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Services Marketing2821
Services Marketing2821
SM
Services Marketing
SM
SM
Chapter 1
INTRODUCTION
TO
SERVICES
SM Introduction
Tangible
Dominant Fast-food
Outlets
Advertising
Agencies
Airlines
Investment
Management
Consulting
Contact: +923006641921 Usman Waheed
Teaching
Figure 1-2 9
SM Percent of
U.S. Labor Force by Industry
80
70
Percent of GDP
60
50
40
30
20
10
0 Services
1929 1948 1969 1977 1984 1996 Manufacturing
Mining & Agriculture
Yea
r
Source: Survey of Current Business, April 1998, Table B.8, July 1988, Table 6.6B, and
July 1992, Table 6.4C; Eli Ginzberg and George J. Vojta, The Service Sector of the U.S.
Economy, Scientific American, 244,3 (1981): 31-39.
Contact: +923006641921 Usman Waheed
Figure 1-3 10
70
60
50
40
30
20
10
0
1948 1959 1967 1977 1987 1996 Services
Manufacturing
Year Mining & Agriculture
Source: Survey of Current Business, August 1996, Table 11, April 1998, Table
B.3; Eli Ginzberg and George J. Vojta, The Service Sector of the U.S.
Economy, Scientific American, 244,3 (1981): 31-39.
Contact: +923006641921 Usman Waheed
11
Differences Between
SM
Goods and Services
Intangibility Heterogeneity
Simultaneous
Production Perishability
and
Consumption
SM Implications of Intangibility
SM Implications of Heterogeneity
SM Implications of Perishability
SM Table 1-2
Services are Different
Goods Services Resulting Implications
Tangible Intangible Services cannot be inventoried.
Services cannot be patented.
Services cannot be readily displayed or communicated.
Pricing is difficult.
Standardized Heterogeneous Service delivery and customer satisfaction depend on
employee actions.
Service quality depends on many uncontrollable factors.
There is no sure knowledge that the service delivered
matches what was planned and promoted.
Production Simultaneous Customers participate in and affect the transaction.
separate from production and Customers affect each other.
consumption consumption Employees affect the service outcome.
Decentralization may be essential.
Mass production is difficult.
Nonperishable Perishable It is difficult to synchronize supply and demand with
services.
Services cannot be returned or resold.
Source: Adapted from Valarie A. Zeithaml, A. Parasuraman, and Leonard L. Berry, Problems and Strategies in Services Marketing,
Journal of Marketing 49 (Spring 1985): 33-46.
Internal External
Marketing Marketing
enabling the setting the
promise promise
Technology
Providers Customers
Product
Price
Place
Promotion
People
Process
Physical Evidence
Contact: +923006641921 Usman Waheed
23
Table 1-3
SM Expanded Marketing Mix for
Services
PRODUCT PLACE PROMOTION PRICE
Physical good Channel type Promotion Flexibility
features blend
Other tangibles
SM
Part 1
CUSTOMER Expected
Service
Customer
Gap
Perceived
Service
External
COMPANY Service Delivery Communications
GAP 4 to Customers
GAP 1 GAP 3
Customer-Driven Service
Designs and Standards
GAP 2
Company Perceptions of
Consumer Expectations
Part 1 Opener
29
Gaps Model of Service
SM
Quality
Customer Gap:
difference between expectations and
perceptions
Provider Gap 1:
not knowing what customers expect
Provider Gap 2:
not having the right service designs and
standards
Provider Gap 3:
not delivering to service standards
Provider Gap 4:
Part 1 Opener
not matching performance to promises
30
Expected
Service
GAP
Perceived
Service
Part 1 Opener
31
SM
Chapter 2
CONSUMER BEHAVIOR
IN SERVICES
32
Objectives for Chapter 2:
SM Consumer Behavior in
Services
Overview the generic differences in consumer behavior
between services and goods
Introduce the aspects of consumer behavior that a
marketer must understand in five categories of consumer
behavior:
Information search
Evaluation of service alternatives
Service purchase and consumption
Postpurchase evaluation
Role of culture
33
SM Consumer Evaluation
Processes for Services
Search Qualities
attributes a consumer can determine prior to
purchase of a product
Experience Qualities
attributes a consumer can determine after purchase
(or during consumption) of a product
Credence Qualities
characteristics that may be impossible to evaluate
even after purchase and consumption
34
Figure 2-1
SM Continuum of Evaluation for
Different Types of Products
Most Most
Goods Services
Easy to evaluate
Difficult to evaluate
Clothing
Jewelry
Furniture
Houses
Automobiles
Restaurant meals
Vacations
Haircuts
Child care
Television repair
Legal services
Root canals
Auto repair
Medical diagnosis
{
{
High in search
qualities
High in experience High in credence
qualities qualities
{
Figure 2-2 35
Categories in Consumer
SM Decision-Making and Evaluation of
Services
Information Evaluation of
Search Alternatives
Use of personal sources Evoked set
Perceived risk Emotion and mood
Information Evaluation of
Search Alternatives
Use of personal sources Evoked set
Perceived risk Emotion and mood
Culture
Values and attitudes
Manners and customs
Material culture
Aesthetics
Educational and social
institutions
SM Information search
SM Perceived Risk
SM Evoked Set
SM Service Provision as
Drama
Authenticity
Caring
Control Courtesy
Formality
Friendliness
Personalization
Promptness
43
SM
Chapter 3
CUSTOMER
EXPECTATIONS OF
SERVICES
SM DEFINITIONS
Zone of
Tolerance
Adequate Service
SM Figure 3-2
Desired Service
Zone of
Tolerance
Adequate Service
Level
of
Zone of Desired
Expectation Desired Service
Tolerance Service
Adequate Service
Zone
of
Tolerance
Adequate
Adequate Service
Service
First-Time Service
Outcome
Process
Recovery Service
Outcome
Process
LOW HIGH
Expectations
Source: Parasuraman, Berry and Zeithaml (1991)
Contact: +923006641921 Usman Waheed
Figure 3-5 50
Enduring Service
Intensifiers
Desired
Service
Personal Needs
Zone
of
Tolerance
Adequate
Service
SM
Desired
Perceived Service Service
Alternatives
Zone
of
Tolerance
Self-Perceived
Service Role Adequate
Service
Situational
Factors
Contact: +923006641921 Usman Waheed
53
SM
Implicit Service
Promises
Desired Word-of-Mouth
Service
Zone
Past Experience
of
Tolerance
Adequate Predicted
Service Service
Contact: +923006641921 Usman Waheed
55
SM
Chapter 4
CUSTOMER
PERCEPTIONS OF
SERVICE
56
Objectives for Chapter 4:
SM Customer Perceptions of
Service
Provide you with definitions and
understanding of customer satisfaction and
service quality
Show that service encounters or the
moments of truth are the building blocks of
customer perceptions
Highlight strategies for managing customer
perceptions of service
Figure 4-1 57
Customer Perceptions of
SM
Service Quality and
Customer Satisfaction
Reliability Situational
Factors
Responsiveness Service
Quality
Assurance
Customer
Empathy Satisfaction
Product
Quality
Tangibles
Personal
Price Factors
58
Factors Influencing
SM
Customer Satisfaction
Product/service quality
Product/service attributes or features
Consumer Emotions
Attributions for product/service success or
failure
Equity or fairness evaluations
59
Outcomes of
SM
Customer Satisfaction
80%
60%
40%
20%
0%
Very Dissatisfied Neither Satisfied Very
dissatisfied satisfied nor satisfied
dissatisfied
Satisfaction measure
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.
61
SM Service Quality
SM Exercise to
Identify Service Attributes
In groups of five, choose a services industry and spend 10 minutes
brainstorming specific 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:
64
SERVQUAL Attributes
SM ASSURANCE
Employees who instill confidence in
customers
Making customers feel safe in their
transactions
RELIABILITY Employees who are consistently courteous
Employees who have the knowledge to answe
Providing service as promised customer questions
Dependability in handling customers
service problems EMPATHY
Performing services right the first time Giving customers individual attention
Providing services at the promised time Employees who deal with customers in a
Maintaining error-free records caring fashion
Having the customers best interest at heart
RESPONSIVENESS Employees who understand the needs of
their customers
Keeping customers informed as to Convenient business hours
when services will be performed TANGIBLES
Prompt service to customers Modern equipment
Willingness to help customers Visually appealing facilities
Readiness to respond to customers Employees who have a neat,
requests professional appearance
Visually appealing materials
associated with the service
65
SM A Service Encounter
Cascade for a Hotel Visit
Check-In
Restaurant Meal
Checkout
Figure 4-5 67
A Service Encounter
SM
Cascade for an Industrial
Purchase
Sales Call
Servicing
Ordering Supplies
Billing
68
Critical Service Encounters
SM
Research
Recovery: Adaptability:
Employee Response Employee Response
to Service Delivery to Customer Needs
System Failure and Requests
Coping: Spontaneity:
Employee Response Unprompted and
to Problem Customers Unsolicited Employee
Actions and Attitudes
71
SM Recovery
DO DONT
Acknowledge problem Ignore customer
Explain causes Blame customer
Apologize Leave customer to
Compensate/upgrade fend for him/herself
Lay out options Downgrade
Take responsibility Act as if nothing is
wrong
72
SM Adaptability
DO DONT
Recognize the Promise, then fail to
seriousness of the need follow through
Acknowledge Ignore
Anticipate Show unwillingness to
Attempt to try
accommodate Embarrass the customer
Explain rules/policies Laugh at the customer
Take responsibility Avoid responsibility
Exert effort to
accommodate
73
SM Spontaneity
DO DONT
Take time Exhibit impatience
Be attentive Ignore
Anticipate needs
Yell/laugh/swear
Listen
Provide information
Steal from or cheat a
(even if not asked) customer
Treat customers fairly Discriminate
Show empathy Treat impersonally
Acknowledge by name
74
SM Coping
DO DONT
Listen Take customers
Try to accommodate dissatisfaction
Explain personally
Let customers
Let go of the customer
dissatisfaction affect
others
75
Figure 4-6
SM Evidence of Service from the
Customers Point of View
Contact employees
Customer him/herself
Operational flow of Other customers
activities
People
Steps in process
Flexibility vs.
standard
Technology vs. Physical Tangible
human Process
Evidence communication
Servicescape
Guarantees
Technology
76
SM
Part 2
LISTENING TO
CUSTOMER
REQUIREMENTS
77
SM Provider GAP 1
CUSTOMER
Expected
Service
GAP 1
Company
COMPANY Perceptions of
Consumer
Expectations
Part 2 Opener
78
SM
Chapter 5
UNDERSTANDING
CUSTOMER
EXPECTATIONS AND
PERCEPTIONS THROUGH
MARKETING RESEARCH
79
Objectives for Chapter 5:
SM Understanding Customer Expectations
and Perceptions through
Marketing Research
Present the types of and guidelines for marketing
research in services
Show the ways that marketing research information
can and should be used for services
Describe the strategies by which companies can
facilitate interaction and communication between
management and customers
Present ways that companies can and do facilitate
interaction between contact people and management
80
8
O O O O
O
6
0
Reliability Responsiveness Assurance Empathy Tangibles
Low
Leverage
Attributes to Maintain Attributes to De-emphasize
LOW
HIGH
Performance
87
SM
Chapter 6
BUILDING
CUSTOMER
RELATIONSHIPS
88
Objectives for Chapter 6:
SM Building Customer
Relationships
SM Relationship Marketing
Assumptions
Income
Expected Customer Lifetime
Average Revenue (month/year)
Other Customers convinced via WOM
Employee Loyalty??
Expenses
Costs of Serving Customer Increase??
91
SM
A Loyal Customer is One Who...
Shows Behavioral Commitment
buys from only one supplier, even though other options
exist
increasingly buys more and more from a particular
supplier
provides constructive feedback/suggestions
Exhibits Psychological Commitment
wouldnt consider terminating the relationship--
psychological commitment
has a positive attitude about the supplier
says good things about the supplier
92
SM Customer Goals of
Relationship Marketing
Enhancing
Retaining
Satisfying
Getting
Figure 6-3 98
Employee Loyalty
99
Figure 6-5
SM Steps in Market Segmentation
and
Targeting for Services
IV.
Excellent
Quality II.
Joint Structural Personal
Investments and Social Relationships
Bonds
Value Bonds
Anticipation/ Customer
Innovation Intimacy
Mass
Customization
101
SM
Chapter 7
SERVICE RECOVERY
102
Objectives for Chapter 7:
SM Service Recovery
SM Unhappy Customers
Repurchase Intentions
Unhappy Customers Who Dont Complain 9%
Unhappy Customers Who Do Complain 37%
19%
Complaints Not Resolved
46%
54%
Complaints Resolved
70%
SM Customer Response
Following Service Failure
Service Failure
Act Quickly
Service
Learn from
Lost Custom
Recovery
Strategies
ers
y
airl
F
Le s
er
Re arn f om
co rom t
ve
ry Cus
Ex t
pe r ea
rie T
nc
es
Pricing
106
High Price
Price Increases
Figure 7-6
Inconvenience
Location/Hours
Wait for Appointment
Wait for Service
Switching
Core Service Failure
Service Mistakes
Billing Errors
Service Catastrophe
Competition
Found Better Service
Ethical Problems
Cheat
Hard Sell
Unsafe
Conflict of Interest
Involuntary Switching
Customer Moved Source: Sue Keaveney
Provider Closed
107
SM Service Guarantees
SM Service Guarantees
SM Service Guarantees
SM
Part 3
ALIGNING STRATEGY,
SERVICE DESIGN
AND STANDARDS
113
SM
Provider GAP 2
CUSTOMER
COMPANY Customer-Driven
Service Designs and
Standards
GAP 2
Company
Perceptions of
Consumer
Expectations
Part 3 Opener
114
SM
Chapter 8
SERVICE DEVELOPMENT
AND DESIGN
Objectives for Chapter 8: 115
Oversimplification
Incompleteness
Subjectivity
Biased Interpretation
Figure 8-2 117
New Service Development Process
SM Business Strategy Development or Review
Front End
Idea Generation
Planning
Screen ideas against new service strategy
Concept Development and Evaluation
Test concept with customers and employees
Business Analysis
Postintroduction Evaluation
Source: Booz-Allen & Hamilton, 1982; Bowers, 1985; Cooper, 1993; Khurana & Rosenthal 1997.
Figure 8-3 118
Existing
SHARE BUILDING MARKET
Services
DEVELOPMENT
New
Services SERVICE DIVERSIFICATION
DEVELOPMENT
Figure 8-4
Service Mapping/Blueprinting
line of interaction
SUPPORT PROCESSES
121
Express Mail Delivery Service
SM Truck
Packaging
Truck
Packaging
Forms Forms
EVIDENCE
CONTACT PERSON CUSTOME PHYSICAL
Hand-held Hand-held
Computer Computer
Uniform Uniform
Driver
Picks Deliver
Up Pkg. Package
Customer
Service
Order
Airport Fly to
Dispatch Unload Load
Driver
Receives Sort Fly to
& Loads Center & On
Destinatio Sort Truck
SUPPORT
Load on
PROCESS
Airplane
n
Sort
Packages
122
Desk
Hotel Cart for Desk Elevators Cart for Room Menu Delivery Food Lobby
Exterior Bags Registration Hallways Bags Amenities Tray Hotel
Parking Papers Room Bath Food Exterior
Lobby Appearance Parking
Key
Arrive Give Bags Call Check out
Go to Receive Sleep Receive
at to Check in Room Eat and
Room Bags Shower Food
Hotel Bellperson Service Leave
SUPPORT PROCESS (Back Stage) (On Stage)
CONTACT PERSON
Greet and
Process Deliver Deliver Process
Take
Registration Bags Food Check Out
Bags
Take
Take Bags Food
to Room Order
SM Figure 8-8
Identify the Identify the Map the Map contact Link customer Add
process to customer or process from employee and contact evidence of
be blue- customer the actions, person service at
printed. segment. customers onstage and activities to each
point of view. back-stage. needed customer
support action step.
functions.
124
Application of Service
SM
Blueprints
Operations Management
rendering the service as
System Technology
promised
managing fail points providing necessary tools:
training systems system specifications
quality control personal preference databases
126
SM
Chapter 9
CUSTOMER-DEFINED
SERVICE STANDARDS
Objectives for Chapter 9: 127
SM Customer-defined Service
Standards
Differentiate between company-defined and
customer-defined service standards
Distinguish among one-time service fixes and
hard and soft customer-defined standards
Explain the critical role of the service encounter
sequence in developing customer-defined standards
Illustrate how to translate customer expectations
into behaviors and actions that are definable,
repeatable, and actionable
Figure 9-1 128
AT&Ts Process Map for Measurements
SM
Business Process Customer Need Internal Metric
Reliability (40%) % Repair Call
30% Product
Easy To Use (20%) % Calls for Help
Features / Functions (40%) Functional Performance Test
Service
Quality
Figure 9-2 131
Concrete High
Figure 9-3 132
Process for Setting
SM Customer-Defined Standards
1. Identify Existing or Desired Service Encounter Sequence
Measure by Measure by
Audits or Hard 5. Develop Feedback Soft Transaction-
Operating Data Mechanisms Based Surveys
SM Importance/Performance Matrix
HIGH 10.0
Improve Maintain
Does whatever it takes to
correct problems (9.26, 7.96)
Delivers on promises specified in proposal/contract (9.49, 8.51)
Gets project within budget, on time (9.31, 7.84)
Completes projects
correctly, on time (9.29, 7.68)
Gets price we originally agreed upon (9.21, 8.64)
Tells me cost ahead of time (9.06, 8.46)
9.0
Provides equipment that operates as vendor said it would (9.24, 8.14)
Gets back to me when
Takes responsibility for their mistakes (9.18, 8.01)
promised (9.04, 7.63)
Delivers or installs on
Importance promised date (9.02, 7.84)
8.0
LOW 7.0
HIGH
8.0 9.0 10.0
Performance
134
Figure 9-5
48 Hours
Customer
Process
Blueprint Report Lost Receive New
Card Card
Company
Process Company Sequential Processes
Blueprint
A B C D E F G H
Lost Card New Card
Reported 40 Days Mailed
136
SM
Chapter 10
PHYSICAL EVIDENCE
AND THE SERVICESCAPE
137
Objectives for Chapter 10:
SM Physical Evidence and the
Servicescape
SM Elements of Physical
Evidence
Servicescape Other tangibles
SM
Part 4
DELIVERING AND
PERFORMING SERVICE
143
SM Provider GAP 3
CUSTOMER
Service Delivery
COMPANY
GAP 3
Customer-Driven
Service Designs and
Standards
Part 4 Opener
144
SM
Chapter 11
EMPLOYEES ROLES IN
SERVICE DELIVERY
145
Objectives for Chapter 11:
SM Employees Roles in Service
Delivery
Illustrate the critical importance of service
employees in creating customer satisfaction and
service quality
Demonstrate the challenges inherent in boundary-
spanning roles
Provide examples of strategies for creating
customer-oriented service delivery
Show how the strategies can support a service
culture where providing excellent service is a way
of life
146
SM Service Employees
SM Service Employees
Internal Environment
149
Figure 11-4
SM Sources of Conflict for
Boundary-Spanning Workers
Se d Str nd
Pr rvic ong
Te nte kills
Tr nica tive
a
ch rac
Hire the
ain l a
I S
wa re
ide e
rs
Re easu
fo nd
Right People
r
r
ov
M
Develop
Customer-
Employees
Empower
Employees
Customers
Deliver
Best
as
Service Service
People Delivery Quality
Em th any
wo e
rk
Inc ee
am ot
Provide
plo e
Te rom
Co Visio
lud s in
y
Needed Support
mp n
P
e
De Systems
Se velo
s
re
ori rvice p a su al
In ent - Provide Me tern e
Pr tern ed In rvic y
oc Supportive Se alit
es al
se
s Technology Qu
and
Equipment
151
SM Empowerment
Benefits: Drawbacks:
quicker responses greater investments in
employees feel more selection and training
responsible higher labor costs
employees tend to interact slower and/or inconsistent
with warmth/enthusiasm delivery
empowered employees are a may violate customer
great source of ideas perceptions of fair play
positive word-of-mouth from giving away the store
customers (making bad decisions)
152
SM Service Culture
SM
Chapter 12
CUSTOMERS ROLES IN
SERVICE DELIVERY
154
Objectives for Chapter 12:
SM Customers Roles in Service
Delivery
Illustrate the importance of customers in successful
service delivery
Enumerate the variety of roles that service
customers play
Productive resources
Contributors to quality and satisfaction
Competitors
Explain strategies for involving service customers
effectively to increase both quality and productivity
155
Importance of Other
SM Customers in Service
Delivery
Productive Resources
Contributors to
Quality and
Satisfaction
Competitors
158
SM Customers as Productive
Resources
partial employees
contributing effort, time, or other resources to
the production process
customer inputs can affect organizations
productivity
key issue:
should customers roles be expanded? reduced?
159
Customers as Contributors to
SM Service Quality and
Satisfaction
Customers can contribute to
their own satisfaction with the service
by performing their role effectively
by working with the service provider
the quality of the service they receive
by asking questions
by taking responsibility for their own satisfaction
by complaining when there is a service failure
160
SM Customers as Competitors
1 2 3 4 5 6
Gas Station Illustration
1. Customer pumps gas and pays at the pump with automation
2. Customer pumps gas and goes inside to pay attendant
3. Customer pumps gas and attendant takes payment at the pump
4. Attendant pumps gas and customer pays at the pump with automation
5. Attendant pumps gas and customer goes inside to pay attendant
6. Attendant pumps gas and attendant takes payment at the pump
Figure 12-3 162
Effective
Define Customer
Customer Recruit, Educate,
Participation and Reward
Jobs
Customers
Manage the
Customer
Mix
163
Strategies for Enhancing
SM
Customer Participation
SM
Chapter 14
Source: Christopher H. Lovelock, Classifying Services to Gain Strategic Marketing Insights, Journal of Marketing, 47, 3 (Summer 1983): 17.
Table 14-2 171
What is the Constraint on
SM Capacity?
Nature of the constraint Type of service
Time Legal
Consulting
Accounting
Medical
Labor Law firm
Accounting firm
Consulting firm
Health clinic
Equipment Delivery services
Telecommunication
Utilities
Health club
Facilities Hotels
Restaurants
Hospitals
Airlines
Schools
Theaters
Churches
172
SM
Part 5
MANAGING SERVICE
PROMISES
174
SM
Provider GAP 4
CUSTOMER
COMPANY
Service Delivery External
Communications
GAP 4 to Customers
Part 5 Opener
175
SM
Chapter 15
INTEGRATED
MARKETING
COMMUNICATION
176
Objectives for Chapter 15:
SM Integrated Services
Marketing Communications
Introduce the concept of Integrated Services
Marketing Communication
Discuss the key reasons for service communication
problems
Present four key ways to integrate marketing
communication in service organizations
Present specific strategies for managing promises,
managing customer expectations, educating
customers, and managing internal communications
Provide perspective on the popular service objective
of exceeding customer expectations
177
Figure 15-1
SM Communications and the
Services Marketing Triangle
Company
Manage
Customer
Expectations
Goal:
Manage Delivery Improve
Service greater than Customer
Promises or equal to Education
promises
Manage
Internal
Marketing
Communication
179
Figure 15-4
SM Approaches for
Managing Service Promises
Goal:
Create Coordinate Offer Delivery
Effective Make
External Realistic Service greater than
Services Communication Guarantees or equal to
Communications Promises
promises
Figure 15-8 180
Approaches for
SM Managing Customer Expectations
Offer Choices
Create Tiered-Value
Offerings
Goal:
Delivery
greater than
or equal to
promises
181
Figure 15-9
SM Approaches for
Improving Customer Education
Teach
Customers
Prepare Confirm Clarify to Avoid
Goal: Performance Expectations
Delivery Customers Peak
for the to Standards after the Sale Demand
greater than Service
or equal to Periods
Process and
promises
Seek Slow
Periods
182
Figure 15-10
SM Approaches for Managing
Internal Marketing Communications
Goal:
Delivery
greater than
or equal to
promises
Create Effective
Vertical
Communications
Create Effective
Horizontal
Communications
Align Back
Office Personnel
w/ External Customers
Create
Cross-Functional
Teams
183
SM
Chapter 17
Service
Quality
? Profits
Service
Quality
Profits
Market
Share
Reputation Sales
Price
Premium
Contact: +923006641921 Usman Waheed
187
Figure 17-3
Costs
Volume of Margins
Service Customer
Purchases
Word of
Mouth Profits
SM Perceptions of Service,
Behavioral
Intentions and Profits
Costs
Volume of Margins
Purchases
Customer
Retention Price
Behavioral Premium
Service Intentions
Word of
Mouth Profits
Sales
Most Profitable
What segment spends more with
Customers us over time, costs less to maintain,
Best
Customers spreads positive word of mouth?
Other
Customers What segment costs us in
time, effort and money yet
does not provide the return
Least Profitable we want? What segment is
Customers difficult to do business with?
Most Profitable
What segment spends more with
Customers Platinum us over time, costs less to maintain,
spreads positive word of mouth?
Gold
Iron
Service
Encounter
Service Behavioral Customer
Quality Intentions Retention Profits
Service
Encounter
Service
Encounter
Price Premium
Volume Increases
Value of Customer
Referrals
Customer
Perspective
Value of Cross Sales Operational
Long-term Value of Perspective:
Customer
Service Perceptions
Right first time (% hits)
Service Expectations
Right on time (% hits)
Perceived Value
Responsiveness (% on
Behavioral Intentions: Innovation and time)
% Loyalty Learning Perspective Transaction time (hours,
% Intent to Switch days)
# Customer Number of new products Throughput time
Referrals Return on innovation Reduction in waste
# Cross Sales Employee skills Process quality
# of Defections Time to market
Time spent talking to
customers
Price
Premium
Service Customer
Quality Retention
Word of
Mouth Profits
Market
Share
Sales
Offensive
Marketing Reputation
Price
Premium
Contact: +923006641921 Usman Waheed