m4 assignment
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MAR5409_PPT_ch09.pptx0
Chapter 9 Managing Services for Business Markets
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The value of systematically monitoring and managing the customer experience
The central role that business services assume in customer solutions
The roles that service quality, customer satisfaction, and loyalty assume in service market success
How offerings that combine products and services can be created to deliver innovative value propositions for customers
Chapter Outline
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Customer Experience Life Cycle
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Customer experience
Represents the internal and subjective response a business customer has to any direct or indirect contact with a company
Touchpoints
Instances in which the customer has direct contact with either the product or service itself or with representatives of it by a third party
Offers a valuable tool for diagnosing key touchpoints
Between company and customer from the moment contact is made with a potential customer through the maintenance of an ongoing relationship
Provides a foundation for defining what is most important in customers’ experience
Customer Experience Map
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Aims to identify:
Value that customers place on different levels of performance for each element of the experience
Customers’ minimal expectations for each element
Customers’ perception of the firm’s performance versus that of key competitors
Customer Experience Map (continued)
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Processes that capture customers’ subjective thoughts about a particular company
Requires surveys and targeted studies at points of customer interaction that recognize gaps between customer expectations and their actual experience
Customer Experience Management
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Begins with an analysis of a customer problem and ends by identifying the products and services required to solve the problem
Focus of the exchange process is interaction based
Value is co-created by the firm in concert with the customer
Solution-Centered Perspective
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From a Product to a Solutions Perspective
| Product Perspective | Solutions Perspective | |
| Value proposition | Win by creating innovative products and enriching features of existing products | Win by creating and delivering superior customer solutions |
| Value creation | Value is created by the firm | Value is co-created by the customer and the firm |
| Designing offerings | Start with the product or service, and then target customer segments | Start with the customer problem, and then assemble required products and services to solve the problem |
| Company-customer relationship | Transaction-based | Interaction-based and centered on the co-creation of solutions |
| Focus on quality | Quality of internal processes and company offerings | Quality of customer-firm interactions |
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In developing solutions, business marketing firms must:
Define their unique capabilities
Determine how to use them to help customers to:
Reduce costs
Increase responsiveness
Improve quality
Products provide the platform for the delivery of services
Determine Unique Capabilities
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Figure 9.2 - Relational Processes Comprising a Customer Solution
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Different functional groups and business units have to be in agreement to deliver effective situations
Cross-unit coordination of a customer solution is promoted when employee incentives complement one another
Solution effectiveness can be facilitated by:
Documenting the history of effective and ineffective customer solution engagements
Laying out a process to guide employees
Developing Mechanisms for Coordinating Activities
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Extent to which employees of the business marketing firm are required to document key milestones in the creation and deployment of a solution
Provides a tool for:
Managing complexity involved in creating solutions
Synchronizing work and sharing information across units
Document Emphasis
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Refers to the extent to which a supplier firm:
Clarifies the roles and responsibilities of organizational units
Provides guidelines for sharing customer and product information in developing a solution
Process Articulation
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Customer’s Role
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Customer adaptiveness
Degree to which a customer is willing to adjust its routines and processes to accommodate a supplier’s products
Political counselling
Extent to which a customer provides a supplier with information regarding the political landscape in the customer organization
Operational counselling
Information provided to suppliers concerning relevant technical systems, business processes, and company policies in the customer organization
New opportunities for increasing the amount of business that a company receives from its customer base
Services offer more than what core products can offer
Solutions offer more avenues for differentiation than products as they include a variety of services
By co-creating solutions, business marketers enhance loyalty resulting in the customer creating barriers for competition
Benefits of Solution Marketing
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Intangible
Consumed at the time of production
Cannot be stored
Highly variable
Services versus Products
Tangible
Time lag exists between the production and consumption
Can be stored
Highly standardized
Products
Services
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Figure 9.3 - Business Product–Service Classification Based on Tangibility
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| Characteristics | Examples | Marketing Implications |
| Simultaneous production and consumption | Telephone conference call; management seminar; equipment repair | Direct-seller interaction requires that service be done “right”; requires high-level training for personnel; requires effective screening and recruitment |
| Nonstandardized output | Management advice varies with the individual consultant; merchandise damages vary from shipment to shipment | Emphasizes strict quality control standards; develop systems that minimize deviation and human error; prepackage the service; look for ways to automate |
Unique Service Characteristics
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| Characteristics | Examples | Marketing Implications |
| Perishability: inability to store or stockpile | Unfilled airline seats; an idle computer technician; unrented warehouse space | Plan capacity around peak demand; use pricing and promotion to even out demand peaks and valleys; use overlapping shifts for personnel |
| Lack of ownership | Use of railroad car; use of consultant’s know-how; use of mailing list | Focus promotion on the advantages of nonownership: reduced labor, overhead, and capital; emphasize flexibility |
Unique Service Characteristics (continued)
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| Responsiveness | Description | Examples |
| Reliability | Delivering on promises | Promised delivery date met |
| Responsiveness | Being willing to help | Prompt reply to customers’ requests |
| Assurance | Inspiring trust and confidence | Professional and knowledgeable staff |
| Empathy | Treating customers as individuals | Adapts to special needs of customer |
| Tangibles | Representing the service physically | Distinctive materials: brochures, documents |
Dimensions of Service Quality
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Basic elements of the product or service that customers expect all competitors to provide
Basic support services that make the product or service more effective or easier to use
Recovery process for quickly fixing product or service problems
Extraordinary services that excel in solving customers’ unique problems or in meeting the needs that they make the product seem customized
Customer-Linking Processes That Affect Customer Satisfaction
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Encompasses the procedures, policies, and processes a firm uses to resolve customer service problems promptly and effectively
Customer’s level of perceived service quality rises when service providers satisfactorily resolve service failures
Business marketers should develop highly responsive processes for dealing with service failures
Service Recovery
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Customer defections - Customers who do not come back
Profits rise considerably when company’s relationship with a customer lengthens
Benefits of retaining customers
Service companies can charge more
Cost of doing business is reduced
Long-standing customer provides free advertising
Zero Defections
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Service providers should:
Track customer defections carefully
Recognize that continuous improvement in service quality is an investment in a customer
Zero Defections (continued)
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Product dimension of service that includes decisions about:
Essential concept of the service
Range of service provided
Quality and level of service
Must consider some factors unique to services
Personnel who perform the service, physical product that accompanies the service, and process of providing the service
Service Packages
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Figure 9.4 - Conceptualizing the Service Product
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Combination of one or more goods and one or more services that together offer more customer benefits than if the good and service were available separately
Employed to advance revenue and profit growth
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Hybrid Offering
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Figure 9.5 - Manufacturer-Specific Resources and Capabilities for Successful Hybrid Offerings
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Hybrid Service Offerings Classification
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Product life cycle services (PLS)
Facilitate the customer’s access to a manufacturer’s product
Ensure its desired functioning during all stages of its useful life from delivery, installation, and maintenance to recycling or disposal
Asset efficiency services (AES)
Designed to provide customers with productivity gains on their asset investments
Hybrid Service Offerings Classification (continued)
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Process support services (PSS)
Provided by a manufacturer that assist customers in increasing the efficiency of their own business processes
Process delegation services (PDS)
Manufacturer performs specific processes on behalf of the customer
