The Great Importance for Costa Coffee - Assignment Example

Costa Coffee’s service approach Executive summary This report evaluates Costa Coffee’scustomer care capabilities after filling a Service Evaluation Form (SEF) used by a mystery shopper. The mystery shopper conducts an excursion to the premises to have a firsthand account of the internal customer experience. In the shop the products and the condition of the premises are taken note of, and later compared to the standards expected of coffee outlets in this hospitality industry. The SEF is a 10 point questionnaire that the shopper answers after visiting the shopping outlet. The outcomes are then analysed using appropriate tools to gauge if the company cares about customer needs. The report outlines the “push and pull” theory as a method of addressing customer concerns; it further evaluates the validity of this approach in handling customer issues in modern day business environment that is getting increasingly competitive. This theory is applied in supporting my arguments that place customer care as a vital component of business processes. The relationship between good customer relationships and business success is explored with an aim of giving you the justifications for adopting a customer oriented strategy that contributes to overall business sustainability over time. Customer service training is vital in making the employees responsive to customer needs and in establishing it as part of the firm’s culture. In the last part of this report, I give recommendations on the most appropriate methods Costa Coffee can use to appeal to its clients after investigating the short comings during mystery shopping. Introduction If a firm owner wants to be successful in achieving the objectives set forth, then customer service is of paramount importance because positive responses increase client numbers. In Adam Smith’s basic theory of competition, he says that businesses need to be very involved in this initiative to satisfy individual customer needs. Clients treated in a humane way and in a respectful manner have a high chance of coming back to the premises. Costa Coffee is a business outlet in the hospitality industry; this is a highly competitive field with new shops opening at city corners every day (Brody, 2009)1. In order to remain competitive in this growing field, customer relationship building initiatives is therefore of vital importance to keep them coming. This is enhanced by offering them the best services at a reasonable cost and maintaining a feedback mechanism that ensures their specific needs are met. For instance, coffee is available in a variety of grades and types; we have the Arabica and Robusta coffee varieties which also have different tastes. Giving clients these brew options provides a one stop shop where different taste needs are met. Mystery shopping experience We used mystery shopping as a tool for measuring customer service quality at Costa Coffee; in this exercise, the shopper engages the employees by asking questions when purchasing a product. At the end of the shopping experience, we give feedback that forms the basis for this report. The justification for using this approach is due to the fact that it is ideal for hotel industry as employee-customer interaction is paramount in this type of business. After the mystery shopping experience, the shopper will answer the following questions regarding the process as contained in the service evaluation form: The number of customer support employees on entering the premise. The time taken by the support employees to greet the mystery shopper. The nature of the reception as compared to the stated objectives. The variety and specifications of products offered to the client. The product sale arguments used by the support employees i.e. consumer benefits and competitive advantages. Store conditions in terms of cleanliness and staff image. The time taken before the shopper gets the ordered product. If Costa Coffee is complying with the standards set in the hospitality industry in terms of the nature of service delivered and outward appearance. Whether or not the customer support staff invited our mystery shopper to come back next time. The other product options made known to the mystery shopper apart from the one initially requested. The customer feedback There is only one receptionist at the entrance who welcomes clients to the coffee shop, however, the receptionist does not welcome the clients as they make their way to empty tables. She only deals with clients opting for take-away services by directing them to the available waiters. On the table, the waiter takes five minutes to attend to the mystery shopper. This is a long time and it is due to the fact that they have only five waiters who have many clients to attend to. The orders however, do not take very long to be processed. In the menu list, there are few varieties of coffee offered to clients as Costa Coffee focuses on the standard coffee brews. However, they have other accompaniments for instance doughnuts and burgers to go with the beverages. The employees did not inform the client on the available bargains and ongoing promotional activities yet there is a “buy a cup and get a doughnut” promotion currently undertaken by the firm. The hotel staffs are clean and well kempt; however, their operating environment is dirty as there is no continuous cleaning process done due to the few employees numbers continually buried in processing the orders. Costa Coffee has no effective outlet branding that attracts passersby as only the premise only has the business name at the door. When the mystery shopper was done with taking the coffee, no one was there to thank her for coming as they all seemed occupied. The shopper left the payment with the receipt at the table to be picked later by the waiters. The receptionist did not bother to tell her to come next time. Customer service theories The push and pull theory has been applied in customer service as a basic approach for pushing up sales in any business unit. The overriding assumption in this theory is that businesses evaluate client needs ahead of time and devise relevant solutions. They then push products and information to the clients in accordance with the identified problems. This anticipation reduces the interaction time between the company and its clients as their issues are addresses beforehand. This pushing is not ideal for modern customer relations as direct communication has been recognised as a vital image building tool. However, it saves time and increases efficiency in use of firm’s resources since it eliminates other trial and error mechanisms (Schneider & White, 2004)2. In the pull side of the theory, the client initiates the request for a particular product or information, the business then acts by addressing the most recurring issues brought up by the clients. This is a good approach to customer relations as they are the ones that bring out the issues; the responses are then directed to the individual cases presented. Consumers who have little trust for solutions provided by the management have the freewill to conduct the research themselves and identify their pressing needs. Relationship between customer service and business success Firms become profitable only when revenues received from retained customers surpass the costs associated with luring and servicing clients over a period of time. In order to achieve this growth, it has to come up with and implement a customer oriented strategy that strengthens and nurtures customer relationships. According to customer service expert Terry Hill, there is a strong relationship between long term company success and long term customer service initiatives (Hill, 2004)3. Every stage of their life cycle has to be invested in as they move deeply to approve of the business and its products. This customer life cycle starts from: Customer selection: this is done after a thorough market analysis and segmentation to determine areas to concentrate on; this enhances efficient use of promotional resources and activities. In Costa Coffee’s case, value analysis is important at this stage as it makes the business unit have high value client base with less fallback risks. Customer acquisition: after selecting the client base, the firm then lures these consumers using strategically established promotional initiatives for instance, offering low introductory prices to ward them off from competitors. This is the most rigorous part of the process and is done in a systematic manner to prevent customer fallbacks. Customer retention: this is conducted after these new clients start using a firm’s products; continuous customer feedback is required at this stage to improve on service delivery. A personalised approach to client communication is vital in ensuring their particular needs are addressed. This also makes them feel part of the business process. Customer growth: increasing customer numbers through the efforts applied in the initial stages results to increased sales. After making them loyal to the company and its products, Costa Coffee can diversify its product offering to widen their product choices. Customer growth strategies are focused on increasing their lines of spending. The firm has to invest in initiatives that continually increase client numbers to maintain a positive growth trajectory. Growth in purchases done by an individual does not represent, to a large extent, growth in overall sales volumes. The customer growth cycle is then maintained, in all business operations, through concurrently running market search and client development plans. Effective relations between customer service and business success is enhanced by use of Customer Relationship Management (CRM) processes. This is a program that manages client relations in a business unit, in a seamless manner, through all the customer development stages. It also balances initiatives promoting acquisition of new clientele with the growth of existing clients, to maximize on sales and business development. In Costa Coffee’s case, it can apply the following tools to promote good customer relations: providing product updates to existing and potential customers, make customer satisfaction a key goal by ensuring the quality of coffee offered is up to or above industry standards. Above all, the firm can involve its clients in product development by seeking their opinions, through focus groups, on how to improve their product lines. Customer service training In providing justifications for continued investment in customer service training, much emphasis is laid on employee empowerment as a tool for improving the business climate. Customer service training refers to giving employees the attitudes and skills necessary in making the customer shopping experience and products offered exceed customer expectations. All employees are eligible for this empowerment process since they can all be required, at any time, to respond to client needs. It is not a good show if someone refers a client to another employee if in a position to help. However, the most suitable candidates are waiters and shop receptionists. Customer service training is beneficial in many aspects: it helps in building their loyalty to the business. By being loyal, the clients are retained since loyal clients will always come back for services. On the same point, it is a cost effective measure since it is cheaper to retain existing clients than to acquire new ones. Customers who enjoy a good interaction with employees at the reception or at the sales desk are open to additional sales messages passed across. They even tend to lengthen the time taken in the outlet as they feel they are appreciated and not viewed as a bother. On the other hand, good customer service skills shorten the time taken to handle a single client as the employees will be well conversant with the process; this enhances efficient service delivery in the firm (Evenson, 2011)4. Getting everyone on board in the training ensures the same message is passed to the employees; this ensures uniformity in terms of the responses given to the customers. This commonality in language and processes in vital in building a unified image. This increases sales as the customers will view these employees as people who know what they are doing. Lastly, training enhances employee motivation as they feel the management takes them as an integral component of the business. This makes them happy and is able to freely assist clients whenever necessary (Wagen, 2008)5. Customer oriented approach Most traditional approaches focus on creation and retention of customers by putting them at the top of organizational chart, customer orientation goes deeper to directing businesses towards the clients by use of various marketing initiatives (Clow & Baack, 2010)6. Orientation makes customers more aware of what they need; this is because of the client sensitization initiatives given by the businesses. The business is then able to devise their strategies according to market demands. This approach ensures efficient use of company resources as the needs assessment process outlines the key requirements needed; the firm is then able to address specific concerns without using a wholesome approach that increases resource wastage. Conclusion Customers are of great importance to a business unit as they are the ones who consume products offered, hence providing revenue streams. The income realised is used to pay the employees, shareholders and also invested in company growth plans. Due to this reason, it is of great importance that Costa Coffee invests in improving customer experience to boost sales through retention and client referrals. Referrals is realised when existing employees take the customer experience messages to other potential clients. These new clients are then motivated to sample the brand. Recommendations Employ more staff: the overriding shortcoming detected in the mystery shopping experience is that Costa Coffee has few waiters available to effectively service their clients. The employment policy should also focus on customer service skills as opposed to technical skills. The employees should be positive about their job and be ready to engage the clients freely when need be. Enhance customer service belief system: employees at Costa Coffee are not well versed on effective customer service issues. They seem to be pre-occupied with their jobs more than attending to client needs. This is a result of low motivation and the management needs to take them through training to improve on their service delivery (Terrill & Middlebrooks, 2000)7. Improve on company image: an evaluation of this premise’s outside and internal appearance found that it is dirty on the inside and with no elements that can attract potential clients passing by. Introduction of a mascot at the entrance can increase public awareness and excitement which creates the much needed attention. Drawing coffee glass images on the glass windows also shows these clients, at a glance, what is offered by the outlet. Bibliography Terrill, C., & Middlebrooks, A. (2000). Market leadership strategies for service companies: creating growth, profits, and customer loyalty. Lincolnwood, Ill.: NTC Business Books. Schneider, B., & White, S. S. (2004). Service quality: research perspectives. Thousand Oaks, Calif.: Sage Publications. Wagen, L. (2008). Customer service intelligence perspectives for human resources and training. Oxford: Butterworth-Heinemann. Clow, K. E., & Baack, D. (2010). Marketing management: a customer-oriented approach. Thousand Oaks, Calif.: Sage. Evenson, R. (2011). Customer service training 101 (2nd ed.). New York: American Management Association. Hill, T. H. (2004). How Do You Sustain And Grow Your Customer Relationships?. Customer Service Manager.com, Resource for Customer Service Professionals - CSM. Retrieved May 7, 2012, from http://customerservicemanager.com/how-do-you- sustain-and-grow-your-customer-relationships.htm Brody, D. (2009). Latest trends in hotel industry. Chandni Chowk, Delhi: Global Media. Read More