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The importance of market research Chapter 6 © Hudson & Hudson. Customer Service for Hospitality & Tourism.

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Presentation on theme: "The importance of market research Chapter 6 © Hudson & Hudson. Customer Service for Hospitality & Tourism."— Presentation transcript:

1 The importance of market research Chapter 6 © Hudson & Hudson. Customer Service for Hospitality & Tourism

2 Topics Covered o Tourism and hospitality research introduction o Consumer research and customer loyalty o Measuring service quality o Critical incidents studies o Lost customer research o Online research o Common research errors o Effective use of market research in decision making

3 ‘At Your Service’ Spotlight: Simply the Best Service with no boundaries. o Significant research Press visits Product development o Attention to media and journalists Ski lovers as press coordinators Media visits Winterstart World Cup Top treatment of journalists o Staff Teaching by example Excellence cards Ride breaks

4 Introduction to research in tourism and hospitality o Market research often Considered costly and time-consuming Undertaken only around major developments Contributions to day-to-day operations overlooked Organizations overlook existing, accessible information Study results ignored or not fully considered

5 Applied Research in Tourism & Hospitality Table 6.1

6 Consumer research and customer loyalty o ‘Completely satisfied’ Enterprise customers o ‘Voice-of-Customer Operating Model’ o Net Promoter Score for consumers o Competitor intelligence o Benchmarking Guest satisfaction scores (GSS)

7 Benchmarking UK’s top 20 attractions Table 6.2 (Source: Based on Which?, 2011)

8 A DINESERV interview Table 6.3

9 Benchmarking fast-food restaurants Figure 6.1 (Source: Adapted from Min and Min, 2010)

10 The Gaps Model of Service Quality Figure 6.2 (Source: Parasuraman, et al., 1985)

11 Measuring service quality o Importance–performance analysis (IPA) Relative importance of attributes versus actual performance o SERVQUAL Difference between consumers’ expectations and perceptions of service quality 22 item scale, five dimensions has been adapted to serve different industry sectors o Comment cards performance-based measure and diagnostic tool feedback at time of service experience may be more effective than SERVQUAL or IPA o Mystery shopping participant observation A common market research technique Rich information about service experience as it unfolds

12 IPA attribute ratings for ski destination Figure 6.3 (Source: Hudson and Shephard, 1998)

13 Advantages and disadvantages of mystery shopping Table 6.4 (Source: Adapted from Hudson, Hudson & Miller, 2004)

14 Snapshot: Checking out the Competition You can never be too old to learn new things from just about anyone. o Mystery shopping Gather information on industry rivals Stay current, competitively priced Improve customer service and guest communication Enhance staff training and understand nuances of staff-guest interactions o Websites and publications o Stay abreast of trends o Learn what competitors are doing o Business in remote settings o Social media Brand Karma Photo courtesy of Ben Hall

15 Critical incidents studies o Critical incident technique (CIT) o Qualitative interview procedures, verbatim accounts: Consumer evaluation of services Service failure and recovery Employee and customer participation in service delivery Service experience o Four main benefits of CIT Sound information easily translated into action Useful when the service is new, little information exists Useful for assessing cross-cultural perceptions

16 Tracking service quality Figure 6.4 (Source: Adapted from Hudson, Hudson & Miller, 2004)

17 Lost customer research o Few organizations have effective strategies for evaluating customer attrition o Research targets customers who have dropped the company’s service Makes inquiries about reasons for leaving Identifies failure points and common problems Calculates the cost of lost customers. o NBRI study – root cause driving down customer loyalty and customer satisfaction (68 %) identified as ‘wait time’

18 Online research o Electronic and online surveys Computers placed in high-traffic locations Customers asked to complete online surveys Input tabulated, available instantly Can be accessed by corporate and front-line staff ⁻ Instant service recovery ⁻ Long-term service improvement o Virtual focus groups o Online ‘chat’ sessions Pre-recruited respondents in guided online discussion ⁻ Time- and cost-saving benefits o Virtual worlds e.g. Second Life o Social media and crowdsourcing e.g. Brand Karma

19 Common research errors o Not enough qualitative information Especially important for launching new service or product o Improper use of sophisticated statistical analysis Errors in collection, tabulation, or analysis of data o Failure to have a representative sample Inaccurate estimates of the thoughts and behaviors of larger population o Problems with interpretation Skill and dexterity is required on the part of the researcher

20 Effective use of market research o Research can play a critical role in development Practical decision-making at a strategic level Academic understanding of industry development Feasibility studies for new projects o Successful research contingent on 3 conditions: Sufficient resources Research results stand, even when they conflict with preconceived views Results should be implemented e.g. Courtyard by Marriott

21 Case Study: Driving complete customer satisfaction o Enterprise Service Quality index (ESQi) Phone survey with two questions Results collected, analyzed quarterly Branch by branch comparisons Promotions based on rankings ”Brand Integrity Audits” o ‘Completely satisfied’ 3 times more likely to rent again o 3 satisfaction priorities: Attitude, helpfulness of staff Speed of transaction Ceanliness of the car Going ”above and beyond” to satisfy customers.


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