Why ignore dissatisfied customers, it’s an opportunity?
Unhappy customers affect loyalty, word-of-mouth, repeat-purchase behaviour, and profit. Today’s consumers demand higher quality service and often perceive existing levels to fall short of expectations.
Customers rightly or wrongly believe there is a widening gap between expected and desired levels of service. For owner managers defining the intangible nature of service quality to satisfy the desired level of customer service while maintaining a profit presents a significant challenge.
Especially when generally service problems only become apparent when consumers do not get what they “bargained for.”
It is absolutely imperative owner managers understand the consumers’ perception of current service levels. For example, it has been suggested the average firm could lose up to 20 percent of their customers base through consumers dissatisfaction with service (Timm, 1990).
Taken in conjunction with reports which estimate that the cost of obtaining a new customer can be up to five times greater than servicing an existing one, the importance of providing quality service cannot be over emphasised (Szabo. 1989).
Consumer displeasure can be restored and maintained if the appropriate managerial action is taken.
Deploying a systemised problem resolution procedure can become a positive competitive strategy to differentiate you from your competitors. Well managed customer compliant assessment and redress has been shown to help build customer loyalty and higher levels of repurchase intention (Etzel and Silverman, 1981; Gilly, 1987; Westbrook, 1987).
Developing a procedural aggregated approach diminishes emotional reactions by focusing on actively understanding service attributes consumers find unsatisfactory. Once service shortcomings are identified, a quality function deployment (QFD) tool known as the House of Quality matrix can be employed.
This management tool is designed to assess causes of compliant and how different configurations of service dimensions might affect consumer perceptions. The acquired knowledge becomes the basis to develop a service strategy to meet desired service levels.
Stages for Implementation
|Procedural stages||Key objectives and tasks|
|Consumer complaints and problem identification||Aggregate complaints, critical incident technique|
|Problem evaluation||Identify common and related causes of problems|
|Develop alternative service design solutions||QFD (House of Quality Matrix)|
|Implement and evaluate||Measure performance and satisfaction; adjust strategy or tactics as required|
Critical Incident Technique
Critical Incident Techniques (CIT) are designed to identify and classify specific events and behaviours from consumer communications (Bitner et al., 1990).
An “incident” is defined as an action that will allow for inferences to be drawn and predictions made about an act or its actors.
A “critical incident” is defined as an act which significantly impacts, in this case negatively, the activity in question (service quality and satisfaction) (Bitner etal, 1990).
Customers lodging complaints are contacted by the owner/manager and asked to detail their negative service experience.
They are directed to “tell their story” by describing their experience and the circumstances that surrounded it but, not their perception of the underlying causes of their dissatisfaction.
It will be ideally the responsibility of marketing personnel to analyse the information elicited by customers and draw inferences from the communication. At the conclusion of the elicitation phase of this procedure, CITs are classified.
Classification of CIT Elicitations
The CIT elicitation procedure requires all complaints and client interviews to be transcribed. The data should provide a large amount of information this should be systematically categorised so that the information obtained can be quantified and ultimately synthesised into actionable managerial strategy.
Ideally you need two independent evaluators to read and assess the stories. Stories should be categorised upon similarity and categories defined by labelling distinct incidents.
For example reception, long check in lines, reservation mistakes, customers want earlier check in time. Check-out, later check out, billing mistakes, shorter check-out line. Customer stories not achieving consensus should be reread or re-categorised or removed.
The next stage requires a third evaluator who has no previous knowledge of the previous categorisation step. Inter-evaluator reliability can be assessed based on the third evaluator’s accuracy in recreating the categories initially formed by the previous two evaluators.
Two advantages – one, the procedure allows for “accurate and consistent interpretations of people’s accounts of events without depriving these accounts of their power of eloquence.” Two the procedure incorporates the use of both quantitative and qualitative statistical methods providing a rich source of information.
These systematised but unadulterated consumer stories can now be used as input into the development of service design solutions, the QFD stage.
Using this methodology appears bureaucrat.
So why use this system?
Prevent business demise. Owner/managers cannot be on duty twenty fours a day, seven days a week. To prevent competitors taking your customers you need to understand what’s happening.
Finding a new customer can be up to five times greater than servicing an existing one.
Journal of Services Marketing, Vol. 8 No. 4,1994, pp. 50-60 © MCB University Press, 0887-6045
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