Lecture sevenManaging Expectations

Customer Service Excellence

An organisation to implementStrategy

Style

Systems Structure

Staff

Skills

Sourc

e:

McK

inse

y 7

S f

ram

ew

ork

Sharedpurpose

Acquisition

RetentionRetention

Acquisition

Strategy Evaluation and Choice

Retention

Strategic FocusBudgets and

ResourcesCustomer Branded

Experience

Customerbranded

experience

Salespromotionsand sales packages

Acquisition

Customerbranded

experience

Salespromotionsand sales packages

Retention

Acquisition

Focussing on the customer??Customer need/ProductCost/PriceConvenience/PlaceCommunication/Promotion

Service qualityCompetitive advantage can be obtained by

delivering consistently higher quality service than competitors

Customer service expectations must be exceeded

Internal marketing essentialNeeds top management commitmentStandards must be setPerformance must be monitored

‘ServQual’ – Assessing Service Quality Developed by Zeithaml, Parasuraman & Berry It’s been about for a while (book 1990) Examines importance & performance and identifies

gaps 5 Dimensions of Service Quality

Tangibles Reliability Responsiveness Assurance Empathy

Xerox 3R+V (Reliability, Responsiveness, Relationship + Value)

The 5 ServQual Factors Tangibles

Reliability

Responsiveness

Assurance

Empathy

Appearance of physical facilities, equipment, personnel

Ability to perform the promised service dependably & accurately

Willingness to help customers & provide prompt service

Knowledge & courtesy of employees & conveying of trust

Caring, individualized attention the firm provides for customers

Source: Zeithaml, Parasuraman & BerrySource: Zeithaml, Parasuraman & Berry

5 SERVQUAL elements in action Tangibles: Physical evidence of the

service –

Reliability: Consistency and dependability in performing the service

Responsiveness: Willingness or readiness of employees to provide the service

Assurance: Knowledge/competence of employees and ability to convey trust and confidence

-Empathy: Caring and individual attention provided by employees

Appearance of physical facilities Appearance of personnel Tools or equipment used to provide the

service

Accuracy of billing or record keeping Performing services when promised

Returning customer phone calls Providing prompt service

Knowledge and skills of employees Company name and reputation Personal characteristics of employees

Listening to customer needs Caring about the customer’s interests Providing personalised attention

•Adapted from Parasuramann, Berry & Zeithaml (1985)

DIMENSION EVALUATION CRITERIA

Measuring Service QualitySERVQUAL

Five service quality dimensions

• Tangibles• Reliability• Responsiveness• Assurance• Empathy

Customer expectationsof excellentfirms in thespecificservice sector

Customerperceptionsof the organisationbeing evaluated

Measurement

Determinants of perceived service quality

Dimensions of quality

Access

Credibility Knowledge Reliability Security

Competence Communication

Courtesy

Responsiveness Tangibles

Word of Past Buyers’ Advertising mouth experience needs

Expectedservice

Perceivedservice

Perceived servicequality

Experiencing The Brand

BrandEssence

BrandPromise

BrandedCustomer

Experience

Translatesinto

Translatesinto

What youcommunicate

The value youcommit todeliver tocustomers

Delivery of your brand promise through every interaction your customers have with your organisation

Branding the Experience

Brandedcustomer

experience

Brandvalues

Brandimage

Translatesinto

Translatesinto

Creating a unique experiencethrough everyinteraction yourcustomers have with your organisation

The value your customerscome to expect and rely on

What you become known for in the marketplace

Brands in 2009Best Global Brands 2009: Trust | The

Businessweek Video Library

Customer Loyalty

Branded customer experience drives loyalty

RandomExperience

Predictableexperience

Brandedexperience

Customer loyalty

• Consistent• Intentional

• Consistent• Intentional• Differentiated• Valuable

Developing brandsBranding allows marketers to create added

values that distinguish one brand from another (e.g.)

‘Crisps are crisps’ so how have Walkers added value to distinguish themselves ?

Brand building involves a deep understanding of both the functional and emotional values that customers use to choose between brands.

Walkers

Why do Customers Buy?

It’s important to remember that customers do not buy features, products and/or services but solutions to their problems.

They have needs, and require products or services which satisfy those needs.

They are searching for benefits - and generally have a combination of benefits in mind.

We succeed by offering the marketing mix which best meets the customer’s needs

Interbrand | Back to brand basics: Focus on the customer | brands

Customers have

WantsNeeds Demands

£Basic requirementsto satisfy

A want supportedby willingness &ability to pay

SAEsteemSocialSafetyPhysiological

A desire to satisfyan underlying need

Customers’ needs, wants and demands

A Customer Relationship CredoIf you’re good to your customers, they'll keep

coming back, because they like you.

If they like you, they’ll spend more money

If they spend more money, you’ll want to treat them better

If you treat them better, they’ll keep coming back

Customers for Life : Carl Sewell, 1990.(The world’s most successful Cadillac dealer)

Positive Negative

Creating Customer Value

Product benefits

Service benefits

Relational benefits

Image benefits

Monetary costs

Time costs

Energy costs

Psychological costs

CustomerValue

Perceivedbenefits

Perceivedsacrifice

Minus

Mr Kotler

SERVQUAL model…Expectations

Perceptions

Service Delivery

Service Standards

Management Perceptions

External CommunicationsGap 1

Gap 5

Gap 2

Gap 3

Gap 4

Organisation

Customer

www.interbrand.com

Current thinking on branding issues…..

Inspirational Dean Cruickshank 2012