MK212 Marketing
Value promise
A promise made to customers about value-in-use, which they should be able to realise in their value-creating processes in the future. Value promise fits situations in which value as value-in-use is not delivered but created in co-creational and customer-independent value creation processes
Zone of tolerance
Acceptable range of variations in service delivery
Customer service
All activities performed by retailers and their personnel to attract, retain, and enhance a customer's shopping experience (Levy & Weitz, 2007)
Promise management
An approach to marketing, in which marketing is a process of making promises, keeping promises and enabling the making and keeping of promises
Satisfaction
An attitude-like judgment following a service purchase or series of service interactions
Services as experiences
Creating memorable events for customers
High-contact services
Customers visit service facility and remain throughout service delivery, active contact between customers and service personnel, includes most people-processing services
Potential value-in-use
The potential value for customers embedded in the resources offered by a service provider. It is realised as real value (i.e. as value-in-use) for the customer during usage. As a customer-centric concept, based on utility theory, potential value-in-use is used in SL
Co-creation
The process of creating something together in a process of direct interactions between two or more actors, where the actors' processes merge into one collaborative, dialogical process
A joint sphere
The service provider and customers interact directly, which enables the provider to engage with customers' value creation and co-create value with them
The service provider can actively and directly influence...
customers' perceptions of the firm and its service, as well as customers' willingness to continue buying from it
Omni retail channels
An integrated and seamless blending of the customer shopping experience with physical and online channels. This is similar to the concept of using multi-channel formats except that it is concentrated more on a seamless approach to the consumer experience through all available shopping channels e.g. mobile Internet devices, computers, bricks and mortar, television, catalogues etc
Loyalty programme
An integrated system of marketing actions that aims to make customers more loyal by developing personalized relationships with them (Waarden-Meyer, 2008: 89)
Big data
Any collection of data sets so large and complex that it becomes difficult to process using traditional data processing applications
Service Culture
Appreciation for good service, good service is given to internal as well as external customers, good service is a way of life
Individual Behaviours
Approach behaviour; desire to stay, explore, work, affiliate whereas avoidance behaviour is the opposite
Network theory
Argues strongly that the internationalisation process is based on and facilitated by social interaction and relationships that evolve and develop over time. While grounded initially in the context of manufacturing, it has also been applied to the retail sector
Dimensions of Store Image
Atmosphere, convenience, facilities, institutional, merchandise, promotion, sales personnel, service
Relationship Marketing (RM)
Attracting, maintaining and - in multi-service organisations - enhancing customer relationships (Berry, 1983, p. 25)
Five key service elements
Availability of service personnel. responsiveness to customers, personalisation, proactiveness, loyalty programs
Price-related drivers
Average price, dispersion of prices, price dynamics, price-related policies
Brand equity revolves around a number of key dimensions:
Awareness, loyalty, perceived quality, brand associations and other proprietary brand assets (Aaker, 1991)
Switching Barriers
Barriers that make it difficult to leave one service provider and begin a relationship with another
Competition Based Pricing Strategy
Based on prices charged by other firms in the same industry or market. Used when services are standard across service providers and in oligopolies, with few large service providers
Functional differentiation
A mode of distinguishing things or arrangements based on the purposes or activities to which they are devoted
GAP Model of Service Quality
A model identifying five gaps that can cause problems in service delivery and influence customer evaluations of service quality
Value proposition
A one-sided, firm-oriented concept for effective value delivery, with the clear potential to strengthen marketing in a goods-providing firm that engages in limited customer interfaces, other than customers' indirect interactions with a physical product, which is a context characterised by value delivery
Subordinate service role
A performing role that give people a status below that of the customer e.g. waiters, bus drivers and hotel receptionists
Servicescape
A physical setting in which a marketplace exchange is performed, delivered, and consumed within a service organisation (Zeithaml et al., 2009)
Employee satisfaction
A pleasurable or positive emotional state resulting from the appraisal of one's job or job experiences (Locke, 1976, p. 1,300), is believed to be achieved through various human resource management practices i.e. job design, employee rewards and recognition etc (Spector, 1997)
Guarantee
A pledge or assurance that a product offered by a firm will perform as promised and, if not, then some form of reparation will be undertaken by the firm
Customer loyalty
A primary determinant of organisational profitability and growth (Heskett et al., 42); a deep commitment to the service provider (Shankar et al., 2003, p. 154)
Service switching
A process resulting from a series of decisions and critical service encounters over time rather than one specific moment in time when a decision is made
Markdowns
A reduction in the price of an item to reflect the present market position, caused by difficulties in forecasting demand, damaged goods, poor pricing, need to avoid being perceived as regular and predictable discounts, better use of technology
The purchase funnel
A sequential consumer decision-making model encompassing awareness to loyalty. It may consist of awareness, interest, consideration, intent, evaluation, purchase
Overhead costs
A share of fixed costs
Trailer call
A short survey that follows ("trails") a service event of encounter. If offers quick feedback on employees and also allows a company to fix its processes in a timely fashion
Competitive intensity
A situation where industry competition is fierce due to the number of competitors in the market and the lack of potential opportunities for further market growth
(Attracting Status Seekers) Prestige pricing
A special form of demand- based pricing where service providers offer high-quality or status services. Higher price is charged for the luxury end of the business e.g. restaurants, health clubs
The free form layout
A store design, used primarily in small specialty stores or within the boutiques of large stores, that arranges fixtures and aisles asymmetrically; 'organised chaos'. Also called boutique layout
Services triangle
A strategic framework that visually reinforces the importance of people in the ability of firms to keep their promises and succeed in building customer relationships (Bitner, 1995; Kotler, 1994; Grönroos, 2007)
Content marketing
A strategic marketing approach focused on creating valuable, relevant and consistent content to attract and retain a clearly defined audience, and ultimately to drive profitable customer action. It is also labelled as real-time marketing and has the role of storytelling (building narratives)
Value
A subject's relativistic preference after his or her interactions with things or events (Babin et al., 1994). It represents another important element in managing long-term customer relationships (Pride and Ferrell, 2003)
Attention restoration theory
A theory proposing that particular environmental characteristics, often found in natural settings, can support recovery from attentional fatigue
Service 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; process > points of contact > evidence
The customer pyramid
A tool that enables the firm to utilise differences in customer profitability to manage for increased customer profitability, strengthen the link between service quality and profitability as well as determine the optimal allocation of scarce resources
Financial Bonds
A type of business practice which is to enhance customer loyalty through pricing incentive (Berry, 1995)
The grid layout
A type of store layout that is characterised by long rows of shelving with aisles between the rows
Social Media Influencer
A user on social media who has established credibility in a specific industry. They have access to a large audience and can persuade others by virtue of their authenticity and reach
Competitive
About as good as the competition
Activists
Above average propensity to complain on all levels; more likely to complain to a third party; feel most alienated from the marketplace compared to other groups; in extreme cases can become "terrorists"
Supporting
Acceptable or slightly less versus the competition
Benefits of Social Media Platforms for Shoppers
Access information about specific retailers, brands and special offers, contribute views and opinions about shopping experiences, learn from other like-minded shoppers, engage in comparison pricing and information on retailers and brands, develop a personalised relationship with fellow shoppers and the retailer, save time and benefit from the convenience of 'visiting' the retail store in a 'virtual' sense, get some preferential treatment from retailers by virtue of being a fan, feel more confident about making purchases, feel a sense of belonging and being part of a community
Voicers
Actively complain to the provider, but not likely to spread negative WOM; believe in the positive consequences of complaining - the service provider's best friends
Boundary-spanning behaviour (BSB) contends that service employees achieve excellence through three key areas:
Actual service delivery (akin to key elements of service quality provision), external representation (being outstanding advocates of the company to external constituents) and internal influence (being an internal champion for developing service excellence across the company).
Cost-plus pricing
Adding a standard mark-up to the cost of the product, ignores market realities
(CBBE) Salience
Addresses aspects of the brand that are noticeable and recognisable to the consumer. This does not necessarily mean all elements of the brand, but aspect which mean that the consumer includes the brand in the 'consideration set' when evaluating brand alternatives in the early stages of the purchasing process
Six dimensions of shopping behaviour
Adventure, social shopping, gratification, idea shopping, role and value (Arnold and Reynolds, 2003)
Dimensions of Shopping Behaviour
Adventure, social shopping, gratification, idea shopping, role, value
Hi-Lo
Advocates the use of sales periods to stimulate store traffic and turnover, tend to attract shoppers with a higher willingness to pay, lack of conditioning to lower prices as in EDLP, fluctuating high and low prices
Social interactions
Affected by the physical container in which the service occurs. Can affect the nature of the social interaction in terms of the duration and the actual progression of events and limit the duration of the service
Low level of participation
All that is required is the customer's physical presence with the employees of the firm doing all the service production work e.g. orchestral concert
Wholesaling
All the activities involved in selling goods and services to those buying for resale or business use
Organic growth (or growing internally)
Allows the company to have very high levels of control over its operations. The costs of pursuing this approach are also high and the degree of risk is also relatively high compared with other entry mode options
Sponsorship
Allows the retailer to align/invest its brand values with a similar entity or brand. Needs to activate and leverage the sponsorship
Positive greens (18%)
Already act environmentally, looking to engage further
Stalled starters (10%)
Ambivalent or anti-environmental views, not taking action
Customer databases
An area of tracking customer reactions to different service and promotional offerings
Risk
An attribute of an alternative decision reflecting the variance of its possible outcomes (Gefen et al., 2002)
Achievement-striving motivation
An employee's perception of his/her desired intention to engage in planned actions to achieve beneficial, work-related tasks
Service inclination
An employees' interest in doing service-related work, which is reflected in their attitudes towards service and orientation toward serving customers and others on the job
Radio Frequency Identification
An extension of the bar code concept; 'intelligent' bar codes that can ' talk' to a networked system and track a particular item, pallet or case as it moves from point of manufacture to the time it ends up in the shopper's basket
Biophilia hypothesis
An innate bond exists between humans and other living systems, including nature and wildlife (Wilson, 1984)
Special treatment benefits
Customers receiving a special deal or price, or getting preferential treatment
Lead customers
Customers that cost the company money. The company must minimise this customer segment, either by trying to upgrade customers or by disassociating from them. However, if customers will be more profitable in the future, the company should serve them well
Post-sales touchpoint
Dealing with complaints, returns and warranty issues, speed of response to customer complaints and concerns, managing the complaints process, speed of response to replacing items
Interactive quality
Derives from the interaction between contact personnel and customers as well as between some customers and other customers
Hedonic values
Derives more from fun and enjoyment than from task completion and are non-instrumental, experiential, and affective (Chaudhuri and Holbrook, 2001) e.g. entertainment, exploration, and self-expression (Ailawadi et al., 2001; Chandon et al., 2000),
Marketing Science
Describes how IT has altered the very nature of the firm's connection to the customer
Subjectivity
Describing a service in words will be biased by personal experiences and degree of exposure to the service
Customer Relationship Management Systems
Designed to keep a history of all contacts a customer has had with the service provider
Demand-oriented pricing
Determining the value of a service (to customers)
Sustainable development
Development that meets the needs of the present without compromising the ability of future generations to meet their own needs (United Nations, 1987)
Creating Successful Service Delivery Teams
Emphasis on cooperation, listening, coaching, and encouraging one another, understand how to air differences, tell hard truths, ask tough questions, management needs to set up a structure to steer teams toward success
Types of centres
First generation: traditional "high street format" - 1960's and 70's in UK Second generation: early versions of the shopping centre concept - more focus on local brands and products Third generation: shopping as entertainment Third plus e.g. ski slopes
Role of Personal Selling
Impact of Omni-channels, no longer the 'sole keeper of knowledge', the customer is more proactive, a key role in reinforcing the retailer's brand image, reassurance, steering and directing
Four categories of external search
Impersonal advocate (print and broadcast media), impersonal independent (popular articles and broadcast programming), personal advocate (salespeople), personal independent (friends and relatives) (Andreasen, 1968)
Service Guarantee
Implicit guarantees i.e. return of goods, specific guarantees i.e. speed of servic, unconditional guarantees i.e. total satisfaction
Approach behaviours
Include all positive behaviours that might be directed at a particular place, such as desire to stay, explore, work, and affiliate (Mehrabian and Russell 1974)
(Components of service blueprinting) Customer actions
Includes all of the steps that customers take as part of the service delivery process. They are depicted chronologically across the top of the blueprint
Actual service
Includes both final results and the process through which those results were obtained
Expected experience
Includes expected attraction experience (i.e. expected number and experience value of visited attractions) and wait experience (i.e. expected waiting time)
Physical quality
Includes the physical aspects of the service (e.g., equipment or building)
Visitor satisfaction
Includes transaction-specific and overall satisfaction (Jones & Suh, 2000)
Consumer-specific factors that influence price image:
Individual factors that are relatively consistent over time e.g. price sensitivity and familiarity with market prices Situational factors such as time pressure and the financial consequences of the purchase decision
(Ethical shoppers) Suspicious shoppers
Individuals who are mistrustful of other people. This is reflected in their dealings with retailers where they feel they may be taken advantage of in certain buying situations. They tend to be idealistic and do not wish to do anything that might hurt others
Explicit signals
Labels, for giving directions, communicating the service script, reminders about behavioural rules
Emotional labour
Labour that goes beyond the physical or mental skills needed to deliver quality service. Boundary-spanning service employees are expected to align their displayed emotions with organisationally desired emotions e.g. delivering smiles, making eye contact, showing sincere interest and engaging in friendly conversation
Honestly disengaged (10%)
Lack of concern and interest in the environment, see no need to change actions or lifestyle, individualistically-focused
Factors that influence desired service
Lasting service intensifiers, personal needs
Transformational leaders
Leaders who stimulate and inspire (transform) followers to achieve extraordinary outcomes
Passives
Least likely to take any action, say anything to the provider, spread negative WOM, or complain to a third party; doubtful of the effectiveness of complaining
Key drivers of sustainable supply chain management (Mannet al., 2010)
Legislation, environmental drivers, financial drivers, internal business process drivers, customers, social
(Retail location strategy) Shopping
Leisure entertainment-based and functional utilitarian
Unprompted/unsolicited employee actions
Level of attention, unusual action, cultural norms, gestalt, adverse action
Constraints to effective customer service design and implementation
Levels of pay, part-time staff, repetitive and boring, in-store theft, technology and shift to 'low-touch'
Roles
Like actors, employees have roles to play and behave in specific ways
Expectations as beliefs
Links between an object and attribute - in order to take advantage of the preciseness and general acceptability of definitions of the concept belief
Remote services
Little or no customer involvement with the servicescape; employee only servicescape e.g. telephone company, insurance company, professional services
Aghazadeh (2005: 31) identifies a number of guidelines for making store layout decisions...
Locate high-draw items around the store, use prominent locations for high-impulse and high-margin items, distribute what is known as 'power items' to both sides of an aisle and to increase the viewing of other items, use end-aisle locations for high exposure rate, convey the impression of the store by careful selection in the positioning of the lead-off department
Retail pricing objectives
Long-term market development and profitability, short-term market share gain or protection, brand and quality-led objectives, sustainability-led objectives, equitable pricing objectives, promotions-led objectives, inventory-led objectives
Retail store loyalty
Loyal customers tend to buy more goods, they tend to be more predictable, cheaper to retain loyal customers, they act as ambassadors, they tend to become more profitable to the retailer over time, they are less likely to switch
(Categories of shoppers) Materialistic bargain hunter
Mainly blue collar (working class) are avid (interested) shoppers and will use any type of outlet, but will never pay full price for anything (11% of European population)
Key factors that shape the direction of retailer pricing strategies
Medium (online/offline), manufacture interaction, product type, other marketing mix, cross-channel competition and store positioning/format, in-channel competition and customer factors
Walters and Laffy (1996) identified four broad areas that make up the retail marketing mix:
Merchandise decision, store format, layout, space allocation, design and atmospherics, customer service and customer communications
(Retail location strategy) Location
Micro-level and macro-level
(Attracting bargain hunters) Discounting
Offering discounts or price cuts to communicate to price sensitive buyers that they are receiving value e.g. Airlines offering discounted ticket prices or free seats where customers pay only taxes and administration charges
Structural Bonds
Offers target customers value-adding benefits that are difficult or expensive for businesses to provide and that are not readily available elsewhere (Berry, 1995, p. 240)
Service-dominant logic service
Often defined as the application of specific competences on resources for the benefit of someone (Vargo and Lusch, 2008)
(Categories of shoppers) Old neighbourhood shopper
Older people, less well-off. Conservative, value tradition and their local roots. Fixed shopping habits, favour the 'corner shop' (21% of European population)
(Categories of shoppers) Demanding shopper
Older people, well-off and selective. Seek good standards of service and are loyal to specialist shops (13% of European population)
Factors influencing the location decision
Online developments, mobile technology, social media platforms, growth in expenditure on leisure-based activities, lifestyle changes, emergence of pop-up stores, multi-format locations, greater consumer mobility
Dangers of using social media
Open access, negative comments, uninvited brands, privacy and security concerns, no 'one size fits all' approach
Two principal dimensions of Service Brand Complexity
Operational complexity and interpersonal complexity
3 main causes of role stress
Organization VS Client: dilemma whether to follow company rules or to satisfy customer demands. This conflict is especially acute in organisations that are not customer oriented; Person VS Role: conflicts between what jobs require and employee's own personality and beliefs; Client VS Client: conflicts between customers that demand service staff intervention
Strategic Roles of the Servicescape
Package, facilitator, socialiser, differentiator
Incompleteness
People tend to omit details or elements that they are not familiar with
Moment of Truth
Perceived quality is realised when the service provider and the customer meets (Normann, 1991)
Social Bonds
Personal ties that focus on service dimensions to develop buyer-seller relationships through interpersonal interactions, friendships (Berry, 1995; Wilson,1995), and identifications (Smith, 1998; Turner, 1970)
Six key pillars that act as the drivers for customer experience excellence in the retail sector:
Personalisation, time and effort, expectations, resolution, integrity and empathy
Six pillars to drive customer experience excellence
Personalisation, time and effort, expectations, resolution, integrity, empathy
Post-benefit convenience
Personnel gain the training and empowerment to rectify post-purchase problems
Personal motives
Physical activity, sensory stimulation, role playing, diversion, learning about new trends, self-gratification
Components of service blueprinting
Physical evidence, customer actions, line of interaction, onstage contact-employee actions, line of visibility, backstage contact-employee actions, line of internal interaction, support processes
Job demands
Physical, social or organisational aspects of the job that require sustained physical and/or psychological (i.e. cognitive or emotional) effort on the part of the employee
TCC can be classified into specific categories:
Physical/spatial/facility, ecological, psychological, community, economic, social/cultural, political carrying capacity (Bao & Chu, 2006; Getz, 1982)
Interpersonal services
Placed between the two extremes and represents situations involving both customer and employees e.g. restaurants, hotels, hospitals, educational institutions and banks
Geocode
Placed on the computer with a spatial referencing point and visually displayed through maps and graphs (Clarke, 1998: 291)
Social motives
Pleasure of bargaining, status and authority, social experience outside the home, communications with others having a similar interest, peer group attraction
Mehrabian and Russell's (1974) research they have concluded that the emotion-eliciting qualities of environments are captured by two dimensions:
Pleasure-displeasure and degree of arousal (i.e. the amount of stimulation or excitement)
Image-related objectives
Positioning, low-cost, lifestyle
Engagement
Positive, fulfilling, work-related state of mind that is characterised by vigour, dedication, and absorption Schaufeli et al. (2002, p. 74)
Job resources
Positively self-evaluated environmental conditions that reinforce an employee's sense of his/her ability to successfully control and impact an environment (Hobfoll, 1989)
Social response theory
Posits that people often treat computers like humans, therefore, online retailers can gain a competitive advantage by using social cues that emulate human connections and some type of emotional bond
Key touch points in the purchasing process
Pre-sales: information-seeking, social media, friends, work colleagues, advertising; Sales encounter: interactions with store employees, handling of queries, demonstrating/advising, closing the sale; Post-sales: dealing with complaints, returns and warranty issues, speed of response to customer complaints process, speed of response to replacing items
Demand patterns
Predictable cycles, random demand fluctuations, demand patterns by market segment
Cost-Based Pricing Strategy
Price = Direct Costs + Overhead Costs + Profit Margin
(Attracting Convenience Seekers) Price bundling
Pricing and selling grouped together rather than individual services. Allows the customer to pay less than when purchasing each of the services individually e.g. health clubs
Self-service technologies (SSTs)
Services produced entirely by the customer without any direct involvement or interaction with the firm's employees. It represents the ultimate form of customer participation along a continuum from services that are produced entirely by the firm to those that are produced entirely by the customer
Three central tenets of Service-Dominant Logic (S-DL)
Services, S-DL shifted focus from a producer perspective to a customer perspective in the process of value creation where there are two types of resources: operand and operant
(Strategic Roles of the Servicescape) Differentiator
Servicescape acts as a differentiator by separating designs of a company from its competitor. It helps to reposition a company and attract new segments
Key factors that influence the level of involvement in purchasing decisions
Self-image, perceived risk, social factors and hedonistic influences (Laurent and Kapferer, 1985)
Factors Influencing the Level of Involvement in Purchase Situations
Self-image, perceived risk, social factors, hedonistic influences
The 'darker' side of relationship management
Self-interest, self-preservation, selfishness, greed
(Components of service blueprinting) Support processes
Separated from contact employees by the internal line of interaction. These are all of the activities carried out by individuals and units within the company who are not contact employees but that need to happen in order for the service to be delivered. Vertical lines from the support area connecting with other areas of the blueprint show the inter-functional connections and support that are essential to delivering the service to the final customer
(Components of service blueprinting) Onstage/visible contact employee actions
Separated from the customer by the line of interaction. Those actions of frontline contact employees that occur as part of a face-to-face encounter are depicted as onstage contact employee actions
(Components of service blueprinting) Backstage/invisible contact employee actions
Separated from the onstage actions by the very important line of visibility. Everything that appears above the line of visibility is seen by the customer, while everything below it is invisible (involves non-visible interaction and other activities that contact employees do)
Three types of BSBs frontline employees may perform associated with linking the organisation to its positional or actual customers:
Service delivery, external representation, internal influence
Self-Service Technologies (SSTs)
Service produced entirely by the customer without any direct involvement or interaction with firm's employees
(Strategic Roles of the Servicescape) Facilitator
Servicescape acts as a facilitator to help people in their surroundings
Competitive-based pricing
Setting prices based on competitors' strategies, prices, costs, and market offerings, however, competitors do not have the same resources, capabilities and scale
Passive loyalty
Shoppers remain open to repurchasing the brand but are also open to the idea of buying other brands
Employer brand
Similar to a product brand except that it promotes the organisation as a great place to work, rather than promoting a specific product or service
Seven sins of greenwashing
Sin of the hidden trade-off, sin of no proof, sin of vagueness, sin of worshipping false labels, sin of irrelevance, sin of lesser of two evils, sin of fibbing
Challenges for Competition Based Pricing
Small firms may charge too little to be viable, heterogeneity of services limits comparability, prices may not reflect customer value
Four different categories of social media (Schmidt and Ralph, 2011)
Social network or online communities, blogs, microblogs and really simple syndication (RSS)
Key drivers for Triple Bottom Line
Social, legislation, environmental, financial, internal business process, customer
Everyday Low Pricing (EDLP)
Based on the presumption that the price of every product in the store will be as low as possible on a daily basis, variations can occur, steers shoppers away from the notion of 'predictable discounting', it can create a downward spiral of price decreases
Challenges of global sourcing
Cultural, political and legal differences, lack of technology, poor infrastructure (IT, communications), customs procedures, exchange rate fluctuations, instability (e.g. economic, political)
(Service failures) Intangibility
Customer comparison of perceptions to expectations is highly subjective
Three social elements with each representing a social dimension that influences a customer's experience in a service setting
Customer placement, customer involvement, and interaction with employees
High level of participation
Customers are truly co-creators of the service; they have important participation roles that will affect the nature of the service outcome
Social benefits
Customers develop a sense of familiarity and, even, a social relationship with their service provider
(Attracting Convenience Seekers) Price framing
Customers do not possess accurate reference prices for services, services marketers are more likely than product marketers to organise price information for customers so they know how to view it
Selling environment
The physical and virtual spaces that are available to retailers as they attempt to attract customers to their product offerings, encourage them to browse, hopefully make a purchase and ultimately revisit that space on a regular basis
Location
The physical and/or virtual space that a retailer inhabits in order to present its value proposition and provide an opportunity for its target market(s) to access its merchandise and connect with its brand values and associations
Flagship store
The pinnacle in a retail chain, usually large and located in a high footfall prestigious location, with a full range of merchandise but an emphasis on the more expensive high quality and high fashion lines (Varley, 2007: 176)
Interpersonal complexity
The potential complexity of the personal interactions between customer and provider, in terms either of the number of different people involved in the service transaction or the depth of knowledge or quality of relationship required to deliver the service effectively
Categorisation
The process by which people assign a label to an object e.g. when people see a feathered animal flying through the air, they categorise it as a "bird" and not a "fish" (Loken and Ward 1990; Mervis and Rosch 1981)
Gold customers
The profitability level is lower and the commitment is not as high as platinum members, even though they are heavy users
(Regeneration of city centres) Physical approach
The role of heritage, in city centres as well as in neighbourhoods
(Regeneration of city centres) Integrated approach
The role that culture and creative activities can play in acting as a driving force for urban regeneration
Flexible replicatio
This recognises that full replication (standardisation) is not feasible or indeed desirable as it ignores obvious areas where differences occur across different international retail markets. Instead, a combination of standardisation and adaptation is the most appropriate strategy for retailers. However, flexibility should be at the heart of this approach (Jonsson and Foss, 2011)
Window of opportunity
This recognises that markets in general and the retail sector in particular goes through a life cycle which generally consists of four phases: opening, peaking, maturing and closing. Various characteristics are associated with each phase and will have major implications for critical decisions such as the mode of entry and the most appropriate labour strategy to be employed in each case
Other proprietary brand assets
This refers to the issue of being able to leverage the brand and build on its strengths. An example would be an exercise in co-branding. This involves two branders with similar brand values coming together to engage in various marketing exercises such as joint promotions or the creation of a new product
Social brand consumption
This refers to the level of interaction between consumers in the brand community. This form of brand consumption is exhibited by the willingness of consumers to share their experiences with each other, make recommendations and indeed act on recommendations by members of the particular brand community
Perceived quality
This refers to the shopper's perception of the overall quality or superiority of a brand in relation to others that are considered in the purchase decision
Green-minded shopper
This segment exhibits concerns about the way in which products are developed (for example, using natural resources, not using animals to test and develop the product etc)
(CBBE) Judgement (cognitive)
This stage builds on the second one where the shopper is in a position to make some observations and opinions about a particular brand in relation to aspects such as quality and credibility
The sources of cues can be divided into two broad categories:
Those derived from interaction with the physical environment and those derived from interaction with other people
Credence attributes
Those that customers find impossible to evaluate confidently even after purchase and consumption e.g. hygiene conditions of the kitchen and the healthiness of the cooking ingredients
Digital immigrants
Those that had to adjust to survive in a digital age
Experience products
Those whose relevant attribute information cannot be known until the trial/use of the product/service (Nelson, 1970, 1974)
Credence products
Those whose relevant attribute information is not available prior to and after the use of the product/service for a considerable period of time (Darby and Karni, 1973)
Capacity constraints
Time, labour, equipment, facilities
Listening posts
Tools for collecting data from customers and systematically translating those data into information in order to improve service and products. Common examples are letters of complaint
Challenges for Demand Based Pricing
Value may be perceived differently by customers because of different tastes, knowledge, buying power and ability to pay, setting prices internationally may differ across countries
Service failure
When a service outcome and/or service process fails to meet customer expectations
Brand associations
When reflecting on a particular brand, it is normal for shoppers to have certain associations with that brand e.g. for ethically concerned shoppers, retailers such as Body Shop and Lush inculcate strong associations with issues such as using natural ingredients that have not been tested on animals
Optimal Capacity
When resources are fully employed but not overused and that customers are receiving quality service in a timely manner e.g. all tables at a restaurant are completely full
Joint ventures
When two or more companies join forces - sharing resources, risks, and profits, but not actually merging companies - to pursue specific opportunities
Racetrack format
Where different departments are located around periphery of store, good way of getting customer to see max amount of different products as their eyes may be veered to another department whilst shopping in another e.g. Ikea
Decision waves
Where multiple decisions are taken within a single decision process seen as a sequence of activities, rather than stages, allowing for multiple decisions within each single decision process
Win- lose situation
Where only one party gains benefits and the other has to make sacrifices if it wishes to continue in the relationship
Interactive marketing (or real-time marketing)
Where promises are kept or broken by the firm's employees, subcontractors or agents
Win-win situation
Where there are no losers and each party derives some benefits from the relationship. there are doubts about whether commentators suggest. Like a partnership public
Four key questions for developing Sustainable Retail Supply Chain Strategies
Who are we (assessing the current position of our organisation)? What is changing (assessing the environment: current and future)? How do we fit (evaluating the risks and opportunities)? How should we fit (applying this analysis to existing strategy and identifying strategy changes)?
External dimensions
Windows - intrigue, inform, inspire, awnings, signage/facia, door entrances
Attributes that shape trust within the context of the online environment include...
brand name, website design and navigation, information, past experiences and country of origin
Brown (1993) refers to the concept of agglomeration as being...
central to an understanding of how retailers address spatial considerations. Traditionally, retailers have tended to locate or cluster close to retailers selling similar or complementary merchandise
The perceived risk associated with buying a private label product is higher than that of buying a...
comparable manufacturer brand alternative
The main driver for the move to global sourcing has been the...
cost imperative
Dynamic pricing is built on three marketing pricing structures...
cost, competition and demand
Lighting ranges from...
creating desired 'moods', blue lighting for 'hygienic look', wall and spot lights for shelf display, highlighting pockets of interest, merchandise can be seen
Operational consistency is clearly vital in avoiding...
customer dissatisfaction. If something doesn't work, it doesn't matter how engaging the interpersonal experience is, you're not going to deliver satisfaction
Attractive quality leads to...
customer satisfaction, but its absence does not cause dissatisfaction
Buzz/viral marketing campaigns bring...
customers and branders together, revolving around a particular activity or theme. It is a good example of how a retailer can integrate the message with other elements of the marketing communications mix
Customer expectations can change due to a number of factors such as...
competitive activities, new entrants to the market adopting different business models and the general state of the economy
In attempting to manage the total customer experience, complexity is generally the enemy of ___
consistency
When private labels enter a category, manufacturer brands adopt a...
defensive strategy of investing in product innovation that can enhance their competitive advantage and enable a sustainable price premium over the private labels
Customer factors that lead to...
demand uncertainty and the corresponding joint optimisation of price, promotion and product assortment
The physical selling environment refers to the...
internal and external dimensions
Components to develop brand positioning include...
its overall reputation, products/service performance, product and customer portfolio and networks
Perceived product risks are greater when the provided product information is...
limited and consumers have a low level of self-confidence in their brand evaluation (Bhatnagar and Ghose, 2004)
Generic private labels are often categorised as...
low cost, low quality alternatives
Many private labels now boast equivalent or even superior quality to that of...
manufacturer brands and even premium private labels are sold in some retailers
Services deliver an experience by...
providing a bundle of benefits which creates an experience for the consumer. This delivery process has been entitled the Servuction System model
Online consumers perceive more risks than those shopping in-stores for three reasons...
they cannot examine the product before they receive it, they are concerned about after-sales service, they may not fully understand the language used in e-sales (Hong and Yi, 2012)
(Ethical shoppers) Corrupt consumer
Someone that is similar to suspicious shoppers but is less idealistic and is predisposed to take advantage of any situation that presents an opportunity for personal gain (Al-Khatib, Stanton and Rawwas, 2005)
Market Maven
Someone who acts as a conduit of information about trends and developments in terms of new products and innovations that are on the market or are about to hit the outlets in the near future
Jay customer
Someone who acts in a thoughtless or abusive way, causing problems for the firm, its employees, and other customers e.g. the cheat, the thief, the rulebreaker, the belligerent, the family fueders, the vandal and the deadbeat
Price
The amount of money charged for a product or service, or the sum of the values that consumers exchange for the benefits of having or using the product or service
Customer alchemy
The art of turning less profitable customers into more profitable customers
Experiencescapes
The extent to which the surroundings people encounter in the course of their lives "take the form of physical as well as imagined landscapes of experience"
Corporate culture
The pattern of shared values and beliefs that give the members of an organisation meaning and provide them with the rules for behaviour in the organisation
Profit margin
The percentage of full costs
The product demand cycle
The periodic cycle influencing demand for a particular service; it may vary in length from one day to 12 months
The four dimensions in a servicescape are...
physical, social, socially symbolic, restorative/natural
Stages in the brand management process
Identifying and establishing brand positioning, planning and implementing brand marketing programmes, measuring and interpreting brand performance, growing and sustaining brand equity
(Regeneration of city centres) Economic approach
Cultural and arts events and festivals can play a significant role in providing cities with an identity and empowering local communities within the area
Store Image
"...the way in which the store is defined in the shopper's mind, partly by its functional qualities and partly by an aura of psychological attributes" (Dupreez, Visser and Van Noordwyk, 2008)
Quality
"conformance to requirements" (Crosby, 1979)
The price-quality schema
"the generalised belief across product categories that the level of the price cue is related positively to the quality level of the product" indicating that consumers use price for the evaluation of overall product excellence or superiority (Zeithaml, 1988) i.e. it doesn't focus on actual product quality, but on the consumer's belief in the relationship between quality and price (Lichtenstein and Burton, 1989)
Current attendance should not fall below the...
"threshold attendance" needed to break even during shoulder seasons (Ahmadi, 1997)
Global supply chain
'...the distribution of performance outcomes of interest expressed in terms of losses. Profitability, speed of event, speed of losses, the time for detection of the events and frequency' (Manuj and Mentzer, 2008)
The physical retail selling environment begins with an...
'empty shell'. This applies to large spaces such as hypermarkets or small concession areas in department stores. If it is left as an empty shell, it will serve no purpose
Brand
A combination of a name, a logo and a symbol to provide recognition and awareness of a product
Customer Inertia
A consistent pattern of buying the same brand almost every time a consumer shops, out of habit, merely because less effort is required
Franchising
A contractual agreement between a franchisor and a franchisee that allows the franchisee to operate a business using a name and format developed and supported by the franchisor
Omni-retailing
A coordinated multichannel offering that provides a seamless experience when using all of the retailer's shopping channels (Levy et al., 2013)
Service 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
Critical incidents research
A customer recalls and discusses both satisfying and unsatisfying experiences with a service provider and its employees
Path-to-purchase (PtP)
A decision-making process to solve an occasion-specific purchase need (Shankar et al., 2011)
Loyalty
A deeply held commitment to rebuy or repatronise a preferred product/service consistently in the future (Oliver, 1999, p. 34)
Intrinsic motivation
A desire to perform a behaviour effectively for its own sake
Price image and its impact on shopping behaviour
A function of two types of factors: retailer-based and consumer-based (Hamilton and Cherney, 2013)
Efficient Consumer Response (ECR)
A global movement in the grocery industry focusing on the total supply chain-suppliers, manufacturers, wholesalers and retailers, working closely together to fulfil the changing demands of the grocery consumer better, faster and at least cost (Fiddis, 1997, p. 40) e.g. sharing consumer information with suppliers
The Service Recovery Paradox
A good recovery can turn angry, frustrated customers into loyal ones. ..can, in fact, create more goodwill than if things had gone smoothly in the first place (Hart et al. 1990)
Consideration set
A group of brands within a product category that a buyer views as alternatives for possible purchase
Eclectic theory
Based on the view that international organisations build up significant advantages which can form the basis for development and exploitation in international markets. They largely revolve around ownership-specific, location-specific and internalisation advantages (Dunning, 1981)
Decision convenience
Being able to give customers appropriate information so that they can make informed buying decisions
External representation
Being vocal advocates to outsiders of the organization's image, goods and services (Bowen and Schneider 1985)
Customer expectations
Beliefs about service delivery that serve as standards, or reference points, against which performance is judged
Dimensions of brand equity
Brand awareness, brand loyalty, perceived quality, brand association, other proprietary brand assets
Sales-related objectives
Building sales volume, building customer traffic, increasing sales through loyal customers
Vendor-Managed Inventory (VMI)
By collaborating with suppliers and involving them intensively - to the extent of managing the inventory - it can be argued that benefits accrue to the retailer in terms of increased profits, and to the supplier in terms of more accurate forecasting i.e. getting suppliers to manage stores
Attraction experience
Can be measured by the number of attractions visited and/or experience value (i.e. the perceived value of the tourist experience) of attractions visited (Prebensen, Woo, & Uysal, 2014). However, it is restricted by waiting time
(Regeneration of city centres) Social approach
Can help to create a civic bond and cohesion in the process of urban regeneration and make more creative use of public space. The role of culture can also help address issues such as social inequality and social exclusion
Service improvements
Changes in service features e.g. extended hours of service
Price discrimination
Charging different prices for the same product to different segments of customers across the different retail channels
Categories of store brands
Classic store brand - positioned similar to or slightly below producer brands; generic store brand - basic, plain packaging, cuts in quality, no advertising; premium store brand - positioned like leading national brands
Kaplan (1987) concluded that preference for or liking of a particular environment can be predicted by three environmental dimensions:
Complexity (increase emotional arousal), mystery and coherence (enhance positive evaluation)
Sideline supporters (14%)
Concerned about the environment, but not taking significant action
Cautious participants (14%)
Concerned about the environment, taking some action, hold a pessimistic worldview about impact
Concerned consumers (14%)
Concerned about the environment, though show less conviction towards action than previous groups
Moderate level of participation
Consumer inputs are required to aid the service organisation in creating the service. Inputs can include information, effort or physical possessions
Functional brand consumption
Consumers make use of social media to address a number of problems or issues that require some clarification. These include solving problems; sending specific inquiries; searching for information; evaluating service before purchasing; and gaining access to a brand's special deals and giveaways
Content issues
Content engagement value, content media, content syndication, content participation, content access platform
The mode(s) of entry is influenced by a number of critical factors
Control, cost, level of risk, flexibility, speed of geographic coverage, critical mass, regulations
Limitations of Corporate Branding and Culture
Corporate branding implies that the large sums spent on building product brands have been a waste of time, it can damage the impact and contribution of local brands, it can potentially upset and alienate customers if well-loved and favourite brands disappear from the shelves
(Non-monetary costs) Convenience costs
Cost in obtaining a service e.g. travel costs
Challenges for Cost-Based Pricing
Costs are difficult to trace, labour is more difficult to price than materials, costs may not equal the value that customers perceive the services are worth
(Non-monetary costs) Psychological costs
Costs that customers experience as sacrifices when purchasing and using services
Experiential marketing
Create product desire, verify the target audience, build relationships, raise awareness, increase loyalty, increase return on marketing investment, establish relevance, encourage interaction and product trial, create memories, stimulate positive word-of-mouth, change the mind of dissatisfied customers (Morton, 2009)
Relational bonds
Created through economic or emotional marketing activities, may improve customers' utilitarian or hedonic value. When consumers highly value these bonds, they are motivated to be loyal
E-procurement Issues
Creates greater transparency, improves purchasing control, corporate purchasing agreements, expected to decrease administrative costs, getting 'buy-in' from suppliers, more accurate forecasting
The logic for designing a marketing communications initiative around such individuals revolves around three reasons:
Credibility: the belief that the celebrity has similar values and attributes that are closely associated with the brand values and attributes of the retailer; Recognition: the target market has a very high level of recognition when they see images of the celebrity; Popularity: the celebrity generates high levels of positive opinions and perceptions
Key success factors for effective generation...
Devolvement of power to the local city authorities, creating balanced and attractive residential neighbourhoods, valuing the role of culture in the regeneration process, working across boundaries, sectors and professions, generating a substantial part of the necessary revenue for generation from local taxes
Provider gap 2 (the service design and standards gap)
Difference between company understanding of customer expectations and development of customer-driven service designs and standards
The customer gap
Difference between customer expectations and perceptions. Closing the gap between what customers expect and what they receive is critical to delivering quality service
Provider gap 1 (listening gap)
Difference between customer expectations of service and a company's understanding of those expectations
Provider gap 4 (communication gap)
Difference between service delivery and service provider's external communications
Dynamic Pricing Models
Direct result of technology and software enablers, capturing 'live' information, tracking of purchase patters, still relying on historical data, ability to change prices in 'real time'
Customer Complaint Actions Following Service Failure
Dissatisfaction/negative emotions, complaint/no complaint action, complain to provider/negative word-of-mouth/third-party action, exit/switch or stay
Problematic customers
Drunkenness, verbal or physical abuse, breaking company policies, uncooperative customers
Social environmental concerns
Ecological effects, resident experience (Canestrelli & Costa, 1991), infrastructure and super-structure (Forbartha, 1966), and political/administrative factors (Getz, 1983)
Relationship marketing benefits for firms
Economic benefits - increased purchases over time; repeat purchases; customer behaviour benefits - continuous word of mouth communication; human resource management benefits - contribution to the production of the service by assisting in service delivery
Principles of Retail Pricing
Effective pricing is based around price sensitivity of shoppers; pricing decisions have to address the long-term aspects of the retailer's operations; retailers would like to sell their merchandise at 'full price'; retailers are increasingly making use of IT; use of location-based apps; retailers work closely with their supply base; retailers can engage in joint price promotions to maximise revenue; retailers have to grasp on operating multiple channels; shoppers increasingly use technology to track prices
E-service quality dimensions
Efficiency, fulfilment, reliability, privacy, responsiveness, compensation, contact
External marketing
Efforts that the firm engages in to set up its customers' expectations and make promises to customers regarding what is to be delivered
Two categories of service provision
Elements that are deemed to be compulsory i.e. the retailer cannot avoid service provision in such areas e.g. issues with law, and areas where the retailer has discretion on the extent of provision and level of investment provided
Innovators
Employees: may act as innovators since human capital remains a non-substitutable source of creativity (Bowen, 2016) Customers: may act as innovators as they take part in the development and delivery of new services. As 'free' consultants, they offer valuable feedback and ideas for innovation through interaction with employees, other customers and/or technological interfaces (Hoyer, Chandy, Dorotic, Krafft, & Singh, 2010)
Differentiator
Employees: the unique position of employees as a means to differentiate was already articulated by Heskett, Sasser, and Hart (1990) Customers: influence on the service out-come has grown significantly (Bitner et al., 1997), especially when technology acts as substitutor or network facilitator
Coordinator
Employees: this role becomes increasingly prevalent as complex service systems comprised of multiple actors require active co-ordination to create successful outcomes (Ostrom et al., 2015) Customers: they act as a resource integrator selecting and bringing together multiple related and/or unrelated parties in the service encounter (Tax et al., 2013) e.g. patients with chronic diseases regularly participate in the treatment process
External aspects
Entrance to the outlet, the use of logos and window displays to encourage shoppers to enter the store in the first instance
Internal Responses to the Servicescape
Environment and cognition, environment and emotion, environment and physiology, variations in individual responses
Benefits of adopting a sustainable retail supply chain strategy (Emmett and Sood, 2010: 8)
Environmental, technological, economic, regulatory, social
Strategies for when demand and capacity cannot be matched
Establish a reservation process, differentiate waiting customers, make waiting more pleasurable
Sustainability touches all aspects of operations
Ethical sourcing, not an 'optional extra', carbon footprint, energy efficiency, recycling
Reasons companies might NOT want to offer a service guarantee
Existing service quality is poor, a guarantee does not fit the company's image, service quality is truly uncontrollable, potential exists for customer abuse of the guarantee, costs of the guarantee outweigh the benefits
Factors that influence desired and predicted service
Explicit service promises, implicit service promises, online and offline word of mouth, past experience
Elements of physical/virtual evidence
Exterior servicescape, interior servicescape, virtual servicescape, other tangibles
The Power of Teamwork in Services
Facilitate communication among team members and knowledge sharing, higher performance targets, pressure to perform is high
Transaction convenience
Facilitates transactions such as checkouts and returns
Process oriented
Failure related to the service delivery failures e.g. rude employee behaviour
(Service failures) Inseparability
Failures occurring during interaction between service provider and customer
Outcome oriented
Failures related to incidents occurring with the core service e.g. Ocado grocery shopping website failed to meet demands so they had to temporarily close down their website
Source credibility revolves around three dimensions:
Familiarity (the extent of recognisability associated with the celebrity; Likeability (the degree of affection generated by the celebrity in the mind of the consumer); Similarity (the extent to which the individual sees the celebrity as a mirror of themself)
Self-service anxiety
Fear and apprehension of using technology to execute a service along with the perceived social pressures of performing the service
Transformational leadership theory (Bass, 1985)
Focuses on exceptional leaders who have profound effects on their followers
The seven core categories of shoppers' buying behaviour
Food, drink and product safety, animal welfare, honest labelling, advertising and promotions, ethical trading, human rights, the environment
New services
For currently served market - e.g. Tesco providing insurance services
Benefits of Service Guarantees
Forces company to focus on customers, sets clear standards, generates feedback, forces company to understand why it failed
Micro-level
From the perspective of the individual retailer (performance in outlets or assessing potential sites)
(Retail location strategy) Using space
Functional (facilitating purchases), social (coffee shops, restaurants), leisure (cineplex, indoor bowls)
Davis et al (2014) identify five core elements of brand consumption in a social media setting:
Functional brand consumption, emotional brand consumption, self-oriented brand consumption, social brand consumption and relational brand consumption
Shopping Motives
Functional/mundane, effort/planning, pleasure-seeking, escape
Corporate social responsibility-related objectives
Good citizenship, ethics, climate change, social issues
Other key factors influencing the location decision (Birkin, Clarke and Clarke, 2002)
Greater consumer mobility, online developments, mobile technology, social media platforms, growth in expenditure on leisure-activities, lifestyle changes, emergence of pop-up stores, multi-format locations
GAPACT
Greet, ask, provide, add-on, close the sale, thank
Digital natives
Groups that were born and grew up in the digital age
Two dimensions of determining customer services
Hard elements - tangible factors that the shopper can observe and assess e.g. car parking Soft elements - these include performance of the retail salesperson in areas such as product knowledge, interaction skills
Benefit convenience
Helping customers understand the benefits of products and services to create a more enjoyable experience
Service-profit chain audit
Helps companies determine what drives their profit and suggests actions that can lead to long-term profitability
How can organisations improve their operations and be successful via people?
Hire and select the right people, be the preferred employer and train your most important asset
Customer experience
Holistic in nature and involving the customer's cognitive, affective, emotional, social and physical responses to the retailer (Verhoef et al., 2009: 32)
Customer perceptions
How customers perceive services, how they assess whether they have experienced quality service and whether they are satisfied is ultimately what we as service marketers are interested in
Internal aspects
How do we display our merchandise? Where do we display the different categories of product within the store? How do we manage the entrance and exit of shoppers? How can we ensure that shoppers spend as much time as possible in the store? etc
Four different behaviours that characterise transformational leaders
Idealised influence, inspirational motivation, intellectual stimulation, individual consideration
The role of brands for consumers
Identification of a source of product, assignment of responsibility to a product maker, risk reducer, search cost reducer, promise, bond or pact with maker of product, symbolic device, signal of quality
The Service Profit Chain
Identifies important relationships between employee satisfaction, loyalty and productivity, organisational profitability and consumer loyalty (Heskett et al, 1994)
Keller (2008) identifies four stages in the brand management process:
Identifying and establishing brand positioning, planning and implementing brand marketing programmes, measuring and interpreting brand performance, growing and sustaining brand equity
Roles of the retail employee
Information provision, product knowledge, establishing trust and confidence, implementing retail procedures with returns and warranties, sales skills, cross-selling, up-selling, dealing with disinterested shoppers, dealing with 'problem' shoppers, handling complaints
Online Shopping Motives
Information search, price comparison, uniqueness seeking, product assortment, convenience seeking, social interaction, browsing, seeking out new ideas/products
Pre-sales touchpoint
Information-seeking, social media, friends, work colleagues, advertising, evaluation of alternatives
Willems et al (2011) examined the fashion retail sector and developed a specific scale that included the following dimensions:
Innovativeness (trendy, hip, boring, youthful and modern), chaos (chaotic, careless, tidy, calm and busy), conspicuousness (special, extravagant and striking), agreeableness (approachable, reliable, successful and friendly), sophistication (classy, elegant, stylish, distinguished and chic)
Services as products
Intangible product offerings that customers value and pay for in the marketplace
Green Supply Chain Management (GrSCM)
Integrating environmental thinking into supply-chain management, including product design, material sourcing and selection, manufacturing processes, delivery of the final product to the consumers as well as end-of-life management of the product after its useful life (Srivastava, 2007: 54- 55)
Sales encounter touchpoint
Interaction with store employees, handling of questions/queries, demonstrating/advising, closing the sale
How to assess potential retail locations:
Intuition, checklist, analogue, competitive activities, multiple regression, GIs and spatial modelling, geodemographic systems, lifestyles, mathematical models
Access convenience
Involves making sure they know where merchandise is and assisting customers in finding it
Direct costs
Involves materials and labour associated with delivering the service
Corporate quality
Involves the company's image or profile
Functional quality
Involves the manner in which the service is delivered
Technical quality
Involves what the customer is actually receiving from the service
Benefits of Corporate Branding and Culture
It provides coherence and a framework for internal cooperation, it signals the strength and size of the organisation to its key audiences, it is more cost-effective to operate as an overall corporate brand than to develop a range of different product brands
Emotional Labour
Occurs when there is gap between what employees feel inside, and emotions that management requires them to display to customers
Internal marketing
Management engages in these activities to aid the providers in their ability to deliver on the service promise: recruiting, training, motivating, rewarding, and providing equipment and technology; the task of ensuring employees understand the brand promise and their part in delivering an on-brand customer experience
Factors influencing store layout decisions
Managing the flow of footfall, create pockets of interest, inject excitement, encourage the purchase of additional items, encourage impulse purchases, encourage loitering (where relevant)
The role of brands for manufacturers
Means of identification to simplify handling or tracing, means of legally protecting unique features, signal of quality level to satisfied customers, means of endowing products with unique associations, source of financial returns
Internal quality
Measured by the feelings that employees have toward their jobs, colleagues, and companies
Synchro marketing
Modifications in product features and distribution elements, as well as communication efforts, to help smooth the peaks and valleys of demand (Kotler, 1973)
Switching Costs
Monetary and non-monetary costs involved in changing to and purchasing from a different firm
Operant
More intangible and human (both employee and customer) knowledge and physical and mental skills
Irates
More likely to engage in negative WOM to friends and relatives and to switch providers; average in complaints to provider; unlikely to complain to third parties; more angry, less likely to give provider a second chance
Platinum customers
Most profitable customers, who are typically heavy users of the product, who are not overly price sensitive and whose commitment to the enterprise is high
(Non-monetary costs) Time costs
Most services require customers direct participation and thus consume real time
Differentiating
Much better than the competition
The challenges of pricing in the retail context
Multi-product and multi-site, the service dimension, different retail formats and channels, varying margins across the portfolio of merchandise, price auditing and competitive checking
Challenges of pricing in the retail context
Multi-product/multi-site the service dimension, different retail formats and channels, varying margins across the portfolio of merchandise, price auditing and competitive checking, constant price adjustment
Start-up businesses
New service for a market that is already served by existing products e.g. online banking for financial services
Major or radical innovations
New services for markets yet undefined e.g. Facebook
Excess Demand
No one is being turned away, but the quality of service may still suffer due to overuse, crowding or employees being pushed to deliver beyond their abilities
Interpretation
No two people will define 'quick' or 'responsible' the same way
Benefits of global sourcing
Non-availability of products locally, cost-savings, access to higher quality product, cost reduction (labour, facilities and infrastructure), shortening of product development time, satisfying counter-trade obligations
Greenwashing
Not all companies engage in sustainable practices for the sake of society itself, but many recognise the reputational benefits. Some brands have incorporated sustainability into their marketing strategy without implementing sustainable practices throughout the business
(Service failures) Heterogeneity
Not every service encounter is going to be identical
Why do customers complain?
Obtain restitution or compensation, vent their anger, help improve the service, for altruistic reasons e.g. spare other customers from experiencing the same shortcomings
What determines customer satisfaction?
Product and service features, consumer emotions, attributions for success and failure, perceptions of equity and fairness, other consumers, family members and co-workers
Alternative Approaches to Value Creation (Nagel et al., 2011)
Product-led: product -> cost -> price -> value -> customers Customer-led: customers -> value -> prices -> costs -> products
Criteria for selecting suppliers
Product-related issues, quality-related issues, responsiveness-related issues, network-related issues, price and cost-related issues, sustainability-related issues, management-related issues
Excess capacity
Productive resources in the form of labour
Store brands
Products that are marketed by the retailer as opposed to the manufacturer's brands (which are produced and marketed by the manufacturer)
Generational cohort theory
Proposed by Mannheim in 1928, it has been used to understand consumer behaviour and explain the use of technology (Smelser, 2001)
Expectancy-Disconfirmation Theory
Proposes that consumers use expectations as a benchmark against which performance perceptions are judged
Acquisitions
Provides a retailer with a reasonably quick way of establishing a presence in the chosen international market. However, it is also associated with high levels of risk. In addition to the costs involved in acquiring local retail operations, such a strategy is usually well publicised and, if it goes wrong, can also attract much critical and negative comment in the financial press
Four attributes that shape different retail brand positions
Range brands, price brands, convenience brands and experience brands (Floor, 2006)
Online dimensions of customer service
Reliability, access, ease of navigation, efficiency, responsiveness, assurance, security, aesthetics, personalisation
Dimensions of customer service have been identified as being important for online retailers:
Reliability, access, ease of navigation, efficiency, responsiveness, assurance, security, aesthetics, personalisation (Suryandari and Paswan, 2014: 70)
Service quality dimensions
Reliability, assurance, tangibles, empathy, responsiveness
Medium
Recognises that many retailers operate multi-channel strategies and the different approaches which may exist in terms of online and offline pricing strategies
Service exclusion
Referring to unfairness that occurs when services (service providers) deliberately or unintentionally fail to include or to adequately service customers in a fair manner e.g. poverty, race or religion, sexuality, body image, stereotyping etc
Source credibility
Refers to a communicator's expertise, objectivity, or trustworthiness
(Corporate social responsibility) Internal considerations
Refers to initiatives and policies that operate within the confines of the organization e.g. many retailers instigate policies and procedures with internal staff to make them more aware of the need for social responsibility concerns when dealing with customers
Online aesthetic appeal
Refers to online ambient conditions and to the extent to which consumers interpret the servicescape as attractive or alluring
(Corporate social responsibility) External dimensions
Refers to practices that move outside the 'four walls' of the retailer and have an impact on the wider stakeholders e.g. some retailers employ rigorous policies with regard to managing their suppliers
In-channel competition
Refers to price competition within a particular store or across a number of stores within a retailer's operation. It also covers the impact of loss-leader price campaigns on store traffic (the number of people visiting stores)
(CBBE) Imagery
Refers to social and psychological needs. It considers the relationship between the brand's and the consumer's characteristics e.g. for luxury brands, the product may allow the consumer to relate their desired social position in society by purchasing such an item
Tenant mix
Refers to the 'relationship between the percentage of shop areas occupied by different store types in a shopping mall' (Yiu and Xu, 2012: 524- 541)
(CBBE) Performance
Refers to the ability of the product/service to meet the functional needs and requirements of the consumer. This covers product characteristics such as quality, durability, customer service, price etc
Store image
Refers to the combination of dimensions that shape a shopper's perception of a particular store
Integration with other marketing mix variables
Refers to the extent of price and product customisation together with promotional activities
Manufacturer interaction
Refers to the interaction between suppliers and retailers in areas such as promotions and store brand
Product type
Refers to the nature of the retail offering e.g. whether the retailer operates in the fashion or staple retail sectors (e.g. perishables and packaged goods) and the level of complementarity across the product ranges
Retail demand externalities
Refers to the overall impact that the presence of high-end retailers, or an appealing tenant mix, has on overall sales, footfall and the shopping experience. The way in which retail developers locate individual stores in the centre plays a key role in shaping the shopping experience (Howard, 2007)
Cross-channel competition
Refers to the retailer's overall positioning strategy and the extent and range of formats that it adopts
Dynamic pricing
Refers to the use of price to manage demand for a service by capitalizing on customer sensitivity to prices
Avoidance behaviours
Reflect the opposite of approach behaviour, in other words, a desire not to stay, explore, work, and affiliate
___ of service is the single most important feature in judging service quality
Reliability
SERVQUAL model
Reliability (consistently delivering the services promises at the stated level), responsiveness (providing prompt service), assurance (ability to inspire trust and confidence in the retailer), empathy (willingness to give some form of personalized attention to the shopper), tangibles (appearance of a retailer's store layout and design, communications material and so on)
Types of service encounters
Remote, telephone and face-to-face encounters
Biophilia
Represents a driver that encourages humans to subconsciously seek connection with "the rest of life," perhaps encouraging patronage to commercial third places
(CBBE) Resonance
Represents the strongest level of commitment of the individual to a particular brand. It takes the relationship between the consumer and the brand to a new level and is ideally where the brander wants to be
Fix the Customer
Respond quickly, provide appropriate communication, treat customers fairly, cultivate relationships with customers
Geuens, Weijters and Wulf (2009) developed a personality scale based on five factors:
Responsibility, activity, aggressiveness, simplicity and emotionality
Utilitarian value
Results from the conscious pursuit of an intended consequence (Babin et al., 1994). It is primarily instrumental, functional, and cognitive and represents customer value as the means to an end (Chandon et al.,2000) e.g. savings
Price image is a function of two types of factors:
Retailer-based factors, which managers can directly influence, and consumer-based factors, which are particular to the individual buyers and which managers cannot directly influence (Hamilton and Chernev, 2013: 3)
Macro-level
Role of Government and Regional Authorities, retail developers: investment groups, legislators
Customer satisfaction
Satisfaction is the consumers' fulfilment response. It is a judgement that a product or service feature, or the product or service itself, provides a pleasurable level of consumption-related fulfilment (Wilson et al., 2016)
Internal branding
Seeks to develop and reinforce a common value-based ethos, typically attached to some form of corporate mission or vision
Subscription-Based Promotions
Selected group of customers are offered limited sets of product for limited time periods, exclusivity
Loss leaders
Selected items sold at a loss to attract customers to buy costlier goods
Value is a phrase that unfortunately has generated many definitions largely built around some of the following concepts:
Something a company does that is better than the competition, delivering something that exceeds the customer's expectations, creating a desire in the mind of the customer resulting in a purchase
Qualifying
Somewhat better than the competition
Customer needs and requests
Special needs, customer preferences, customer errors, disruptive other
Demand exceeds optimum capacity
Staff and facilities are occupied at an ideal level
Demand is balanced at the level of optimal capacity
Staff and facilities are occupied at an ideal level
Non-price drivers
Store design, layout, ambience, website appearance, sales staff
Brand loyalty
Strong equity revolves around loyalty and commitment to that brand. It is more cost-effective to retain customers than it is to chase new ones. Loyal customers are less likely to switch to another retail brand
(Categories of shoppers) Mall shopper
Suburban, well-off people who prefer to obtain everything under the one roof, either in hypermarkets or shopping malls (12% of European population)
Social media channels
Such channels involve third-party operators who have created and operate platforms; were not set up originally to facilitate commercial activities and communications; often involves WOM advertising viral/buzz marketing
Self-selection
Suggests that most service jobs will draw applicants with some level of service inclination and that most employees in service organisations are inclined towards service
Relationship management theory
Suggests that there is no such thing as a 'one-size-fits-all' approach to dealing with suppliers. It is not financially viable or necessary to have a close, intimate relationship with each supplier
(Service failures) Perishability
Supply and demand problems are a common occurrence
Reactive approach
Tactical in nature and is far removed from what we might see as the desired position of employing a 'strategic, long-term perspective' with regard to such decisions
Common approaches to managing demand when there is insufficient capacity (excess demand)
Take no action, reduce demand, increase demand, inventory demand (reservation system and formalised queuing)
Internal influence
Taking individual initiative in communications to the firm and co-worker to improve service delivery by the organisation, co-workers and oneself (Schneider and Bowen, 1984; Zeithaml et al., 1988)
Maximum capacity
The absolute limit of service availability e.g. excessive waiting by customers in a restaurant
Benefits of adopting a Sustainable Retail Supply Chain Strategy
Technological, economic, social, regulatory, environmental
Factors that influence adequate service
Temporary service intensifiers, perceived service alternatives, self-perceived service role, situational factors, predicted service
Key Success Factors in Shopping Centre Developments
Tenant mix, anchor store(s), retail demand externalities (impact of closures and vacancy rates), embracing digital technology, keeping the centre fresh and vibrant, primary locations, the life-cycle effect, role of flagship stores
Key success factors in shopping centre developments
Tenant mix, retail demand externalities, embracing digital technology, keeping the centre fresh and vibrant, primary locations, the life-cycle effect, role of flagship stores
Descriptive beliefs
Tend to be held with certainty as they are the product of direct personal experience
Operand
Tend to be tangible and nonhuman, e.g. money, physical facilities, and good
Private labels have advantages when introducing new products
Tend to imitate faster, have immediate access to and control over distribution, immediate access to consumers, deliver a significant price utility - in line with the retailer's strategy, retailers may influence consumers' perceptions of private labels by providing samples, launched under an umbrella branding strategy
(Categories of shoppers) Discount shopper
Tends to be lower income, of all age groups and types of locality. Prefer shops which are local and offer lowest prices
Benefits of CRM Programmes
The ability to identify customers and their individual profitability, identification of individual customer's specific needs, tailored products to individual requirements, retain customers longer, cross-sell and up-sell, identify new product opportunities, capability to target high value prospects, a more holistic view based on the life time value of a customer
P - O fit
The congruence of organisational and individual values, from the employee perspective (O'Reilly et al., 1991)
Informational beliefs
The connection between an object and attribute is first made by another source (indirect)
Inferential beliefs
The connection between object and attribute results from an inference drawn from a prior belief i.e. go beyond the information given (Fishbein and Ajzen, 1975)
Four categories of online shoppers
The convenience shopper, the variety-seeking shopper, the store-oriented shopper and the balanced buyer (Rohm and Swaminathan, 2004)
Social media
The creation and exchange of user generated content (Kaplan and Haenlein, 2010, p. 61)
Intellectual stimulation
The degree to which a leader encourages his/her subordinates to think of old problems in new ways, to question their own values and beliefs and, when appropriate, those of their leader (Bass et al., 1987). Transformational leaders directly encourage followers to challenge accepted methods and answer their own questions when doing their work
Inspirational motivation
The degree to which the leader articulates a vision that is appealing and inspiring to followers. Inspirational leaders establish and convey high expectations (Bass, 1998) that challenge employees to achieve more than they thought possible
Individualised consideration
The degree to which the leader attends to each follower's needs, "acting as a coach, mentor, teacher, facilitator, confidant and counsellor" (Avolio, 1999, p. 47), suggesting to employees that they respect them and care about their personal situations, instilling a sense of meaning in their work
Idealised influence
The degree to which the leader behaves admirably that cause followers to identify with the leader. It is the leader's ability to develop a vision and to influence others to accept and share that vision (Jung and Avolio, 2000)
Positioning
The deliberate, proactive, interactive process of defining, modifying and monitoring consumer perceptions of a marketable product (Arnott, 1992)
Customer-based brand equity model (CBBE)
The differential effect of brand knowledge on consumer response to the marketing of the brand (Keller, 1993: 8) and is based on the principle of building the brand over a period of time and moving through a number of steps or stages (six) from the base of the pyramid up to the pinnacle
Provider gap 3 (the service performance gap)
The discrepancy between development of customer-driven service standards and actual service performance by company employees
Psychic distance
The distance between the home market and a foreign market resulting from the perception and understanding of cultural and business differences (Evans and Bridson, 2005: 70)
Hedonism
The drivers of behaviour that bring consumers to the marketplace to satisfy their internal needs (Jin and Kim, 2003: 399)
Shopping motivations
The drivers of behaviour that bring customers to the marketplace to satisfy their internal needs (Jin and Kim, 2003: 399)
(Non-monetary costs) Search costs
The effort invested to identify and select from among services you desire
Emotional exhaustion
The employee's perception of his/her work as being the root cause of feelings of emotional overextension and/or exhaustion (Maslach and Jackson, 1981)
Physical evidence
The environment in which the service is delivered and where the firm and customer interact, and any tangible components that facilitate performance or communication of the service
Digital age
The era where a person can exert significant influence on not only their identity but also their behaviour as consumers (Solomon, 2009)
Mutuality
The expectation that by engaging in such close relationships, both parties will gain from the experience in areas such as general competitiveness, profitability and increased sales
Zone of Tolerance
The extent to which customers recognise and are willing to accept this variation. Services are heterogenous and can vary across providers
Demand Based Pricing Strategy
The focus is on the customer and not the company or market. This type of pricing is fixed keeping in mind what the customers are likely to pay for the perceived value offered by the service. Non-monetary costs are considered as these contribute to the perception of value
Oversimplification
The intangibility element makes it difficult to describe a service in words
Mergers
The joining together of two or more companies or organisations to form one larger one
Boundary Spanners
The link between the external customer and environment and internal operations of the organisation
Sustainable supply chain management
The management of raw materials, information and services from the point of origin to the point of consumption and back, focusing on the delivery of value while explicitly addressing social, ethical and environment concerns in the supply chain process
Sustainable Supply Chain Management
The management of raw materials, information and services from the point of origin to the point of consumption and back, focusing on the delivery of value while explicitly addressing social, ethical and environmental concerns in the supply chain process (Ennis, 2015)
Public relations
The management through communication of perceptions and strategic relationships between an organisation and its internal and external stakeholders for mutual benefit and a greater social order (Valin, 2004)
Public Relations
The management, through communication, of perceptions and strategic relationships between an organisation and its internal and external stakeholders for mutual benefit and greater social order (Valin, 2004)
Tourism Carrying Capacity (TCC)
The maximum number of people that may visit a tourist destination at the same time, without causing destruction of the physical, economic, socio-cultural environment and an unacceptable decrease in the quality of visitors' satisfaction (World Tourism Organization [UNWTO], 1981)
Market Place exclusion
The mechanisms through which certain individual and communities are barred from the resources and opportunities provided by the market to other citizens
Operational complexity
The number of component parts brought together under the same brand name, in terms of the number of different services offered, the number of steps in a typical service transaction or the number and/or complexity of products offered in relation to the service
E-servicescape
The online environment factors that exist during service delivery
(CBBE) Feelings (affective)
The second element relates to the ability of the brand to engender feelings such as excitement, happiness, fun, social approval etc. it can be based on the individual reaction or as part of the social desirability and approval of the social set to which the individual belongs
Customisation Bonds
The service provider is attempting to create these type of bonds when it customises the service that is delivered to particular groups of customers: in other words, the provider tailor-makes the service to the needs of the customer
(Strategic Roles of the Servicescape) Socialiser
The servicescape design acts as a perfect socializer between both customers and employees
(Strategic Roles of the Servicescape) Package
The servicescape helps to convey the internal image through its outward appearance
Brand personality
The set of meanings constructed by an observer to describe the "inner" characteristics of another person (Fournier, 1995)
Common misconceptions about pricing
The shopper has rational motives for buying, consumers know the price of products and services, quality determines price, manufacturers can control the price charged by retailers, pricing can be based on fixed and inflexible margin policies, pricing based on competitor strategies is more effective
Service competencies
The skills and knowledge necessary to do the job
Space
The spatial area used by the retailer to present its merchandise and provide access for shoppers
Service science
The study of service systems, which are dynamic value co-creation configurations of resources (people, technology, organisations and shared information) (Maglio & Spohrer, 2008, p.18)
Expectation
The subjective probability that a behaviour will be followed by a particular outcome
Value drivers
The tangible and intangible factors that when acted upon by the organisation lead to an enhancement of competitive advantage (Macdivitt and Wilkinson, 2011)
Active loyalty
The traditional view, where the shopper does not consider any other brands
Channel
The way in which customers interact with an organisation
Category Management
The way of managing retail operations by classifying the assortment of the retailer into categories on the basic of consumer preference, not just on the basis of individual brands or items (Rashid and Matilla, 2011, p. 64) i.e. managing inventory based on categories
(Components of service blueprinting) Physical evidence
These are all the tangibles that customers are exposed to that can influence their quality perceptions
Master Franchisors
These are individuals or organisations that have local knowledge and expertise and are tasked with the challenge of recruiting and training potential franchisees, they may take responsibility for carrying out such visits
Confidence benefits
These benefits comprise feelings of trust or confidence in the provider, along with a sense of reduced anxiety and comfort knowing what to expect
Digital media channels
These channels essentially facilitate information to be stored and transmitted electronically and encoded digitally. Such technologies allow retailers to capture data on shoppers, track purchase patterns and use such information to develop customised messages that can be tailored to each individual
Iron customers
These customers provide the volume needed to utilise the firm's capacity but whose spending levels, loyalty and profitability are not substantial enough for special treatment
(Ethical shoppers) Principled purchasers
These shoppers are characterised by the emphasis they place on ethical behaviour in their day-to-day activities. They are scrupulous in matters such as not taking advantage of mistakes made by retail assistants e.g. undercharging for an item or giving too much change back
Fellow customers
They are present in the service environment and can affect the nature of the service outcome or process. Fellow customers can either enhance or detract from customer satisfaction and perceptions of quality
Value propositions
They are reciprocal promises of value, operating to and from suppliers and customers seeking an equitable exchange (Ballantyne and Varey, 2006)
The importance of employees
They are the service, the organisation in the customer's eyes, the brand and are marketers
The portfolio of channels should be based on the following guidelines:
They should be shopper-centric, reflecting the needs of the customer, they should recognise the fact that shoppers engage in multiple touchpoints with the retailer's value proposition, all of the channels should allow the shopper to engage with the retailer in a seamless and integrated fashion
Brand awareness
This aspect is the building block for developing a strong brand. Without high levels of brand awareness and brand recall, it is virtually impossible to capture a position in the mind of the shopper
Self-oriented brand consumption
This aspect replicates some of the functional and emotional elements but will tend to vary due to the individual's lifestyle and the goals that drive them forward. Three primary motivators contained in this core value include self-actualisation; self-perception enhancement; and self-branding. They reveal that consumers often seek self-actualisation in their experiences with brands and other consumers in a social media community
Emotional brand consumption
This emotional involvement with the brand involves some enjoyable connections e.g. alleviating personal problems or situations; feeling privileged, recognised, and valued by a brand; and escapism and satisfaction of curiosity
Relational brand consumption
This focuses on the level of interaction between the consumer and the brand. In many ways social media shortens the gap between the brander and the individual. It also allows for a degree of personalisation in terms of the level of contact and interaction between both parties
Code of behaviour document
This identifies a number of aspects of sourcing that retailers explicitly take a position on. It guides the way in which they identify, evaluate, select and draw up contracts with suppliers
Self-service
This is the environment in which the customer performs most of the activities and few if any employees are involved e.g. ATMs, cinemas, self-service entertainment such as golf courses and online internet services
(Attracting bargain hunters) Odd pricing
This is the practice of pricing services just below the exact amount to make buyers perceive that they are getting a lower price e.g. haircuts priced at £19.50 rather £20
(Attracting Status Seekers) Skimming pricing
This is where new services are introduced at high prices with large promotional expenditures e.g. new restaurants with celebrity chefs when opening in a new city
(Attracting Bargain Hunters) Penetration
This is where new services are introduced into a market at low prices to stimulate trial and widespread use e.g. online streaming services
The communications mix is made up of three parts:
Traditional - TV, radio, print, billboard, sponsorship, selling, PR; Digital - geo-based apps, beacon technology, tablets, androids; Social media - Twitter, Facebook, LinkedIn, Instagram, YouTube
The communications mix consists of three interlocking elements:
Traditional, digital and social media
Service delivery network (SDN)
Two or more organisations that, in the eyes of the customer, are responsible for the provision of a connected, overall service (Tax et al., 2013, p. 455). It is as an alternative to a service encounter-dominant view of the provision of the customer experience
Traditional media channels
Typical channels that organisations including retailers have used for decades to communicate their message to a target audience. Many of them allow for one-way communication and has a lack of focus and customisation with regard to the message
Service delivery system failures
Unavailable service, unreasonably slow service, other core service failure
The retail loyalty ladder
Unaware customer -> Interested customer -> Regular loyal -> Advocate
Characteristics of an Effective Service Guarantee
Unconditional, meaningful, easy to understand, easy to invoke
Internal customer service audits
Used to implement a culture of internal service quality. Through the audit, internal organisations identify their customers, determine their needs, measure how well they are doing and make improvements
Sales promotion
Used to stimulate a response from shoppers, attracts shoppers, use of banners,, push sales of selected product categories, joint promotions, differentiated promotions, use of information
(Categories of shoppers) Smart shopper
Young urban people, well-educated, like novelty. No preferences over type of shop, will seek good value for money (13% of European population)
Consumer demographic variables that affect their new product acceptance
Younger people tend to be less risk averse and more stimulated to try new products, larger households tend to by heavy buyers and create a greater likelihood for within-household heterogeneity, socioeconomic class with more purchasing power
A customer's individual capital includes...
a customer's personality, knowledge, skills and abilities (Phau and Chang-Chin, 2004)
A qualitative attribute is similar to the competitive attribute except that...
a retailer can afford to achieve less than the competition on this attribute, particularly if it is less relevant to the target market or the low rating on this feature is more than compensated for by the score on other attributes
Green supply chains consider the environmental effects of...
all processes of supply chain from the extraction of raw materials to the final disposal of goods (Emmett and Sood, 2010: 9)
As the monetary value of the product increases, the perceived risks involved in purchasing the product...
also increase (Dowling, 1999)
Customer service ultimately is about...
attracting, retaining and enhancing customer relationships (Sparks, 1992)
Continually investing in customer service does not necessarily lead to...
automatic increases in customer satisfaction
In-store marketing communications at the point of purchase includes...
banners, shelf-edge labels, cart/trolley talkers and augmented reality
Service loyalty has been found to have both...
behavioural and cognitive/attitudinal dimensions (Jones and Taylor, 2007)
The cognition-based component of attitude includes...
belief, judgments, and thoughts associated with an object, whereas the affect-based component includes emotions, feelings, and drives (Edwards, 1990 and McGuire, 1969)
Multiplicity of roles often results in service staff having to pursue...
both operational and marketing goals
Attributes contributing to web brand trust include...
brand name, website design and navigation, information, past experiences and country of origin
Newly introduced private label products are by default at a...
disadvantage, as consumers perceive them to be highly risky
Service line extensions
e.g. adding new menu items in restaurants
Style changes
e.g. revising the company logo
Touch includes...
engagement and interaction, product demonstrations, engagement with a contextual setting e.g. TISO (outdoor experience retailer), combining aroma with engagement
Continually exceeding customer expectations allows a firm the ability to...
enhance customer loyalty, thus providing the firm with a competitive advantage (Zeithaml et al., 2006)
In the Perceived Risk Theory (PRT), the components of perceived risk are...
finance (price), product performance (quality) and physical, privacy and time loss related (Kaplanet al., 1974)
Non-price-oriented promotions include...
free samples, sweepstakes, contests and premium user programmes
Critical areas where the retailer needs to capture information from its customer base in order to facilitate decision-making with regard to customer service strategy are...
frequency of browsing visits, frequency of purchasing visits, average transaction per visit, items purchased, range purchased, product/services purchased/used, satisfaction levels, customer services/facilities used, use of different retail channels, comparison with other retailers visited
Viral marketing allows retailers to...
generate interest, curiosity, excitement, discussion or visits to websites. People share their views, 'spread the word' and generally become wrapped up in the excitement
Developing a service culture is clearly a means of creating and enhancing...
good interactive marketing performance needed for implementing a relationship marketing strategy (Gronroos 1990)
High utilitarian or hedonic value =
high loyalty/loyal customer
Credence services are seen to constitute...
high risk purchases (Zeithaml, 1981), suggesting it is an "important" element of the involvement construct
Customer touchpoints in the purchasing process are...
holistic in nature and involving the customer's cognitive, affective, emotional, social and physical responses to the retailer (Verhoef et al., 2009)
Smell involves...
image associations, creation of artificial aromas e.g. Abercrombie and Fitch, cynical(?), linking to overall cleanliness of the retail outlet, ambient factors like temperature and humidity
A competitive attribute recognises that...
in order to be successful, this attribute is a minimum requirement. On its own, it does not provide any strong differentiating reason why a shopper should visit that particular store
Rintamaki and Kuusela (2007: 624) conclude by suggesting that a customer value proposition should...
increase the benefits and/or decrease the sacrifices that the customer perceives as relevant, build on competencies and resources that the company is able to utilise more effectively than its competitors, be recognisably different (unique) from competition, result in competitive advantage
Customer value propositions should...
increase the benefits and/or decrease the sacrifices that the customer perceives as relevant, build on competencies and resources that the company is able to utilise more effectively than its competitors, be recognisably different (unique) from the competition, result in a competitive advantage
Constant price adjustment can lead to...
increased traffic to the store and increased sales revenue. The danger of this approach lies in its ability to damage the integrity of the brand through constant price discounts and deals
The dimensions of brand personality are...
innovativeness, chaos, conspicuousness, agreeableness and sophistication (Willems et al, 2011)
When demand is high...
it exceeds the organisation's ability to meet it i.e. potential business is lost
Retail formats can be characterised along two dimensions...
merchandise assortment and customer service
The retail marketing mix consists of...
merchandise decision, store format, customer communications and customer services
The service logic is of a...
multidimensional nature. Depending on from which vantage point service is viewed, its content varies
Colour ranges from...
neutral, bright beacon, green environment and cultural interpretations
Omni channels represent a blurring of channels between...
physical and online approaches
Trust is more important for ___ retailers than ___ because of the higher risks involved
online, offline
Threshold attendance is determined not only by...
operating costs (Getz, 1983), but also by visitor-generated revenue
Value =
perceived product benefits + perceived emotional associations - perceived price
Product class determines the level of overall...
perceived risk in the product (Chaudhuri, 1998)
Quality is connected with ___ ___ and concerns the potential failure of a product to meet the expected quality/performance requirements (Kiang et al., 2011)
performance risk
It is suggested that the affective component of attitude is...
post-cognitive (e.g. Edwards, 1990)
Transformational leadership theory is particularly well suited to...
predicting employee engagement (Macey and Schneider, 2008)
Brand equity may be measured as the...
price differential between a given brand and the average market price
Price-oriented promotions include...
price discounts, coupons and rebates
Retailers can wield power if they focus on areas like...
pricing requirements, slotting allowances, unpaid services to retailers and penalties, and compensation for retailer's services (Radaev, 2003)
When using the Internet to purchase products, the fundamental risks are associated with...
privacy issues (Pantano, 2014;6, P, 2002), the degree to which consumers perceive that using the online environment will be secure (Taylor and Strutton, 2010), the inability of buyers to directly interact with the seller, the difficulty of navigation (Forsythe et al., 2006) e.g. the time spent searching for information, uncertainty about the after sales service warrantee compared with more traditional ways of shopping (Hong and Yi, 2012)
Operant resources act upon operand resources to...
produce effects customers use in forming their experience of value
The online purchasing process turns consumers into both...
product buyers and users of web-based technologies (Wu, 2013)
A potentially influential factor of consumer acceptance of new products is...
product novelty
When demand is low...
productive capacity is wasted
If a brand is perceived as something that simply replicates and copies what is already available (often referred to as a 'me-too' product), then consumers will most likely...
revert to their original preferred choice
Employee and customer outcomes in the Service Encounter 2.0 are driven by three factors...
role clarity, ability, motivation
Overall price image can influence the...
shopping behaviour and patronage of shoppers, shoppers adopt a holistic view of price image: the influencing factors should be viewed in their entirety and recognise the interdependent nature of the relationship between variables
Atmospherics include...
sight, sound, touch, taste and smell (Floor, Ko, 2006, p. 273)
Sound involves...
sound of silence, encourage browsing, music tempo, affects mood and movement, muzak and intrusiveness
Taste involves...
stimulating sales, introducing new flavours, creating a relaxed environment, using 'experts' e.g. whisky and wine tasting events, sampling
The elements found to be fundamental for engagement are...
strong leadership, accountability, autonomy, a sense of control over one's environment and opportunities for development (Kular et al., 2008, p. 11).
Private labels generally form a...
subgroup in consumers' memory, with specific categorisation cues, such that previous consumer learning may influence private label innovations
The service-dominant logic suggests that maintaining a service advantage requires...
that the retailer make the customer part of the coproduction of the service offering
The price-related drivers include...
the average price, which reflects how a retailer's prices compare with competitors, the dispersion of prices, reflecting how low and high prices are distributed within a store, price dynamics, which reflect the extent to which prices change within a store over a period of time, price-related policies such as price promises (revisit the price promise example in an earlier section), price-related communications such as price-based advertising
Store image is formed by...
the cues or signals that the individual retailer sends out to its target market. This can take the form of visual cues such as store design, layout, location, merchandising and the various marketing communications tools employed
A customer's social capital requires...
the existence of and the effects resulting from specific and sustained social relationships between consumers
The service recovery paradox is more likely to occur when...
the failure is not considered by the customer to be severe, the customer has not experienced prior failures with the firm, the cause of the failure is viewed as unstable by the customer, the customer perceives that the company had little control over the cause of the failure
Consumers decide whether they intend to proceed with a purchase based upon...
the information available to them (Kim et al., 2008), the degree of influence on provided recommendations and reviews (Wang and Chang, 2013), whether there is a reduction in performance and risks (Suwelack et al., 2011)
Store layout decisions are heavily influenced by...
the nature of the products sold. For instance, supermarkets tend to sell products that are largely utilitarian. This recognises that many of these products are low-involvement purchases e.g. cereal
The utilisation of space has to reflect...
the needs of shoppers and the location of the outlet must reflect a shopping environment that addresses such needs
Price image is unidimensional insofar as it considers...
the overall role of price perceptions
S-DL is viewed as...
the philosophical foundation of service science (Maglio & Spohrer, 2008: p. 19)
Critics of the source credibility and source attractiveness models argue that...
they do not place sufficient emphasis on the need for a strong relationship between the celebrity and the product or brand that is being endorsed. This leads to an alternative view that is referred to as the 'match-up' theory
Wait experience can be measured in several ways:
tolerable waiting time, waiting time and wait proportion
Repetitive operational tasks are the most conducive to...
training by rote, automation, measurement and quality control
Value equals
value-in-use; the value for customers, created by them during their usage of resources. It is created and determined by them
Experience-related variables play different roles in...
visitor satisfaction such as experience value, visited-attraction number, and waiting time
Service encounter
"Where promises are kept or broken and where the proverbial rubber meets the road-sometimes called real time marketing." -Wilson et al. (2013). It is from these encounters how consumers build their perceptions of the service brand and service quality
Involvement construct
"a person's perceived relevance of the object based on inherent needs, values and interests" (Zaichkowsky, 1985, p. 342)
Value generation
A process that includes actions by several actors (service provider, customer and others) and that ultimately leads to value for the customer. It is comprised of three value spheres
Service
"A service is any activity or benefit that one party can offer to another which is essentially intangible and does not result in the ownership of anything. Its production may or may not be tied to a physical product" -Kotler et al (2002) "Services are all economic activities whose output is not a physical product or construction, is generally consumed at the time it is produced, and provides added value in forms (such as convenience, amusement, timeliness, comfort, or health) that are essentially intangible concerns of its first purchaser." -Wilson et al. (2013)
The Service Encounter
A period of time during which a consumer directly interacts with a service (Shostack, 1985)
Information search
A critical aspect of consumer decision making and can be categorised into either internal or external search (Moorthy et al., 1997)
Value co-creation
A joint process that takes place on a co-creation platform involving e.g. a service provider and a customer, where the service provider's service (production) process and the customer's consumption and value creation process merge into one process of direct interactions
Image
A method of differentiating and representing an entity to its target market. Image is not "product;" nor is it "service"
Service Encounter 2.0
Any customer-company interaction that results from a service system that is comprised of interrelated technologies (either company- or customer-owned), human actors (employees and customers), physical/digital environments and company/customer processes. These encounters range from simple to complex interactions e.g. human-to-technology etc
Provider SL
As service providers, through all their actions and interactions with users (e.g. customers), firms strive to support users' everyday processes in a way that facilitates (or contributes to) users' value creation
Search qualities
Attributes a customer can determine before purchasing a product e.g. clothing, jewellery, furniture
Experience qualities
Attributes that can be discerned only after purchase or during consumption e.g. haircuts, restaurant meals
Experience attributes
Cannot be evaluated before purchase - the consumer will not know how much they will enjoy the food, the service, and the atmosphere until the actual experience
Credence qualities
Characteristics that the consumer may find impossible evaluate even after purchase e.g. car repair, dental treatment, legal services
A provider sphere
Closed to customers, where the service provider compiles resources, including potential value-in-use, to be offered to customers to facilitate their value creation
A customer sphere
Closed to the service provider and where the customers independently create value and may socially co-create value with actors in their ecosystem
Service industries and companies
Companies whose core product is a service
Ways to ensure customers are satisfied
Deliver the promises, improve customer service through feedback and disgruntled/struggling customers, exceeding expectations during service interaction. However, once customers are delighted their expectations are raised, minimise channel switching by increasing self-service channels, cultural attributes and values
Asset Builders
Delivers value through building, marketing, distributing and leasing physical things (physical capital) e.g. traditional retailers, logistics providers, and industrial manufacturers
Network Orchestrators
Delivers value through connecting peers and establishing relationships via a platform (network capital). These peers may sell products or services, build relationships, share advice, give reviews or collaborate e.g. social media businesses, review and sharing platforms
Technology Creators
Delivers value through ideas as they develop and sell intellectual property (intellectual capital) e.g. software, analytics, and pharmaceutical companies
Service Providers
Delivers value through skilled people. Hence, value is mostly created by the company's employees for which they charge customers (human capital) e.g. financial institutions, healthcare organisations, and business consultants
Heterogeneity
Difficult to control, process management, expectation management, service can and does vary due to people e.g. different lecturers
Intangibility
Difficult to display or communicate, cannot protect through patents, difficult to justify prices, make the intangible tangible, create "presence" through physical things, the company brand gives reassurance
Enabler
Employees: help both customers and technology to perform their respective service encounter roles well (Bowen, 2016) Customers: support employees and/or technology in the service encounter
Co-creation platform
Formed when two or more actors' processes, such as a service provider's and a customer's processes, merge into one collaborative, dialogical process, in which the actors actively influence each other's processes and outcomes. A co-creation platform entails only direct interactions
Strategic responses to managing customer perceptions of risk
Free trial (for services with high experience attributes), advertise (helps to visualise), display credentials, use evidence management e.g. furnishing, equipment etc, offer guarantees, encourage visit to service facilities, give customers online access about order status
Personnel
Front stage personnel are like members of a cast; backstage personnel are support production team
Klein (1998) identifies two conditions that hold for experience-products:
Full information on dominant attributes cannot be known without direct experience and information search for dominant attributes is more costly/difficult than direct experience
Perceived risks of purchasing and using services
Functional, financial, temporal, physical, psychological, social, sensory
Credence goods
Goods and services characterised by high levels of information asymmetry where it is the seller who often determines the customer's requirements e.g. legal services, insurance, financial services (Darby and Karni, 1973). Even after product trial and consumption, the consumer may find it difficult to evaluate the purchase (Zeithaml, 1981)
Search attributes
Helps customers evaluate a product before purchase e.g. type of food, location, type of restaurant and price
Search products
Identified as those whose relevant attribute information (e.g., price, quality, performance, dimension, size, colour, style, safety, warranty) can be easily obtained prior to use/purchase
McQuarrie and Munson (1992) proposed that there are two main elements within involvement:
Importance is viewed as the cognitive dimension of the construct, and interest captures the more affective, or emotional elements of involvement
___ ___ is judged to be a "key concomitant of heightened consumer involvement" (McQuarrie and Munson, 1992, p. 109) and the ___ ___ ___ have an impact on information search (Assael, 1998)
Information search, levels of involvement
Social value co-creation
Interactions in the customer sphere between the customer and actors in his or her ecosystem, where such actors, but not the service provider, can influence the customer's value creation
Indirect interactions
Interactions where one actor (e.g. a customer) interacts with a standardised system or product. No merged collaborative, dialogical process occurs, and therefore, the other actor (e.g. a provider of such resources) cannot actively influence customers' value creation. Instead, it interacts indirectly with the customer and this takes place in the customer sphere
Service delivery
Serving customers in a conscientious, responsive, flexible and courteous manner (Parasuraman et al., 1988)
Augmentation (of service employees)
Signifies technology's ability to assist and complement service employees in the service encounter (Marinova et al., 2017) i.e. Intelligence Augmentation (IA)
Direct interactions
Joint processes where two or more actors' actions merge into one collaborative, dialogical process. The actors can be human actors or intelligent systems and products and take place in the joint sphere
Low-contact service
Little or no physical contact with service personnel, contact usually at arm's length through electronic or physical distribution channels, new technologies (e.g. web, self-service technologies) help reduce contact levels
The consequences of consumer dissatisfaction
Lost sales and profits are the major consequence, some dissatisfied consumers will not give the seller a chance to remedy the problem, either as they feel the sell won't be willing or because they may be reluctant to complain in general (this can also relate to cultural/values issue e.g. Starbucks in Australia), it costs five times as much to attract a new customer than it does to retain a current customer
Inseparability
Simultaneous consumption, customer care must be real, service quality, no product to compensate, "Word of mouth", people talk about experience e.g. reviews
Perishability
Means they can't be stored, capacity planning, special promotions
Adequate service level
Minimum acceptable level of service
Challenges posed by services
Most services cannot be inventoried, intangible elements dominate value creation, services are often difficult to visualise and understand, customers may be involved in co-production, people may be part of the service experience, operational inputs and outputs tend to vary more widely, the time factor often assumes great importance, distribution may take place through non-physical channels
Interaction
Mutual or reciprocal action where two or more parties have an effect upon one another. In a business context supplier, customer interactions are for business reasons, and in these contacts, they have opportunities to influence one another's processes
Stages in Consumer Decision Making
Need recognition, information search, evaluation of alternatives, purchase, consumer experience, post-purchase evaluation
A "molecular" model
Offers opportunities for visualisation and management of a total market entity. It reflects the fact that a market entity can be partly tangible and partly intangible, without diminishing the importance of characteristic
Retailer attributes
Perceived value, convenience, order services, reputation and company responsiveness (e.g. information services) (Eastlick and Feinberg, 1999)
Factors influencing customer expectations of service
Personal needs, belief about what is possible, perceived service alternations, situational factors, explicit & implicit service promises, word-of-mouth, past experience, predicted service
The Expanded Marketing Mix
Product, price, promotion, place, people, physical evidence, process
Value proposition concept
Refers to contexts in which the firm delivers value to its customers (Anderson et al., 2006), not, as the SDL suggests, contexts in which the firm cannot deliver value
Network facilitation
Refers to technology acting as an enabler of connections and relationships. Network Orchestrators heavily build on such technologies. Rather than focusing on replacing human employees, these business models seek to use technology as a way to connect multiple entities in the service encounter - both human and technological
Substitution (of service employees)
Reflects the purpose of replacing human input in the service encounter (Marinova et al., 2017)
How do consumers handle perceived risk?
Seek information from respected personal sources, compare service offerings and search for independent reviews and ratings via the Internet, relying on a firm with good reputation, looking for guarantees and warranties, visiting service facilities or going for trials before purchase and examining tangible cues or other physical evidence, asking knowledgeable employees about competing services
Predicted service level
Service level that customer believes firm will actually deliver
Scripts
Specifies the sequences of behaviour for customers and employees
Service facilities
Stage on which drama unfolds, this may change from one act to another
Convenience, Shopping, and Specialty (CSS) goods
The conventional product-classification framework was originally developed by Copeland (1923) and has been prominently used before the web started to become an important shopping medium
Independent value creation
The customer's process of creating value-in-use out of resources in the customer's sphere, which is closed to the service provider. During this process, the service provider cannot actively influence value creation
Value creation
The customer's process of extracting value from the usage of resources. It is the customer's creation of value-in-use. Despite using the expression "value creation", value is not always instrumentally created; it may emerge as value-in-use
Value-in-exchange
The potential value embedded in resources provided by a firm, which, through sales, is realised as real value for the firm. Value-in-exchange is a firm-centric concept, based on labour theory, so it is not used in SL
Value facilitation
The way a service provider contributes to the customer's value creation by offering resources representing potential value-in-use
User SL
Users (e.g. customers) integrate resources acquired from a provider with other necessary resources in their possession and apply knowledge and skills held by them in a process that renders value ("use resources as service")
Value-in-use
Value emerging for or created by the customer during usage, is a key value concept, used to refer to value determined by customers
Desired service level
Wished-for level of service quality that customer believes can and should be delivered
Technology takes a central position in the Service Encounter 2.0, the three key roles are...
augmentation of service employees, substitution of service employees, network-facilitation (i.e. Lamberton & Stephen, 2016)
Services possess high levels of experience and credence properties, which in turn make them...
challenging to evaluate, particularly prior to purchase
Interactions are situations where the interacting parties are involved in...
each other's practices and have opportunities to influence each other
Credence services are the most difficult service offerings for consumers to...
evaluate, before and after purchase, and therefore a better understanding of the main influencers on this process is crucial to service providers and academics in this area
Service is the fundamental basis of ___
exchange
The ___ the value-in-use, the ___ the likelihood that the customer considers buying from the same firm the next time
higher, greater
Sheth (1983) identifies the factors that affect customer patronage preference as...
product types and characteristics, retail-outlet types and attributes, personal characteristics of shoppers, demographics and life-style
The involvement construct is generally recognised as having a...
strong influence on consumer buyer behaviour and is used to classify products in a number of advertising frameworks (Vakratsas and Ambler, 1999)
