Mktg208 : Marketing Management : Assessment Answers
Question:
Discuss the notion that customers are the best judges of the quality of a service process.
Choose a service organisation you are familiar with and analyse its operations from the perspective of managing customer expectations through service processes, & the way that impacts customer satisfaction, customer perceptions (value & quality), and customer retention
Purpose of this paper is to show that Why is it important to understand customer expectations and how does this relate to service design, service implementation, and customer satisfaction?
Answer:
Discuss the notion that customers are the best judges of the quality of a service process
Introduction:
Service organizations must at first know and understand their customer expectations in order to receive customer satisfaction as well as stellar customer service. According to Sengupta, Balaji and Krishnan (2015) until or unless the company knows what their customer want, what do they expect, a company cannot match up the expectations. The present report will deal with the service marketing analysis of a selected company that is Amazon. The report will proceed through various steps such as classifying the service process of the company, how does the company manages customer expectations and service standard and retention strategies. The report will finally conclude by giving an overview of the entire report and highlight on the key issues.
Discussion
Amazon is an electronic commerce company originated in Washington in the year 1994 founded by Jeff Bezos. In terms of market capitalization, it is the biggest internet retailer and revenue collector in this industry (Amazon.com 2018). The company actually began with selling online books but later included software, electronics, video games, furniture, apparel, jewelry, toys and food also. The company also serves by providing the largest cloud infrastructure services.
Classifying the service process- In the beginning the company sold books only. Today it has become a market titan of logistics services, e –commerce business, media and data storage. The company deals with many more industries. The shoppers and the merchants both prefer this site because it is the largest medium for selling and buying of products(Amazon.com 2018). Amazon has almost 85 million subscribers in the US, which is equivalent to the 2/3rd of the American population. Therefore, it is not merely an e-commerce company it is a global platform for business industries where customers can avail their desired products at reasonable price and the merchants can also get their customers by just using the Amazon website(Amazon.com 2018). The service Amazon company provides do not involve simultaneous production and consumption. The customer does not need to be present physically at the time of production as suggested by Harmeling et al. (2015). The company takes care that they can deliver the product without any damage that will satisfy the customers otherwise their confidence in the service will be lost.
The goods that area sold via Amazon are tangible but the services process of Amazon are non-tangible(Amazon.com 2018). The company serves globally and delivers products throughout the world. The company is serves online to China, Japan, Australia, UK, India and any other countries(Amazon.com 2018). The customized service type of the company attracts more customers. The customized services are those services which are flexible, user friendly and can change or modify according to the customer preferences. Amazon provides seasonal discounts for the customers and also delivers the products on specific timings preferred by the customers. The service process of Amazon is discrete because Amazon deals with the assembly of products which is designed under the discrete system(Amazon.com 2018). In order to run the operations, a company needs to choose a system. The continuous system is basically concerned with the blending of formulas. The discrete on the other hand looks after the assembly of products. The major task that Amazon company does is it assembles the products in an order and then delivers them to the customers.
The service process of Amazon company can be classified as possession processing because the service requires minimum customer engagement. The only work that the customer has to do is to choose the product from the website of the company and make the payments either via online or via cash on delivery. The rest of the work is done by the company regarding from where to pick the product and how to deliver the product to the customer. On the other hand, people processing the customers are supposed to be present at the service factory to avail the services.
Dong et al. (2015) introduces that those customer services that are conducted via personal contact with the customers is called the high-touch customer service whereas if the customer service is mostly done by automated phone systems or through online service portals to respond to the queries of the customer, that is called the high-tech service. In this respect Amazon can be considered as having the high-touch customer services. Although the company uses automated phone systems for the purpose of making online payment, tracking the delivery, choosing the time of delivery and online message dropping, the company representatives also talk to the customers personally over the phone if the customer has any queries or issues related to any purchase(Amazon.com 2018). The Amazon company customer service centers are spread all around the world. The centers are in Africa (Cape Town), Europe (UK and Edinburg), Central America (Costa Rica and San Jose) and in many countries.
Managing Customer Expectations - As suggested by Ascarza et al. (2018) the role of critical incidents is significant because it provides information regarding how the service is benefiting the customers, what are the strengths, what are the weaknesses, how they need to be resolved. It helps to see the service from the viewpoint of the customers and gives space for improvement. The company can advance the customer services to reduce customer dissatisfaction. During any critical incident the Amazon company follows the required methods to deal with the situation. The company tries its best to restore and repair the damage, responding to the customer queries as quick as possible. They know that during such situations they are not likely to deny or blame anyone rather maintain their honesty and transparency with the customers(Amazon.com 2018). The role and script theory is important in determining the customer behaviors and experience during the service encounter supports Jaakkola and Alexander (2014).
The moments of truth metaphor along with the role and script theory helps to effectively communicate and create an environment desired by the customers. However according to Pérez and Rodriguez del Bosque (2015) moments of truth are those points in a relationship between the company and the customers where the company has the opportunity to earn loyalty of the customers by engaging with them as much as possible. The company can know those point by focusing on the customer expectation. The company is supposed to play their roles after recognizing that moment of truth. The role theory is that set of behaviors learned by communication and experience. On the other hand, script theory is the sequence of action that are to be performed to meet the customer expectations. The Amazon company set a customer journey map to know the journey of each of their customer in their company which helps them to understand what is the ‘moment of truth’ with of their customers and how they are supposed to play their role in that case(Amazon.com 2018).
The service quality declines when the customer do not get what has been promised by the company. The worst mistake conducted by a company is to over –promise and under-deliver. N. Bolton et al. (2014) on the other hand supports the view that it is better to promise nothing than to elevate the hopes of the customer and never fulfil that. It may either create frustration among the customers or drive them towards the market competitors. The Amazon company is much concerned with this issue and only promises the customers what is realistic. They coordinate external communication, offer service guarantee and ensure that the delivery meets or exceeds the expectations(Amazon.com 2018).
Service Standards & Retention Strategies- The customer service standards are a set of expectations or policies a company has adopted. These standards help to decide while deals how the customer wants to be treated or what are their standards of services against which they would judge the company services. In this respect Blut et al. (2014) is of the opinion that most of the times the customers buy products and get inspired for future purchase based on their emotions rather than reason. The Amazon company never stays back in this matter. The members of the company adopt the specific behaviors and actions to meet the customer standards. The company representatives at first becomes aware of the problem or need. In the next step they search for the best possible ways of resolving the problem keeping in terms of the customer standards and lastly decide to adopt the best measure to the issue(Amazon.com 2018).
As far as customer retention strategies are concerned Amazon company holds some extraordinary qualities. Their main focus is on customer centricity. They never fail to attend their customer queries. They try their best not to lose their customers at any cost. In every way they show by their actions that they really care for their customers by delivering the exact product at exact place and exact time. Shopping via Amazon has become easy for the website is easy to handle, the customers avail attractive Amazon discounts and best quality product as compared to the market(Amazon.com 2018). The excellent and fast customer service and problem solving nature of the company ties the customers and stops them from going for other options. They adopt the customer standards and serve accordingly. The company binds the customers with their loyalty, honesty, quality and commitment to them. The customers feel free to invest and deal with this e-commerce goliath who have been continuing to serve the best since the year 1994(Amazon.com 2018).
Conclusion:
Therefore, from the above discussion it can be concluded that knowing customer expectations are extremely important for the service organizations to mold their service strategies according to them and customize their product and services keeping in terms of the customer desires. The above report provided an analytical description on what are the grounds based on which companies can know and evaluate the customer expectations and play strategically to get the competitive edge over their competitors. The Amazon company is an ideal example of how companies should keep the practice of asking their customers about their preferences and expectations, whether they have been able to meet their expectations by their services and products. The service organizations must be aware that the customer expectations are increasing fast and if they stay back from meeting their expectations, they will inevitably face customer attrition.
Reference:
Amazon.com 2018. Amazon.com: Online Shopping for Electronics, Apparel, Computers, Books, DVDs & more. [online] Amazon.com. Available at: https://www.amazon.com/ [Accessed 19 Sep. 2018].
Ascarza, E., Neslin, S.A., Netzer, O., Anderson, Z., Fader, P.S., Gupta, S., Hardie, B.G., Lemmens, A., Libai, B., Neal, D. and Provost, F., 2018. In Pursuit of Enhanced Customer Retention Management: Review, Key Issues, and Future Directions. Customer Needs and Solutions, 5(1-2), pp.65-81.
Blut, M., Beatty, S.E., Evanschitzky, H. and Brock, C., 2014. The impact of service characteristics on the switching costs–customer loyalty link. Journal of Retailing, 90(2), pp.275-290.
Dong, Y., Liao, H., Chuang, A., Zhou, J. and Campbell, E.M., 2015. Fostering employee service creativity: Joint effects of customer empowering behaviors and supervisory empowering leadership. Journal of Applied Psychology, 100(5), p.1364.
Harmeling, C.M., Palmatier, R.W., Houston, M.B., Arnold, M.J. and Samaha, S.A., 2015. Transformational relationship events. Journal of Marketing, 79(5), pp.39-62.
Jaakkola, E. and Alexander, M., 2014. The role of customer engagement behavior in value co-creation: a service system perspective. Journal of service research, 17(3), pp.247-261.
- Bolton, R., Gustafsson, A., McColl-Kennedy, J., J. Sirianni, N. and K. Tse, D., 2014. Small details that make big differences: radical approach to consumption experience as a firm's differentiating strategy. Journal of Service Management, 25(2), pp.253-274.
Pérez, A. and Rodriguez del Bosque, I., 2015. Corporate social responsibility and customer loyalty: exploring the role of identification, satisfaction and type of company. Journal of Services Marketing, 29(1), pp.15-25.
Sengupta, A.S., Balaji, M.S. and Krishnan, B.C., 2015. How customers cope with service failure? A study of brand reputation and customer satisfaction. Journal of Business Research, 68(3), pp.665-674.
