Customer Satisfaction and Service Quality

Question 1

LO1: Define customer satisfaction and quality in the service industry

Answer 1

Customer satisfaction is consumers post-purchase evaluation of the overall service experience. It is an affective emotional state or feeling reaction reflecting the extent to which the consumer’s needs, desires and expectations during the course of the service experience have been met or exceeded.

Question 2

LO1: (CONTINUED)

Answer 2

• Herzberg Two-Factor theory: motivator vs hygiene factors –> you would expect parking at the local health clinic (hygiene factor), but you desire helpful doctors to get satisfied (motivator)
• Halo Effect –> customer may transfer an impression of one aspect of the product orservice to the whole brand or organisation –> highlights the importance of consistency
• Types of customer expectations: desired: best circumstance, equitable: what they should receive, predictive: realistic and acceptable level of expectation, adequate: the lowest level of tolerated service.
• The zone of indifference is the area between consumer’s desired state and adequate minimum expectations.

Question 3

LO2: Explain the significance of customer satisfaction in achieving a competitive advantage

Answer 3

Customer satisfaction and service quality can:

• Insulate customers from competition
• Create a sustainable competitive advantage
• Reduce failure costs
• Encourage repeat patronage and loyalty
• Enhance/promote positive word of mouth
• Lower cost of attracting new customers

Question 4

LO3: Describe various models of customer satisfaction and quality

Answer 4

SERVQUAL Model: 1. Tangibles, 2. Reliability, 3. Responsiveness, 4. Assurance, 5. Empathy

Question 5

What is the perceived value model?

Answer 5

Perceived value is derived from: performance value, social value, emotional value, interaction value and price.

Question 6

LO5: List the major drivers for determinants of customer satisfaction and perceived quality in services

Answer 6

Under promise and overdeliver!

Hofstede’s

SERVQUAL

Question 7

LO6: Describe how to measure and monitor customer satisfaction

Answer 7

• Surveys, customer feedback, customer satisfaction score (e.g. OTR)