Coordinate implementation of customer service strategies Lecture 3 Payman Shafiee

1. Coordinate implementation of customer service strategiesLecture 3Payman Shafiee

2.  Business technology & customer service needs • Self Service Technology • Benefits: • Increased tie to the serving company • Increased customer satisfaction • Decrease in company cost, staff and management errors • Lesser legal tribunal cases reffered • Angry and helpless clients and disgruntled customers Slides by Payman Shafiee

3.  Business technology & customer service needs Angry and helpless clients “Failures in the use of self-service technology are not only a source of dissatisfaction; often, they also trigger negative emotions of anger and helplessness. Drawing on the appraisal theories of emotion, KatjaGelbrich argues that these emotions have distinct effects on customers' post-purchase reactions (customer loyalty, frequency of use), both directly and indirectly, by reducing customer satisfaction.”1 • 1. BEYOND JUST BEING DISSATISFIED: HOW ANGRY AND HELPLESS CUSTOMERS REACT TO FAILURES WHEN USING SELF-SERVICE TECHNOLOGIES** • KatjaGelbrich. Schmalenbach Business Review : ZFBF. Düsseldorf: Jan 2009. Vol. 61, Iss. 1; pg. 40, 20 pgs

4. Analysis Angry and helpless clients “Failures in the use of self-service technology are not only a source of dissatisfaction; often, they also trigger negative emotions of anger and helplessness. Drawing on the appraisal theories of emotion, KatjaGelbrich argues that these emotions have distinct effects on customers' post-purchase reactions (customer loyalty, frequency of use), both directly and indirectly, by reducing customer satisfaction.”1 • 1. BEYOND JUST BEING DISSATISFIED: HOW ANGRY AND HELPLESS CUSTOMERS REACT TO FAILURES WHEN USING SELF-SERVICE TECHNOLOGIES** • KatjaGelbrich. Schmalenbach Business Review : ZFBF. Düsseldorf: Jan 2009. Vol. 61, Iss. 1; pg. 40, 20 pgs

5. Strategies to tackle the “technology dissatisfaction problem” expectancy disconfirmation paradigm

6. Strategies to tackle the “technology dissatisfaction problem” expectancy disconfirmation paradigm Slides by Payman Shafiee

7. Strategies to tackle the “technology dissatisfaction problem” Influence diagram for the expectancy disconfirmation paradigm

8. Strategies to tackle the “technology dissatisfaction problem” • Since Oliver's (1980) introduction of the expectancy disconfirmation paradigm, it has become well established that customer satisfaction/dissatisfaction leads to behavioral responses, such as : • loyalty/disloyalty • word-of-mouth communication • changes in frequency of use • emotions as the antecedents of customer satisfaction/dissatisfaction • emotions also influence customer behavioral responses

9. service failure that can occur during the use of self-service technologies (SSTs) • Negative experiences in SST usage often trigger emotional responses of anger and helplessness (Krone, Hamborg, and Gediga (2002); Parasuraman (2000)) • When service fails, customers have nobody to ask for assistance, which makes them feel helpless • Moreover, they cannot observe anyone's recovery efforts, which facilitates and reinforces the occurrence of anger. Slides by Payman Shafiee

10. anger and helplessness consequences has important managerial implications • Examining the occurrence and consequences of anger and helplessness in human-technology interactions has important managerial implications • Providers can learn which type of customer response to service failure goes back to what emotional experience, anger or helplessness • This separation helps SST providers to understand the limitations of customer satisfaction surveys and refine their customer relationship management

11. Anger • Anger occurs if someone attributes a negative situation to an external source (Smith and Ellsworth (1985); Averill (1983)). Anger will be particularly strong if customers consider a cause to be stable (Folkes, Koletsky, and Graham (1987)), because a stable failure reinforces their perception that the provider is not trying to remedy the goal-incongruent situation (McColl-Kennedy and Sparks (2003)).

12. Helplessness • Helplessness occurs if individuals perceive that they have no control over a threat. They do not feel as if they are able to counter or avoid an aversive stimulus (Lazarus (1991); Folkman et al. (1986)). Lack of control is typical of human-technology interactions (Parasuraman (2000)), because there is no service person on the spot for immediate help

13. Post-Purchase effects • Customer loyalty is an important post-purchase reaction • Dissatisfied customers also tend display a lower frequency of use than do satisfied customers • anger and helplessness also have direct effects on the two post-purchase reactions. • Anger is negatively related to customer loyalty • Helplessness is negatively related to frequency of use

14. Anger is negatively related to customer loyalty Why does helplessness almost never triggers any action? • it implies lack of control • Helpless people feel desperate (Frijda (1987)) and lethargic -very harmful- (Shaver et al. (1987)) • As a response to service failure, inactivity implies the omission of an activity that the person would have undertaken otherwise, such as increasing business with a provider (Zeithaml, Berry, and Parasuraman (1996)) • For example, mobile phone users might feel helpless when their phones do not work during an overseas trip. In this case, it is likely that the users do not even carry their mobiles with them when going abroad the next time. Slides by Payman Shafiee

15. Helplessness is negatively related to frequency of use Clearly, angry customers hold the provider responsible for service failure. Therefore, anger is likely to trigger a response that is directed against the provider which would prevail in decreasing loyalty