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CUSTOMER PERSEPTIONS OF

SERVICES

BY

Syed Ghous Ali Shah

Email: ghousali@lrk.szabist.edu.pk

Session 4

Class BBA 7

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Customer perception

Factors which influence consumers

perceptions

Factors which influence satisfaction

Dimensions of service quality

Service encounters

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Satisfaction and Service Quality

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Factors Influencing

Customer Satisfaction

Product/service quality

Specific product or service features

Consumer emotions Attributions for service success or failure

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Factors Influencing

Customer Satisfaction

Perceptions of equity or fairness

Other consumers, family members, and

coworkers

Price

Personal factors

the customers mood or emotional state situational factors

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Outcomes of

Customer Satisfaction

Increased customer retention

Positive word-of-mouth communications

Increased revenues

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Relationship between Customer Satisfaction and

Loyalty in Competitive Industries

Source: James L. Heskett, W. Earl Sasser, Jr., and Leonard A. Schlesinger, The Service Profit Chain, (New York, NY: The Free Press, 1997), p. 83.

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Service Quality

The customers judgment of overall excellence

of the service provided in relation to the

quality that was expected.

Service quality assessments are formed on

judgments of:

outcome quality

interaction quality

physical environment quality

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The SERVQUAL dimensions

Perceived Service Quality

Reliability (dependability, accurate performance)

Assurance (competence, courtesy, credibility & security)

Tangibles (appearance of physical elements)

Empathy (easy access, good communications & customerunderstanding)

Responsiveness (promptness & helpfulness)

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The Five Dimensions of

Service Quality

Ability to perform the promised servicedependably and accurately.

Knowledge and courtesy of employees andtheir ability to inspire trust andconfidence.

Physical facilities, equipment, andappearance of personnel.

Caring, individualized attention the firmprovides its customers.

Willingness to help customers and provideprompt service.

Tangibles

Reliability

Responsiveness

Assurance

Empathy

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n Providing service as promised

n Dependability in handling customers service

problemsn Performing services right the first time

n Providing services at the promised time

n Maintaining error-free records

n Keeping customers informed as to whenservices will be performed

n Prompt service to customers

n Willingness to help customers

n Readiness to respond to customers

requests

RELIABILITY

RESPONSIVENESS

n Employees who instill confidence in customers

n Making customers feel safe in their transactions

n Employees who are consistently courteous

n Employees who have the knowledge to answercustomer questions

ASSURANCE

n Giving customers individual attention

n Employees who deal with customers in a caringfashion

n Having the customers best interest at heart

n Employees who understand the needs of theircustomers

n Convenient business hours

EMPATHY

n Modern equipment

n Visually appealing facilities

n Employees who have a neat, professionalappearance

n Visually appealing materials associated withthe service

TANGIBLES

SERVQUAL Attributes

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E-Service Quality

Efficiency

Fulfillment

Reliability Privacy

Responsiveness

Compensation Contact

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The Service Encounter is the moment of truth

occurs any time the customer interacts with thefirm

can potentially be critical in determining customersatisfaction and loyalty

types of encounters: remote encounters, phone encounters, face-to-face encounters

is an opportunity to: build trust

reinforce quality build brand identity

increase loyalty

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Check-In

Request Wake-Up Call

Checkout

Bellboy Takes to Room

Restaurant Meal

A Service Encounter Cascade

for a Hotel Visit

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Sales Call

Ordering Supplies

Billing

Delivery and Installation

Servicing

A Service Encounter

Cascade for an Industrial Purchase

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Critical Service Encounters Research GOAL:

understanding actual events and behaviors that causecustomer dis/satisfaction in service encounters

METHOD:

Critical Incident Technique

DATA:

stories from customers and employees

OUTPUT:

identification of themes underlying satisfaction anddissatisfaction with service encounters

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Sample Questions for Critical Incidents

Technique Study

Think of a time when, as a customer, you had a particularly satisfying(dissatisfying) interaction with an employee of ______________.

When did the incident happen?

What specific circumstances led up to this situation?

Exactly what was said and done?

What resulted that made you feel the interaction was satisfying(dissatisfying)?

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Common Themes in Critical

Service Encounters Research

Recovery: Adaptability:

Spontaneity:Coping:

employee responseto service delivery

system failure

employee responseto customer needs

and requests

employee responseto problem customers

unprompted andunsolicited employeeactions and attitudes

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Recovery

Acknowledge problem

Explain causes Apologize

Compensate/upgrade

Lay out options

Take responsibility

Ignore customer

Blame customer Leave customer to fend for

him/herself

Downgrade

Act as if nothing is wrong

Pass the buck

DO DONT

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Adaptability

Recognize the seriousness

of the need Acknowledge

Anticipate

Attempt to accommodate

Adjust the system

Explain rules/policies

Take responsibility

Ignore

Promise, but fail to followthrough

Show unwillingness to try

Embarrass the customer

Laugh at the customer

Avoid responsibility

Pass the buck

DO DONT

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Spontaneity

Take time

Be attentive

Anticipate needs

Listen

Provide information

Show empathy

Exhibit impatience

Ignore

Yell/laugh/swear

Steal from customers

Discriminate

DO DONT

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Coping

Listen

Try to accommodate Explain

Let go of the customer

Take customers

dissatisfaction personally Let customers

dissatisfaction affect

others

DO DONT

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Evidence of Service from the

Customers Point of View

People

ProcessPhysical

Evidence

Contact employees

Customer him/herself

Other customersOperational flow of

activities

Steps in process

Flexibility vs. standard

Technology vs. human

Tangible

communicationServicescape

Guarantees

Technology

WebsiteSource: From Managing the Evidence of Service by M. J. Bitner from The Service Quality Handbook, eds. E. E.

Scheuing and W. F. Christopher (1993), pp. 358-70. 23

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Strategies for Influencing Customer

Perceptions

Measure and manage customer satisfaction

Aim for customer quality and satisfaction in everyservice encounter

1. Plan for effective recovery

2. Facilitate adaptability and flexibility3. Encourage spontaneity

4. Help employees cope with problem customers

5. Manage the dimensions of quality at the encounter

level Manage the evidence of service to reinforce

perception

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Exercise to

Identify Service AttributesIn groups of five, choose a services industry and spend 10 minutes brainstormingspecific requirements of customers in each of the five service quality dimensions.

Be certain the requirements reflect the customers point of view.

Reliability:

Assurance:

Tangibles:

Empathy:

Responsiveness:

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