10 - Service Marketing

Question 1

sources customer value

Answer 1

functional value
monetary value
psychological value

Question 2

main issue in Dry Clean Express case?

Answer 2

no clear policy on service quality
- no correct way to evaluate the manager

Question 3

type 1 vs type 2 errors

Answer 3

null hypothesis: customer makes an honest request

type 1: deny an honest request
type 2: satisfy a fraudulent request

• depend on customer’s lifetime value (Primark vs El Corte Ingles)

Question 4

empowering employees

Answer 4

more freedom: risky (service level)
less freedom: less flexibility + lose upside of customer service

Question 5

customer lifetime value

Answer 5

CLV = - AC + ( (Mg - C)/(1+i+r) )

AC: Acquisition cost
Mg: Profit margin from customer
C: Marketing costs associated with customer
i: Discount rate
r: Retention rate

Question 6

7Ps of service marketing

Answer 6

product
price
place
promotion
physical evidence
process
people

Question 7

cash vs coupon

Answer 7

if customer comes back: indifferent

if customer doesn’t come back: coupon is better (no cash outflow)

give customer the choice - cash might be the better signal (risky)