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MKTG 313 - Services > EXAM 2 > Flashcards

EXAM 2 Flashcards

Chs. 6-10

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
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2
Q

the bucket theory

A

customer defection: when customers got out of a product/service

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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)
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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

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5
Q

customer pyramid

A
  • lead
  • iron
  • gold
    -platinum
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6
Q

lead

A

life suckers of org, drain on resources (time and effort)
- difficult customers
- feeling of inferiority

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7
Q

iron

A
  • spend enough
  • not brand loyal
    -“steal” in terms of effort, time
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8
Q

gold

A
  • spend money because of a motivation (coupons)
  • not brand loyal
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9
Q

platinum

A
  • do not expect discounts
  • loyal customer
  • will provide positive word of mouth
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10
Q

types of bonds

A
  • financial bonds
  • social bonds
  • customization bonds
  • structural bonds
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11
Q

financial bonds

A

cross-selling of service
- lower prices of greater volume and for customers who are loyal

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12
Q

social bonds

A

interpersonal bonds
-doctors, hair dressers, counselors, sales people

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13
Q

customization bonds

A

knowing your customer through personalization and intimate knowledge

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14
Q

structural bonds

A

the foundation to the organization
- personal sensitive, build off the other three bonds, sell to business

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15
Q

core service provision

A

switch banners
- customer inertia
-switching costs (set ups contractual, learning)

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16
Q

ending relationships

A
  • incongruent marketsegment
    -difficult customers
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17
Q

service failure

A

service performance that falls below a customers expectations in which a way that leads to customer dissatisfaction

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18
Q

service recovery

A

the action taken by an organization in response to a service failure to improve the situation for the customer

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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
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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

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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
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22
Q

WOM function of complaint satisfaction

A
  • dissatisfied customers on average tell 7 other people
  • satisfied customers after service recovery would recommend 71%
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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
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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”
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25
Q

types of complainers

A
  • passives
  • voicers
  • irates
  • activists
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26
Q

passives

A

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

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27
Q

voicers

A

“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

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28
Q

irates

A

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

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29
Q

activists

A

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

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30
Q

fixing the customer

A
  • 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!
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31
Q

fixing the problems

A
  • respond quickly
  • provide appropriate communication
  • address problem
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32
Q

strategies for fixing the problem

A
  • encourage and track complaints
  • learning from recovery experiences and for most customers
  • making the service fail-safe
33
Q

service guarantees

A

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
Q

characteristics of an effective service guarantee

A
  • limited restriction and exclusions
  • meaningful
  • easy to understand
  • easy to invoke
35
Q

benefits of service guarantees

A
  • 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
Q

when to use or not (service guarantees)

A
  • 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
Q

the design and standard gap (Gap 2)

A
  • poor service design
  • absence of customer-driven standards
    -inappropriate physical evidence and service scape
38
Q

innovation

A

a new, method, or device; the introduction of something new

39
Q

what sets innovation apart?

A
  • 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
Q

service innovation and design

A
  • challenges of service innovation and design
  • important considerations for service innovation
  • types of service innovation
  • stages in service innovation and development
41
Q

risks of relying on words alone to describe services

A
  • oversimplification
  • incompleteness
  • subjectivity
  • biased interpretation
42
Q

important consideration for service

A
  • involve customers and employees (cocreation)
  • employ service design thinking and techniques
  • the 5 principles of service design thinking:
43
Q

the 5 principles of service design thinking

A
  • 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
Q

types of services offering innovations

A
  • 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
Q

stages in service innovation and development

A
  • 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
Q

service blueprinting

A

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
Q

building a service blueprint

A
  • 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
Q

components of building a service blueprint

A
  • physical evidence
  • customer actions
  • employee actions (onstage/visible)
  • employee actions (backstage/invisible)
  • support process
49
Q

company defined standards

A

standards established to reach internal goals for productivity efficiency, cost, or technical quality

50
Q

customer defined standards

A

operational standards based on pivotal customer requirements identified by customer

51
Q

standardization of service

A

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
Q

3 forms of standardization of service

A
  • substitution of technology for personal contact and human effort
  • improvement in work methods
  • combination of these two methods
53
Q

customization of service

A

usually refers to some level of adaption or tailoring of the process to the individual customer

54
Q

hard customer defined standards

A

“quantitative”
things that can be counted, timed, or observed through audits
(wait times. delivery times, delay times)

55
Q

soft customer defined standards

A

“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
Q

one-time fixes

A

technology, policy, or procedure changes that, when instituted, address customer requirements

57
Q

physical evidence

A

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
Q

elements of physical evidence

A
  • serviscape
  • other tangibles
59
Q

serviscape

A

facility exterior
- exterior design
- signage
- parking
- landscape
- surrounding environment

facility interior
- interior design
- equipment
-signage
- layout
- air quality
- sound/scent/music/lighting

60
Q

other tangibles

A
  • business cards
  • stationary
  • billing statements
  • etc.
61
Q

how does physical evidence affect the customer experience?

A
  • flow
  • meaning
  • satisfaction
  • emotional connections to company
62
Q

package “ WRAP THE SERVICE”

A
  • the interior design
  • “packing” the business
  • facilitator - “the flow”
  • socializer “ facilitates interaction”
  • differentiator (competitive advantage)
63
Q

Lean vs. elaborate servicescape

A

Lean: simple (kiosks/vending machine)
Elaborate: complex (fine dining/hotels)

64
Q

S-OR Theory

A

Stimulus-organism-response theory

65
Q

Stimulus

A

Multidimensional environment

66
Q

Organism

A

Customers and employees

67
Q

Response

A

Behaviors directed at the environment

68
Q

Approach vs. avoidance

A

Approach : all positive behaviors that might be directed to a place (Target)

Avoidance: negative behaviors (McDonalds)

69
Q

Internal responses to the servicescape

A

-cognition (perception of the servicescape)
-emotion (servicescape can affect your mood)
-physiology (servicescape can affect your physical condition)

70
Q

Cognition

A

Environment can affect belief about a place and the people and products found in that place

71
Q

Emotion

A

Color, decor, music, scent affected mood

72
Q

Physiology

A

Volume, temperature, air quality, lighting can cause physical discomfort and even pain

73
Q

Variations in individual response

A

Personality difference
- arousal seekers vs. arousal avoiders

Purpose for being in the servicescape
- business/pleasure

Temporary mood state (antecedent states)

74
Q

environmental dimensions

A

-ambient conditions
-spatial layout and functionality
-signs, symbols, artifacts

75
Q

ambient conditions (sensory based)

A
  • temperature
  • lighting
  • noise
  • music
  • scent
    -color
76
Q

spatial layout and functionality (functionality and appeal)

A
  • accessibility
  • aesthetics
  • seating comfort
    can be physical or online
77
Q

signs, symbols, artifacts (guidance/instruction)

A
  • way-finding
  • labels
  • rules of behavior
  • creating aesthetic impressions
78
Q

Customer recovery paradox

A

Where organizations purposefully create service failure to recover from in order to boost customer loyalty

MKTG 313 - Services (2 decks)

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