MKT203 Service Marketing

Discuss the differences and the similarities between service quality and customer satisfaction.

• Identify the gaps that influence consumer perceptions of service quality and discuss factors that influence the size of each of the service quality gaps.
• Understand the basic concepts of the SERQUAL measurement scale and how “gap scores” are calculated.
• Describe the variety of customer and noncustomer research approaches a service firm can use to construct a service quality information system.

What Is Service Quality?

The two concepts are intertwined but their relationship is unclear

– Does customer satisfaction lead to perceived service quality

– Does service quality lead to customer satisfaction?

In your groups, discuss any service gap you may have experienced as a customer.

• What were your feelings?
• What type of gap you think it was?

Answer:

Introduction

It is obvious that the level of service quality directly affects the satisfaction of customers. The connection between the two aspects is however dependent on three major components, customers, employees and the company (Demirci Orel and Kara, 2014). Building a positive image and ensuring customers are retained as well as stay loyal to a brand is a challenging task. However, with the well-structured and enthusiastic customer care department, this can easily be achieved. This report highlights and analyses a service failure I recently encountered. In this case, I had visited a certain Australia based supermarkets to do so purchases. While paying I was told my credit card did not work and so I paid with cash but later that day I noticed they had also charged the same on my credit card. On returning to claim the double charge, the customer service attendant seemed to be less concerned with my issue and insisted that I produce a receipt showing my credit card was charged. Even after showing the transaction statement showing payment to the supermarket, the attendant was still adamant to offer any help until I decided to walk straight to the manager’s office.

Analysis

Roles and scripts of the service personnel

Based on conventional business operation ethics, the customer service section is mandated with the task of receiving customer complaints and channeling them to the right departments (Bull and Adam, 2011). For this reason, the service personnel at the supermarket was supposed to give the way forward or direction as to where the issue can be solved. Furthermore, it was the responsibility of the personnel to first confirm if my claim was true and if actually there was an error when doing the transaction before insisting that a receipt is produced. Although I had a receipt for the cash transaction, the credit card had not worked at the time.

From the responses of the customer attendant, it was clear that there was no service that was forthcoming in regards to the double charge issue. Particularly, the service personnel said that “all our transactions have receipts, and unless you have one, we cannot help you”. Based on this script, it is apparent that there was a delivery gap in services in the supermarket that is mainly influenced by the unwillingness of the employee to perform. Furthermore, the service attendant showed no empathy, reliability, responsiveness or even assurance of offering services as required in any business set up (Goldsmith, 2010). For this reason, that service failure experience can be attributed to the unwillingness of the personnel to perform or incompetence in running customer service operations.

Type of complaint and root cause

Depending on the nature and the cause of a complaint, the expectation can vary from changing the situation or just having it as a recommendation so that the state can be improved. Based on the nature of my problem with the supermarket’s management, the complaint was instrumental. The primary aim of following up the matter was to have my $205 refunded since I had already paid the same amount in cash. Ideally, customer satisfaction is derived from the quality of service provided whether or not there is a problem (Ascarza et al., 2017). Since I have never had a complaint about the services of provided in the supermarket before, I can be considered as a meek customer. However, the instrumental complaint was supposed to be addressed as a discrepancy issue on the side of the supermarket but the service personnel made it develop into a failed service delivery.

The root cause of the complaint was the fact that there was a transaction discrepancy that saw my credit card charges despite paying in cash. As a meek customer, the complaint could not have escalated if the standoff was not initiated by the service personnel. Essentially, the failure would most likely occur to another customer in the future thus showing the need for stability and controllability of service delivery in the firm. The level of satisfaction for the services rendered could not have changed if the matter was followed up according to the set procedures within the supermarket. Depending on the nature of complaint on service quality, it is normal for customers to end up exiting, changing the voice from medium to high (to involve the manager) or retaliating to poor services. However, this further depends on the type of the complainer and the expectations they had prior to launching their concerns (MacDonald, 2018).

Propose Service Recovery Program and Strategy

Without a service recovery plan in the supermarket, there are chances that complaints will keep coming. This will make it challenging for the entity to retain its customers for long as well as attract potential clients (Trevino and Nelson, 2013). Therefore, it is recommended that the supermarket adopts a reimbursement strategy to solve issues relating to my complaint. In order for the double charge complaints to be effectively addressed within the business, there need to be frameworks in place to follow. Specifically, the service recovery program for the supermarket needs to follow the following five steps.

The first step should involve listening to the complaint and apologizing for the inconvenience. Second, the service personnel will proceed to authenticate the issue by confirming both transactions to ascertain the source of the problem. After it is established, any information needed from the customer will be requested to aid the solving the problem.  Depending on the severity of the inconvenience caused or injury made to the financial ability of the customer, the supermarket can do something extra to make the customer happy and satisfied with the service offered. Finally, a follow up will be needed to ensure the customer leaves satisfied.

To further aid the service recovery program, some strategies need to be implemented for the supermarket. This may include prioritizing the complaints of customers and taking charge of the whole process rather than just directing the customers to the involved department/persons. Furthermore, taking responsibility for concerns raised by the customer rather than being defensive as it was with the case of the supermarket customer service attendant. With such strategies coupled with willing employees, the supermarket can recover from any service failures within their business.

Recommendations for Maintaining Customer Loyalty and Retention

Returning customers/shoppers are critical to the success and growth of any business. Particularly the B2C (Business-to-Consumer) entities like supermarkets need more than maintaining stable customer experiences. Since the cost of maintaining the existing customers is lower than acquiring new ones, the supermarket needs to implement several strategies to ensure it retains its customers and make them loyal to the business (Robinson, Neeley and Williamson, 2011). Therefore, in line with the experience with the supermarket, the following recommendations can help them retain their customers and ensure they are loyal.

First, the supermarket should prioritize customer needs at all times without necessarily focusing on making profits. From the conversation with the service personnel, it was apparent that the supermarket was profit-oriented rather than customer-oriented. Under such circumstances, the attention accorded to the customers is usually minimal (Fullerton, 2014). Therefore, by prioritizing the customer in their operations could improve their overall service delivery as well as ensure that customer experiences enhanced. Implementation of this recommendation would not cost the supermarket anything and can be undertaken immediately.

Second, training the service attendants on best customer service practices is needed. This recommendation stems from the fact that the service personnel who showed no empathy, reliability or responsiveness to my case. With such experiences, customers may exit the business and in some cases tell the experience to others who may as well switch to another supermarket. Furthermore, since the experience, I have not shopped in that supermarket again. This illustrates how inadequate training on employees in handling customer issues can lead to an exodus of loyal customers. Ideally, this recommendation is meant to create a culture of caring and reliability that are crucial when a high customer satisfaction level is to be maintained in a business (Bull and Adam, 2011). Depending on the number of staff to be trained, the cost of implementing this recommendation can vary from approximately $500 to $1000. It can also take about four months before all the staff is fully trained and the recommendation implemented.

Lastly, the entity should incorporate an end of the after-sales survey to help in collecting information on primary pain-points of their customers. In essence, retaining customers takes to account the extensive efforts put in place to ensure they don’t struggle to get services delivered to them (Robinson, Neeley and Williamson, 2011). From the experience with the supermarket, if I had not confronted the branch manager, probably my issue would not have been solved by the customer service department. The cost of implementing such a strategy will not cost the business anything and can be implemented almost immediately.

Conclusion

Customer experience is pivotal in businesses that directly engages the consumers/ by offering them exceptional quality services, they can be retained for long making them stay loyal to the brand/business. However, without proper frameworks in place, it is possible for them to massively shift to a competitor business. With the efforts of the three basic components; employees, customers, and the company, that determine satisfaction and service quality levels, a strategy that ensures there is reliability, responsiveness, empathy, and assurance can be created.  Furthermore, if service personnel is adequately trained on how to handle customer complaints, very minimal fallouts may be recorded in any business. Essentially, if all customer service delivery fundamentals were adhered to, I would have not experienced any difficulty in solving the double-charge issue with the supermarket.

References

Ascarza, E., Neslin, S., Netzer, O., Anderson, Z., Fader, P., Gupta, S., Hardie, B., Lemmens, A., Libai, B., Neal, D., Provost, F. and Schrift, R., 2017. In Pursuit of Enhanced Customer Retention Management: Review, Key Issues, and Future Directions. Customer Needs and Solutions, vol. 5, no. 2, pp.65-81.

Bull, C. and Adam, A., 2011. Virtue ethics and customer relationship management: towards a more holistic approach for the development of ‘best practice’. Business Ethics: A European Review, vol. 20, no. 2, pp.121-130.

Demirci Orel, F., and Kara, A., 2014. Supermarket self-checkout service quality, customer satisfaction, and loyalty: Empirical evidence from an emerging market. Journal of Retailing and Consumer Services, vol. 21, no. 2, pp.118-129.

Fullerton, G., 2014. The moderating effect of normative commitment on the service quality-customer retention relationship. European Journal of Marketing, vol. 48, no. 3/4, pp.657-673.

Goldsmith, R., 2010. The Goals of Customer Relationship Management. International Journal of Customer Relationship Marketing and Management, vol. 1, no. 1, pp.16-27.

MacDonald, S., 2018. Customer Complaints: Why Angry Customers Are Good for Business. <https://www.superoffice.com/blog/customer-complaints-good-for-business/>

Robinson, L., Neeley, S. and Williamson, K., 2011. Implementing service recovery through customer relationship management: identifying the antecedents. Journal of Services Marketing, vol. 25, no. 2, pp.90-100.

Trevino, L. and Nelson, K., 2013. Managing Business Ethics: Straight Talk about How to Do It Right. 6th ed. New York: John Wiley & Sons.