2. • Why Services Marketing
• The ICT Services Continuum
• Technological Paradox
• Evidence of Services
• Evaluation of Services and Decision Making
• Service Quality
• Relationship Marketing
• Service Failure and Service Recovery
• Servicescape
• Managing Customer Expectation
3. Service Economy
• The relative importance of service
in a product offering.
• The service economy in developing
countries is mostly concentrated in
financial services, hospitality, retail,
health, human services, information
technology and education.
• Products today have a higher
service component than in previous
decades.
• In the management literature this is
referred to as the servitization of
products.
• Virtually every product today has a
service component to it.
4. • Services dominate countries and
worldwide economies
• Services are growing dramatically
• Service leads to customer
satisfaction, retention and loyalty
• Service leads to profits
• Services help companies
differentiate themselves
5. total expenditure:
5X product costs
total expenditure:
21X product costs
total expenditure:
5X product costs
100%
80%
60%
40%
20%
0%
annual cost of
PC use: $6,259
total annual cost of rail
operations: $29 billion
average annual household
expenditure: $6,064
Personal Computers Locomotives Automobiles
The sale of a
product
accounts for
only a small
portion of
overall
revenues.
Providing
services to
customers is
where the
real money
is.
Source: GartnerGroup, Association of American Railroads, Federal Highway Administration Office of Highway
Information Management. (Railroad expenditures are for Class 1 railroads.)
8. Source : D.G. Mick and S. Fournier, “Paradoxes of Technology : Consumer Cognizance, Emotions and Coping Strategies”, Journal of
Consumer Research 25 (September 1998), pp. 123-147.
9.
10.
11.
12.
13. Expected service
Perceived service
----------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------
External communications to customers
- Lack of integrated service mkt communications
- Inefficient management of customer
- Over Promising
- Inadequate horizontal communicationsexpectations
Actual Service delivery
- Deficiencies in human resource policies
- Failure to match supply and demad
- Customer not fulfilling roles
- Problems with intermediaries/ channels
------------------------------------------------------------------------------
---------------------------------------------------------------------------------
Customer driven service designs and standarts
- Poor service design
- Absence of customer defined standarts
- Inappropriate physical evidence and servicescape
---------------------------------------------------------------------------------------
Company’s understanding of customer expectations
- Inadequate research
- Lack of upward communication
- Insufficient relationship focus
- Inadequate service recovery
14. • How are we doing overall in meeting or
exceeding customer expectations?
• How are we doing overall in closing the
four company gaps?
• Which gaps represent our strengths and
where are our weaknesses?
21. • 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
22.
23. Customer Benefits
Confidence Benefits
Social Benefits
Special Treatment Benefits
Relationship Bonds
Financial Bonds
Social Bonds
Customization Bonds
Structural Bonds
Switching Barriers
Customer Inertia
Switching Costs
Core Service
Provision
Satisfaction
Perceived Service Quality
Perceived Value
Strong
Customer
Relationship
(Loyalty) Firm Benefits
Economic Benefits
Customer Behavior Benefits
Human Resource Management Benefits
Relationship
Drivers
Outcomes
27. Do the job right
at the first time
Effective
complaint
handling
Increase
satisfaction and
loyalty
Identify
complaints
• Conduct research
• Monitor complaints
• Develop
complaints as
opportunity culture
Resolve
complaints
effectively
• Develop effective
strategy
• Training in
complain handling
Learn from
recovery
experiences
Conduct root
cause analysis
28. 1. Act fast
2. Acknowledge the customer’s feelings
3. Don’t argue with the customer
4. Empathize with the customer
5. Clarify the truth and sort out the cause
6. Give customer the benefit of doubt
7. Propose the steps needed to solve the problem
8. Keep customers informed of the progress
9. Consider compensations
10. Continue to regain customer goodwill
11. Self check the system and improve it
Source: TARP Worldwide., 2007
29.
30.
31. the environment in which
• the service is performed, delivered, and consumed
• where the firm and customer interact
• combined with tangible commodities that facilitate
performance or communication of the service
Consider impact on customer response, particularly
perceptions, evaluations and assessment
For example :
patient examination room in a doctor’s office
restaurant seating, furnishing, pictures, lighting, background music