service delivery
system failures.
2)Adaptability
 Employee response to customer needs and
requests.
 Customers judge service encounter quality in
terms of the flexibility of the employees and
the system and customization of the service
to meet a need.
 Expectations, and Perception
3)Spontaneity
 Unprompted and unsolicited employee actions
 Satisfying incidents in this group represent very
pleasant surprises for the customer (special attention,
being treated like royalty, receiving something nice
but not requested).
 Dissatisfying incidents in this group represent
negative and unacceptable employee behaviors
(rudeness, stealing, discrimination, ignoring the
customers).
4)Coping
 Employee response to problem
customers
1)
 Examples of Recovery Incidents, both Good and Bad

Satisfactory Dissatisfactory

 I had made an advance reservation at  We had made an advance reservation

the hotel. They lost my room
reservation but the manager gave me
the suite room for the same price.
(external customer)
 A gentleman left his shoes outside his  One of my suitcases was all dented up
room door to be shined. When he
went to retrieve them, they were gone,
and could not be found. The hotel
staff took responsibility and with in
an hour a representative had arrived
with six pairs of shoes for the
gentleman to choose from.
(employee)
at the hotel. When we arrived we
found we had no room-no
explanation, no apologies, and no
assistance in finding another hotel.
(external customer)
and looked like it had been dropped
from 30,000 feet. When I tried to
make a claim for my damaged
luggage, the employee insinuated that
I was lying and trying to rip them off.
(external customer)
Examples of Adaptability Incidents, Both Good And Bad

Satisfactory Dissatisfactory

 Although it was not our  My young son, flying

regular order time, I needed alone, was to be assisted
some suppliers that we did
by the stewardess from
not have in stock. I called
the supply office and the start to finish. At the
gentleman on the phone airport she left him
said, “No problem. I alone in the airport with
received the supplies the no one to escort him to
next day. His word was as his connecting flight.
good as gold. (internal
(external customer)
customer)
 Examples of Spontaneity Incidents

Satisfaction Dissatisfaction
 The anesthesiologist took extra  I needed a few
time to explain exactly what I minutes to decide
would be aware of and promised
to take special care in making sure
on a dinner. The
I did not wake up. It impressed me waitress said, “If
that the anesthesiologist came to you would read the
settle my nerves and explain the menu and not the
difference in the medicine I was road map, you
getting because of my cold. It was
a nice bit of extra attention that he
would know what
did not have to give. (external you want to
customer) order.” (external
customer)
 Examples of Coping Incidents, Both Good and Bad

Satisfactory Dissatisfactory
 A person who became  An intoxicated man began pinching the female
intoxicated on a flight flight attendants. One attendant told him to
started speaking loudly, stop but he continued and then hit another
annoying the other passenger. The co-pilot was called and asked
passengers. The flight the man to sit down and leave the others alone,
attendant asked the but the passenger refused. The co-pilot then
passenger if he would be “decked" the man knocking him into his seat.
driving when the plane (Employee)
landed and offered him
coffee. He accepted the  While a family of three was waiting to order
coffee and became quieter dinner, the father began hitting his child.
and friendlier (employee) Another customer complained about this to the
manager who then, in a friendly and
sympathetic way, asked the family to leave.
The father knocked all of the plates and glasses
off the table before leaving. (Employee)
 The Evidence of Service
Because services are intangible, customers
are searching for evidence of service in every
interaction they have with an organization.
The three major categories of evidence as
experienced by the customer:
People,

Process, and
Physical evidence.
 Expectations, and Perception

People

Contact employees
Customer
Other customers

Process Physical Evidence

Tangible communication
Operational flow of activities Servicescape
Guarantees
Steps in process
Flexibility versus standard
Technology
Technology versus human
 Strategies For Influencing Customer Perceptions

1) Measure and manage customer satisfaction and

service quality
2) Aim for customer quality and satisfaction in every
service encounter
3) Plan for effective recovery
4) Facilitate adaptability and flexibility
5) Encourage spontaneity
6) Help employees cope with problem customers.
7) Manage the dimensions of quality at the
encounter level
8) Manage the evidence of service to reinforce
perceptions
Thank You !!!