Download Consumer Behaviour in Services

Consumer Behaviour
in Services
CONSUMER PROBLEM
 TIME DEFICIENCY
 REASONS: dual career couples, single
parent families
 IT LEADS TO: demand for different
services
SEARCH, EXPERIENCE &
CREDENCE PROPERTIES
 SEARCH QUALITIES: attributes that a
consumer can determine before the
purchase
 EXPERIENCE QUALITIES : attributes
that a consumer can determine only after
the purchase
 CREDENCE QUALITIES : attributes that
consumer may find impossible to
evaluate even after purchase &
consumption
Continuum of Evaluation for
Different Types of
Products/services
Most
Goods
High in search
qualities
Most
Services
High in experience High in credence
qualities
qualities
SERVICES - DECISION MAKING
PROCESS
Need awareness
Memory
Memory
Evaluation of
service suppliers
Future Intentions
Request service
Service delivery
UNDERSTANDING
DIFFERENCES AMONG
CONSUMERS
 GLOBAL DIFFERENCES
 ROLE OF CULTURE
 DIFFERENT VALUES, ATTITUTEDS
 DIFFERENT CUSTOMS
CUSTOMER EXPECTATION
OF SERVICE
 Customer expectations are the beliefs
about service delivery that serve as
standards or reference points against
which performance is judged.
LEVELS OF EXPECTATION
DUAL CUSTOMER
EXPECTATIONS
Desired Service
Adequate Service
THE ZONE OF TOLERANCE
Desired Service
Zone of
Tolerance
Adequate Service
ZONES OF TOLERANCE FOR DIFFERENT
SERVICE DIMENSIONS
Desired Service
Zone
of
Tolerance
Desired Service
Adequate Service
Zone
of
Tolerance
Adequate Service
Reliability
Tangibles
FACTORS THAT INFLUENCE
DESIRED SERVICE
Lasting Service
Intensifiers
Desired Service
Personal Needs
Zone
of
Tolerance
Adequate Service
Lasting Service Intensifiers are individual, stable factors that
lead the customer to a heightened sensitivity to service.
FACTORS THAT INFLUENCE
ADEQUATE SERVICE
Temporary Service
Intensifiers
Desired Service
Perceived Service
Alternatives
Self-Perceived
Service Role
Situational
Factors
Zone
of
Tolerance
Adequate Service
Predicted
Service
FACTORS THAT INFLUENCE DESIRED
AND PREDICTED SERVICE
Explicit Service
Promises
Implicit Service
Promises
Word-of-Mouth
Desired Service
Zone
of
Tolerance
Adequate Service
Past Experience
Predicted
Service
CUSTOMER PERCEPTION
OF SERVICE
 Customers perceive services in terms of
quality of service & how satisfied they
are overall with their experiences.
CUSTOMER PERCEPTIONS OF QUALITY AND
CUSTOMER SATISFACTION
BUILDERS OF CUSTOMER
PERCEPTION
 SINGLE TRANSACTION SPECIFIC
ENCOUNTER: how the customer has
been treated in a particular encounter
with a particular employee.
 CUMULATIVE PERCEPTION:
customer’s overall experience with the
company.
CUSTOMER SATISFACTION
 It is a judgment that a product or service
feature or the product or service itself
provides a pleasurable level of
consumption related fulfillment.
 It is the customer’s evaluation of a
product or service in terms of whether it
has met the customer’s needs &
expectations. Its failure leads to
dissatisfaction.
DETERMINANTS OF
CUSTOMER SATISFACTION
 PRODUCT & SERVICE FEATURES
 CUSTOMER EMOTIONS- your mood
 ATTRIBUTION FOR SERVICE SUCCESS OR
FAILURE: how much the customer blames or
credits the failure or success of a service on the
service provider
 PERCEPTION OF EQUITY OR FAIRNESS:
have I been treated fairly compared to other
customers?
 PERCEPTION OF FAMILY MEMBERS,
FRIENDS, PEERS ETC
OUTCOMES OF
CUSTOMER SATISFACTION
 Increased customer retention
 Positive word-of-mouth communications
 Increased revenues
RELATIONSHIP BETWEEN CUSTOMER
SATISFACTION AND LOYALTY IN
COMPETITIVE INDUSTRIES
Source: James L. Heskett, W. Earl Sasser, Jr., and Leonard A. Schlesinger, The Service Profit Chain, (New York, NY: The Free Press, 1997), p. 83.
SERVICE QUALITY
 The customer’s judgment of overall
excellence of the service provided in
relation to the quality that was expected.
 Service quality assessments are formed
on judgments of:



outcome quality
interaction quality
physical environment quality
THE FIVE DIMENSIONS OF
SERVICE QUALITY
Reliability
Assurance
Ability to perform the promised
service dependably and
accurately.
Knowledge and courtesy of
employees and their ability to
inspire trust and confidence.
Tangibles
Physical facilities, equipment, and
appearance of personnel.
Empathy
Caring, individualized attention the
firm provides its customers.
Responsiveness Willingness to help customers and
provide prompt service.
THE SERVICE ENCOUNTER
 is the “moment of truth”
 occurs any time the customer interacts with the firm
 can potentially be critical in determining customer
satisfaction and loyalty
 types of encounters:

remote encounters, phone encounters, face-to-face
encounters
 is an opportunity to:




build trust
reinforce quality
build brand identity
increase loyalty
Common Themes in Critical
Service Encounters Research
Recovery:
Adaptability:
employee response
to service delivery
system failure
employee response
to customer needs
and requests
Coping:
Spontaneity:
employee response
to problem customers
unprompted and
unsolicited employee
actions and attitudes
UNDERSTANDING CUSTOMER EXPECTATION AND
PERCEPTION THROUGH MARKETING RESEARCH
Customer
CUSTOMER
Expected
Service
(Customer Gap)
GAP 1
Perceived Service
COMPANY
Company
Company
Perceptions of
Consumer
Expectations
WHY DO SERVICE
RESEARCH?
 To identify dissatisfied customers
 To discover customer requirements or expectations
 To monitor and track service performance
 To assess overall company performance compared to






competition
To assess gaps between customer expectations and
perceptions
To gauge effectiveness of changes in service
To appraise performance of individuals/teams for rewards
To determine expectations for a new service
To monitor changing expectations in an industry
To forecast future expectations
CRITERIA FOR AN EFFECTIVE
SERVICE RESEARCH
PROGRAM
 Includes both qualitative and quantitative






research
Includes both expectations and perceptions of
customers
Balances the cost of the research and the value
of the information
Includes statistical validity when necessary
Measures priorities or importance of attributes
Occurs with appropriate frequency
Includes measures of loyalty, behavioral
intentions, or actual behavior
STAGES IN THE RESEARCH
PROCESS
 Stage 1 : Define Problem
 Stage 2 : Develop Measurement Strategy
 Stage 3 : Implement Research Program
 Stage 4 : Collect and Tabulate Data
 Stage 5 : Interpret and Analyze Findings
 Stage 6 : Report Findings
PORTFOLIO OF SERVICES RESEARCH
Research Objective
Type of Research
Identify dissatisfied customers to attempt recovery;
identify most common categories of service failure
for remedial action
Customer Complaint
Solicitation
Assess company’s service performance compared to
competitors; identify service-improvement priorities;
track service improvement over time
“Relationship” Surveys
Obtain customer feedback while service experience is
fresh; act on feedback quickly if negative patterns develop
Post-Transaction Surveys
Use as input for quantitative surveys; provide a forum
for customers to suggest service-improvement ideas
Customer Focus Groups
Measure individual employee service behaviors for use
in coaching, training, performance evaluation,
recognition and rewards; identify systemic strengths
and weaknesses in service
“Mystery Shopping” of
Service Providers
Measure internal service quality; identify employeeperceived obstacles to improve service; track
employee morale and attitudes
Employee Surveys
Determine the reasons why customers defect
Lost Customer Research
Forecast future expectations of customers; develop
and test new service ideas
Future Expectations Research