EXAM 2 Flashcards
Chs. 6-10 (78 cards)
1
Q
relationship marketing
A
a philosophy of doing business, a strategic orientation that focuses on keeping and improving relationships with current customers rather than an acquiring new customers
- cheaper
- focus is less on attraction
2
Q
the bucket theory
A
customer defection: when customers got out of a product/service
3
Q
customer goals of relationship market
A
build and maintain a base of committed customers who are profitable for the organization
- acquiring (stranger)
-satisfying (acquaintances) - retaining (friends)
-enhancing (partner)
4
Q
benefits of relationship marketing
A
customers:
- trust
- confidence in provider
- reduce anxiety
- social benefits (family, social support, personal relationship)
- social treatment benefits ( special deals, price breaks)
- positive word of mouth
5
Q
customer pyramid
A
- lead
- iron
- gold
-platinum
6
Q
lead
A
life suckers of org, drain on resources (time and effort)
- difficult customers
- feeling of inferiority
7
Q
iron
A
- spend enough
- not brand loyal
-“steal” in terms of effort, time
8
Q
gold
A
- spend money because of a motivation (coupons)
- not brand loyal
9
Q
platinum
A
- do not expect discounts
- loyal customer
- will provide positive word of mouth
10
Q
types of bonds
A
- financial bonds
- social bonds
- customization bonds
- structural bonds
11
Q
financial bonds
A
cross-selling of service
- lower prices of greater volume and for customers who are loyal
12
Q
social bonds
A
interpersonal bonds
-doctors, hair dressers, counselors, sales people
13
Q
customization bonds
A
knowing your customer through personalization and intimate knowledge
14
Q
structural bonds
A
the foundation to the organization
- personal sensitive, build off the other three bonds, sell to business
15
Q
core service provision
A
switch banners
- customer inertia
-switching costs (set ups contractual, learning)
16
Q
ending relationships
A
- incongruent marketsegment
-difficult customers
17
Q
service failure
A
service performance that falls below a customers expectations in which a way that leads to customer dissatisfaction
18
Q
service recovery
A
the action taken by an organization in response to a service failure to improve the situation for the customer
19
Q
reasons why service failure occurs
A
- the service may be unavailable when promised
- may be delivered late or too slowly
- outcome may be incorrect or poorly executed
- employees may be rude or uncaring
20
Q
complaining customers - the tip of the iceberg
A
1%-5% of dissatisfied customers complain to management or company headquarters.
45% of dissatisfied customers complain to a frontline employee
50% of dissatisfied customers of not complain
21
Q
a well designed service recovery strategy
A
- apologize to the customer
- take ownership of the problem
- solve the problem
- offer something extra
- follow up with the customer
22
Q
WOM function of complaint satisfaction
A
- dissatisfied customers on average tell 7 other people
- satisfied customers after service recovery would recommend 71%
23
Q
why people do not complain
A
- waste of time
- nothing positive will occurs for them in they do explain
- they do not know how to complain
24
Q
why people do complain
A
- they believe positive change will occur if they complain
- they believe they should and will be provided compensation for the service failure
- avoid similar situations or punish the service provider
- “complaining personalities”
25
types of complainers
- passives
- voicers
- irates
- activists
26
passives
least likely to take any action, say anything to the provider, spread negative WOMm or complain to a third part; doubt of the effectiveness of complaining
- surveys
- customer comments
- remember others things matter
- eliminate discomfort barriers
27
voicers
"providers best friend"
actively complain to the provider, but not likely to spread negative WOM, believe in the positive consequences of complaining
- make it easy and accessible/visible channels for feedback
- acknowledge and respond promptly to feedback
- implement changes
28
irates
more likely to spread WOM negatively to friends and relatives and to switch providers; average in complaints to provider; unlikely to complain to third parties; more angry less likely to give prodder a second chance
- monitor online reviews, social media, and other public forums
- empower customer service teams to handle complaints calmly and efficiently
29
activists
above average propensity to complain on all levels; more likely to complain to a third party feel most alienated from the marketplace compared to other groups, complaining fits their personal forms
- monitor social media, channels and online platforms for mentions of your brand
- publicly respond to complaints to demonstrate transparency and commitment to resolution
30
fixing the customer
- they expected the company to respond quickly and to be accountable
- they expect to be compensated for their grief and for the hassle of being inconvenienced
- they expect to be treated nicely!
31
fixing the problems
- respond quickly
- provide appropriate communication
- address problem
32
strategies for fixing the problem
- encourage and track complaints
- learning from recovery experiences and for most customers
- making the service fail-safe
33
service guarantees
a pledge on assurance that a product offered by a firm with perform as a promoted and if not, then some form of reparation will be undertaken by the firm
34
characteristics of an effective service guarantee
- limited restriction and exclusions
- meaningful
- easy to understand
- easy to invoke
35
benefits of service guarantees
- a good guarantee forces the company to focus on its customer
- an effective guarantee sets clear standards for the org
- a service guarantee reduced customers sense of risk and builds confidence in the organization
36
when to use or not (service guarantees)
- existing service quality is poor
- a guarantee does not fit the company's image
- service guarantee reduces customers sense of risk and build confidence in the organization
-firms should-
- respond quickly
- provide appropriate communication with customers after the service has failed
- treat customers fully throughout the service recovery process
- cultivate relationships with customers to create a buffer when failures occur
37
the design and standard gap (Gap 2)
- poor service design
- absence of customer-driven standards
-inappropriate physical evidence and service scape
38
innovation
a new, method, or device; the introduction of something new
39
what sets innovation apart?
- innovators create value
- innovation priority and spending plans are much stronger in 2023
- companies expect to increase spending on key innovation enables, even in the face of a downturn
40
service innovation and design
- challenges of service innovation and design
- important considerations for service innovation
- types of service innovation
- stages in service innovation and development
41
risks of relying on words alone to describe services
- oversimplification
- incompleteness
- subjectivity
- biased interpretation
42
important consideration for service
- involve customers and employees (cocreation)
- employ service design thinking and techniques
- the 5 principles of service design thinking:
43
the 5 principles of service design thinking
- user centered (designed for the customers)
- cocreative (all stakeholders should be included)
- sequencing (visualized as a sequence)
- evidence (intangible services should be visualized)
- holistic (the entire environment of a service should be considered)
44
types of services offering innovations
- major or radical innovations (new services for markets as yet undefined)
- start-up businesses (new services for a market already served by existing products)
- new services for the currently served market
- service line extensions
- service improvements
- style changes
45
stages in service innovation and development
- business strategy development or renew
- new service development
- idea generation
- concept development and evaluation
- business analysis
- service development and testing
- market testing
- commercialization
- post introduction evaluation
46
service blueprinting
a technique for simultaneously depicting the service process, the points of customers contact, and the evidence of service from the customers point of view
47
building a service blueprint
- identify process
- identify customer/segment
- map process form customers POV
- map contact activities to needed support functions
- add evidence of service of each customer step
48
components of building a service blueprint
- physical evidence
- customer actions
- employee actions (onstage/visible)
- employee actions (backstage/invisible)
- support process
49
company defined standards
standards established to reach internal goals for productivity efficiency, cost, or technical quality
50
customer defined standards
operational standards based on pivotal customer requirements identified by customer
51
standardization of service
a nonvarying sequential process-similar to the mass production of goods - in which each step is laid out in order and all outcomes are uniform
52
3 forms of standardization of service
- substitution of technology for personal contact and human effort
- improvement in work methods
- combination of these two methods
53
customization of service
usually refers to some level of adaption or tailoring of the process to the individual customer
54
hard customer defined standards
"quantitative"
things that can be counted, timed, or observed through audits
(wait times. delivery times, delay times)
55
soft customer defined standards
"qualitative"
opinion based measures that can be directly observe. they must be collected by tailoring to customers, employees or others ( friendliness, cleanliness, atmosphere, 5 senses, personal preference)
56
one-time fixes
technology, policy, or procedure changes that, when instituted, address customer requirements
57
physical evidence
the environment in which the service is delivered and where the firm and the customer interact and any tangible commodities that facilitate performance or communication of the service
58
elements of physical evidence
- serviscape
- other tangibles
59
serviscape
facility exterior
- exterior design
- signage
- parking
- landscape
- surrounding environment
facility interior
- interior design
- equipment
-signage
- layout
- air quality
- sound/scent/music/lighting
60
other tangibles
- business cards
- stationary
- billing statements
- etc.
61
how does physical evidence affect the customer experience?
- flow
- meaning
- satisfaction
- emotional connections to company
62
package " WRAP THE SERVICE"
- the interior design
- "packing" the business
- facilitator - "the flow"
- socializer " facilitates interaction"
- differentiator (competitive advantage)
63
Lean vs. elaborate servicescape
Lean: simple (kiosks/vending machine)
Elaborate: complex (fine dining/hotels)
64
S-OR Theory
Stimulus-organism-response theory
65
Stimulus
Multidimensional environment
66
Organism
Customers and employees
67
Response
Behaviors directed at the environment
68
Approach vs. avoidance
Approach : all positive behaviors that might be directed to a place (Target)
Avoidance: negative behaviors (McDonalds)
69
Internal responses to the servicescape
-cognition (perception of the servicescape)
-emotion (servicescape can affect your mood)
-physiology (servicescape can affect your physical condition)
70
Cognition
Environment can affect belief about a place and the people and products found in that place
71
Emotion
Color, decor, music, scent affected mood
72
Physiology
Volume, temperature, air quality, lighting can cause physical discomfort and even pain
73
Variations in individual response
Personality difference
- arousal seekers vs. arousal avoiders
Purpose for being in the servicescape
- business/pleasure
Temporary mood state (antecedent states)
74
environmental dimensions
-ambient conditions
-spatial layout and functionality
-signs, symbols, artifacts
75
ambient conditions (sensory based)
- temperature
- lighting
- noise
- music
- scent
-color
76
spatial layout and functionality (functionality and appeal)
- accessibility
- aesthetics
- seating comfort
can be physical or online
77
signs, symbols, artifacts (guidance/instruction)
- way-finding
- labels
- rules of behavior
- creating aesthetic impressions
78
Customer recovery paradox
Where organizations purposefully create service failure to recover from in order to boost customer loyalty
