SERVICE MARKETING TEST 3
service defectors
Customers who defect due to poor customer service.
market defectors
Customers who exit the market due to relocation or business failure.
organizational defectors
Customers who leave due to political considerations inside the firm, such as reciprocal buying arrangements.
price defectors
Customers who switch to competitors for lower-priced goods and services.
product defectors
Customers who switch to competitors who offer superior goods and services.
unconditional guarantee
MOST POWERFUL of the 3 promises complete satisfaction and, at a minimum, a full refund or complete, no-cost problem resolution
personal service philosophies
a customer's own internal views of the meaning of service and the manner in which service providers should conduct themselves
defection management
a systematic process that actively attempts to retain customers before they defect
implicit guarantee
an unwritten, unspoken guarantee that establishes an understanding between the firm and its customers
specific result guarantee
applies only to specific steps or outputs in the service delivery process EX: FedEx guarantees overnight delivery
relationship marketing
based on developing long-term relationships with customers
technological defectors
customers who switch to products outside the industry
aftermarketing
emphasizes the importance of marketing efforts after the initial sale has been made EX: a physician who calls the patient to check on the patient's progress several days after an initial visit for an illness
disconfirmed expectations
expectations DO NOT MATCH customer perceptions
empathy dimension
firm's ability to put itself in its customers' place
lifetime value (LTV) of a customer
idea that a customer is worth much more than a one-time purchase as the firm's customers return, the LTV of its customer base INCREASES the true value of customers is the value of all the purchases they have made plus the value of all the purchases they are likely to make in the future
frequency marketing
strives to make existing customers purchase more often from same provider EX: dine out more often at their favorite restaurant, attend more shows at local theater
lifetime profit (LTP) of a customer
the average profit per sale multiplied by the average number of times customers reorder
customer acquisition cost
the monetary amount spent on marketing and other activities to acquire a new customer
implicit service promises
the tangibles surrounding the service and the price of the service
zero defections
used by service providers that strives for no customer defections to competitors
zero defects model
used in manufacturing that strives for no defects in goods produced DOES NOT WORK WELL IN THE SERVICE SECTOR service customers carry specifications in their minds and can only approximate their desires to service providers EX: hairstyle you want done at salon
role conflict
INCONSISTENCY in service providers' minds between what the service manager expects them to provide and the service they think their customers actually want
focus group interviews
INFORMAL discussions with 8-12 customers that are usually guided by a trained moderator used to identify areas of information to be collected in subsequent survey research
SERVQUAL
A 44-item scale that measures customer expectations and perceptions regarding five service quality dimensions 5 dimensions include: tangibles, reliability, responsiveness, assurance, and empathy a diagnostic tool that uncovers a firm's broad weaknesses and strengths in the area of service quality
research orientation
A firm's attitude toward conducting consumer research the gap DECREASES the more they learn about customers wants and needs
service recovery paradox
A situation in which the customer rates performance higher if a failure occurs and the contact personnel successfully recover from it than if the service had been delivered correctly the first time
service quality
An attitude formed by a long-term, overall evaluation of a firm's performance
mechanistic processes
Formalized step-by-step processes that are developed to facilitate the firm's failure analysis and service recovery efforts
zone of tolerance
Level of quality ranging from high to low and reflecting the difference between desired service and adequate service expands and contracts across customers and within the same customer, depending on the service and the conditions under which it is provided
service recovery culture
ORGANIC APPROACH; informal set of beliefs, behaviors, and practices that set the tone for how the firm wishes to address customer complaints
total market service quality surveys
Surveys that measure the service quality of the firm sponsoring the survey and the service quality of the firm's competitors
question context
The placement and tone of a question relative to the other questions asked EX: (regarding vehicle satisfaction) In general, how satisfied are you with the products in your house? vs How satisfied are you with your Toyota?
personal needs
a customer's physical, social, and psychological needs
overpromising
a firm's promise of more than it can deliver occurs in highly competitive business environments as firms try to outdo one another in the name of recruiting new customers
social desirability bias
a respondent's tendency to provide information that the respondent believes is socially appropriate EX: some people are taught, "if you don't have anything nice to say then don't say anything at all"
core service failures
failures that relate directly to the fundamental service offering EX: airlines that do not depart on time, hotels that do not clean their guest rooms well, etc
unresponsive strategy
firm purposely decides not to respond to customer complaints
service recovery
firm's reaction to a complaint that results in customer satisfaction and goodwill
cultural norms
actions that either positively reinforce cultural norms such as equality, fairness, and honesty OR violate the cultural norms like lying, cheating, stealing
after-sales surveys
addresses customer satisfaction while the service encounter is still fresh in the customer's mind
assurance dimension
addresses the competence of the firm, the courtesy it extends to its customers, and the security of its operations Does the firm possess the required skills to complete the service on a professional basis???
willingness to perform
an employee's desire to perform to his or her full potential in a service encounter
service quality information system
an ongoing research process that provides relevant data on a timely basis to managers, who use the data in decision making
controllability
attribution pertaining to whether or not the firm had control over the cause of the failure EX: say the weather causes a power outage in a restaurant on a busy night, there may be little the restaurant can do to ensure that the situation never happens again
customer retention
focusing the firm's marketing efforts toward the existing customer base; efforts work to satisfy existing customers with the intent of developing long-term relationships
response bias
bias in survey results bc of responses being received from only a limited group among the total survey participants EX: companies may only hear from satisfied customers
service failures
breakdowns in the delivery of service; service that does not meet customer expectations.
knowledge gap
gap between what customers want and what managers think customers want EX: airlines may mistakenly believe that customers around the world all have the same expectations and perceptions about airline travel GAP 1
direct measures
generally obtained directly from customers using customer satisfaction surveys
confirmed expectations
expectations MATCH customer perception, results in customer satisfaction
instrumental complaints
expressed for the purpose of altering an undesirable state of affairs EX: complaining to a waiter about an undercooked steak; the complainer fully expects the waiter to take action in order to correct the situation
unusual action
can reflect both positive and negative events positive- dominos delivery man is out delivering pizza and on his way he sees a family outside their house as it just burned down, he calls and tells his manager and they immediately prepare and deliver pizzas to help the family out negative- rudeness, abusiveness, and inappropriate physical contact
situational factors
circumstances that lower the service quality but that are beyond the control of the service provider
perceived service alternatives
comparable services customers believe they can obtain elsewhere and/or produce themselves
tangibles dimension
compares consumer expectations to consumer thoughts about the firm's ability to manage its tangibles a firm's tangibles consist of objects such as: architecture, design, layout, carpeting, desks, lighting, etc
perceived service adequacy
comparing adequate service with perceived service
expectancy disconfirmation model
comparing customer EXPECTATIONS to their PERCEPTIONS leads customers to have their expectations confirmed or disconfirmed
compensatory strategies
compensate the customer to offset the costs (emotional, monetary, time lost) of the service failure customers typically get to keep the good or service provided, and the compensation provides added value gratis= customer is provided with free good/service discount= customer receives an immediate discount coupon= coupon is redeemable at a later date and tied to a future purchase
responsiveness dimension
concerns the willingness and/or readiness of employees to provide a service reflects the preparedness of the firm to provide the service
conquest marketing
constantly seeking new customers by offering discounts and markdowns and developing promotions that encourage new business
exit
consumer stops patronizing the service firm high exit- consumer never purchases from the firm or buy the product again medium exit- tries not to purchase again; seeks alternatives when available low exit- does not change their purchasing behavior
retaliation
consumer takes action deliberately designed to either damage the physical operation or hurt future business high- consumer physically injures service provider or damages firm; goes out of way to communicate negativity medium- creates minor inconveniences for firm; perhaps tells only a few people about incident low- no retaliation; possibly MINOR negative word of mouth
derived expectations
created from the expectations of others EX: if your boss requests that you find someone to pressure-wash the office building, your expectations of the provider performing the job will most likely be higher than if you had hired the provider on your own initiative
gestalt
customer does not describe the service encounter as discrete events but uses general phrases such as "the whole experience was terrible"
positive disconfirmation
customer perceptions EXCEED customer expectations, customers are delighted
negative disconfirmation
customer perceptions that are LOWER than customer expectations, results in customer dissatisfaction
perceived justice
customers weigh their inputs (monetary, time, energy) against their outputs (value customer places on strategy itself) when forming recovery evaluations making the customers feel that they have received some form of justice
failures relating to customer needs and requests
failures relating to the implicit and explicit needs of customers implicit- not requested EX: disabled customer seated in a wheelchair should not be led to an elevated booth in a restaurant explicit- overtly requested EX: customer asks for their steak to be cooked medium-rare
employee-job fit
degree to which employees are able to perform a service to specifications
delivery gap
difference between the quality specifications SET for service delivery and the actual quality of service DELIVERED GAP 3 EX: Do employees perform the service as they were trained?? Is the employee acting the way employees at chick fil a should?
standards gap
difference between what management thinks the consumers expect and the quality specifications set for service delivery GAP 2 EX: consider the exchange of ideas between an architect and a home buyer, if the architect can't convert the home buyer's wishes to blueprint specifications a standards gap is then created
reflexive complainers
directed at some inner aspect of the complainer; blame themselves as the primary source of the problem EX: "I wasn't clear about how I wanted my steak to be prepared"
ostensive complaints
directed at someone or something outside the realm of the complainer EX: "The chef overcooked this steak!!" , the source of the problem is perceived as someone other than the complainer
level of attention
employees who have poor attitudes, ignore a customer, exhibit behaviors consistent with an indifferent attitude can also occur when employees pay too much attention to the customer making them uncomfortable
learned helplessness
employees who, through repeated dispersion of control, feel themselves unable to perform a service adequately
failures related to unprompted/unsolicited employee actions
events and employee behaviors that are totally unexpected by the customer; actions are not initiated by the customer via request nor are part of the core delivery system SUBCATEGORIES: level of attention, unusual action, cultural norms, gestalt, adverse condition
non customer research
examines how competitors perform on service aspects and how employees view the firm's strengths and weaknesses ex: employee surveys and mystery shopping
customer research
examines the customer's perspective of a firm's strengths and weaknesses includes such measures as customer complaints, after-sales surveys, focus group interviews
indirect measures
include tracking and. monitoring sales records, profits, and customer complaints
apologetic strategies
indicate to the customer that the firm is truly sorry for the service failure front-line apology (service provider) - faster management apology - more valued
organic processes
informal sets of values and beliefs that comprise the firm's service recovery culture
failures relating to problematic customers
instances where neither the employee nor the service firm is at fault for the service failure; the cause of the service failure lies with the customer's own misbehavior This includes: drunkenness, verbal/physical abuse, breaking company policies, and uncooperative customers
stability
is the cause of the failure likely to recur? is this a one-time incident (unstable), or is the cause of the failure likely to recur (stable)?
predicted service
level of service quality a consumer believes is likely to occur
desired service
level of service quality a customer actually wants from a service encounter
adequate service
level of service quality a customer is willing to accept minimum tolerable expectation
mystery shopping
measures individual employee service behavior generally trained personnel who pose as customers, shop at the firm unannounced, and evaluate employees
service gap
most important gap !! describes the distance between customers' expectations of service and their perception of the service actually delivered what they expect compared to what they end up getting
inadequate support
not receiving personal training and/or technological and other resources necessary for employees to perform their jobs in the best possible manner LEADS TO-- a lot of wasted effort, poor employee productivity, dissatisfied customers, and increase in delivery gap
explicit service promises
obligations to which the firm commits itself through its advertising, personal selling, contracts, and other forms of communications due to the lack of a tangible product, consumers of services base their evaluations of the service on various forms of information available
restoration strategies
offered to customers to offset the current failure situation by providing a new identical product, making corrections to the original product, or offering a substitute product total replacement= defective product is replaced with new product correction= defective product is repaired and returned to customer substitution= defective product is unwanted/unavailable and a substitute product is provided
enduring service intensifiers
personal factors that are stable over time and increase a customer's sensitivity to how a service should be best provided
transitory service intensifiers
personal, short-term factors that heighten a customer's sensitivity to service
past experience
pervious service encounters a consumer has had with a service provider
adverse conditions
positive and negative employee actions under stressful conditions positive- employee takes effective control of a situation when everyone else is "losing their heads" negative- captain and crew of sinking ship get on lifeboats before customers
procedural justice
process (time) that is undertaken to arrive at the final outcome those that are implemented "promptly" are much more likely to be associated with higher recovery effectiveness ratings and retention rates than their "delayed" counterparts
employee surveys
provide an internal measure of employee morale, attitudes, and perceived obstacles to the provision of quality services
reimbursement strategies
provide the customer with a refund or store credit
voice
refers to an outcome in which the consumer verbally communicates dissatisfaction with a specific service provider high voice- manager medium voice- person providing the service low voice- no one associated with the providing firm
interactional justice
refers to human content (empathy, friendliness) that is demonstrated by service personnel during the service recovery process
customer loyalty
reflects an emotional attachment as well as a business attachment to the service firm
reliability dimension
reflects the consistency and dependability of a firm's performance EX: does the firm provide the same level of service time after time? does the firm keep its promises?
benchmarking
setting standards against which to compare future data collected EX: think of a benchmark run
dispersion of control
situation in which control over the nature of the service being provided is removed from employees' hands. EX: employees are not allowed to make independent decisions about customer requests without first talking with manager
distributive justice
specific outcome of the firm's recovery effort what specifically did the offending firm offer the customer to recover from the service failure, did this outcome (output) offset the costs (inputs) of the service failure?
levels of management
the complexity of the organizational hierarchy and the number of levels between top management and the customers when the levels of management INCREASE, the size of the knowledge gap tends to increase
communications gap
the difference between the actual quality of service delivered and the quality of service described in the firm's external communications EX: a customer who is promised delivery in 3 days who then has to wait two weeks will perceive service quality to be far lower than expected GAP 4
upward communication
the flow of information from front-line personnel to upper levels of organization in other words, does upper management listen and value the feedback provided by its front-line personnel?
horizontal communication
the flow of internal communication between a firm's headquarters and its service firms in the field "does the left hand know what the right hand is doing?" EX: in some instances, new service programs are announced to the public by corporate headquarters before the local service firms are aware that the new programs exisit
self-perceived service role
the input a customer believes he or she is required to present in order to produce a satisfactory service encounter
question timing
the length of time after the date of purchase that questions are asked satisfaction appears to be highest immediately after purchase and then begins to decrease over time
question form
the way a question is phrased; positively or negatively EX: How satisfied are you? vs How dissatisfied are you?
word-of-mouth communications
unbiased information from someone who has been through the service experience, such as friends, family, or consultants
non instrumental complaints
voiced without any expectation that the undesirable state will be altered EX: complaints of weather such as, "its so hot!!" or complaining to a friend about how bad your hotel room was
role ambiguity
when employees, due to poor employee-job fit or inadequate training, do not understand the roles of their jobs or what their jobs are intended to accomplish
perceived service superiority
when you compare desired service expectations and perceived service received
Locus
who is responsible for the failure? is the source of the failure the service provider, service firm, the customer, or some external force?