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Customer Defined Service StandardsPhysical Evidence and the Servicescape
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Many schools of thought, but only one school of Marketing.
School of Marketing
Advanced Services Marketing (MARK 5065)
Study Period 3, 2008
Many schools of thought, but only one school of Marketing.
School of Marketing
Lecture 6
Customer Defined Service Standards
Physical Evidence and the Servicescape
Many schools of thought, but only one school of Marketing.
School of Marketing
Objectives
the difference between company-defined and customer-defined service standards.
the critical role of the service encounter sequence in developing customer-defined standards
the profound impact of physical evidence, particularly the servicescape, on customer perceptions and experiences.
the differences in types of servicescapes, the roles played by the servicescape, and the implications for strategy.
Many schools of thought, but only one school of Marketing.
School of Marketing
Company-defined and customer-defined service standards
Company ‑ defined standards are establish to reach internal company goals for promoting productivity, efficiency, cost and technical quality.
Customer ‑ defined service standards are visible to and measured by customers and are not sufficient to bring effectiveness to an organization.
Many schools of thought, but only one school of Marketing.
School of Marketing
Types of Customer-Defined Service Standards
Hard Customer-Defined Standards
things that can be counted, timed, or observed through audits
Soft Customer-Defined Standards
Opinion based measures that cannot be directly observed
As Einstein said, “ Not everything that counts can be counted, and not everything that can be counted, counts.”
Many schools of thought, but only one school of Marketing.
School of Marketing
Exhibit 10.1
Examples of Hard Customer-Defined Standards
Many schools of thought, but only one school of Marketing.
School of Marketing
Exhibit 10.2
Examples of Soft Customer-Defined Standards
Many schools of thought, but only one school of Marketing.
School of Marketing
Exercise for Creating Customer-Defined Service Standards
Form a group of four people
Use your school’s undergraduate or graduate program, or an approved alternative
Complete the customer-driven service standards importance chart
Establish standards for the most important and lowest-performed behaviors and actions
Be prepared to present your findings to the class
Many schools of thought, but only one school of Marketing.
School of Marketing
Customer-Driven Standards and Measurements Exercise
Service Encounter Customer Requirements Measurements
ServiceQuality
Many schools of thought, but only one school of Marketing.
School of Marketing
Figure 10.3
What Customers Expect: Getting to Actionable Steps
SatisfactionRelationship
Reliability EmpathyAssurance TangiblesResponsiveness Price
Delivers on timeReturns calls quicklyKnows my industry
Delivers by WednesdayReturns calls in two hoursKnows strengths of my
competitors
Requirements:Abstract
Concrete
Dig deeper
Dig deeper
Dig deeper
Diagnosticity:Low
High
General concepts
Dimensions
Behaviors and actions
Attributes
ValueSolution Provider
Many schools of thought, but only one school of Marketing.
School of Marketing
Figure 10.4 - Process for Setting Customer-Defined Standards
1. Identify existing or desired service encounter sequence
2. Translate customer expectations into behaviors/actions2. Translate customer expectations into behaviors/actions
4. Set hard or soft standards
5. Develop feedback mechanisms5. Develop feedback mechanismsMeasure by
audits oroperating data
Hard Soft
Measure bytransaction-
based surveys
3. Select behaviors/actions for standards3. Select behaviors/actions for standards
6. Establish measures and target levels6. Establish measures and target levels
7. Track measures against standards7. Track measures against standards
8. Provide feedback about performance to employees8. Provide feedback about performance to employees
9. Update target levels and measures9. Update target levels and measures
Many schools of thought, but only one school of Marketing.
School of Marketing
Objectives for Chapter 11:Physical Evidence and the Servicescape
Explain the profound impact of physical evidence, particularly the servicescape, on customer perceptions and experiences.
Illustrate differences in types of servicescapes, the roles played by the servicescape, and the implications for strategy.
Explain why the servicescape affects customer and employee behavior, using a framework based in marketing, organizational behavior, and environmental psychology.
Present elements of an effective physical evidence strategy.
Many schools of thought, but only one school of Marketing.
School of Marketing
Physical evidence
Physical evidence is 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.
Physical evidence includes the servicescape, a term used to describe the physical facility where the service is produced and/or delivered.
Many schools of thought, but only one school of Marketing.
School of Marketing
Table 11.1
Elements of Physical Evidence
Servicescape Other tangibles Facility exterior Exterior design Signage Parking Landscape Surrounding environment
Facility interior Interior design Equipment Signage Layout Air quality/temperature
Business cards Stationery Billing statements Reports Employee dress Uniforms Brochures Web pages Virtual servicescape
Many schools of thought, but only one school of Marketing.
School of Marketing
Table 11.2
Examples of Physical Evidence fromthe Customer’s Point of View
Many schools of thought, but only one school of Marketing.
School of Marketing
Table 11.3
Typology of Service Organizations Based on Variations in Form and Use of the Servicescape
Servicescape usage
Elaborate Lean
Self-service (customer only)
Golf course eBay
ATM Car wash Simple Internet services Express mail drop-off
Interpersonal services (both customer and employee)
Hotel Restaurant Health clinic Hospital Bank Airline School
Dry cleaner Retail cart Hair salon
Remote service (employee only)
Telephone company Insurance company Utility Many professional services
Telephone mail-order desk Automated voice messaging
services
Many schools of thought, but only one school of Marketing.
School of Marketing
Roles of the Servicescape
Package conveys expectations influences perceptions
Facilitator facilitates the flow of the service delivery process
• provides information (how am I to act?)• facilitates the ordering process (how does this work?)• facilitates service delivery
Socializer facilitates interaction between:
• customers and employees• customers and fellow customers
Differentiator sets provider apart from competition in the mind of the consumer
Many schools of thought, but only one school of Marketing.
School of Marketing
Figure 11.2
A Framework for Understanding Environment-User Relationships in Service Organizations
Source: M. J. Bitner, “Servicescapes: The Impact of Physical Surroundings on Customers and Employees,” Journal of Marketing 56 (April 1992), 57–71.
Many schools of thought, but only one school of Marketing.
School of Marketing
Guidelines for Physical Evidence Strategy
Recognize the strategic impact of physical evidence.
Blueprint the physical evidence of service.
Clarify strategic roles of the servicescape.
Assess and identify physical evidence opportunities.
Be prepared to update and modernize the evidence.
Work cross-functionally.
Many schools of thought, but only one school of Marketing.
School of Marketing
Many schools of thought, but only one school of Marketing.
School of Marketing
Questions???