Ch 15: Service Recovery Flashcards
Service failure (def)
Service performance that falls below a customer’s expectations
Service recovery (def)
The actions taken by an organisation in response to a service failure
Service recovery has a strong impact on customer’s .. (4)
… satisfaction
… loyalty
… word of mouth communication
… bottomline performance
Service recovery paradox (def)
An initially disappointed customer who has experienced good service recovery might be even more satisfied by and loyal as a result of good service recovery
Negatives of the Service Recovery Paradox (5)
- Firm will only be aware of the failure if the customer notifies them
- It is expensive to fix mistakes
- You lose reliability
- Repurchase intentions and image perceptions do not increase
- No guarantee that the customer will be satisfied
Customer complaint actions (def)
When customers initiate responses following service failure,
these customer complaint actions can be of various types.
Web-based consumer opinion platforms (def)
Online platforms facilitated for customer feedback e.g. TripAdvisor
Types of complainers (4)
Passives
Voicers
Irates
Activists
Complainers: passives (def)
Not likely to take action, doubt the effectiveness of complaining
Complainers: voicers (def)
Actively complain to service prodiver but are less likely to spread negative Word of Mouth
Complainers: irates (def)
Relatively angry. Likely to complain to friends and relatives, and to switch
Complainers: Activists (def)
Above average likelihood of complaining to all parties. Believe complaining helps
Recovery expectations (def)
What customers expect to happen when something goes wrong
types of justice (3)
Outcome justice
Procedural justice
Interactional justice
Outcome justice (def)
Concerns the results that customers receive from their complaints.
Procedural justice (def)
Refers to the policies, rules and timeliness of the complaint process.
Interactional justice (def)
Focuses on the interpersonal treatment received during the complaint process
What do customers appreciate in outcome justice (2)
*Being able to choose their compensation
*Feeling like they got equal compensation as other customers
What do customers appreciate in procedural justice (2)
- Fairness in policies, rules and timelines of the complaint process
- Easy access to the complaint process
What are fair procedures characterized by? (3)
Clarity
Speed
Absence of difficulties
What is the biggest cause of service switching?
Service Failure
Service recovery strategies (8)
- Act quickly
- Provide adequate explanations
- Treat customers fairly
- Cultivate relationships with customers
- Learn from recovery experiences
- Learn from lost customers
- Make the service fail-safe
- Encourage and track complaints
Service recovery strategy: make the service fail-safe (def)
Doing it right the first time. Aim at zero defects
Poka yoke (def)
a term that means ‘fail safing’ of ‘mistake proofing’. These are warnings or controls in place to ensure that mistakes are not madee
How to encourage people to make complaints (5)
*Develop the mindset that complaints are good
* Make complaining easy
* Be an active listener
* Ask customers about specific service issues
* Conduct short surveys
Lost customer research (def)
A research into why customers decide to leave a company
Guarantee (def)
A pledge that something sold by a business will perform as described and if not some form of reparation must be undertaken by the firm
Benefits of a service guarantee (7)
- Forces the company to focus on its customers
- Sets clear standards for the organization
- Generates immediate and relevant feedback from customers
- Instant opportunity to recover
- Information gathered can be tracked and integrated into improvement efforts
- Suggest that employee morale and loyalty can be enhanced
- Reduces the sense of risk to the customers
Characteristics of service guarantees (4)
- Unconditional
- Meaningful
- Easy to understand
- Easy to invoke
