Managing Customer Expectations and Why? K Sudhakar Goud. Ex Librarian British Library Hyderabad and currently with Unicef as a Consultant

Transcription

1 Managing Customer Expectations and Why? By K Sudhakar Goud Ex Librarian British Library Hyderabad and currently with Unicef as a Consultant

2 Why CS /CE are important? With out customers no company or business exists. On an avg companies lose customers every year. Study / profiling customers is an integral part of business plan and marketing plan. Profit / loss depends on how you manage customers and their satisfaction levels

3 What is a Marketing Plan? Management of process for identifying, anticipating and satisfying customers requirement profitably CIM UK 7Ps of Marketing mix : Product, Price, Place /distribution, promotion, People, Physical evidence and Process management. Roles of strategic planning and Marketing Plan

4 Components of a Marketing Plan Back ground to the plan Vision for the organization Market overview/ situational analysis Internal /External analysis and audit (SWOT/ TOWS/PEST analysis) Target market and its characteristics (all customer related) Management of seven Ps of marketing mix Development of the brand Budgets Action plan and implementation and control

5 CE Gaps model (Zeithaml, Parasuraman & Berry 1990)

6 Stages in Consumer Decision Making and Evaluation of Services

7 Frequently Asked Questions About Customer Expectations Should a company aim to delight the customer? How does a company exceed customer service expectations? Do customer service expectations continually escalate? Is it a better strategy to under-promise and over-deliver? How does a service company stay ahead of competition in meeting customer expectations?

8 Customer expectations of service Types of expectations customers hold for service performance Sources of customer expectations

9 Possible Levels of Customer Expectations

10 Zones of Tolerance for Different Service Dimensions Desired Service Level of Expectation Zone of Tolerance Desired Service Adequate Service Zone of Tolerance Adequate Service Reliability Tangibles Source: L. L. Berry, A. Parasuraman, and V. A. Zeithaml, Ten Lessons for Improving Service Quality, Marketing Science Institute, Report No (May 1993).

11 Factors That Influence Desired and Predicted Service Explicit Service Promises Implicit Service Promises Desired Service Word-of-Mouth Zone of Tolerance Past Experience Adequate Service Predicted Service

12 Customer perceptions Factors which influence consumers perceptions Factors which influence satisfaction Dimensions of service quality Service encounters

13 Customer Perceptions of Quality and Customer Satisfaction

14 Factors Influencing Customer Satisfaction Product/service quality Specific product or service features Consumer emotions Attributions for service success or failure

15 Factors Influencing Customer Satisfaction Perceptions of equity or fairness Other consumers, family members, and coworkers Price Personal factors the customer s mood or emotional state situational factors

16 Outcomes of Customer Satisfaction Increased customer retention Positive word-of-mouth communications Increased revenues

17 Relationship between Customer Satisfaction and Loyalty in Competitive Industries Source: James L. Heskett, W. Earl Sasser, Jr., and Leonard A. Schlesinger, The Service Profit Chain, (New York, NY: The Free Press, 1997), p. 83.

18 Service Quality The customer s judgment of overall excellence of the service provided in relation to the quality that was expected. Service quality assessments are formed on judgments of: outcome quality interaction quality physical environment quality

19 The SERVQUAL dimensions Perceived Service Quality (Parasuraman, Zeithaml & Berry 1988) Reliability (dependability, accurate performance) Assurance (competence, courtesy, credibility & security) Tangibles (appearance of physical elements) Empathy (easy access, good communications & customer understanding) Responsiveness (promptness & helpfulness)

20 The Five Dimensions of Service Quality Reliability Assurance Tangibles Empathy Responsiveness Ability to perform the promised service dependably and accurately. Knowledge and courtesy of employees and their ability to inspire trust and confidence. Physical facilities, equipment, and appearance of personnel. Caring, individualized attention the firm provides its customers. Willingness to help customers and provide prompt service.

21 RELIABILITY SERVQUAL Attributes 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

22 The Service Encounter is the moment of truth occurs any time the customer interacts with the firm can potentially be critical in determining customer satisfaction and loyalty types of encounters: remote encounters, phone encounters, face-to-face encounters is an opportunity to: build trust reinforce quality build brand identity increase loyalty

23 Evidence of Service from the Customer s Point of View Operational flow of activities Steps in process Flexibility vs. standard Technology vs. human Process People Physical Evidence Source: From Managing the Evidence of Service by M. J. Bitner from The Service Quality Handbook, eds. E. E. Scheuing and W. F. Christopher (1993), pp Contact employees Customer him/herself Other customers Tangible communication Servicescape Guarantees Technology Website

24 UNDERSTANDING CUSTOMER REQUIREMENTS

25 Listening to customers through market research Using Marketing Research to Understand Customer Expectations Elements in an Effective Services Marketing Research Program Analyzing and Interpreting Marketing Research Findings Model Services Marketing Research Programs Using Marketing Research Information Upward Communication

26 Listening to Customers through Research Present the types of and guidelines for marketing research in services. Show how marketing 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.

27 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.

28 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

29 Thank you Any questions please?