This document discusses the financial and economic impact of service quality. It examines how improving service quality can increase profits through both offensive and defensive marketing effects. Offensive marketing can help attract new customers and increase market share, while defensive marketing helps retain existing customers. The key drivers of service quality, customer retention, and profits are positive service encounters. A balanced scorecard can be used to measure performance across financial, customer, operational, and innovation/learning perspectives. Tracking the right metrics ensures an organization's vision and strategies are properly aligned.
Consumer perception the base for decision making. People make decisions instantly within 20 seconds about other person, yet when it comes to product they take more time. If the perception tone is set right by the companies consumer will not have any confusions. This presentation explores the ways and means of consumer perception and ends with the application of perception at large by organizations around the globe.
Service marketing introduction, , classification and challengesPROF.JITENDRA PATEL
This Module contain basic of Service Marketing, its definition, major characteristics of Services, its various classification, contribution of service in economy and various challenges faced by service marketer.
Consumer perception the base for decision making. People make decisions instantly within 20 seconds about other person, yet when it comes to product they take more time. If the perception tone is set right by the companies consumer will not have any confusions. This presentation explores the ways and means of consumer perception and ends with the application of perception at large by organizations around the globe.
Service marketing introduction, , classification and challengesPROF.JITENDRA PATEL
This Module contain basic of Service Marketing, its definition, major characteristics of Services, its various classification, contribution of service in economy and various challenges faced by service marketer.
Assessing service market potential - Classification of services – Expanded marketing mix – Service marketing – Environment and trends – Service market segmentation, targeting and positioning
Assessing service market potential - Classification of services – Expanded marketing mix – Service marketing – Environment and trends – Service market segmentation, targeting and positioning
The new Facebook Page Timeline and admin dashboard design will go live for every Page on June 12th, 2014. In this presentation we explore some of the changes and updates.
Achieving Dialogue In The Age Of The Omni-Channel CustomerG3 Communications
"Blast" marketing strategies of the past are no longer sufficient to engage today's customers and foster loyalty. Typical campaign response rates have plummeted while customer opt-out rates have ascended, limiting your ability to converse with even your most valuable customers. New automated dialogue strategies can help retailers create a seamless experience across all channels and engage with each of their customers as individuals, connecting every customer communication - outbound, inbound, marketing, sales or service - into an ongoing dialogue where customer insight and understanding forms the basis for each and every interaction.
Contact Center is a Gold Mine for Customer Experience Improvement Company-wideClearAction
Customer comments in the contact center are underutilized gold mines for guiding your whole company in improving and differentiating customer experience for stronger business results.
See https://ClearAction.com/
Managing the customers you can't afford to losePLB68
Presented by Peter Browne, Head of Strategy,
Gordian Business, Sydney, Australia
Competition is becoming more intense, products and services increasingly commoditised and buyers more knowledgeable. At the same time your largest customers want better quality and services at lower prices. As industries consolidate, your largest customers represent a growing proportion of your revenue and profit. So you cannot risk losing your largest accounts. To reduce this critical risk you need a disciplined approach to identify and manage the customers you can't afford to lose.
Participants of this webinar will receive a complimentary SEGMENTING ACCOUNTS TOOL which will show you how to manage your most important accounts in four different ways.
Peter Browne will show you how to engage with your key customers to enable your company to build barriers to entry against competitors, and retain and grow your most valuable customers.
To build and maintain customer loyalty, it is necessary to maintain high service standards and consistently provide customers with an exceptional experience. To increase customer volume, you need customers who become advocates because they are enthusiastic about their exceptional experience. This paper discusses consistent experience in the energy industry and how you can utilize consistent experience ratings to build and maintain your brand equity.
Customer relationship management in Hotel Industry
Services marketing
1. THE FINANCIAL AND ECONOMIC
IMPACT OF SERVICE
ISHA CHAMAN (15-MBA-11)
ISHA BANDRAL (16-MBA-11)
KARNIDH KAUR (17-MBA-11)
2. OBJECTIVES
• Examine the direct effects of service on profits.
• Consider the impact of service on getting new customers.
• Evaluate the role of service in keeping customers.
• Discuss what is know about the key service drivers of overall
service quality, customer retention and profitability.
• Discuss the balanced performance scorecard to focus on strategic
measurements other than financials.
3. HOW DO SERVICE QUALITY
IMPROVEMENTS WILL BE A GOOD
INVESTMENT?
WHERE IN THE COMPANY SHOULD
THE MONEY BE INVESTED TO
ACHIEVE HIGHER RETURNS?
4. Return On Service
Quality
Assumptions:
• Service Quality is an investment.
• Service Quality efforts must be financially
accountable.
• It is possible to spend too much on service
quality
• Not all service quality expenditures are
equally valid.
5. The Direct Relationship between
Service and Profits
“Will service improvement result in Profitability?”
Service
Quality
? Profits
6. STRATEGY FOR IMPROVING
PROFITABILITY
1. Reduce costs: focus on cost cutting and
efficiencies.
2. Build revenues through improvements to
customer service, customer satisfaction, and
customer retention.
3. Combine (1) and (2).
7. Offensive Marketing
Effects of Service
Service quality can help companies attract more and
better customers to a business, through
OFFENSIVE MARKETING
Attracting more and better customers
-involves market share, reputation, and price premiums
-PIMS (profit impact of marketing strategy)
Example: There are several auto repair shops in a three block
area. One of the shop owners decides to extend his operating
hours until 10:00pm Monday-Thursday and provide a pick-up
and delivery service, and guarantee all repairs for six months.
9. • When service is good, a company gains a
positive reputation and through that, a higher
market share and ability to charge more than
its competitors for services.
10. Profit Impact of Marketing
Strategy
• Companies offering superior service achieve
higher than normal market share growth and
that service quality influences profit through
increased market share and premium prices as
well as lowered costs and less rework.
12. Defensive Marketing Effects of
Service on Profit- CUSTOMER RETENTION
Costs
Volume of Margins
Service Customer
Purchases
Quality Retention Price
Premium
Word of
Mouth Profits
13. Effects of Service on Behavioral
Intentions and Profits
Costs
Volume of Margins
Purchases
Customer
Retention Price
Behavioral Premium
Service Intentions
Word of
Mouth Profits
Sales
14. The “80/20” Customer Pyramid
Most Profitable
What segment spends more with
Customers us over time, costs less to maintain,
Best
Customers spreads positive word of mouth?
Other
Customers What segment costs us in
time, effort and money yet
does not provide the return
Least Profitable we want? What segment is
Customers difficult to do business with?
15. The Key Drivers of Service Quality, Customer
Retention, and Profits
Key Drivers Service Encounters
Service
Encounter
Service
Encounter
Service Behavioral Customer
Quality Intentions Retention Profits
Service
Encounter
Service
Encounter
16. Service Quality Spells Profits
Costs
Defensive Volume of Margins
Marketing Purchases
Price
Premium
Service Customer
Quality Retention
Word of
Mouth Profits
Market
Share
Sales
Offensive
Marketing Reputation
Price
Premium
18. BALANCED SCORE CARD
(A performance measurement system)
Term coined by ART SCHNEIDERMAN(1987)
Devised by ROBERT S KAPLAN & DAVID P NORTAN
19. DEFINITION
The balanced scorecard is a strategic
planning and m anagem system that
ent
is used extensively in business and
industry, governm and non-profit
ent
organizations worldwide to align
business activities to the vision and
strategy of the organization, im prove
internal and external com unications,
m
and m onitor organization’s
perform ance against strategic goals.
20. BALANCED SCORE CARD DOES
WHAT
• Translates vision and strategy into action;
• Defines the strategic linkages to integrate performance across
organizations;
• Communicates objectives and measures to a business unit, joint venture,
or shared service;
• Aligns strategic initiatives;
• Aligns everyone within an organization so that all employees understand
how and what they do supports the strategy;
• Provides a basis for compensation; and
• Provides feedback to the senior management if the strategy is working.
21.
22. Financial Measures
Price Premium
Volume Increases
Value of Customer Referrals
Customer Value of Cross Sales Operational
Perspective Perspective
Long-term Value of Right first time (% hits)
Service Perceptions Customer
Defection rate
Service Expectations Right on time (% hits)
SAMPLE MEASUREMENTS FOR
Perceived Value BALANCED SCORECARD Responsiveness (% on time)
Transaction time (hours,
Behavioral Intentions:
Percentage of Loyalty Innovation and days)
Percentage of Intent to Switch Learning Perspective
No. of Customer Referrals
Number of new products Throughput time
No. of Cross Sales
No. of Defections
Return on innovation Reduction in waste
Employee skills
Process quality
Time to market
Time spent talking to
customers
23. BALANCED SCORE CARD IN
PRACTICE
• Implemented not only in corporations but also in government
and non profit organizations.
• In 2001, the UNIVERSITY OF VIRGINIA LIBRARY, a system of
11 different libraries with holdings of 4 million volumes,
became the first library in North America to implement
balanced score card to improve its performance.
24. LIMITATIONS
One fact is that it is not easy to implement this tool because it involves a lot
of subjectivity.
Also, the tool is much more complex compared to the other tools. The
measures that need to be taken are contingent upon the kind of
environment, industry and the business the organization is in.
The tool has tried to fill up the void that exists in most management systems.
However, a lot of refinement is still required, so that it becomes
understandable to every stakeholder associated with the organization and
removing subjectivity to a large extent.
25. CONCLUSION
The balanced scorecard is a very important strategic management tool
which helps an organization not only to measure performance, but also
decide/manage the strategies needed to be adopted/modified so that the
long-term goals are achieved.
In other words, the application of this tool ensures the consistency of
vision and action which is the first step towards the development of a
successful organization.
Also, proper implementation can ensure the development of
competencies within an organization which will help it in developing a
competitive advantage, without which it cannot be expected to
outperform its rivals.