services marketing - ppt shared 1

Upload: jasjeet-singh

Post on 14-Apr-2018

219 views

Category:

Documents


0 download

TRANSCRIPT

  • 7/29/2019 Services Marketing - PPT Shared 1

    1/127

    v

  • 7/29/2019 Services Marketing - PPT Shared 1

    2/127

    In our life

    Consultation

    Movie Cinema

    Coaching / Training

    Airlines

    Computer software

    Mobile Network

    Electronic Gadgets

    Automobiles

    Cosmetics

    Detergents Fast Food JointsFinancial Institution BanksGenera Stores

    Saloons /Beauty Parlors

    Advertising Agency

    Direct to Home

    Insurance

    Groceries

    Packaged food

    Super Market

    HouseApparels

    Books & Magazines

    Health Care / Hospitals

    Medicines

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    3/127

    Contribution of Services to the GDP

    Year Agriculture Industries Services

    1951 52 55.4 15.4 29.3

    1961 - 62 49.4 19.5 31.1

    Source : Reserve Bank Of India, Office of Statistics

    1971 - 72 43.1 22.5 34.51981 - 82 37.6 24.6 37.9

    1991 92 30.3 25.6 44.1

    2001 - 02 24 25 51

    2010 - 11 14.6 28.5 56.9

    Agriculture Sector employs approximately 52% of the countrys workforceAutomobile and ancillaries is currently the fastest growing industry in India alongwith Infrastructure

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    4/127

    Indian Service Sector BreakupSource : Reserve Bank Of India, Office of Statistics

    THTC - Construction, Trade, Hotels, Transport, & CommunicationsFIRBS - Finance, Insurance, Real Estate, & Business ServicesCSPS - Community, Social & Personal Services

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    5/127

    What is Service? The Old View

    Service is a technical after-sale function that is provided bythe service department.

    Old:Service =wrench time

    Old view of service =Customer Service Center

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    6/127

    What is Service? The New View

    Service includes every interaction between any customerand anyone representing the company, including:Dealers

    Web site and

    Salespeople

    Receptionistsand

    Schedulers

    Managementand Executives

    ServiceEmployees

    Billing andAccounting

    Personnel

    any e-channelInteraction

    Customer

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    7/127

    What are Services? Definition

    Services are a means of delivering value to customerswithout requiring the customer to own specific of thecosts and risks.

    Lets break the definition to get more specific means of delivering value - value is defined in terms of utility (fit for purpose) and

    warranty (fit for use). Using the service should lead to the desired outcome.

    customer -A customer is someone who buys goods or services

    without requiring the customer to own specific of the costs and risks - doesnot have to worry about the capabilities and resources required to provide theservice. My risk is limited to the choice made.

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    8/127

    Economic Definition of Services

    In Economics, a service is an intangible commodity.More specifically, services are an intangible equivalentof economic goods.

    which means - Service is an economic activity where the buyer doesnot generally, except by exclusive contract, obtain exclusive ownershipof the thing purchased.

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    9/127

    Are you satisfied with theCustomer Service you receive?

    Promised V/s. Delivered Staff Knowledge and Professionalism

    Increased use of Self Service and less human interface

    ncrease use o ec no ogy u poor y es gne sys em

    Cost Cutting. Profit Center V/s. Cost Center

    Lip Service. No real intent.

    Delivering consistent High Quality Service is not easy.

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    10/127

    Is Marketing of Services Different?

    Services Goods Sales and operations are closely

    linked. Production is a part ofthe sales process

    Sales and Production aredecoupled.

    Customer inter ace is a majordifference.

    No stock inventories. It has torely on the mental inventory ofthe sales person

    eop e uy pro uct ecause t eybelieve they work.

    Goods are produced and stockedas per the market demand

    People deal with people they like; and they buy services because

    they believe they will like them as well.

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    11/127

    Why do firms focus on Services?

    Services can provide higher profit margins and growthpotential than products

    excellence

    Services can be used as a differentiation strategy in

    competitive markets

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    12/127

    Why study Services Marketing?

    Service-based economies

    Service as a business imperative in manufacturingand IT

    Deregulated industries and professional serviceneeds

    Services marketing is different

    Service equals profits

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    13/127

    Service Can Mean all of These Service as a product

    Customer service

    Services as value add forgoods

    Service embedded in atangible product

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    14/127

    Characteristics of ServicesCompared to Goods

    Intangibility Heterogeneity

    Perishability

    Simultaneous

    ProductionandConsumption

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    15/127

    Implications of Intangibility

    Services cannot be inventoried

    Services cannot be easily patented

    Services cannot be readily displayed or communicated

    Pricing is difficult

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    16/127

    Implications of Heterogeneity

    Service delivery and customer satisfaction depend onemployee and customer actions

    factors

    There is no sure knowledge that the service delivered

    matches what was planned and promoted

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    17/127

    Implications of SimultaneousProduction and Consumption

    Customers participate in and affect the transaction

    Customers affect each other

    Employees affect the service outcome

    Decentralization may be essential

    Mass production is difficult

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    18/127

    Implications of Perishability

    It is difficult to synchronize supply and demand withservices

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    19/127

    Challenges for Services Defining and improving quality

    Ensuring the delivery of consistent quality

    Designing and testing new services

    Communicatin and maintainin a consistent ima e

    Accommodating fluctuating demand Motivating and sustaining employee commitment

    Coordinating marketing, operations, and human resourceefforts

    Setting prices

    Finding a balance between standardization versuscustomization

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    20/127

    network administration

    network

    technical support

    network equipment

    other

    finance

    repair

    insurance

    100%

    80%

    annual cost ofPC use: $6,259

    average annual householdexpenditure: $6,064

    Personal Computers Automobiles

    The sale of aproduct accountsfor only a smallportion of overallrevenues.

    Where the Money in Manufacturing Is: Services

    by end user (downtime,file management, etc.)

    administration

    technical support

    desktop hardware

    gas

    used car purchase

    new car purchase

    total expenditure:5X product costs

    total expenditure:5X product costs

    60%

    40%

    20%

    0%

    to customers iswhere the realmoney is.

    S o u r c e : G a r t n e r G r o u p , A s s o c i a t i o n o f A m e r i c a n R a i l r o a d s , F e d e r a l H i g h w a y A d m i n i s t r a t i o n O f f i c e o f H i g h w a y

    I n f o r m a t i o n M a n a g e m e n t . ( R a i l r o a d e x p e n d i t u r e s a r e f o r C l a s s 1 r a i l r o a d s . ) Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    21/127

    Traditional Marketing Mix

    All elements within the control of the firm thatcommunicate the firms capabilities and image tocustomers or that influence customer satisfaction with

    Product

    Price

    Place

    Promotion

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    22/127

    Expanded Mix for Services The 7 Ps Product Price Place Promotion

    eop e All human actors who play a part in service delivery and thus influence the

    buyers perceptions: namely, the firms personnel, the customer, and othercustomers in the service environment.

    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. Process

    The actual procedures, mechanisms, and flow of activities by which theservice is deliveredthe service delivery and operating systems.

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    23/127

    Group Project (5 Marks) Identify a service industry for your group study.

    Each group will make a 8 - 10 min. presentation next weekon the industry choosen which will cover the following:

    Any regulators that control the industry and the role ofregulators in the growth of the industry

    Who are the various stakeholders in the industry?

    How has the industry evolved over the years and what are themost significant events of the recent past?

    What benefit does the group foresee in the study of theindustry?

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    24/127

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    25/127

    The Customer Gap

    The Customer Gap is the difference between the Customers Expectations and

    Customers Perception

    Customers Expectations are Market Controlled factors:

    Pricing, Advertising, Sales Promotion

    Innate personal needs, word-of-mouth, competitiveoffering

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    26/127

    Customer Gap

    ExpectedService

    How well does the company

    understand expectations ofService Quality?

    PerceivedService

    How well does companyunderstand the customers

    perception about theservice?

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    27/127

    Sources of Customer Expectation. Business must have a clear understanding of its customer.

    (Customer Segmentation) Sources Customer expectations are market controlled

    factors:

    Service Guarantee Sales Promise Price comparison

    And Factors that a marketer has limited ability to affect: Innate personal needs Word of mouth communication Competitive offering

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    28/127

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    29/127

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    30/127

    Consumer Behavior in Services

    Focus is How consumers seek, choose, purchase and evaluate

    services?

    Many influences affect the process:

    (2 important factors are)

    Consumers life stage (childhood to retirement)

    Personal background and upbringing.

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    31/127

    Why do you purchase Services? Time Deficiency

    Concentrate on Core

    Lack of knowledge (about the process and not service!)

    Limited resources Cost of performing V/s. Cost of buying

    ALL OF THE ABOVE ARE INTER RELATED TO A LARGE EXTENT.

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    32/127

    Classification of Service

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    33/127

    Buying process

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    34/127

    Search PropertyWhat is your buying process for a Car?

    Kitna deti hai?

    Sedan or Hatchback

    eg room

    Acceleration

    Brand and after sales service

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    35/127

    Search Properties Do you purchase Pre Packaged food?

    How do you make a choice of what you want to buy?

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    36/127

    Search Properties Search properties are product characteristics that

    customers can easily evaluate and compare prior topurchasing the product.

    best product to purchase.

    They are often objective measures of productperformance.

    Basically, customers can gather information and makecomparisons prior to the time they make a purchase

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    37/127

    Experience Properties Esselworld claims it is the Island of Fun

    Do you agree with this?

    Why?

    Have you ever been to any other entertainment park?

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    38/127

    Experience Properties Experience properties are product characteristics that

    cannot be evaluated prior to purchase, but must beexperienced by the customer in order to be evaluated.

    Marketers may attempt to describe these properties inadvertising, but ultimately customers realize thatevaluating them requires experiencing the product.

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    39/127

    Experience Properties Some examples in our daily life:

    barber shops, (Javed Habib / Lakme beauty store)

    banks, (PSU, Private, Co-op)

    ote s an restaurants

    Mobile / Internet Service Providers,

    retail stores.

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    40/127

    Credence Properties Have you seen the commercial on Emami Fair and

    Handsome or the commercial of a Chinese Oil to GrowHair?

    Would you trust the product if it were to be reinforcedthrough a specialist?

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    41/127

    Credence Properties Do you feel you are receiving the right education in

    this Services Marketing class?

    What is the basis of your judgment?

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    42/127

    Credence PropertyJet Airways Your Experience

    Best First-Class Service in the World award at Business Travellers 20th annual

    Best in Business Travel awards Best Business Class & Best Economy Class at the Business Traveller Awards

    Best Overall in Entertainment at the Avion Awards 2010

    Best Long Haul Carrier ex-Brussels award at the Tm Travel Awards 2009.

    Best Eastbound Airline from India and Best domestic Airline in India awards atthe Abacus Tafi Awards 2009.

    Business Travellers Best Indian Airline Award In London.

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    43/127

    Credence Properties Credence properties are product characteristics

    which cannot be easily evaluated even afterthecustomer has experienced the productinstead the

    credible source. The reason they cannot be evaluatedis that the typical customer does not have enoughknowledge or expertise to make an accurate

    evaluation. As a result, customers wind up relying onthe opinion of supposed experts, who give anevaluation and make comparisons.

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    44/127

    Search, Experience and Credence Properties

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    45/127

    Buying process

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    46/127

    Consumer Behavior Stages in Consumer Decision Making and Evaluation

    of Services:

    Consumer Choice

    onsumer xper ence

    Post Experience

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    47/127

    Steps that lead to Purchase Steps for goods and Services are similar

    Need Recognition

    Information Research

    va uat on o a ternat ves

    PURCHASE

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    48/127

    Maslows Hierarchyof Needs

    Need for ersonal services

    Needto Joinclasses

    for oil painting,bungee jumping

    Need of Food and drink during shopping / sight seeing

    Need to buy Auto cop security systems whenyou realize thefts in the neighborhood

    Need to socialize and network inClubs, go out on vacation with family.

    such as massage and Spas, plastic

    surgery such as Nose Job, Lip Job etc.

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    49/127

    Steps that lead to Purchase Steps for goods and Services are similar

    Need Recognition

    Information Research

    va uat on o a ternat ves

    PURCHASE

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    50/127

    Information SearchWhy does consumer search information about the

    goods or services?

    Reduces the risk

    a e cus omer ee more con en a ou e c o ces

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    51/127

    Information search Extensive and formalised Process if the service is

    important or warrants major investment

    Quick and relatively automatic if the service does not.

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    52/127

    Modes of Information research Personal and non Personal

    Mass media eg. TV Commercials, Print Ads, Hoardings

    Talking to aqautainces, friends, experience sites

    or o out

    Rating services and Professional associations!

    Personal influence plays a very important role when the

    services become complex or when the objectivitystandards by which to evaluate the product decreases.

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    53/127

    Information Search Perceived Risk Financial Risk (exchange, refund)

    Performance Risk (guarantees, warranty, trial offer)

    Social Risk (use of unbranded, perciaeved cheap)

    Physiological risk (will affect the physical / mental state)

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    54/127

    Steps that lead to Purchase Steps for goods and Services are similar

    Need Recognition

    Information Research

    va uat on o a ternat ves

    PURCHASE

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    55/127

    AlternativesVisit the establishment (place where service is

    delivered)

    Lower no. of service providers in a geography /

    Limited information on services offered and provided.

    Generally customers accept the first available option.

    Decision between self performing or buying srvices.

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    56/127

    Steps that lead to Purchase Steps for goods and Services are similar

    Need Recognition

    Information Research

    va uat on o a ternat ves

    PURCHASE

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    57/127

    Service Purchase The major difference in Service purchase as opposed to

    Goods purchase is that a customer can touch and feelthe goods before purchase while services are produced

    .

    Taking a vacation Visiting a doctor

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    58/127

    Consumer ExperienceAll services are Experience. Each interaction is a

    unique experience.

    ets scuss your exper ence ast t me your octor

    ordered for a medical check up. Involvement of Multiple parties

    Doctor

    Path Lab + Radiology Lab etc Chemist

    SERVICE AS PROCESS

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    59/127

    Consumer ExperienceWhy do Bartenders twist and turn the bottles while

    serving? you are more interested to see the tricks than the drink

    In your favorite restaurant, do you prefer to be servedby a particular waiter? need a repeat service

    In your B-school, do you have a favorite professor? knowledge of the contact is critical

    SERVICE PROVISION AS DRAMA

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    60/127

    x v

  • 7/29/2019 Services Marketing - PPT Shared 1

    61/127

    CaseletYou went to a super market to buy yourself a Lunch box.

    At the entrance you were greeted by the sales rep with awarm smile. You states your requirement and the rep

    boxes were placed. At the section he requested the Aislesales person to assist you.

    The aisle sales person asked you question on your

    requirement and within a minute presents you thelunch box you were looking forward to buy.

    HOW DO YOU RATE THIS EXPERIENCE?

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    62/127

    Caselet (Contd.) Later, you visited your friend for lunch and saw a nice

    window curtain. You would like to have the samewindow curtain.

    ,

    friend to buy the curtain.

    What are your expectation?

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    63/127

    Customer Expectations They are beliefs about service delivery that serve as a

    standard or a reference points against whichperformances are judged.

    Customers compare their perception of performancewith reference points while evaluating the servicequality.

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    64/127

    Caselet Travel experience to Olympics The choice of the airlines was dependent on:

    Good looking On-flight personnel

    Food and Beverage - Quality / Quantity

    -

    Leg space Baggage allowance

    Punctuality (on time performance)

    Brand Image

    Knowing what customer expects is prime to deliveringQuality Service.

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    65/127

    Our Goal for the day Types of Customer Service Expectations

    Factors that influence Customer Service Expectation

    Issues involving Customer Service Expectation

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    66/127

    Caselet You have planned a dinner with your best friend whom you

    have been with now for the past 10 years. It is just for a quick catch up on recent things

    What would be your ideal setting for this dinner?

    It is just a quick catch up.We have known each other for long.

    Any restaurant where we can catch for a quick while will do

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    67/127

    CaseletYou have planned a dinner with your friend whom you

    have known for the past 3 months. It is social dinner to know more about each other

    What would be your ideal setting for this dinner?

    It is just a quick catch up.

    We are on our way to building up a strong friendship.

    A good restaurant where we can have good food and talk

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    68/127

    CaseletYou have planned a dinner with a group of friends

    from your school. This is your first group dinner after you all have

    com leted our schoolin

    What would be your ideal setting for this dinner?

    Meeting after a long time.

    Let me check if anyone knows a good place for thisgathering.

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    69/127

    CaseletYou have planned a dinner with your client with whom

    you are expecting a huge order that will help you scalenew heights in business.

    What would be your ideal setting for this dinner?

    Very important client. Needs to be taken care off.

    Expensive restaurant and excellent food is what I want!!!

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    70/127

    CaseletYou have planned a dinner with your Fianc.

    This is a dinner to celebrate the anniversary of yourcommittment to each other.

    What would be your ideal setting for this dinner?

    Compiled by Ajay Raheja ([email protected])

    Possible levels of customer expectation

  • 7/29/2019 Services Marketing - PPT Shared 1

    71/127

    Desired level of service

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    72/127

    Levels of Expectation The highest level of expectation is termed as the

    desired service Level of this service is what the customer wished for

    es re serv ce s a en o w a cus omer e eves

    can be and should be

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    73/127

    CaseletWhat is the ideal company you would like to work for?

    What is the role you are expecting in that company?

    God forbid! If the company does not have a vacancy orthe role is not available.

    What will you do?

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    74/127

    Levels of Expectation

    Adequate Service represents the minimum tolerableexpectation. It is the bottom level of performance

    .

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    75/127

    Levels of Expectation Do customers hold the same level of expectation for

    service firms of the same industry?

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    76/127

    Zone of Tolerance Services are Heterogeneous.

    Depends on employee and customer action

    erv ce may vary etween prov ers

    It may vary within the same provider

    It may also vary with the same employee

    The extent to which the customers are willing to acceptthis variation is called as the Zone of Tolerance

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    77/127

    Zone of Tolerance

    Zone of Tolerance

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    78/127

    Zone of Tolerance Different customers possess different zone of tolerance

    Narrow zone of Tolerance means tighter ranger ofserv ce rom t e prov er

    Price is an important factor in Zone of Tolerance.When Price increase tolerance reduces. This is because

    the adequate service pushes up.

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    79/127

    Zone of Tolerance It varies for different service attributes or dimensions.

    The more important the factor, the narrower is thezone.

    Your promised your friend to return an amount heloaned you in 10 days. He missed the date.

    What is the level of trust you have on your friend?

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    80/127

    Zone of Tolerance

    Compiled by Ajay Raheja ([email protected])

    Zones of Tolerance for

  • 7/29/2019 Services Marketing - PPT Shared 1

    81/127

    First-Time and Recovery Service

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    82/127

    Our Goal for the day Types of Customer Service Expectations

    Factors that influence Customer Service Expectation

    Issues involving Customer Service Expectation

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    83/127

    Desired Service Expectation Personal Needs

    These are states or conditions for essential to thephysical or psychological well being of a customer.

    It is the customers generic attitude about the meaning ofservice and proper conduct of a service provider.

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    84/127

    Caselet Recollect the eg. of the financial advisor:

    My friend benefited with is service I did not like the advisor

    y r en prov e a e ree om o m n

    recommending the investments He needed a person to take care of the excess money he hasgenerated.

    My expectations from him were limited to providing meguidance to schemes where I could earn more than mycurrent earnings .

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    85/127

    Your ExpectationYou with your family are out for a dinner.

    You ordered your dinner and have been served.

    You need some more Rotis and asked the waiter toget t em or you

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    86/127

    Expectation of Service In the case of the Financial advisor the personal need

    was different and hence the expectation of service wasalso different

    In the restaurant you ordered for more rotis expectingthat you will be provided with rotis immediately asyou have already been served

    (This is the least you expect as service in a restaurant!!!)

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    87/127

    Factors that Influence Desired Service

    Compiled by Ajay Raheja ([email protected])

    omp e y ay a e a a ayra e a@gma .com

  • 7/29/2019 Services Marketing - PPT Shared 1

    88/127

    Adequate Service Expectation Level of service which customer finds acceptable.

    The determinants of Adequate Service are short term. Temporary service intensifiers

    In case of a breakdown of the car on the highway

    erce ve serv ce a erna ves

    Investing in a mutual fund SIP V/s. recurring deposit in a Bank

    Choice between driving to work or hiring a cab.

    Customer self perceived service role

    A customer will be dissatisfied if he is asked to reiterate the car problems which hehas already mentioned while booking the service.

    Zone of tolerance increases if the cutomer is not fulfilling his duties Situational factors

    Gujrat Earthquake in 2002 or Tsunami in 2005. Cutomer tolerance level increasedwith insurance Cos.

    Predicted Service

    Already know the service you will get. Eg is visiting an Udipi restaurant for a snack

  • 7/29/2019 Services Marketing - PPT Shared 1

    89/127

    Factors that influence Adequate Service

    Compiled by Ajay Raheja ([email protected])

    C f i !!!

  • 7/29/2019 Services Marketing - PPT Shared 1

    90/127

    Confusion!!!Predicted Service Desired Service

    It is an estimate of the servicethat the customer will receive

    Desired service expectationsare global assessments

    rather than in overall

    relationship with the serviceprovider.

    It is almost an estimation ofwhat will happen in the nexttransaction,

    service transaction.

    Compiled by Ajay Raheja ([email protected])

    Sources of Desired and Predicted

  • 7/29/2019 Services Marketing - PPT Shared 1

    91/127

    Service ExpectationExplicit Service

    Promises

    Implicit ServicePromises

    PredictedService

    Word-of-Mouth

    Past ExperienceZone

    of

    Tolerance

    Desired Service

    Adequate Service

    Compiled by Ajay Raheja ([email protected])

    O G l f th d

  • 7/29/2019 Services Marketing - PPT Shared 1

    92/127

    Our Goal for the day Types of Customer Service Expectations

    Factors that influence Customer Service Expectation

    Issues involving Customer Service Expectation

  • 7/29/2019 Services Marketing - PPT Shared 1

    93/127

    Issues Customer Service Expectation

    Un-realistic Expectations

    Customer Delight Exceed Expectation

    Raising the bar

    Stay ahead of Competition.

    Compiled by Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    94/127

    Wh i C t ?

  • 7/29/2019 Services Marketing - PPT Shared 1

    95/127

    Who is a Customer? The most important person in any business.

    He/she is not dependent on us, but we are on him/her. He/she not an interruption for our work, but rather

    t e purpose or t.

    Does us a favor when he/she calls, we are not doinghim/her a favor serving them

    Is part of our business, not an outsider

    Compiled by Prof. Ajay Raheja ([email protected])

    A customer is

  • 7/29/2019 Services Marketing - PPT Shared 1

    96/127

    A customer is Is a human being like us, with the same feelings and

    emotions Is not someone to argue with, or match wits with

    r ngs us t e r wants, t s our o to u t ese

    needs and wants Is deserving of the most courteous and attentive

    service we can provide

    Is the life blood of every business

    Compiled by Prof. Ajay Raheja ([email protected])

    The Golden Rule

  • 7/29/2019 Services Marketing - PPT Shared 1

    97/127

    The Golden Rule

    Compiled by Prof. Ajay Raheja ([email protected])

    The Platinum Rule

  • 7/29/2019 Services Marketing - PPT Shared 1

    98/127

    The Platinum Rule

    Compiled by Prof. Ajay Raheja ([email protected])

    Customer Perceptions

  • 7/29/2019 Services Marketing - PPT Shared 1

    99/127

    Customer Perceptions Perceptions are Dynamic, evaluation may shift from

    time to time - person to person culture to culture

    qua y serv ce o ay may ecome a norm

    tomorrow

    Compiled by Prof. Ajay Raheja ([email protected])

    Example for our daily life

  • 7/29/2019 Services Marketing - PPT Shared 1

    100/127

    Example for our daily life Did we ever imagine 15 years back that home delivery

    of food could get pegged to 30 minutes Dominos has set a standard.

    We as consumers of services would expect that the

    food be delivered to us whether it is Dominos or anyother restaurant within 30 minutes.

    Compiled by Ajay Raheja ([email protected])

    Example from our daily life

  • 7/29/2019 Services Marketing - PPT Shared 1

    101/127

    Example from our daily lifeAt a multiplex - movie theatre, we are now served with

    eatable and drinks at our seat.

    our ews

    I get my eatables on my seat and can enjoy the movieswithout missing any part

    What a disturbance; these guys have an art to disturbyou during the most critical scene / dialogue

    Compiled by Prof. Ajay Raheja ([email protected])Compiled by Ajay Raheja ([email protected])

    What is Customer Satisfaction?

  • 7/29/2019 Services Marketing - PPT Shared 1

    102/127

    What is Customer Satisfaction? Quote from Richard L Oliver

    Everyone know what satisfaction is, untill asked togive definition. Then it seems nobody knows

    Compiled by Ajay Raheja ([email protected])

    What is customer satisfaction?

  • 7/29/2019 Services Marketing - PPT Shared 1

    103/127

    What is customer satisfaction? Satisfaction can be viewed as contentment

    Satisfactions can be associated with Feeling of pleasure

    Fee ing o appiness

    Surprise in a positive way (may lead to delight) Removal of negative

    Sense of relief

    Feeling of ambivalence

    Compiled by Ajay Raheja ([email protected])

    What determines Csat?

  • 7/29/2019 Services Marketing - PPT Shared 1

    104/127

    What determines Csat? Personal factors play a very important role :

    Mood or emotional state of mind. Situational factors

    p n on o r en s an am y

    Compiled by Prof. Ajay Raheja ([email protected])

    Experience from our daily life

  • 7/29/2019 Services Marketing - PPT Shared 1

    105/127

    Experience from our daily lifeYou are out on a vacation with your friends to Goa. You

    have booked yourself a nice exotic resort in Goa.What will you judge in the resort to state that you were

    Resort ambience, features such as the pool, access tocasino, access to the golf facility, restaurants, room

    comfort, helpfulness and courtesy of the staff. Mostimportant the Price

    Customer Satisfaction is determined by - Product and Service Feature

    Experience from our daily life

  • 7/29/2019 Services Marketing - PPT Shared 1

    106/127

    Experience from our daily lifeYou are out on a vacation with your friends to Goa. You

    have booked yourself a nice exotic resort in Goa.You and your friends are having a fun time. One of

    himself and had to be hospitalized. What as a customer will be your Csat level?

    Customer Satisfaction is determined by - Customer Emotion

    Compiled by Ajay Raheja ([email protected])

    Experience from our daily life

  • 7/29/2019 Services Marketing - PPT Shared 1

    107/127

    Experience from our daily lifeAfter buying and using Sandhi Sudha, you were

    surprised by the results / outcome. Outcome Possibilities

    1. ou rea y overcame t e pa n

    (2.) Your pain did not subsideWill Sandhi Sudha take responsibility of the outcome?

    Customer Satisfaction is determined by - Product / Service Success

    Compiled by Ajay Raheja ([email protected])

    Experience from our daily life

  • 7/29/2019 Services Marketing - PPT Shared 1

    108/127

    Experience from our daily lifeYour mom asked you to buy a kilo of Tomatoes on your

    way back home.You stopped at the market and bought the Tomatoes as

    .

    While making the payment he took Rs. 20 from you,while the other lady who was also buying the Tomatoesof the equal quantity paid Rs. 15?

    Are you Ok with the purchase?

    Customer Satisfaction is determined by - Perception of Equity / Fairness

    Compiled by Prof. Ajay Raheja ([email protected])

    Experience from our daily life

  • 7/29/2019 Services Marketing - PPT Shared 1

    109/127

    Experience from our daily lifeYou are out on a vacation with your friends to Goa. You

    have booked yourself a nice exotic resort in Goa.Will your level of satisfaction depend on the

    C Sat is determined by - Other customers, family and friends

    Compiled by Prof. Ajay Raheja ([email protected])

    What is customer satisfaction?

  • 7/29/2019 Services Marketing - PPT Shared 1

    110/127

    What is customer satisfaction? Satisfaction can be viewed as contentment

    Satisfactions can be associated with Feeling of pleasure

    Fee ing o appiness

    Surprise in a positive way (may lead to delight) Removal of negative

    Sense of relief

    Feeling of ambivalence

    Compiled by Prof. Ajay Raheja ([email protected])

    Outcome of Customer Satisfaction

  • 7/29/2019 Services Marketing - PPT Shared 1

    111/127

    Outcome of Customer Satisfaction Increased customer retention

    Positive word-of-mouth communications Increased revenues 100%

    )

    0%

    20%

    40%

    60%

    80%

    Verydissatisfied

    Dissatisfied Neithersatisfied

    nordissatisfied

    Satisfied Verysatisfied

    Loyalty

    (rete

    ntio

    Satisfaction measure

    Compiled by Prof. Ajay Raheja ([email protected])

    Satisfaction V/s. Service Quality

  • 7/29/2019 Services Marketing - PPT Shared 1

    112/127

    Satisfaction V/s. Service Quality Satisfaction is viewed as broader concept while Service

    Quality focused specifically on the dimension of theservice.

    .

    Customer judge quality of service based on theirperception of outcome

    Compiled by Prof. Ajay Raheja ([email protected])

    Satisfaction V/s. Service Quality

  • 7/29/2019 Services Marketing - PPT Shared 1

    113/127

    Satisfaction V/s. Service Quality

    Compiled by Prof. Ajay Raheja ([email protected])

    Dimensions of Service Quality

  • 7/29/2019 Services Marketing - PPT Shared 1

    114/127

    Dimensions of Service QualityReliability

    Responsiveness

    ServiceQuality

    Assurance

    Empathy

    TangiblesTEARR

    Compiled by Prof. Ajay Raheja ([email protected])

    Five Dimension of Service Quality Providing service as promisedRELIABILITY

    Giving customers individual attentionEMPATHY

  • 7/29/2019 Services Marketing - PPT Shared 1

    115/127

    y Providing service as promised

    Dependability in handling customersservice problems

    Performing services right the first time

    Providing services at the promised time

    Maintaining error-free records

    Giving customers individual attention

    Employees who deal with customers in acaring fashion

    Having the customers best interest at heart

    Employees who understand the needs oftheir customers

    Convenient business hours

    Keeping customers informed as towhen services will be performed

    Prompt service to customers Willingness to help customers

    Readiness to respond to customersrequests

    Employees who instill confidence incustomers

    Making customers feel safe in theirtransactions

    Employees who are consistently courteous

    Employees who have the knowledge to

    answer customer questions

    ASSURANCE

    Modern equipment

    Visually appealing facilities Employees who have a

    neat, professional appearance

    Visually appealing materials associatedwith the service

    TANGIBLES

    Service Encounters

  • 7/29/2019 Services Marketing - PPT Shared 1

    116/127

    It is the moment of truth occurs any time the customer interacts with the firm can potentially be critical in determining customer satisfaction

    and loyalty

    remote encounters

    phone encounters face-to-face encounters

    is an opportunity to: build trust

    reinforce quality build brand identity increase loyalty

    Compiled by Prof. Ajay Raheja ([email protected])

    What was your service encounter

    when you visited a hotel last time?

  • 7/29/2019 Services Marketing - PPT Shared 1

    117/127

    y

    Check-In

    Bellbo Takes to Room

    Request Wake-Up Call

    Checkout

    Restaurant Meal

    Compiled by Prof. Ajay Raheja ([email protected])

    Example of Service Encounter of an

    office purchase

  • 7/29/2019 Services Marketing - PPT Shared 1

    118/127

    Compiled by Prof. Ajay Raheja ([email protected])

    Critical Service Encounters

  • 7/29/2019 Services Marketing - PPT Shared 1

    119/127

    GOAL

    understanding actual events and behaviors thatcause customer dis/satisfaction in serviceencounters

    METHOD

    Critical Incident Technique DATA

    stories from customers and employees

    OUTPUT identification of themes underlying satisfaction

    and dissatisfaction with service encounters

    Compiled by Prof. Ajay Raheja ([email protected])

    Critical Incidents Technique Study

  • 7/29/2019 Services Marketing - PPT Shared 1

    120/127

    Think of a time when, as a customer, you had a

    particularlysatisfying (dissatisfying) interaction withan employee of __________

    What specific circumstances led up to this situation?

    Exactly what was said and done?

    What resulted that made you feel the interaction wassatisfying (dissatisfying)?

    Compiled by Prof. Ajay Raheja ([email protected])

    Themes in Critical Service Encounters

  • 7/29/2019 Services Marketing - PPT Shared 1

    121/127

    Compiled by Prof. Ajay Raheja ([email protected])

    Recovery

  • 7/29/2019 Services Marketing - PPT Shared 1

    122/127

    DO DONT

    Acknowledge problem

    Explain causes

    Ignore customer Blame customer

    Apologize

    Compensate/upgrade

    Lay out options

    Take responsibility

    eave customer to en orhim/herself

    Downgrade

    Act as if nothing is wrong

    Compiled by Prof. Ajay Raheja ([email protected])

    Adaptability

  • 7/29/2019 Services Marketing - PPT Shared 1

    123/127

    DO DONT

    Recognize the seriousness ofthe need

    Promise, then fail to followthrough

    Ac now e ge

    Anticipate Attempt to accommodate

    Explain rules/policies

    Take responsibility

    Exert effort to accommodate

    Ignore

    Show unwillingness to try Embarrass the customer

    Laugh at the customer

    Avoid responsibility

    Compiled by Prof. Ajay Raheja ([email protected])

    Spontaneity

  • 7/29/2019 Services Marketing - PPT Shared 1

    124/127

    DO DONT

    Take time

    Be attentive

    Exhibit impatience

    Ignore

    Anticipate needs

    Listen Provide information (even if

    not asked)

    Treat customers fairly

    Show empathy

    Acknowledge by name

    Yell/laugh/swear

    Steal from or cheat acustomer

    Discriminate

    Treat impersonally

    Compiled by Prof. Ajay Raheja ([email protected])

    Coping

  • 7/29/2019 Services Marketing - PPT Shared 1

    125/127

    DO DONT

    Listen

    Take customers

    Explain

    Let go of the customer

    Let customers

    dissatisfaction affect others

    Compiled by Prof. Ajay Raheja ([email protected])

    The Evidence of Service from the

    Customers Point of View Contact employees

  • 7/29/2019 Services Marketing - PPT Shared 1

    126/127

    Operational flow of

    activities

    Contact employees

    Customer him/herself

    Other customers

    PEOPLE

    Flexibility vs.

    standard Technology vs.

    human

    Tangible

    communication Servicescape Guarantees Technology

    PROCESS PHYSICALEVIDENCE

    Compiled by Prof. Ajay Raheja ([email protected])

  • 7/29/2019 Services Marketing - PPT Shared 1

    127/127