Transcript
McGraw-Hill © 2000 The McGraw-Hill Companies
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Wel-Come Wel-Come
LETS FILL THE GAPS…….. Together
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Traditional Marketing MixTraditional Marketing Mix• All elements within the control of the
firm that communicate the firm’s capabilities and image to customers or that influence customer satisfaction with the firm’s product and services:– Product– Price– Place– Promotion
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SERVICE MARKETING MIX - ISERVICE MARKETING MIX - I
SERVICE MARKETING MIX
PRODUCT
PLACE
PROMOTION
PRICE
PEOPLE
PROCESS
PHYSICAL EVIDENCE
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Ways to Use the 7 PsWays to Use the 7 Ps
Overall Strategic Assessment– How effective is a firm’s services marketing mix?– Is the mix well-aligned with overall vision and
strategy?– What are the strengths and weaknesses in terms
of the 7 Ps?
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Ways to Use the 7 PsWays to Use the 7 Ps
Specific Service Implementation– Who is the customer?– What is the service?– How effectively does the services marketing
mix for a service communicate its benefits and quality?
– What changes/ improvements are needed?
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Expanded Marketing Mix for Expanded Marketing Mix for ServicesServices
PRODUCT PLACE PROMOTION PRICE
Physical good features
Channel type Promotion blend
Flexibility
Quality level Exposure Salespeople Price level
Accessories Intermediaries Advertising Terms
Packaging Outlet location Sales promotion
Differentiation
Warranties Transportation Publicity Allowances
Product lines Storage
Branding
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Expanded Marketing Mix for Expanded Marketing Mix for ServicesServices
PEOPLE PHYSICAL EVIDENCE
PROCESS
Employees
Facility design Flow of activities
Customers Equipment Number of steps
Communicating culture and values
Signage Level of customer involvement
Employee research Employee dress
Other tangibles
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PerceivedService
Expected Service
CUSTOMER
COMPANY
CustomerGap
GAP 1
GAP 2
GAP 3
External Communications
to CustomersGAP 4Service Delivery
Customer-Driven Service Designs and Standards
Company Perceptions of Consumer Expectations
Part 1 Opener
Gaps Model of Service QualityGaps Model of Service Quality
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WHAT’S GAP MODEL ABOUT?WHAT’S GAP MODEL ABOUT?
• That there exists gaps in what is expected and what is delivered and that it alters the perceptions, both for the Customer and the Provider– As the aim of the Service Marketers’ is to close
the customer gap they need to know the Consumer Behavior
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ExpectedService
PerceivedService
GAP
The Customer GapThe Customer Gap
Part 1 Opener
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CECE AND AND CPCP
Customer Expectation: The Reference Points Customers Have When They Plan To Utilize or Enter Into a Service
Customer Perception: The Perceptions formed as the customers receive the actual Service
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THE GLARING GAPTHE GLARING GAP
THE ORIGINAL GAP IS
THE CUSTOMER GAPThe gap between Customer Expectations (CE) and Customer Perception (CP)
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THE OTHER GAPS
These are called the Provider Gaps, as they pertain to the SBU, which tries to close the Customer Gap
• Gap1 Not Knowing What Customers Want
• Gap 2 Not Selecting the Right Service Designs and Standards
• Gap 3 Not Delivering to Standards• Gap 4 Not Matching Performance to
Promises
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SMConsumer Evaluation Processes for Consumer Evaluation Processes for ServicesServices
• Search Qualities– attributes a consumer can determine prior to purchase of a
product• Experience Qualities
– attributes a consumer can determine after purchase (or during consumption) of a product
• Credence Qualities– characteristics that may be impossible to evaluate even
after purchase and consumption
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SMContinuum of Evaluation for Different Continuum of Evaluation for Different
Types of ProductsTypes of Products
Clo
thin
g
Jew
e lry
Fu
rnit
ure
Ho
use
s
Au
tom
ob
iles
Res
tau
ran
t m
eal s
Vac
atio
ns
Ha i
rcu
ts
Ch
ild
ca r
e
Tel
evi
sio
n r
epai
r
Leg
al s
ervi
ces
Ro
ot
can
als
Au
to r
epai
r
Med
ica l
dia
gn
os i
s
Difficult to evaluateEasy to evaluate
{High in search
qualitiesHigh in experience
qualitiesHigh in credence
qualities
{{Most
GoodsMost
Services
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SMCategories in Consumer Decision-Making an Categories in Consumer Decision-Making an Evaluation of ServicesEvaluation of Services
s
Information Search
Evaluation of Alternatives
Purchase and Consumption
Post-Purchase Evaluation
Use of personal sources Perceived risk
Evoked set Emotion and mood
Service provision as drama Service roles and scripts Compatibility of customers
Attribution of dissatisfaction Brand loyalty
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SMCategories in Consumer Decision-Making and Categories in Consumer Decision-Making and
Evaluation of ServicesEvaluation of Services
Information Search
Evaluation of Alternatives
Purchase and Consumption
Post-Purchase Evaluation
Use of personal sources Perceived risk
Evoked set Emotion and mood
Service provision as drama Service roles and scripts Compatibility of customers
Attribution of dissatisfaction Brand loyalty
Culture Values and attitudes Manners and customs Material culture Educational and social
institutions
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SMDual Customer Expectation LevelsDual Customer Expectation Levels
Adequate Service
Desired Service
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SM The Zone of ToleranceThe Zone of Tolerance
Adequate Service
Desired Service
Zone ofTolerance
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Figure 3-3Figure 3-3
Zones of Tolerance forZones of Tolerance forDifferent Service DimensionsDifferent Service Dimensions
Most Important Factors Least Important Factors
Level of
Expectation
Source: Berry, Parasuraman, and Zeithaml (1993)
Adequate Service
Desired Service
Zone ofTolerance
DesiredService
AdequateService
Zone of
Tolerance
Desired Service
Adequate Service
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Figure 3-5Figure 3-5
Factors that InfluenceFactors that InfluenceDesired ServiceDesired Service
DesiredService
AdequateService
Zone of
Tolerance
Enduring ServiceIntensifiers
Personal Needs
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SMFigure 3-6Figure 3-6
Factors that InfluenceFactors that InfluenceAdequate ServiceAdequate Service
DesiredService
AdequateService
Zone of
ToleranceSelf-PerceivedService Role
Situational Factors
Perceived ServiceAlternatives
Transitory ServiceIntensifiers
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Figure 3-7Figure 3-7
Factors that InfluenceFactors that InfluenceDesired and Predicted ServiceDesired and Predicted Service
DesiredService
AdequateService
Zone of
Tolerance
Predicted Service
Explicit ServicePromises
Implicit ServicePromises
Word-of-Mouth
Past Experience
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Thank YOUThank YOU
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l
CUSTOMER PERCEPTIONS OF SERVICE
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Figure 4-1Figure 4-1
Customer Perceptions of Customer Perceptions of Service Quality and Service Quality and
Customer SatisfactionCustomer Satisfaction
ServiceQuality
Reliability
Responsiveness
Assurance
Empathy
Tangibles
ProductQuality
PricePersonalFactors
CustomerSatisfaction
SituationalFactors
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SMFactors Influencing Factors Influencing
Customer SatisfactionCustomer Satisfaction
• Product/service quality
• Product/service attributes or features
• Consumer Emotions
• Attributions for product/service success or failure
• Equity or fairness evaluations
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SMOutcomes of Outcomes of
Customer SatisfactionCustomer Satisfaction
• Increased customer retention
• Positive word-of-mouth communications
• Increased revenues
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SM Service QualityService Quality
• The customer’s judgment of overall excellence of the service provided in relation to the quality that was expected.
• Process and outcome quality are both important.
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SM The Five Dimensions of The Five Dimensions of Service QualityService Quality
Ability to perform the promised service dependably and accurately.
Knowledge and courtesy of employees and their ability to convey 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.
Tangibles
Reliability
Responsiveness
Assurance
Empathy
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SM Exercise to Exercise to Identify Service Identify Service
AttributesAttributesIn groups of five, choose a services industry and spend 10 minutes brainstorming specific requirements of customers in each of the five service quality dimensions. Be certain the requirements reflect the customer’s point of view.
Reliability:
Assurance:
Tangibles:
Empathy:
Responsiveness:
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SMSERVQUAL AttributesSERVQUAL 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
Keeping customers informed as to when services will be performed
Prompt service to customers Willingness to help customers Readiness to respond to customers’
requests
RELIABILITY
RESPONSIVENESS
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
ASSURANCE
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
EMPATHY
Modern equipment Visually appealing facilities Employees who have a
neat, professional appearance
Visually appealing materials associated with the service
TANGIBLES
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SM The Service EncounterThe 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
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Check-InCheck-In
Request Wake-Up CallRequest Wake-Up Call
CheckoutCheckout
Bellboy Takes to Room Bellboy Takes to Room
Restaurant MealRestaurant Meal
Figure 4-4Figure 4-4
A Service Encounter A Service Encounter Cascade for a Hotel VisitCascade for a Hotel Visit
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Sales CallSales Call
Ordering SuppliesOrdering Supplies
BillingBilling
Delivery and Installation Delivery and Installation
ServicingServicing
Figure 4-5Figure 4-5
A Service Encounter A Service Encounter Cascade for an Industrial Cascade for an Industrial
PurchasePurchase
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SMSample Questions for Critical Sample Questions for Critical
Incidents Technique StudyIncidents Technique Study
• 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)?
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SM Common Themes in CriticalCommon Themes in CriticalService Encounters Service Encounters
ResearchResearch
Recovery: Adaptability:
Spontaneity:Coping:
Employee Responseto Service Delivery
System Failure
Employee Responseto Customer Needs
and Requests
Employee Responseto Problem Customers
Unprompted andUnsolicited EmployeeActions and Attitudes
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SM RecoverRecoveryy
• Acknowledge problem
• Explain causes• Apologize• Compensate/upgrade• Lay out options• Take responsibility
• Ignore customer• Blame customer• Leave customer to
fend for him/herself• Downgrade• Act as if nothing is
wrong
DO DON’T
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SM AdaptabilityAdaptability
• Recognize the seriousness of the need
• Acknowledge
• Anticipate
• Attempt to accommodate
• Explain rules/policies
• Take responsibility
• Exert effort to accommodate
• Promise, then fail to follow through
• Ignore
• Show unwillingness to try
• Embarrass the customer
• Laugh at the customer
• Avoid responsibility
DO DON’T
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SM SpontaneitySpontaneity
• Take time
• Be attentive
• Anticipate needs
• Listen
• Provide information (even if not asked)
• Treat customers fairly
• Show empathy
• Acknowledge by name
• Exhibit impatience• Ignore• Yell/laugh/swear• Steal from or cheat a
customer• Discriminate• Treat impersonally
DO DON’T
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SM CopingCoping
• Listen• Try to accommodate• Explain• Let go of the
customer
• Take customer’s dissatisfaction personally
• Let customer’s dissatisfaction affect others
DO DON’T
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SMFigure 4-6 Figure 4-6
Evidence of Service from theEvidence of Service from theCustomer’s Point of ViewCustomer’s Point of View
People
Process PhysicalEvidence
Contact employees Customer him/herself Other customers
Operational flow of activities
Steps in process
Flexibility vs. standard
Technology vs. human
Tangible communication
Servicescape
Guarantees
Technology
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SM Provider GAP 1Provider GAP 1
Company Perceptions of
Consumer Expectations
Expected Service
CUSTOMER
COMPANY
GAP 1
Part 2 Opener
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SMFigure 5-1Figure 5-1
Criteria for An Effective Criteria for An Effective Services Research ProgramServices Research Program
ResearchObjectives
Includes
Qualitativ
e
Research
IncludesQuantitative
Research IncludesPerceptions
and Expectations
of Customers
IncludesMeasures
ofLoyalty orBehavioralIntentions
Balances Cost
and Value of
InformationIncludesStatisticalValidity
When Necessary
Measures Priorities
or Importance
Occurswith
AppropriateFrequency
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SM Portfolio of Services Portfolio of Services ResearchResearch
Customer Complaint Solicitation
“Relationship” Surveys
Post-Transaction Surveys
Customer Focus Groups
“Mystery Shopping” of Service Providers
Employee Surveys
Lost Customer Research
Identify dissatisfied customers to attempt recovery; identify most common categories of service failure for remedial action
Obtain customer feedback while service experience is still fresh; act on feedback quickly if negative patterns develop
Use as input for quantitative surveys; provide a forum for customers to suggest service-improvement ideas
Assess company’s service performance compared to competitors; identify service-improvement priorities; track service improvement over time
Measure individual employee service behaviors for use in coaching, training, performance evaluation, recognition and rewards; identify systemic strengths and weaknesses in service
Measure internal service quality; identify employee-perceived obstacles to improve service; track employee morale and attitudes
Determine the reasons why customers defect
Research Objective Type of Research
Future Expectations ResearchTo forecast future expectations of customersTo develop and test new service ideas
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SMStages in the Research Stages in the Research
ProcessProcess
• Stage 1 : Define Problem
• Stage 2 : Develop Measurement Strategy
• Stage 3 : Implement Research Program
• Stage 4 : Collect and Tabulate Data
• Stage 5 : Interpret and Analyze Findings
• Stage 6 : Report Findings
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SMSM
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SERVICE RECOVERY
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SMFigure 7-1Figure 7-1
Unhappy Customers’ Unhappy Customers’ Repurchase IntentionsRepurchase Intentions
95%
70%
46%
37%
82%
54%
19%
9%
Complaints Resolved Quickly
Complaints Resolved
Complaints Not Resolved
Minor complaints ($1-$5 losses) Major complaints (over $100 losses)
Unhappy Customers Who Don’t Complain
Unhappy Customers Who Do Complain
Percent of Customers Who Will Buy Again
Source: Adapted from data reported by the Technical Assistance Research Program.
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Figure 7-3Figure 7-3
Customer Response Customer Response Following Service FailureFollowing Service Failure
Service Failure
Do NothingTake Action
Stay with ProviderSwitch Providers
Complain to Provider
Complain to Family & Friends
Complain to Third Party
Stay with ProviderSwitch Providers
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SMFigure 7-5Figure 7-5
Service Recovery StrategiesService Recovery Strategies
Learn fromRecovery Experiences
Treat C
ustomers
Fairly
Learn
from
Lo
st Cu
stom
ers
Welcome and
Encourage ComplaintsFail S
afe the S
ervice
Act Q
uickly
Service Recovery Strategies
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SMFigure 7-6Figure 7-6
Causes Behind Service Causes Behind Service SwitchingSwitching
Service Switching Behavior
• High Price• Price Increases• Unfair Pricing• Deceptive Pricing
Pricing
• Location/Hours• Wait for Appointment• Wait for Service
Inconvenience
• Service Mistakes• Billing Errors• Service Catastrophe
Core Service Failure
• Uncaring• Impolite• Unresponsive• Unknowledgeable
Service Encounter Failures
• Negative Response• No Response• Reluctant Response
Response to Service Failure
• Found Better Service
Competition
• Cheat• Hard Sell• Unsafe• Conflict of Interest
Ethical Problems
• Customer Moved• Provider Closed
Involuntary SwitchingSource: Sue Keaveney
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SMSM
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Part 3
ALIGNING STRATEGY, SERVICE DESIGN
AND STANDARDS
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CUSTOMER
COMPANY
GAP 2
Customer-Driven Service Designs and
Standards
Company Perceptions of
Consumer Expectations
Provider GAP 2Provider GAP 2
Part 3 Opener
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Figure 8-2 Figure 8-2
New Service Development ProcessNew Service Development Process
Source: Booz-Allen & Hamilton, 1982; Bowers, 1985; Cooper, 1993; Khurana & Rosenthal 1997.
Business Strategy Development or Review
New Service Strategy Development
Idea Generation
Concept Development and Evaluation
Business Analysis
Service Development and Testing
Postintroduction Evaluation
Commercialization
Market Testing
Screen ideas against new service strategy
Test concept with customers and employees
Test for profitability and feasibility
Conduct service prototype test
Test service and other marketing-mix elements
Front End Planning
Implementation
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SMFigure 8-4Figure 8-4
Service Mapping/BlueprintingService Mapping/Blueprinting
A tool for simultaneously depicting the service process, the points of customer contact, and the evidence of service from the customer’s point of view.
ServiceMapping
Process
Points of Contact
Evidence
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DriverPicksUp Pkg.
DispatchDriver
AirportReceives& Loads
SortPackages
Load onAirplane
Fly toDestinati
on
Unload&
Sort
LoadOn
Truck
Express Mail Delivery ServiceExpress Mail Delivery ServiceSU
PPO
RT
PR
OC
ESS
CO
NTA
CT
PER
SO
N(B
ack
Sta
ge)(O
n S
tage)C
USTO
ME
RPH
YSIC
AL
EV
IDEN
CE
CustomerCalls
CustomerGives
Package
TruckPackagingFormsHand-held ComputerUniform
ReceivePackage
TruckPackagingFormsHand-held ComputerUniform
DeliverPackage
CustomerServiceOrder
Fly toSort
Center
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SMOvernight Hotel StayOvernight Hotel Stay
SU
PPO
RT P
RO
CESS
CO
NTA
CT P
ER
SO
N
(Back
Sta
ge)(
On S
tage)
CU
STO
MER
HotelExteriorParking
Cart for Bags
DeskRegistrationPapersLobbyKey
ElevatorsHallwaysRoom
Cart for Bags
RoomAmenitiesBath
Menu DeliveryTrayFoodAppearance
Food
BillDeskLobbyHotelExteriorParking
Arriveat
Hotel
Give Bagsto
BellpersonCheck in Go to
RoomReceive
BagsSleep
Shower
CallRoom
Service
ReceiveFood
EatCheck out
andLeave
Greet andTakeBags
ProcessRegistration
DeliverBags
DeliverFood
ProcessCheck Out
Take Bagsto Room
TakeFoodOrder
RegistrationSystem
PrepareFood
RegistrationSystem
PH
YSIC
AL
EV
IDEN
CE
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SM Figure 8-8Figure 8-8
Building a Service BlueprintBuilding a Service Blueprint
Step 1
Identify the process to be blue-printed.
Step 1
Identify the process to be blue-printed.
Step 2
Identify the customer or customer segment.
Step 2
Identify the customer or customer segment.
Step 3
Map the process from the customer’s point of view.
Step 3
Map the process from the customer’s point of view.
Step 4
Map contact employee actions, onstage and back-stage.
Step 4
Map contact employee actions, onstage and back-stage.
Step 5
Link customerand contact person activities to needed support functions.
Step 5
Link customerand contact person activities to needed support functions.
Step 6
Add evidence of service at each customer action step.
Step 6
Add evidence of service at each customer action step.
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SMApplication of Service Application of Service
BlueprintsBlueprints
• New Service Development• concept development
• market testing
• Supporting a “Zero Defects” Culture• managing reliability
• identifying empowerment issues
• Service Recovery Strategies• identifying service problems
• conducting root cause analysis
• modifying processes
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SMBlueprints Can Be Used By:Blueprints Can Be Used By:
• Service Marketers– creating realistic customer
expectations• service system design• promotion
• Operations Management– rendering the service as
promised• managing fail points• training systems• quality control
• Human Resources– empowering the human element
• job descriptions• selection criteria• appraisal systems
• System Technology– providing necessary tools:
• system specifications• personal preference databases
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SMSM
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CUSTOMER-DEFINED SERVICE STANDARDS
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Figure 9-3Figure 9-3
Process for Setting Process for Setting
Customer-Defined StandardsCustomer-Defined Standards 1. Identify Existing or Desired Service Encounter Sequence
2. Translate Customer Expectations Into Behaviors/Actions2. Translate Customer Expectations Into Behaviors/Actions
4. Set Hard or Soft Standards
5. Develop FeedbackMechanisms
5. Develop FeedbackMechanisms
7. Track Measures Against Standards
Measure byAudits or
Operating DataHard Soft
Measure byTransaction-
Based Surveys
3. Select Behaviors/Actions for Standards 3. Select Behaviors/Actions for Standards
6. Establish Measures and Target Levels 6. Establish Measures and Target Levels
8. Update Target Levels and Measures 8. Update Target Levels and Measures
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SMSM
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PHYSICAL EVIDENCE AND THE SERVICESCAPE
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SMTable 10-1Table 10-1
Elements of Physical Elements of Physical EvidenceEvidence
Servicescape Other tangibles
Facility exteriorExterior designSignageParkingLandscapeSurrounding environment
Facility interiorInterior designEquipmentSignageLayoutAir quality/temperature
Business cardsStationeryBilling statementsReportsEmployee dressUniformsBrochuresInternet/Web pages
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Table 10-2 Table 10-2 Examples of Physical Evidence from the Examples of Physical Evidence from the
Customer’s Point of ViewCustomer’s Point of ViewService Physical evidence
Servicescape Other tangiblesInsurance Not applicable Policy itself
Billing statementsPeriodic updatesCompany brochureLetters/cards
Hospital Building exteriorParkingSignsWaiting areasAdmissions officePatient care roomMedical equipmentRecovery room
UniformsReports/stationeryBilling statements
Airline Airline gate areaAirplane exteriorAirplane interior (décor, seats, airquality)
TicketsFoodUniforms
Express mail Not applicable PackagingTrucksUniformsComputers
Sportingevent
Parking, Seating, RestroomsStadium exteriorTicketing area, Concession AreasEntrance, Playiing Field
SignsTicketsProgramUniforms
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SM
Table 10-3 Table 10-3
Typology of Service Organizations Typology of Service Organizations Based on Variations in Form Based on Variations in Form and Use of the Servicescapeand Use of the Servicescape
Complexity of the servicescape evidenceServicescapeusage
Elaborate Lean
Self-service(customer only)
Golf LandSurf 'n' Splash
ATMTicketronPost office kioskInternet servicesExpress mail drop-off
Interpersonalservices(both customer andemployeee)
HotelRestaurantsHealth clinicHospitalBankAirlineSchool
Dry cleanerHot dog standHair salon
Remote service(employee only)
Telephone companyInsurance companyUtilityMany professional services
Telephone mail-order deskAutomated voice-messaging-based services
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Figure 10-3Figure 10-3 A Framework for UnderstandingA Framework for UnderstandingEnvironment-user Relationships Environment-user Relationships
in Service Organizationsin Service Organizations
Source: Adapted from Mary Jo Bitner, “Servicescapes.”
PHYSICALENVIRONMENTAL
DIMENSIONS
HOLISTICENVIRONMENT
INTERNALRESPONSES
BEHAVIOR
Ambient Conditions
Space/Function
Signs, Symbols, and Artifacts
PerceivedServicescape
Cognitive
Emotional
Physiological
Cognitive
Emotional
Physiological
Employee Responses
Customer Responses
Individual Behaviors
Social Interactions
between and among
customer and employees
Individual Behaviors
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SMSM
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Part 4
DELIVERING AND PERFORMING SERVICE
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SM
CUSTOMER
COMPANY
Provider GAP 3Provider GAP 3
Service DeliveryGAP 3
Customer-Driven Service Designs and
Standards
Part 4 Opener
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SMSM
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EMPLOYEES’ ROLES IN SERVICE DELIVERY
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SM Service EmployeesService Employees
• They are the service
• They are the firm in the customer’s eyes
• They are marketers
• Importance is evident in– The Services Marketing Mix (People)– The Service-Profit Chain– The Services Triangle
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SM Service EmployeesService Employees
• Who are they?– “boundary spanners”
• What are these jobs like?– emotional labor– many sources of potential conflict
• person/role• organization/client• interclient• quality/productivity
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Figure 11-3Figure 11-3
Boundary Spanners Interact Boundary Spanners Interact with Both Internal with Both Internal
and External Constituentsand External Constituents
Internal Environment
External Environment
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SMFigure 11-4Figure 11-4
Sources of Conflict for Sources of Conflict for Boundary-Spanning WorkersBoundary-Spanning Workers
• Person vs. Role
• Organization vs. Client
• Client vs. Client
• Quality vs. Productivity
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Figure 11-5 Figure 11-5
Human Resource Strategies for Closing GAP 3Human Resource Strategies for Closing GAP 3
Customer-oriented Service Delivery
Hire theRight People
ProvideNeeded Support
Systems
Retain theBest
People
DevelopPeople to
DeliverServiceQuality
Compete
for
the B
est
People
Hire for Service
Competencies and Service Inclination
Provide Supportive Technology
and Equipment
Tre
at
Em
plo
ye
es
a
s
Cu
sto
me
rs
Em
po
we
r E
mp
loy
ee
s
Be the Preferred
Employer Train for
Technical and
Interactive
Skills
Prom
ote
Team
wor
k
Measure
Internal
Service
Quality
Develop Service-
oriented Internal
Processes
Mea
sure
and
R
ewar
d S
tron
g S
ervi
ce
Pro
vide
rs
Include
Em
ployees in
the
Com
pany’s
Vision
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SM Service CultureService Culture
“A culture where an appreciation for good service exists, and where giving good service to internal as well as ultimate, external customers, is considered a natural way of life and one of the most important norms by everyone in the organization.”
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Part 5
MANAGING SERVICE PROMISES
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CUSTOMER
COMPANYExternal
Communications to CustomersGAP 4
Service Delivery
Provider GAP 4Provider GAP 4
Part 5 Opener
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SMFigure 15-1Figure 15-1
Communications and the Communications and the Services Marketing TriangleServices Marketing Triangle
Internal MarketingInternal Marketing Vertical Communications
Horizontal Communications
Interactive Marketing Personal Selling
Customer Service Center Service Encounters
Servicescapes
External Marketing Communication Advertising Sales Promotion Public Relations Direct Marketing
Company
CustomersEmployees
Source: Parts of model adapted from work by Christian Gronroos and Phillip Kotler
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SMApproaches forApproaches for
Integrating Services Marketing Integrating Services Marketing CommunicationCommunication
Goal:Delivery
greater than or equal to promises
Improve CustomerEducation
ManageService
Promises
ManageCustomer
Expectations
ManageInternal
MarketingCommunication
Figure 15-3Figure 15-3
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Goal:Delivery
greater than or equal to promises
OfferService
Guarantees
Create EffectiveServices
Communications
MANAGING SERVICE PROMISES
MakeRealisticPromises
Coordinate External
Communication
Figure 15-4Figure 15-4
Approaches forApproaches forManaging Service PromisesManaging Service Promises
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Communicate Criteria for Service Effectiveness
Create Tiered-ValueOfferings
Figure 15-8Figure 15-8
Approaches forApproaches forManaging Customer ExpectationsManaging Customer Expectations
NegotiateUnrealistic
Expectations
Goal:Delivery
greater than or equal to promises
Offer Choices
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Goal:Delivery
greater than or equal to promises
Prepare Customers
for the Service Process
Clarify Expectationsafter the Sale
Figure 15-9Figure 15-9
Approaches forApproaches forImproving Customer EducationImproving Customer Education
Teach Customers to Avoid
Peak Demand Periods
andSeek Slow
Periods
Confirm Performanceto Standards
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SMGoal:
Delivery greater than or equal to promises
Figure 15-10Figure 15-10
Approaches for ManagingApproaches for Managing Internal Marketing CommunicationsInternal Marketing Communications
Create EffectiveVertical
Communications
Align Back Office Personnel
w/ External Customers
Create EffectiveHorizontal
Communications
CreateCross-Functional
Teams
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SMManaging Uncooperative Managing Uncooperative
CustomersCustomers
• There are 5 profiles of “Customers from Hell," representing the worst that customers have to offer.
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SM Egocentric EdgarEgocentric Edgar
• Places his needs above all other customers & service personnel.
• Your credo "We Are Here To Serve," for Edgar means "Your Company Exists To Serve My Needs and My Needs Alone & Right Now!"
• Doesn't believe waiting in line (Pushes his way to the front & demands service on a variety of things & immediate attention.)
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SM Dealing with Edgar(s)Dealing with Edgar(s)
• Don’t let his ego destroy yours, while at the same time appeal to his ego.
• Take action that demonstrates your ability to solve his problem, which will surprise Edgar.
• Never talk policy to Edgar directly but use phrases such as, "For you, Edgar, I can do the following..."
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SM Bad-Mouth BettyBad-Mouth Betty
• Lets you know in clear terms exactly what she thinks of you, your organization, and the heritage of both.
• If she can’t be right, becomes abusive to service personnel and other customers alike.
• Loud, vulgar, rude, crude and insensitive.
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SM Dealing with Betty(s)Dealing with Betty(s)
• Attempt to move her "off stage," to reduce contamination of other customers.
• Selective agreement on minor issues to show that you are listening & are possibly on her side(Be careful, agreeing with her that your boss really is an "SOB" is not advisable,
since Betty is likely to use this to her advantage at a later date!) • The last option that every good service firm should
seriously consider is to "force the issue."
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SM HYSTREICAL HAROLDHYSTREICAL HAROLD• He is the classic tantrum
thrower (A screamer. If he doesn't get his way, his face will turn colors and veins will literally pop out from his neck.)
• Demonstrates the dark side of the child inside all of us.
• The adult embodiment of the terrible two (Only louder- Much louder.)
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SM Dealing with Harold(s)Dealing with Harold(s)
• Move Harold offstage, when Harold has a problem, Harold has to vent. When offstage, let him vent and get it off his chest.
• Get to the heart of the matter and begin to take action. • Take responsibility for the problem(Do not blame the problem
on fellow employees, upper management, or others who may ultimately be
responsible.) • Offer an apology for what has occurred and, more
importantly, a solution to Harold's problem.
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SMDictatorial Dick
• Claims to be Egocentric Edgar's evil twin.
• Tells everyone exactly how they are supposed to do their jobs because he has done it all before.
• Will provide you a written copy of his instructions (Which is copied to your boss, your boss's boss & his lawyer. Dick will most likely make you sign for your copy.)
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SM Dealing with Dick(s)Dealing with Dick(s)
• Don’t let him push you around. • Stick to your game plans and provide service in
an appropriate & equitable manner.• Tell him straight what exactly you can do for
him. • And if reasonable to do so, fulfilling his request
will break up Dick's game plan and resolve the conflict.
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SM FREELOADING FREDAFREELOADING FREDA• Will push your return policy to
the limits.• Scream bloody murder to
everyone including media.• Give her an inch and she'll take
everything that's not nailed down.
• If her kid's shoes begin to wear out in a year, she'll return them for new ones now.
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SM Dealing with Freda(s)Dealing with Freda(s)
• Bite your tongue & give her what she wants(Have a heart, despite popular beliefs the Freda(s) of the world probably represent only 1% to 2% of customers!)
• Another possibility is to track Freda's actions and suggest possible legal action to persuade her to take her business elsewhere.
• Develop new policies for the sole purpose of defeating Freda and her comrades ( But that’ll make it difficult for honest
customers, alas.)
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Part 6
THE BIG PICTURE: :
CLOSING ALL THE GAPS
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PerceivedService
Expected Service
CUSTOMER
COMPANY
CustomerGap
GAP 1
GAP 2
Gaps Model of Service QualityGaps Model of Service Quality
GAP 3
External Communications
to CustomersGAP 4Service Delivery
Customer-Driven Service Designs and Standards
Company Perceptions of Consumer Expectations
Figure 18-1Figure 18-1
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Provider Gap 1: Not knowing what customers expect
Provider Gap 2: Not selecting the right service designs and standards
Provider Gap 3: Not delivering to service standards
Provider Gap 4: Not matching performance to promises
Customer Expectations
Customer Perceptions
Figure 18-2Figure 18-2
Key Factors Leading to Key Factors Leading to the Customer Gapthe Customer Gap
CustomerGap
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Expectations
Company Perceptions of Customer Expectations
Inadequate Marketing Research OrientationInsufficient marketing researchResearch not focused on service qualityInadequate use of market research
Lack of Upward CommunicationLack of interaction between management and customersInsufficient communication between contact employeesand managersToo many layers between contact personnel and topmanagement
Insufficient Relationship FocusLack of market segmentationFocus on transactions rather than relationshipsFocus on new customers rather than relationshipcustomers
Inadequate Service Recovery
GAP1
Figure 18-3Figure 18-3 Key Factors Leading to Provider Gap 1Key Factors Leading to Provider Gap 1
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Management Perceptions of Customer Expectations
Poor Service Design Unsystematic new service development process Vague, undefined service designs
Failure ot connect service design to servicepositioning
Absence of Customer-Driven StandardsLack of customer-driven service standardsAbsence of process management to focus oncustomer requirementsAbsence of formal process for setting servicequality goals
Inappropriate Physical Evidence and Servicescape
GAP2
Figure 18-4Figure 18-4
Key Factors Leading to Provider Gap 2Key Factors Leading to Provider Gap 2
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Service DeliveryService Delivery
Customer-Driven Service Designs and Standards
Customer-Driven Service Designs and Standards
Key Factors Leading to Provider GAP 3Key Factors Leading to Provider GAP 3
Figure 18-5Figure 18-5
Deficiencies in Human Resource PoliciesIneffective recruitmentRole ambiguity and role conflictPoor employee-technology job fitInappropriate evaluation and compensation systemsLack of empowerment, perceived control and teamwork
Failure to Match Supply and DemandFailure to smooth peaks and valleys of demandInappropriate customer mixOver-reliance on price to smooth demand
Customers Not Fulfilling RolesCustomers lack knowledge of their roles and responsibilitiesCustomers negatively impact each other
Problems with Service Intermediaries Channel conflict over objectives and performance Channel conflict over costs and rewards Difficulty controlling quality and consistency Tension between empowerment and control
GAP3
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SMService DeliveryService Delivery
Key Factors Leading to Provider GAP 4Key Factors Leading to Provider GAP 4Figure 18-6Figure 18-6
Lack of Integrated Services Marketing Communications Tendency to view each external communication as independent Not including interactive marketing in communications plan Absence of strong internal marketing program
Ineffective Management of Customer ExpectationsNot managing customer expectations through all forms ofcommunicationNot adequately educating customers
OverpromisingOverpromising in advertisingOverpromising in personal sellingOverpromising through physical evidence cues
Inadequate Horizontal CommunicationsInsufficient communication between sales and operationsInsufficient communication between advertising and operationsDifferences in policies and procedures across branches or units
GAP4
External Communications to Customers
External Communications to Customers
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