Customer Service & Loyalty

1. Customer Service & Loyalty Dr. Mark Rosenbaum University of Hawaii

2. Satisfaction • Customer Delight. • To meet or to exceed expectations • Precursor to loyalty

3. Loyalty • Commitment • Despite situational forces that encourage switching behaviors.

4. Steps to satisfaction • Answer your phone • Don’t make promises unless you WILL keep them • Listen to your customers • Deal with complaints • Be helpful - even if there’s no immediate profit in it

5. Steps • Train your staff (if you have any) to be ALWAYS helpful, courteous, and knowledgeable. • Take the extra step. • Throw in something extra.

6. Survey Customers • Are current customers satisfied? • What about customers who defect? • Why do 90% of all customers defect? • Satisfaction is temporal.

7. Loyalty • Why are customers loyal? • Habit, after 5 years, 80% usually stay • Convenience • Beyond the product and into the social • Loyalty is not necessarily forever

8. The forgotten fact

9. Service Quality a. Reliability--ability to perform the promised service dependably and accurately. b.Tangibles--appearance of physical facilities, equipment and personnel. c.Responsiveness--willingness to help customers and to provide prompt service d.Assurance--knowledge and courtesy of employees and their ability to inspire trust and confidence. e.Empathy--caring individualized attention the form provides its customers

10. The questions • Tangibles: • X has modern-looking equipment • X’s physical facilities are visually appealing • X’s employees are neat-appearing • Materials associated with the service, such as statements, are visually appealing.

11. Reliability • When X promises to do something by a certain time, it does so. • When you have a problem, X shows a sincere interest in solving it. • X performs the service right the first time. • X provides its services at the time it promises to do so. • X insists on error free records.

12. Responsiveness • Employees of X tell you exactly when services will be performed. • Employees of X give you prompt service. • Employees of X are always willing to help you. • Employees of X are never too busy to respond to your requests.

13. Assurance • The behavior of employees of X instills confidence in customers. • You feel safe in your transactions with X. • Employees of X are consistently courteous with you. • Employees of X have the knowledge to answer your questions.

14. Empathy • X gives you personal attentions. • X has operating hours convenient to all its customers. • X has employees who give you personal attention. • X has your best interests at heart. • Employees of X understand your specific needs.

15. But, what about employees • Internal Service Quality: • Workplace design • Job design • Employee selection & development • Employee rewards & recognition • Tools for serving customers

16. Employee Satisfaction • Surveys • Frequent interviews • Roundtable discussions

17. Leads to… • Employee Retention • Avg. tenure of employees • Employee Productivity • Sales per employee

18. Value • Perceived Benefits/Costs • Wal-mart vs. small town America • Without value, no sales, no traffic

19. Customer Satisfaction • Current • Defects • Don’t aim for 100% it’s impossible. • In fact, it’s not feasible! • http://www.theacsi.org/ • Mark’s hypothesis

20. Customer Loyalty • Retention • Repeat Business • Referrals

21. Results • Revenue Growth • Profitability • How to measure profitability: • http://www133.americanexpress.com/osbn/tool/ratios/financialratio.asp • Thomson Analytics • Yahoo financials Students should realize that a balance sheet without rations is like a house without a roof—it’s not complete and I wouldn’t want to live in it on a cloudy day.