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Business (Psychology of Customer Expectations (What might prompt a…

- - - - Quality is in the mind of the customer, if they perceive quality is bad, it is bad.
  - - - As a rule, it takes a lot of different information to change a customer's prevailing impression of a business's service quality.
  - - - Identify the expectations your customers have of which they (and you) may be unaware.
      - The general rule is that customers become the most aware of the expectations they hold (consciously or unconsciously) when expectations are violated.
        
        Expectations can be violated in a:
  - - - Reliability
        
        Do what your company promises, and do it in a dependable, accurate manner.
      - Responsiveness
        
        Anticipate the customer's need, and be there to help.
      - Assurance
        
        Build a feeling of trust and confidence in your customers. Follow through, go the extra mile.
      - Empathy
        
        Care about your customers, and let them know you care.
      - Appearance
        
        Dress appropriately, and keep your work neat if necessary.
- - - - Few people have been trained to pay attention to the other half of today's jobs -- the people part.
        
        Trained in technical aspects -- not in ensuring that their work provides value to others.
    - - An oft-quoted statistic says that it costs five or six times as much to get a new customer than to keep an existing customer.
        
        Encourage repeat business, build customer loyalty.
        
        Customer service is like a daily election and customers vote with their feet.
        
        Traditional advertising: US spends $11.5 billion annually on advertising. But only 25% of customers respond to a TV ad, and only 15% to a newspaper or magazine ad.
- - - - Repeat buying ( or the intention to do so as needed.)
      - Willingness to recommend the company to others, and
      - A commitment to the company demonstrated by a resistance to switch to a competitor.
- - - - Talk to customers about what customers expect (or at least the front-line employees)
      - Review letters of complaint & compliments
      - Mystery shopper programs
      - Hard Data
        
        System Downtime - not 95% of the time, but not 100%
        
        Employee replacement time
        
        Frequency & depth of customers' use of the business
        
        Ratio of new to old customers.
        
        Surveys, interviews, Focus Groups, etc.
    - - Cost Leadership Strategy
        
        Focus on offering lowest priced service at minimally acceptable quality levels, as the basis of competitive advantage in the marketplace.
        
        Focuses on the denominator of the equation
      - Differentiation Strategy
        
        Focusing on providing something unique to customers, such as superior personal service
- - - - These 11 people may tell an average of 5 people each
        
        Total people to hear bad word-of-mouth advertising = 67
        
        Assume that 25% of these 67 potential customers decide not to patronize your organization. Total customer loss then = 17
        
        Cost to keep a customer happy is $19 per customer
        
        Cost to attract a new customer is $118 per customer
        
        Cost of attracting 17 new customers (because of one dissatisfied customer) = $2006.00