Chapter 3: Consumer perceptions of services

Question 1

Discuss the major determinants of customer satisfaction for services ! What sources of (dis)satisfaction are distinguished for different service encounters?

Answer 1

There are several determinants in order to get satisfied customers:

• Features = all characteristics, benefits, … of the service and how well they cover the needs and expectations of the customers.
• Emotions = The emotional state or mood of the customer can determine how the service is perceived and experienced and can therefore influence the satisfaction of said customer.
• Attributions for service failure and success = Will the customer attribute the success or failure of the service delivery to themselves or the service provider? For example: You buy a closet in Ikea, but you are really bad at putting it together and you make a total mess. Then there are 2 types of reactions: you either attribute the failure to yourself and acknowledge that you simply suck at it OR you attribute the failure to Ikea because their manuals are unclear, their materials suck, … These two types of customers will have completely different levels of satisfaction of the Ikea closet.
• Perceptions of equity & fairness = If something goes wrong, customers want to be understood and helped in a fair and equitable manner. This is a very delicate matter, especially when there are other customers that are also being helped. For example: airport, missed flight and all customers before you are being helped and booked to other flights while you are not. Customer satisfaction will be totally different in these cases.
• Consumers, family members & coworkers = people’s judgement heavily depends on the word of mouth of people in their network.

Question 2

Explain the concept of the Net Promotor Score!

Answer 2

A single survey question asking respondents to rate the likelihood that they would recommend a company, product, or a service to a friend or colleague.
The NPS assumes a subdivision of respondents into “Promoters” who provide ratings of 9 or 10, “Passives” who provide ratings of 7 or 8, and “Detractors” who provide ratings of 6 or lower. Usually, users of the NPS perform a calculation that involves subtracting the proportion of Detractors from the proportion of Promoters collected by the survey item.

Question 3

Explain the major sources of pleasure and displeasure in Service encounters?

Answer 3

There are 4 common sources of (dis)pleasure in service encounters:

• Recovery = How do employees deal with system failures in the service delivery process?
• Adaptability = To what extent is the service provider able to address the needs of the customer?
• Coping = How employees deal with customers that have experienced issues (= angry customers)?
• Spontaneity = How do employees respond to unforeseen circumstances?

Question 4

How do satisfaction and service quality relate to one another ? How do they finally relate to profitability and what are their major antecedents ?

Answer 4

Customer (dis)satisfaction is influenced by 5 factors:
- Service quality and all its dimensions (reliability, tangibility, responsiveness, assurance and empathy)
- Product quality = quality of the tangible elements surrounding the service
- Price = the price sets the expectation level and when the service delivery is better or worse than expected, the customer can be satisfied or dissatisfied (resp.).
- Situational factors = who did the service delivery? Was it too busy? Too warm? …
- Personal factors = how well did they co-operate? How well is the fit between customer and service? …
Satisfied customers become loyal customers and loyal customers tend to be more profitable.

Question 5

What are the 5 quality dimensions found by Zeithaml et. al. following their Servqual-research ? Explain ?

Answer 5

Reliability = delivering on promises
- Providing service as promised dependably and accurately
- Dependability in handling customers’ service problems
- Performing services right the first time
- Providing services at the promised time
Assurance = inspiring trust & confidence
- Employees who inspire trust and confidence
- Making customers feel safe in their transactions
- Employees who are consistently courteous
- Employees who have the knowledge to answer customer questions
Tangibles = representing the service physically
- Modern equipment
- Visually appealing facilities
- Employees who have a neat, professional appearance
- Visually appealing physical and virtual materials associated with the service
Empathy = treating customers as individuals
- Giving customers individual attention
- Employees who deal with customers in a caring fashion
- Having the customer’s best interest at heart
- Employees who understand the needs of their customers
- Convenient business hours
Responsiveness = being willing to help
- Keeping customers informed as to when services will be performed
- Prompt service to customers
- Willingness to help customers
- Readiness to respond to customers’ requests.

Question 6

What are the main service quality dimensions indicated for e-services ?

Answer 6

Service quality evaluation boils down to 4 core service evaluations:

• Efficiency = The ability of customers to get to the website, find products and information (e.g. is the website easily accessible and is it easy to navigate the site?)
• Fulfillment = The accuracy of service promises, having products in stock, and delivering as promised (e.g. ability of the website to live up to their promises).
• Reliability = The technical functioning of the site, the extent to which it is available and functioning properly (e.g. is the website functional?)
• Privacy = The assurance that shopping behaviour data are not shared and that the information is secure (e.g. is the website safe? Is it safe to share personal information?)

Service recovery evaluation is also important (discussed in following chapters):

• Responsiveness
• Compensation (not always money, but an apology is also good).
• Contact

Question 7

What type of questions need to be asked to guarantee a successful implementation of the “critical incident technique”. Moreover, discuss the type of service encounters!

Answer 7

Critical incident technique = a research method in which the research participant is asked to recall and describe a time when a behavior, action, or occurrence impacted (either positively or negatively) a specified outcome (for example, the accomplishment of a given task).
Examples of questions that need to be asked in these methods:
- Think of a time when, as a customer, you had a particularly satisfying (dissatisfying) interaction with: ______________.
- When did the incident happen?
- What specific circumstances led up to this situation?
- Exactly what did the employee (or firm member) say or do?
- What resulted that made you feel the interaction was satisfying (or dissatisfying)?
- What could or should have been done differently?

Question 8

What is satisfaction and what factors play a role in how satisfied customers are?

Answer 8

Satisfaction is the customer’s evaluation of a product or service in terms of whether that product or service has met the customer’s needs and expectations. Failure to meet needs and expectations is assumed to result in dissatisfaction with the product or service
Customer (dis)satisfaction is influenced by 5 factors:
- Service quality and all its dimensions (reliability, tangibility, responsiveness, assurance and empathy)
- Product quality = quality of the tangible elements surrounding the service
- Price = the price sets the expectation level and when the service delivery is better or worse than expected, the customer can be satisfied or dissatisfied (resp.).
- Situational factors = who did the service delivery? Was it too busy? Too warm? …
- Personal factors = how well did they co-operate? How well is the fit between customer and service? …