Services Marketing by P Sivarajadhanavel Part 3 Chapter - 6 – Listening to Customers through Research Chapter – 7 – Building Customer Relationships Chapter – 8 – Service Recovery

The Listening Gap Not knowing what customers expect is one of the root causes of not delivering to customer expectations Provider Gap – 1is the difference between customer expectations of service and company understanding of those expectations

Company Perceptions of Consumer Expectations Provider Gap 1 CUSTOMER Expected Service (Customer Gap) Listening Gap Perceived Service GAP 1 COMPANY Company Perceptions of Consumer Expectations

Chapter - 6 Listening to Customers through Research

Objectives Present the types of and guidelines for marketing research in services Show how marketing research information can and should be used for services Describe the strategies by which companies can facilitate interaction and communication between management and customers Present ways that companies can and do facilitate interaction between contact people and management

Meeting customer expectations Market research is the process of systematically gathering, recording and analyzing data and information about customers, competitors and the market Using marketing research to understand customer expectations Marketing research is a form of business research and is generally divided into two categories: consumer market research and business-to-business (B2B) market research, which was previously known as industrial marketing research. Consumer marketing research studies the buying habits of individual people while business-to-business marketing research investigates the markets for products sold by one business to another

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

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 Services 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 measurement of loyalty, behavioral intentions, or actual behavior

Service Research Strategies Qualitative and Quantitative Research Common Service Research Techniques/program: complaint solicitation critical incident studies Requirements research “relationship and SERQUAL” surveys trailer calls or post transaction Service Expectation meeting and reviews Process checkpoint Evaluations Market oriented Ethnography “mystery” shopping customer panels lost customer research employee surveys Future expectations research

Portfolio of Services Research Research Objective Type of Research Customer Complaint Solicitation “Relationship” Surveys Post-Transaction Surveys Customer Focus Groups “Mystery Shopping” of Service Providers Employee Surveys Lost Customer Research Identify dissatisfied customers to attempt recovery; identify most common categories of service failure for remedial action Assess company’s service performance compared to competitors; identify service-improvement priorities; track service improvement over time Obtain customer feedback while service experience is still fresh; act on feedback quickly if negative patterns develop Use as input for quantitative surveys; provide a forum for customers to suggest service-improvement ideas Measure individual employee service behaviors for use in coaching, training, performance evaluation, recognition and rewards; identify systemic strengths and weaknesses in service Measure internal service quality; identify employee-perceived obstacles to improve service; track employee morale and attitudes Determine the reasons why customers defect To forecast future expectations of customers To develop and test new service ideas Future Expectations Research

Analyzing and interpreting marketing research findings Tracking of performance, Gap Scores, and Competition Zones of Tolerance Charts Importance/Performance Matrices

Service Quality Perceptions Relative to Zones of Tolerance 9 8 7 6 5 4 3 2 1 O O O O O Reliability Responsiveness Assurance Empathy Tangibles Insurance Agency = Zone of Tolerance = Service Quality Perception O

Importance/Performance Matrix HIGH High Leverage   Attributes to Improve Attributes to Maintain      Importance Low Leverage  Low Leverage   Attributes to Maintain Attributes to De-emphasize LOW Performance HIGH

Tracking of Customer Expectations and Perceptions of Service Reliability

Using Marketing Research Information upward communication allows management to truly understand customer expectations can help to close Objectives for Upward Communication Research for Upward Communication Executive Visits to Customers Executive or Management Listening to Customers Research on Intermediate Customers Research on Internal Customers Executive or Management Listening Approaches to Employees Employee Suggestions

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