services marketing-vtu

1. Understanding customer
expectation through market
research
Module-3

2. 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

3. Criteria for an Effective
Service Research Program

4. 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

5. Building customer relationship's
• is a philosophy of doing business that focuses on
keeping current customers and improving
relationships with them
• does not necessarily emphasize acquiring new
customers
• is usually cheaper (for the firm)
– keeping a current customer costs less than attracting a new
one
• thus, the focus is less on attraction, and more on
retention and enhancement of customer relationships

6. Customer Goals of Relationship
Marketing

7. Profit Generated by a Customer
Over Time

8. Profit Impact of 5 Percent Increase in
Retention Rate

9. A Loyal Customer is One Who...
• Shows Behavioral Commitment
– buys from only one supplier, even though other options
exist
– increasingly buys more and more from a particular supplier
– provides constructive feedback/suggestions
• Exhibits Psychological Commitment
– wouldn’t consider terminating the relationship--
psychological commitment
– has a positive attitude about the provider
– says good things about the provider

10. Underlying Logic of Customer
Retention Benefits to the Organization

11. Benefits to the Organization
of Customer Loyalty
• loyal customers tend to spend more with the
organization over time
• on average costs of relationship maintenance
are lower than new customer costs
• employee retention is more likely with a stable
customer base
• lifetime value of a customer can be very high

12. Benefits to the Customer
• inherent benefits in getting good value
• economic, social, and continuity benefits
– contribution to sense of well-being and quality of
life and other psychological benefits
– avoidance of change
– simplified decision making
– social support and friendships
– special deals

13. • Foundations:
– Excellent Quality/Value
– Careful Segmentation
• Bonding Strategies:
– Financial Bonds
– Social & Psychological Bonds
– Structural Bonds
– Customization Bonds
• Relationship Strategies Wheel
Strategies for Building Relationships

14. Customer Pyramid

15. The Expanded Customer Pyramid

16. Levels of Retention Strategies

17. Steps in Market Segmentation and
Targeting for Services