Dogan Gursoy, PhD Taco Bell Distinguished Professor Editor, Journal of Hospitality Marketing & Management The Other Side of the Picture in Destination

Dogan Gursoy, PhDTaco Bell Distinguished Professor

Editor, Journal of Hospitality Marketing & Management

The Other Side of the Picture in Destination Management: Service Quality, Tourist Satisfaction and

Destination Loyalty

School of Hospitality Business ManagementCollege of Business

Introduction• Most of the time, we focus on the managing physical

attractions in the destination Roads, zoning, regulations, etc.

• Ignore the consumer and business aspect

• Tourism is a business To have any form of sustainable business, we need to

have satisfied customers A destination need to create satisfactory tourism

experiences


Introduction

• Customer satisfaction is one of the most important and most frequently examined concepts of modern marketing thought and practice (Gursoy, McCleary and Lepsito 2003, 2007; Yi, 1990).

Determines the perceived quality of products that is actually delivered to customers (Vavra 1997; Pizam and Ellis 1999)

It is essential for the survival of any type of business (Berkman and Gilson 1986).

Generates positive behavioral reactions from the customers such as return, repeat purchases, purchase recommendations and positive word of mouth (Anderson, Fornell and

Lehmann 1994; Boulding, Kalra, Staelin and Zethaml 1993; Cronin and Taylor 1992; Davis and Vollmann 1990; Dube, Renaghan and Miller 1994).


Introduction (Cont’d)

• Most argued that providing quality service is a prerequisite for customer satisfaction satisfaction leads to loyalty.

• Do you ever purchase a product and expect to be dissatisfied?

• Simply satisfying customers may not lead to loyalty customers may have to be surprised, delighted.


Customer Satisfaction

• It may easier to create satisfied customers for tangible products compared to a destination the nature of a destination makes it significantly harder

to accomplish this goal.

• Why? Because a tourist product is the result of a process

where facilities, services and attitudes from multiple firms are configured to produce an experience of value to customers.

Tourism most often takes place in many stages Source: Neal and Gursoy (2008)


Customer Satisfaction (Cont’d)

• Tourism experience is a multi-faceted and a hybrid experience encompassing services delivered by a large number of companies.

• Quality of services delivered by each company is likely to influence tourists satisfaction with their tourism experience their loyalty to a destination.

Source: Neal and Gursoy (2008)



• Research shows that overall satisfaction with travel/tourism services is a function of tourists satisfaction with Pre-trip services,

• The second highest impact on overall satisfaction Services at the destination

• The highest impact on overall satisfaction The transit route services.

• The third highest impact on overall satisfaction

Source: Neal and Gursoy (2008)



• What happens if any one of customers’ experiences with any service aspect is not up to their expectations? Lower their perception of quality Lower their satisfaction Lower their loyalty

• It is vital to: Understand the complex relationships among various components

of tourism product Develop strategies to ensure visitors to a destination will have

surprisingly pleasant and satisfying experiences.


What affects customers’ satisfaction?

• The offering

• Employees

• Other customer

• Locals residents attitudes and behaviors towards tourists


Offering

• Offering must effectively meet the needs and desires of your target customers. Focus on the experience customers want to have. Strategy:

• perform at acceptable levels on some aspects while excelling on others

• Why? It is expensive to excel on everything

Source: Frei (2008)


Offering (Cont’d)

• Determine which attributes to target for excellence which to target for average performance

• Do not over-invest in underappreciated attributes.

• Cater to customer priorities let the competition worry about things customers care

less about

Source: Frei (2008)


Employees

• Support and motivate employees• What makes our employees reasonably able to achieve

excellence?• What makes our employees reasonably motivated to achieve

excellence?

• Accommodate economic reality in the design of employee management

• Design a system that allows the average employees to thrive

Source: Frei (2008)


Customers

• Customers are involved in operational processes

• Customers’ input influences their own experiences and other customers’ too.

• Employees and customers are both part of value-creation process• Customer labor less expensive than employee labor• Leads to better service experience

• When customers are involved in a process, it can become more complicated Learn to manage and lead your customer

Source: Frei (2008)


Local residents• They are an integral part of tourists’ experiences

• Positive attitudes will create a welcoming environment Better experience, Higher satisfaction, Higher loyalty

• Make them believe in tourism

• Communicate the benefits

• Ask their opinion and show them that you value their opinions

• Address their concerns


Customer Satisfaction and Loyalty• However, these may not be enough

• Customers also expect you to offer a good value service excellence

• How can you create service excellence and offer good value at the same time?


How can you create service excellence and offer good value at the same time? (Berry 2009)

• With great employees

• With reliability

• With respect and pleasant surprises

• With convenience

• With the best

Source: Berry (2009)


Consumer value

• What is the value? Value should be defined from a customers’ perspective. Value is benefits received for burdens endured.

• Benefits are what customer seeks to buy.

• A superior value entails: Maximizing benefits for customers. Minimizing the costs. Providing customers with a good return on investment.



Creating service excellence with great employees

• Make sure employees have “good work” to do. Good work helps attract good employees. Good employees deliver excellent service.

• Believing, investing, listening. Show faith in the goodwill and good judgment of the

employees. Invest in the success of employees and increase their

desire to stay. Listen to the employees

• Being an employer of choice Be a relational employer seek to build true bonds with employees



Creating service excellence and offering good value with reliability

• Reliability is the core of quality service Customers buy a promise of quality service.

• Designing reliability into the service depends on how you answer these four questions.1. Can you simplify the service without compromising its value

to customers?2. What can you do to assist customers in using the service

correctly?3. What processes in the service system are most prone to

failure, and what can be done to prevent these failures?4. What capabilities do service providers need to perform the

service accurately and dependably?Source: Berry (2009)


Creating service excellence with reliability (cont’d)

• Run to the problem, not from it. Correct a problem before it reaches the customer. Gain back the customer’s confidence in the service

through right service recovery. The worst mistake is not to end up in a better place

after having made a service failure.



Surprise customers Exceeding customers’ expectation requires pleasant surprise.

Not in every area. Exceed their expectations in areas that are important to customers

Human interaction provides the opportunity. Pleasing customers demonstrates respectfulness.

Respectful treatment of the customer is fundamental to delivering a quality service.

Respectful service extends esteem and dignity not only to the customer, but also to the provider.



Common Customer Service Complaints• True lies

Cheating customers• Selling unneeded services or purposely overcharging

• Red alert Providers who assume customers are stupid or dishonest, and treat them

harshly or disrespectfully• Broken promises

Service providers who does not deliver what they promised. Careless mistake prone service

• I just work here Powerless employees who lack the authority – or desire – to solve basic

customer problems.• The big wait

Waiting in line made long because you failed to schedule adequate number of staff.

Source: Berry (1999, p. 31)


• Automatic pilot Impersonal, emotionless, no-eye-contact, going-through-the –motions non

service• Suffering the silence

Employees who do not bother to communicate with customers who are anxious to hear how a service problem will be fixed.

• Don’t ask Employees are unwilling to make any extra effort to help customers, or who

seem put-out by requests for assistance• Lights on, no one home

Clueless employees who do not know (i.e., will not take time to learn) the answers to customers’ common questions.

• Misplaced priorities Ignoring customers

• Employees who visit with each other or conduct personal business while the customer waits.• Those who refuse to assist a customer because they are off duty or on a break.

Common Customer Service Complaints

Source: Berry (1999, p. 31)


Creating service excellence with convenience

• Be innovative in saving customers time and effort. Customers time and effort are nonmonetary burdens. Service convenience is an important facet of service quality. Reducing the burdens is likely to lead to increase benefits.



Creating service excellence with the best

• Service excellence builds on; Hiring the best employees Delivering reliable service Delivering respectful customer treatment Enhancing convenience

Service excellence is the competitive edge to provide differentiated value to customers.

It enables you to create memorable service experiences



Creating Memorable Experiences

• Enables you to create Customer satisfaction Customer loyalty Emotional connection between buyer and service

provider Personal stories Long-term profitability


Thank you for your attention!

Any Questions?

Documents

Dogan Gursoy, PhD Taco Bell Distinguished Professor Editor, Journal of Hospitality Marketing & Management The Other Side of the Picture in Destination