Managing Employees

1. Importance of Employees in Service Experience

• Employees shape customer perceptions and experiences through their interactions.

2. Services Marketing Triangle

• Three Parties: Company, Employees, Customers.

• Types of Marketing:

  • External (company to customers)

  • Internal (company to employees)

  • Interactive (employees to customers).

3. Internal Service Quality

• Refers to how well employees are treated and supported, impacting motivation and performance.

4. Boundary Spanners

• Employees who interface directly with customers and may experience emotional labor and role conflict.

5. Employee Attraction and Retention Strategies

• Strategies include creating a positive work environment, providing growth opportunities, and recognizing contributions.

• Common Hiring Mistake: Focusing solely on technical skills without considering cultural fit.

6. Zappos' Internal Marketing

• Strong company culture emphasizing employee empowerment and open communication.

7. Empowerment

• Allowing employees to make decisions can enhance service delivery but may lead to inconsistencies.

8. Interaction Quality

• Three Sub-Dimensions:

  • Attentiveness

  • Responsiveness

  • Communication.

Managing Customers

1. Cruise Industry Customer Management

• Companies may segment and manage customers differently based on profitability and engagement.

2. Characteristics of Services

• Key Characteristics: Intangibility, inseparability, variability, and perishability necessitate active customer involvement.

3. Good vs. Bad Customers

• Good Customers: Enhance value.

• Bad Customers: Can disrupt service or harm the brand.

4. Customer Typology

• Four Types of Customers:

  • Loyal

  • Price-sensitive

  • Indifferent

  • Problem customers.

5. Jaycustomers

• Customers who disrupt service; types include aggressive, irresponsible, and abusive customers.

6. Recruiting Right Customers

• Ensures sustainable profitability and enhances service quality.

7. Reasons for Lack of Complaints

• Customers may feel it’s not worth their time, fear confrontation, or believe complaints won’t lead to changes.

8. Customer Lifetime Value (CLV)

• A metric for forecasting the total value a customer brings over their lifetime, guiding marketing and service decisions.

Primary Data Collection

1. Types of Data

• Primary Data: Collected firsthand.

• Secondary Data: Collected by others; primary data is specific but can be costly.

2. Importance of Research

• Helps understand customer needs, improve service, and maintain competitiveness.

3. Methods of Primary Data Collection

• Surveys, interviews, observations, focus groups.

4. Benefits of Surveys

• Cost-effective, can reach a large audience, easy to analyze.

5. Representativeness

• Ensured through random sampling and stratification.

6. Considerations for Surveys

• Question clarity, length, and format to avoid bias.

7. Question Creation Rules

• Keep questions clear and concise; avoid leading questions.

8. Doritos Case Insight

• Specific flavor preferences or snacking habits identified through consumer research.

9. A/B Testing

• Comparing two versions to determine which performs better in achieving goals.

Case Studies: ZipCar and De Beers

1. ZipCar Challenges

• Challenges include competition, managing customer behavior, and maintaining service quality.

• Solutions: Streamlined user experience, improved marketing.

2. De Beers Challenges

• Changing consumer perceptions of diamonds; the ‘Real is Rare’ campaign aims to restore value and exclusivity.

3. Generalizable Lessons

• Understand customer behavior, adapt to market changes, and invest in brand equity.

Managing the Outcome, Demand, and Capacity

1. Outcome Quality

• Three Sub-Dimensions:

  • Consistency

  • Reliability

  • Outcome satisfaction.

2. Factors in Evaluations

• Tangibles (physical aspects), valence (positive/negative feelings), and waiting time perceptions.

3. Importance of Waiting Time

• Impacts customer satisfaction and perceived service quality.

4. Queue Configurations

• Types include single line, multiple lines, take-a-number systems, each affecting flow and efficiency.

5. Psychology of Waiting

• Expectations, distractions, and perceived fairness influence customer experience.

6. Waiting Strategies

• Strategies include avoidance, entertainment, and providing accurate wait times.

7. Walt Disney’s Wait Time Management

• Involves pre-visit information, managing experience during the wait, and post-visit follow-up.

8. Demand and Capacity Management

• Essential to balance service delivery and customer satisfaction.

9. Excess Demand and Capacity Scenarios

• Strategies for managing peak times, overbooking, and service flexibility.

10. Capacity Constraints

• Types include physical (facility size), operational (staffing), and resource-based (equipment).

11. Random vs. Predictable Demand

• Examples include seasonal tourism versus year-round restaurants.

12. Shifting Demand

• Methods include promotions, loyalty programs, and flexible pricing.

13. Shifting Capacity

• Involves cross-training staff, flexible work hours, and utilizing technology.

14. Aligning Capacity and Demand

• Adjusting staffing levels, scheduling, and resource allocation based on demand forecasts.