Académique Documents
Professionnel Documents
Culture Documents
External
COMPANY Service
Communications
Delivery GAP 4 to Customers
GAP 1 GAP 3
Customer-Driven
Service Designs and
Standards
GAP 2
Company Perceptions
of Consumer
Expectations
Key Factors Leading to the
Customer Gap
Customer
Expectations
Customer
Prov
GAP
Prov
Customer
Perceptions
Key Factors Leading to
Provider Gap 1
Customer
Expectations
GAP
1
Inadequ
Insuffi
Resea
Company Perceptions of
Customer Expectations
Key Factors Leading to
Provider Gap 2
Customer-Driven Service
Designs and Standards
GAP
2
Poor Ser
Unsyste
Vague,
Management Perceptions of
Customer Expectations
Closing Gap 2
• Service Development and Design
GAP
3 Deficienc
Ineffectiv
Role amb
Service Delivery
Closure of Gap 3
• Understanding Employees roles in
Service Delivery
• Understanding Customers roles in
Service Delivery
• Intermediaries roles
• Managing demand & Capacity
Employees’ Roles
in Service Delivery
• The Critical Importance of Service
Employees
• Boundary Spanning Roles
• Strategies for Closing Gap 3
• Service Culture
Service Employees
• They are the service.
• They are the organization in the customer’s eyes.
• They are the brand.
• They are marketers.
• Their importance is evident in:
– The Services Marketing Mix (People)
– The Service-Profit Chain
– The Services Triangle
The Services Marketing
Triangle
Company
(Management)
Internal External
Marketing Marketing
enabling setting
promises promises
Te nte kills
Tr nica tive
Re ure a
ch rac
ai n l
Hire the
I S
Pe ervi g
ers
fo and
rfo ce Right People
n
w
as
r
rm
Me
Develop
Customer-
Employees
Empower
Employees
Customers
Best Deliver
as
Service Service
People
Delivery Quality
Em th any’
wo e
rk
Inc ee
am ot
Provide
plo e
Te rom
Co Visio
lud s in
y
Needed Support
mp n
P
e
Systems
De
Se velo
s
re
or rvic p a su al
i
Int ente -
e
Provide Me tern e
Pr ern d In rvic y
oc Supportive Se alit
es al
se
s Technology Qu
and
Equipment
Empowerment
• Benefits: • Drawbacks:
– quicker responses – greater investments in
– employees feel more selection and training
responsible – higher labor costs
– employees tend to interact – slower and/or inconsistent
with warmth/enthusiasm delivery
– empowered employees are a – may violate customer
great source of ideas perceptions of fair play
– positive word-of-mouth – “giving away the store”
from customers (making bad decisions)
Importance of customers
in Service delivery
• Customers are a part of the production
process.
• A service experience heavily depends on
the audience’s (customer’s) input levels
also.
• Level of customer participation in
service varies across services.
• Role of other customers
How Customers Widen
Gap 3
• Lack of understanding of their roles
• Not being willing or able to perform
their roles
• No rewards for “good performance”
• Interfering with other customers
• Incompatible market segments
Levels of customer
participation across
different services
• Low - consumer presence required
during service delivery –
– Products are standardized
– Service is provided regardless of any
individual purchase
– Payment may be the only required
customer input
• Ex. Airline travel, Hotel stay, fast food restaurant.
Contd…
• Moderate - consumer inputs required for service
creation –
– Client inputs customize a standard service
– Provision of service requires customer purchase
– Customer inputs are necessary for an adequate
outcome, but the service firm provides the service
• Ex. Restaurant, Haircuts, annual physical exam etc.,
Contd..
• High - customer cocreates the service product
– Active client participation guides the customized
service
– Services cannot be created apart from the
customer’s purchase and active participation
– Customer inputs are mandatory and cocreate the
outcome
• Ex. Marriage counseling, major illness or surgery, lawyer consultation
etc.,
Importance of Other
Customers in Service Delivery
• Other customers can detract from
satisfaction:
– Disruptive behaviors
– Excessive crowding
– Incompatible needs
• Other customers can enhance satisfaction:
– Mere presence
– Socialization/friendships
– Roles: assistants, teachers, supporters
Customer Roles in
Service Delivery
Productive Resources
Contributors to
Quality and
Satisfaction
Competitors
Customers as Productive
Resources
• “Partial employees”
– Contributing effort, time, or other resources
to the production process
• Customer inputs can affect organization’s
productivity
• Key issue:
– Should customers’ roles be expanded?
reduced?
Customers as Contributors
to Service Quality and
Satisfaction
• Customers can contribute to
– Their own satisfaction with the service
• By performing their role effectively
• By working with the service provider
– The quality of the service they receive
• By asking questions
• By taking responsibility for their own satisfaction
• By complaining when there is a service failure
Customers as
Competitors
• Customers may “compete” with the service provider
• “internal exchange” vs. “external exchange”
• Internal/external decision often based on:
– Expertise capacity
– Resource capacity
– Time capacity
– Economic rewards
– Psychic rewards
– Trust
– Control
Self-Service Technologies—
The Ultimate in Customer
Participation
• Produced directly by customers without
any direct involvement or interaction
with the firm’s employees.
• Advances in technology, have allowed
the introduction of wide range of self-
service technologies.
• Ex: ATM’s, Airline check-in, internet banking, online
auctions, etc.,
Customer Usage of SST’s
• Benefits > costs
• Customer readiness results from a
combination of – personal motivation,
ability and role clarity.
• Benefits to companies – cost savings
and revenue growth.
Success with SST’s
• Clear strategy
• Benefits to customer
• Motivating customers to try
• Making customers tech-ready
• Involving customers in the design of the
service technology system and processes
• Educating customer for encouraging adoption.
Strategies for Enhancing
Customer Participation
Effective
Recruit, Educate,
Define Customer Customer and Reward
Jobs
Participation Customers
Manage the
Customer
Mix
Strategies for Enhancing
Customer Participation
• Define customers’ jobs
– Helping himself
– Helping others
– Promoting the company
– Individual differences
• Not everyone wants to participate
Strategies for Recruiting,
Educating, and Rewarding
Customers
1. Recruit the right customers
2. Educate and train customers to perform
effectively
3. Reward customers for their contribution
4. Avoid negative outcomes of inappropriate
customer participation
Manage the customer
mix
• Attracting maximally homogeneous
groups of customers
• Compatibility of customer segments
Key Factors Leading to
Provider GAP 4
Service Delivery
GAP
4
Lack of In
Tenden
indep
External Communications to
Customers
Marketing Communication
mix
• Advertising
• Sales promotion
• Public relations
• Direct marketing
• Personal selling
Communications and the
Services Marketing Triangle
Company
Internal Marketing External Marketing
Vertical Communications Communication
Horizontal Communications Advertising
Sales Promotion
Public Relations
Direct Marketing
Manage
Customer
Expectations
Goal:
Manage Delivery Improve
Service greater than Customer
Promises or equal to Education
promises
Manage
Internal
Marketing
Communication
Matching service promises
with delivery
Approaches for
Managing Service
Promises
Goal:
Create Coordinate Offer Delivery
Effective Make
External Realistic Service greater than
Services Communication Guarantees or equal to
Communications Promises
promises
Services Advertising
Strategies Matched with
Properties of Intangibility
• Incorporeal existence
• Abstractness
• Generality Vs. specificity
• Nonsearchability
• Mental impalpability
Guidelines for service
advertising effectiveness
• Use narratives to demonstrate the service
experience
• Present vivid information
• Use interactive imagery
• Focus on the tangibles
• Feature employees in communication
• Promise what is possible
• Encourage W-O-M communication
Approaches for
Managing Customer Expectations
Offer Choices
Create Tiered-Value
Offerings
Negotiate
Unrealistic
Expectations
Goal:
Delivery
greater than
or equal to
promises
Approaches for
Improving Customer
Education
Teach
Customers
Goal: Prepare Confirm Clarify to Avoid
Delivery Customers Performance Expectations Peak
greater than for the to Standards after the Sale Demand
or equal to Service Periods
promises Process and
Seek Slow
Periods
Approaches for Managing
Internal Marketing Communications
Goal:
Delivery
greater than
or equal to
promises
Create Effective
Vertical
Communications
Create Effective
Horizontal
Communications
Align Back
Office Personnel
w/ External Customers
Create
Cross-Functional
Teams
Pricing of Services
• Three Key Ways Service Prices are
Different for Consumers
• Approaches to Pricing Services
• Pricing Strategies That Link to the
Four Value Definitions
Three Key Ways Service
Prices are Different for
Consumers
• Customer knowledge of services
– Service heterogeneity limits knowledge
– Providers are unwilling to estimate price
– Individual customer needs vary
– Price information is overwhelming in services
– Prices are not visible
• The role of nonmonetary costs
– Time costs, search costs, convenience costs and
psychological costs
• Price as an indicator of service quality
Three Basic Price Structures and
Difficulties Associated with Usage
for Services
Co
st
-B
d n-
as
se tio
1. Price signaling ed 1. Cost-plus pricing
Ba peti
2. Going-rate pricing m 2. Fee for service
Co
a se d
nd -B
Dema
Three Basic Price Structures and
Difficulties Associated with Usage
for Services
PROBLEMS: Co PROBLEMS:
1. Small firms may charge too st 1. Costs difficult to trace
-B
d n-
as
se tio
little to be viable 2. Labor more difficult to
ed
Ba peti
2. Heterogeneity of services price than materials
limits comparability m 3. Costs may not equal value
3. Prices may not
Co
reflect customer
value
a se d
nd -B
Dema
PROBLEMS:
1. Monetary price must be adjusted to reflect
the value of non-monetary costs
2. Information on service costs less available to
customers, hence price may not be a central factor
Four Customer Definitions
of Value (perceived value)
Value is everything
I want in a service.
• Prestige pricing
• Skimming pricing
Pricing Strategies When the
Customer Defines Value as
Quality for the Price Paid
• Value pricing
• Market segmentation
pricing
Pricing Strategies When the Customer
Defines Value as All That Is Received for
All That Is Given