Services Marketing Chapter 10 Building Customer Loyalty Through Services Quality

1. Fisk/Grove/John-4e, Copyright © Cengage Learning. All rights reserved. 1 | 1
Chapter 10
Building Customer
Loyalty Through
Services Quality

2. Fisk/Grove/John-4e, Copyright © Cengage Learning. All rights reserved. 1 | 2
Objectives
1. To examine the concept of customer loyalty
with service providers
2. To examine the concept of service quality
3. To discuss how customers evaluate service
quality
4. To discuss the role of service guarantees in
relation to quality
5. To examine the design of effective service
guarantees and their payoff

3. Fisk/Grove/John-4e, Copyright © Cengage Learning. All rights reserved. 1 | 3
Introduction
• Customer delight occurs when customer
expectations are significantly exceeded.

4. Fisk/Grove/John-4e, Copyright © Cengage Learning. All rights reserved. 1 | 4
Introduction (cont’d)

5. Fisk/Grove/John-4e, Copyright © Cengage Learning. All rights reserved. 1 | 5
What is Service Quality?
• Service quality from the provider’s
perspective means the degree to which the
service’s features conform to the organization’s
specifications and requirements; from the
customer’s perspective it means how well the
service meets or exceeds expectations.

6. Fisk/Grove/John-4e, Copyright © Cengage Learning. All rights reserved. 1 | 6
What is Service Quality? (cont’d)

7. Fisk/Grove/John-4e, Copyright © Cengage Learning. All rights reserved. 1 | 7
How Customers Evaluate
Service Quality
• Service quality is more difficult to evaluate than
goods quality
• Service quality perceptions result from a
comparison of consumer expectations with
actual service performance
• Quality evaluations are not made solely on the
outcome of a service; they also involve
evaluations of the process of service delivery

8. Fisk/Grove/John-4e, Copyright © Cengage Learning. All rights reserved. 1 | 8
How Customers Evaluate
Service Quality (cont’d)
• SERVQUAL is a scale designed to measure
customer perceptions of service quality along
five key dimensions:
• Reliability
• Assurance
• Tangibles
• Responsiveness
• Empathy of the service provider

9. Fisk/Grove/John-4e, Copyright © Cengage Learning. All rights reserved. 1 | 9
How Customers Evaluate
Service Quality (cont’d)

10. Fisk/Grove/John-4e, Copyright © Cengage Learning. All rights reserved. 1 | 10
Why and When to
Guarantee a Service
• A service guarantee is a promise to compensate
customers if the service delivery fails to meet
established standards

11. Fisk/Grove/John-4e, Copyright © Cengage Learning. All rights reserved. 1 | 11
What Makes an Extraordinary
Service Guarantee?
• Unconditional
• Easy to understand and communicate
• Meaningful
• Simple to invoke
• Easy and quick to collect on (Hart,1988)

12. Fisk/Grove/John-4e, Copyright © Cengage Learning. All rights reserved. 1 | 12
How to Design a
Service Guarantee
• Three major decisions:
– Degree of explicitness
– Scope of what is covered
– Conditions of coverage