Developing Services Marketing Leadership In Serving the Global Executive Education Customer

1. Executive Education at a Crossroads: Global Perspectives on Success in a Changing Environment Developing Services Marketing Leadership In Serving the Global Executive Education Customer Nancy J. Stephens, Ph.D. Associate Professor Center for Services Leadership Arizona State University December 6, 2002

2. Arizona State University College of Business www.cob.asu.edu/csl

3. Charter Member Firms

4. Charter Member Firms

5. Center for Services Leadership: Bridging Communities Actionable Research Student Education Executive Education

6. Leadership in Services Marketing: • 1. Making, Keeping and Enabling Promises • Building Relationships and Customer Loyalty • Recovering from Service Failures

7. Making, Keeping and Enabling Promises The Services Marketing Triangle Organization Internal Marketing External Marketing “Enabling Promises” “Making Promises” Service Providers Customers Interactive Marketing “Keeping Promises”

8. In your university : 1. What is being promised? By whom? 2. How will it be delivered? By whom? 3. Are the supporting systems in place to deliver the promised service? 4. Where are our weaknesses? 5. Where are our strengths?

9. Which point in the triangle is most important? • For gaining the customer’s loyalty: • Gain his/her trust in the service • provider/ frontline employee. • If service is high value, gain • trust in the organization. Organization Service Providers Customers Organization Service Providers Customers SOURCE: Sirdeshmukh, Singh and Sabol (2002)

10. 2. Building Relationships and Customer Loyalty a. Identify them b. Differentiate them. c. Interact with them. d. Customize for them. Treat the customer relationship like a marriage?

11. The Customer Pyramid (Rust, Zeithaml and Lemon 1999) The Customer Pyramid Spends more, costs less to serve, spreads positive word-of-mouth Spends more, costs less to serve, spreads positive word-of-mouth Platinum Platinum Gold Gold Iron Iron Lead Expensive or difficult to serve and doesn’t provide good return Expensive or difficult to serve and doesn’t provide good return Lead SOURCE: Rust, Zeithaml and Lemon 1999

12. How do we build loyalty? What drives customer loyalty? Performance - Expectations = Satisfaction = Loyalty What I What I thought I’m satisfied I’ll continue got I would get to buy from this company “Is it this simple?”

13. Recovering from Service Failures Minimizing complaints is the wrong goal. Enlightened managers try to encourage complaints (feedback).

14. The majority of unhappy customer do not complain. Why not? 1. Too much hassle. It’s easier to go elsewhere. 2. Don’t think it will make any difference. 3. Feel the problem is their own fault. 4. Do not have assertive personality.

15. Managers must make it easy for customers to complain. How? 1. Actively, not passively, seek customer feedback. 2. Ask customers for specifics. (“What could we have have done to make this a better experience for you?” rather than “How is everything?”) 3. Thank and/or reward customers for feedback. 4. Follow-up with customers on what was done as a result of their complaint.

16. What to do when things go wrong • Give distributive justice • (What did customer get?) • Give procedural justice • (What procedure did s/he have to follow to get it?) • Give interactional justice. • (How was the customer treated?)

17. Good Luck ! May you: • Make, keep and enable promises to customers, • 2. With whom you have good relationships • and who are loyal, but, • Who tell you about it when they are unhappy • so that you may recover from service failure.