1. McGraw-Hill/Irwin ©2003. The McGraw-Hill Companies. All Rights Reserved Part 2 LISTENING TO CUSTOMER REQUIREMENTS

2. McGraw-Hill/Irwin ©2003. The McGraw-Hill Companies. All Rights Reserved Company Perceptions of Consumer Expectations Expected Service CUSTOMER COMPANY GAP 1 Part 2 Opener Provider GAP 1

3. McGraw-Hill/Irwin ©2003. The McGraw-Hill Companies. All Rights Reserved Chapter 5 Using Marketing Research to Understand Customer Expectations Elements in an Effective Services Marketing Research Program Analyzing and Interpreting Marketing Research Findings Using Marketing Research Information Upward Communication Understanding Customer Expectations and Perceptions Through Marketing Research

4. McGraw-Hill/Irwin ©2003. The McGraw-Hill Companies. All Rights Reserved Objectives for Chapter 5: Understanding Customer Expectations and Perceptions through Marketing Research Present the types of and guidelines for marketing research in services. Show the ways that 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.

5. McGraw-Hill/Irwin ©2003. The McGraw-Hill Companies. All Rights Reserved Common Research Objectives for Services 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 service performance of individuals and teams for rewards To determine expectations for a new service To monitor changing expectations in an industry To forecast future expectations

6. McGraw-Hill/Irwin ©2003. The McGraw-Hill Companies. All Rights Reserved Figure 5.1 Criteria for an Effective Service Research Program

7. McGraw-Hill/Irwin ©2003. The McGraw-Hill Companies. All Rights Reserved Portfolio of Services 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 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 Assess company’s service performance compared to competitors; identify service-improvement priorities; track service improvement over time 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 Research Objective Type of Research Future Expectations Research To forecast future expectations of customers To develop and test new service ideas

8. McGraw-Hill/Irwin ©2003. The McGraw-Hill Companies. All Rights Reserved 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

9. McGraw-Hill/Irwin ©2003. The McGraw-Hill Companies. All Rights Reserved Figure 5.3 Tracking of Customer Expectations and Perceptions of Service Reliability

10. McGraw-Hill/Irwin ©2003. The McGraw-Hill Companies. All Rights Reserved Retail Chain 9 8 7 6 5 4 3 2 1 0 Reliability Responsiveness Assurance Empathy Tangibles O O = Zone of Tolerance = S.Q. Perception O O O O Figure 5.4 Service Quality Perceptions Relative to Zones of Tolerance (by Dimensions)

11. McGraw-Hill/Irwin ©2003. The McGraw-Hill Companies. All Rights Reserved Computer Manufacturer 10 8 6 4 2 0 Reliability Responsiveness Assurance Empathy Tangibles O O O O O = Zone of Tolerance = S.Q. Perception O Service Quality Perceptions Relative to Zones of Tolerance (by Dimensions)

12. McGraw-Hill/Irwin ©2003. The McGraw-Hill Companies. All Rights Reserved Figure 5.5 Importance/Performance Matrix HIGH LOW Performance Importance Attributes to ImproveAttributes to Maintain High Leverage Attributes to De-emphasizeAttributes to Maintain Low Leverage