Service in the Marketing Mix
There are some instances when service is such an important factor in delivering customer satisfaction that it will be seen as an important part of the marketing mix. The mix then becomes the ‘four Ps and S’. Service can be provided at any stage: before, during or after the sale. Therefore the provision of a free design service, the ability to try on clothing in comfort while children are happy at the play table provided, or a speedy emergency repair service can all offer a reason for customers to prefer one company to another. As in many markets, competing products are increasingly similar; it becomes more likely that service levels will determine the final choice.
Companies need to understand the determinants of customer value and satisfaction. Customer delivered value is the difference between total customer value and total customer cost. Customers will normally choose the offer that maximizes their delivered value. Customer satisfaction is the outcome felt by buyers who have experienced a company performance that has fulfilled expectations. Customers are satisfied when their expectations are met and delighted when their expectations are exceeded. Satisfied customers remain loyal longer, buy more, are less price sensitive and talk favorably about the company.
To create customer satisfaction, companies must manage their own value chains and the entire value delivery system in a customer-centered way. The company’s goal is not only to get customers, but to retain customers: a much more important issue nowadays. Customer relationship marketing provides the key to retaining customers and involves building financial and social benefits as well as structural ties to customers. Companies must decide the level at which they want to build relationships with different market segments and individual customers, from such levels as basic, reactive, accountable and proactive to full partnership. Which is best depends on a customer’s lifetime value relative to the costs required to attract and retain that customer.
Companies must understand how their customers perceive quality and how much quality they expect. Companies must then do a better job of meeting consumer quality expectations than their competitors do. Delivering quality requires total management and employee commitment as well as measurement and rewards systems. Marketers play an essential critical role in their company’s drive towards higher quality. (378 words)
About the author or the publisher
Author: Martin Hahn
Martin Hahn PhD has received his education and degrees in Europe in organizational/industrial sociology. He grew up in South-East Asia and moved to Europe to get his tertiary education and gain experience in the fields of scientific research, radio journalism, and management consulting.
After living in Europe for 12 years, he moved to South-East again and has worked for the last 12 years as a management consultant, university lecturer, corporate trainer, and international school administrator
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