Customer Service Excellence - Essay Example

? SERVICE EXCELLENCE Table of Contents Introduction 3 Evolution of Marketing 3 Relationship Marketing 4 Importance Service 4 Impact of Technology 6 Stages of Customer Relationship Movement 8 Conclusion 10 References 11 Introduction The concept of marketing has evolved over time and customer is given the highest priority by any business organisation in the modern era. A company which is market oriented keeps the customers at the central position and all its business activities revolve around the customers. It tries to align its marketing strategy with the needs and wants of its customers. Customer orientation is also similar to market orientation wherein the companies are focused to satisfy the wants of the customer and create value for them. Apart from focusing on the customers a company also needs to look into the facts related to how its competitors in the market are able to satisfy all the needs and wants of the customers. The company needs to have knowledge about the strengths and weaknesses of its competitors and look for opportunities to outperform its competitors and only then it can gain a competitive advantage in the market. Hence an integrated marketing approach would always help a company to perform its business activities in an effective and efficient way. This study deals with the importance of customer service in organisations now-a-days. Technological advancements and its impact on organisational process to increase the profitability of companies through delivery of better customer service have also been discussed in this study. Evolution of Marketing The evolution of marketing can thus be considered to have taken place through five different phases which could be distinctly different from each other. Those five different phases include the era of trading, era of production, era of sales, era of marketing department, and era of marketing company (Perreault, and McCarthy, 2006, p. 15). In the trade era products were produced in limited quantities and the supply was limited. Then in the production era the concept of mass production was introduced. Next when the customer demand started becoming saturated the companies needed to make extra efforts to sell their products. This era can be termed as the sales era. Then when the organisations realised the fact that the sales pattern followed by them did not correspond with the consumer needs, then the need for a separate marketing department was realise. It can thus be named as the marketing department era. Next came the marketing company era when the need of organisations to focus on its customers to achieve its goals was realised. Hence, customer is given the highest priority in any of the marketing activities followed by the organisations. Customer Relationship Marketing Relationship is vital to the marketing process and the companies are now focussed on relationship marketing which helps to create, maintain and build a strong long term relationship with the stakeholders of the company including its customers (Palmatier, 2008). The area of relationship marketing has been an area of focus for the last few years. Relationship marketing mainly puts emphasis on the retention of customers rather than acquiring new customers. It heavily stresses on the process of customer satisfaction and gives less importance to sales transactions. Relationship marketing, to a large extent, differs from that of the traditional forms of marketing. Relationship marketing mainly gauges the importance of long term relationship with a customer. Some of the eminent scholars identified that practicing relationship marking will help the company to convert a normal customer into a loyal customer. The loyalty factor in turn offers the company with new sales opportunities through repeat purchase (Food and Agriculture Organization of the United Nations, 1986, p. 234-235). Importance of Customer Service Customer service can be considered as the relationship that an organisation develops with its consumers or customers. It includes the provision of support during and after the process of purchasing. An organisation has to ensure that both the purchasing and service of a product has resulted in customer satisfaction and they are happy with it. This is crucial to any organisation not only because it has been able to provide satisfaction to its customers and it would be able to retain the customer successfully but also because of the fact that word of mouth marketing communication strategy would be enforced with the customers recommending about the product or the organisation to their friends, relatives and family members. Hence it can result in synergistic effect where retaining certain customers would actually result in acquiring more number of new customers thereby increasing the profitability of the company in a significant manner. Nowadays marketing includes not only the exchange activities but various other essential elements also. Consequently the American Management Association defined marketing as the process of planning and accomplishing the notion, pricing, endorsement or promotion, and finally the distribution of the goods in order to facilitate exchange that will satisfy the objectives of the organization as well as the individual or the consumer (Lusch, 2007). The marketing era is completely focused towards the customer and is mainly dedicated towards the satisfaction of customer. Customer satisfaction is the primary function of every department of an organization starting from the marketing department to the human resource department. Kotler even argued that the profitability of a service firm is linked with customer satisfaction (Kotler, 2008, p.227). If we look at the existing literature it can be found that research studies related to customer relationship have received renewed attention amongst the researchers in recent times (Bansal, Irving, and Taylor, 2004). The service employees are observed to be concerned with the well being of the customers as well as their own selves. Managing these two types of concerns at the same time is found to be one of the strategic importances of a customer oriented business firm (Paulin, Ferguson, and Bergeron, 2006). Impact of Technology Customer relationship management (CRM) assists in interacting with the customers, whether it is service or sales related. In cases like this, technology is also used to streamline the CRM process that affects the loyalty of the customers, delivery of services, and the management quality. In the present turbulent situation, when the businesses have to face aggressive competition, they have to make efforts to survive in the uncertain market. The people have started realizing that maintaining good customer relation is very important for the success of the business. CRM is the strategy which would help in building a long-lasting relationship by increasing the profits through consumer focused strategies and right management. For boosting the loyalty and getting into a good business relationship, it is important to boost the loyalty of the customers and get close to them. It should be always kept in mind that the service should be based on the requirements of the customers. CRM technology is used to focus on managing the interactions of the organization with its customers for utilizing those data in a variety of other business application. CRM assists in maintaining a superior customer relationship through low cost. It answers to the five basic needs of the customers, such as service, quality, appreciation, action, and price. The use of the CRM application helps in creating business strategies in an effective way, so as to increase the loyalty of the customers and retain them. 7 Ps of service marketing which includes price, product, promotion, people, place, process and physical evidence plays an important role in case of baking institutions in order to meet the customer needs and successfully handle the competition in the market (Reynolds, 2002). Reynolds (2002) suggests that the rapid changes that are taking place in the hotel environment are paving way to the introduction of marketing philosophy as one of the major strategies to tackle the existing competition in the market and thereby increasing its profitability. According to Reynolds (2002) if the hotels wish to become marketing oriented, there are three different strategies which they can implement in their marketing strategy. They are: a) defensive strategy that is related to retaining and protecting the existing customers, b) Offensive strategy that is related to entering into new markets through the adoption of innovative means in their business process and expanding the business in new geographical locations, and c) Rationalisation strategy that is related to resorting to various cost reduction mechanisms. Customer relationship management (CRM) technology has evolved mainly due to the impact and role played by customer expectations. The customer centric view of organisations was previously internally focused. However with the passage of time improvement in customer service has become one of the major concerns for business organisations. Retaining the existing customers of a company is crucial because of the increasing intensity of rivalry and competition in the market. However, multichannel CRM proves to be a major technological challenge for an organisation. The technology that is needed to assist all the sales people in an organisation is not similar to the technology that is needed to assist a large volume of call centre (Buttle, 2012, p. 61). Technological advancements can be utilised by the organisations to provide customer service in a number of ways. The customers could be reached through various media like over telephone, internet media, print media or even in persons at their door steps. However it is necessary to use technology in an effective way so that it does not upset or dissatisfy a customer. Hence use of technology is good but it should be used judiciously and cautiously so that it ultimately serves for the purpose of the organisation to satisfy its customers and not irritate or dissatisfy them (Humphrey, 2010, p. 70). Self service technologies are the recent advancements and use of technology in the field of customer service. There has been a recent change in trend with the way the customers interact with technology and thereby leading to the creation of services and they are not required to refer to or interact with any of the employees of the organisation (Zeithaml, Gremler, Bitner, and Pandit, 2008, p. 59). Technology is used to collect feedback from the customers as well. Addressing the customer issues is necessary to satisfy and retain them. It is also vital for the organisations to address customers in a timely manner. Technology can help in this process through the provision of various means like electronic mail, internet, etc. where the customers can give their feedbacks and the company management can receive such feedbacks in real time so that the customer issues are resolved immediately and in quick time (Gibson, 2011, p. 3). Stages of Customer Relationship Movement As discussed earlier, CRM is an important constituent of any business organisation in this modern era. CRM can be considered to be consisting of a system or process that goes through various stages in an organisation. Some of those stages of CRM have been discussed below: Customer orientation: The whole thought process of an organisation is required to be focused primarily on the current and potential needs and requirements of the customers. Not only the needs but various problems, and wishes of the customers are also needed to be referred by the companies. Hence the companies need to have accurate knowledge and understanding about the markets, competition, products and the customers. Quality of service and product performance: The quality of services and products offered by the business organisations in relation to the prevailing competition in the market plays a vital role towards their success. It is always beneficial for the organisations to incorporate the specific needs and wants of the customers into the services or products in the design stage itself. Hence the focus should be on finding products for the customers rather than finding customers for the products. An important factor that is needed to be considered in this context is the cost to benefit ratio of the products or services offered to the customers. Customer satisfaction: Once the service or the product is utilised or consumed by the customers they would always ask themselves whether they are happy with it or not. If the answer to this query is affirmative the customers will be interested in choosing the same product when they would require it again in future. They may even refer it to their friends, relatives and others and might even become a regular customer of the organisation. Hence this stage of customer satisfaction is also a vital step leading towards the success of an organisation (Hill, Roche, and Allen, 2007, p. 18-19). Customer retention: The key step towards building up a strong customer base in an organisation is through the satisfied customers. It is necessary for an organisation that they do not lose any customer because it is very difficult to satisfy a customer once he/she is unsatisfied the first time. The organisations who can successfully adapt their business processes and activities in alignment with the customer expectations results in generation of customer satisfaction and thereby creating a strong customer base for themselves. Customer value and organisational success: The profitability of a company the customer commitment is closely related to each other. The ultimate goal of any business organisation is to increase its profitability in the market. Hence, with the increasing duration of the relationship of an organisation with its customers results in enhancing the profit per customer and ultimately towards the increase in overall profitability of the company (Raab, Ajami, Gargeya, and Goddard, 2008, p. 10 -11). Conclusion The facts and analysis presented in this report suggest that most of the business organisations in this modern era are customer oriented. Any company which is market oriented is found to focus on all their business activities keeping the customers at the centre. The business activities are performed in such a way that it corresponds to the specific needs and wants of the customers. This process leads to the increased satisfactions for the customers and once the customer becomes happy it can be expected that they would continue their relationship with the organisation and would like to have the same product in future. This increases the customer trust and loyalty and helps the organisations to have a sustainable growth in future. Concept of marketing is not new and it has evolved through various stages. The five different phases related to the evolution of marketing that have been identified in this study includes trading era, production era, sales era, marketing department era and marketing company era. This suggests that the business organisations are now mostly market oriented and its primary focus is on the needs and wants of the customers. Hence creating and building up of customer relationship is vital to the success of any business organisations. The companies are now focused on finding products for the customers and not finding customers for the products offered by them. Technological advancements are also having a significant impact on the ways in which customer services are provided by the organisations. Technology has helped to provide customer service in a timely manner and the companies can now provide greater satisfaction to their customers. All these facts suggest that customer service is the most important aspect for any business organisation in order to ensure its profitable and sustainable growth in future. References Bansal H. S., Irving P. G.,and Taylor, S. F., 2004. A Three-Component Model of Customer Commitment to Service Providers. Journal of Academy of Marketing Science, 32(3), pp. 234–50. Buttle, F., 2012. Customer Relationship Management. Massachusetts: Elsevier Butterworth-Heinemann. Food and Agriculture Organization of the United Nations, 1986. Management of Forest Industries. Rome: Food & Agriculture Organization. Gibson, P., 2011. The World of Customer Service. 3rd ed. Connecticut: Cengage Learning. Hill, N., Roche, G, and Allen R., 2007. Customer Satisfaction: The Customer Experience through the Customer's Eyes. London: Cogent Publishing. Humphrey, D. D., 2010. 21st Century Business Customer Service. 2nd ed. Connecticut: Cengage Learning. Kotler. P., 2008. Principles of Marketing. New Delhi: Pearson Education India. Lusch, R. F., 2007. History of Marketing. Journal of Public Policy & Marketing, 26(2). [pdf] Available at: . [Accessed 19 October 2012]. Palmatier, R. W., 2008. Relationship Marketing. [pdf] Available at: http://faculty.washington.edu/palmatrw/docs/MSI.RM.Book.pdf [Accessed 19 October 2012]. Paulin, M., Ferguson, R. J., and Bergeron, J., 2006. Service Climate and Organizational Commitment: The Importance of Customer Linkages. Journal of Business Research, 59(1), pp. 906-915. Perreault, W. D., and McCarthy, E. J., 2006. Basic Marketing: A Global Managerial Approach. 15th ed. New Delhi: Tata McGraw Hill. Raab, G., Ajami, R. A., Gargeya, V. B., and Goddard, G. J., 2008. Customer Relationship Management: A Global Perspective. Hampshire: Gower Publishing Ltd. Reynolds, J., 2002. A Practical Guide to CRM. CMP Media. Zeithaml, V. A., Gremler, D. D, Bitner, M. J., and Pandit, A., 2008. Services Marketing: Integrating Customer Focus Across the Firm. 4th ed. New Delhi: Tata McGraw-Hill Education. Read More