Critical Factors Relating to Customer Expectations - Essay Example

Discuss the critical factors relating to Customer Expectations and the ways in which organizations can ensure that these expectations are consistently met or exceeded Customers are users of products and services provided by businesses. Every customer has some expectations from the product he/she uses. The attitude a customer shows towards a product largely depends upon the way it is marketed and the customer’s experience with the product. The products or services which match the expected performance of the customer satisfy the customer. In this competitive age, customer satisfaction has become the top priority of businesses. The customer today has become more demanding and is only satisfied as long as his requirements are constantly met (Ward 1994). The success of a company largely depends on customer satisfaction and for this the businesses throughout the world are focusing on measuring and improving the satisfaction level of both internal and external customers. The expectations of the customers are simple; all they desire are timely quality solutions within budget. Meeting these expectations results in customer satisfaction. The basic condition for delivering superior service is to understand customer expectations; customers have preconceived expectations when judging a firm’s service. The Theory of Expectations is the most commonly accepted theory in this regard. It states that the customer has a predetermined standard of expectations and the satisfaction or dissatisfaction results from a comparison between these predetermined sets of expectations and the actual performance of the product or the service (Swamidass 2000). Given the fact that the extent to which customer expectations are met will decide their level of satisfaction from the services, it is very important to understand their expectation in the first place and then to deliver on those expectations (Rai 2007). Keiningham and Vavra (2001) further explain that the customer satisfaction can be broadly categorized into three zones: the zone of pain where the customer expectations are not met; the zone of mere satisfaction where, although the customer expectations are met, but the company is not offering anything unique which would distinguish itself from others in the market. In this case the customers can easily switch over to similar products offered by other companies and finally is the zone of delight. The zone of delight is that where the customer expectations are not only fully met but are exceeded, which leads to customer loyalty and word of mouth marketing. For instance, iPhones and iPads are more popular among people because the Apple Store has a greater content of music, films, books, TV shows and other multimedia apps which the users can download directly (Arthur 2012); these are the extra services which ensure customer expectations are exceeded. Types of Customer Expectations Jugulum and Samuel (2010) have stated the customer expectations to be of three types: performance, perceptions and outcome expectations. The first two expectations are linked to the products delivered to the customers and for this reason are also known as the product expectations. The third type of expectation – the outcome expectation – exists in the absence of the products as well. The performance expectations can be measured and revolve around the quality of the product, cost and availability. The second type of expectations or the perception expectations are unclear and difficult to measure expectations; user friendliness of a product, its look and feel, durability and timelessness and also ease of doing business come under these types of customer expectations. According to Jugulum and Samuel (2010), most of the perception expectations can be measured and once a framework for measuring them is established, they become performance expectations. The outcome expectations are the results a customer desires through the use of the product or by working with a particular provider. The outcome expectations can be market share, return on investment, health, entertainment etc. The performance and perception expectations are instrumental in improving the quality of the product provided they are properly identified, measured and acted upon; whereas innovation takes place when the unmet outcome expectations are identified, measured and a suitable solution is explored. What a Customer Wants? Importance of meeting customers’ expectations is evident from the fact that it determines the success or failure of the business. While some customer expectations are predictable, some are difficult to determine. These expectations vary as well and rely heavily on the changing marketing trends. Those organizations which understand the needs and supply accordingly emerge as survivors, if not winners. As customer expectations are ever evolving, it is extremely difficult to find out what these expectations might be. However, service, quality, cost, action and appreciation can be categorized as the five basic needs of the customer. Cost is especially important as both the businesses and the individual consumers want to effectively utilize their money. However, cost is one aspect of customer expectations which can be compromised upon. The customers expecting a luxurious interior are willing to pay more for a Mercedes-Benz or a Lexus. Similarly, the cost of production of a Honda and a BMW are the same and both offer almost the same features but customers are willing to pay more for a BMW because it is more of a status symbol (Hill and Jones 2012). Customers expect accuracy; they want the company to deliver what it has promised; the absence of accuracy results in customer dissatisfaction. Availability is another aspect to be looked at while exploring customer expectations. The product should be conveniently available and should be within reach of the customers. Ease of availability is one of the reasons why the online marketing has thrived. However, availability is one factor which can be easily copied and so the business owners should also emphasize quality besides convenience. Durability and functionality are two qualities which the customer expects from its purchases. In the service industry understanding what the customer wants is the key step in delivering “good quality service.” The levels of expectations vary with the service. For example, those wishing to dine in a good restaurant expect a formal environment, good china and cutlery, thoughtful, attentive service and above all tasty food. The person is also aware that he will have to wait for sometime before the food is served. The same person who goes to a fast food restaurant expects a lively ambience, great food and a quick and efficient service. As mentioned earlier, identifying a customer’s needs should be the top priority of the business or service. For instance, a person going to a hospital’s emergency expects to be attended immediately. However, the nature of his injury or sickness may not be that urgent and there could be another patient who has come to emergency requiring immediate attention. Under such circumstances the hospital staff can keep the patients busy by asking them to fill in a form and checking their vitals. Customer expectations can be emotional as well. Most businesses are going green and the customers are motivated to buy green products because it makes them feel a responsible citizen of the world. The sales of the sports company Nike shot up when it announced that it would be manufacturing sports goods and accessories with recyclable material (Krishnani 2012). With this step Nike established an emotional bond with consumers. Nike not only fulfills the customer needs by providing them sustainable quality products. When buying a Nike product, the customer not only gets a good product but also contributes positively towards saving the environment. Nike won customer loyalty too. Customer Feedback in Customer Service Customer expectations are met when the business pays close attention to the customer’s needs. In order to survive the cut throat competition, the businesses should identify the needs of the customers and understand customer behavior. The best way to reach customers is through feedback. Most customers do not complain and instead move away to other businesses, thereby damaging the business (Goodman 2009). Explaining this point, Grigoroudis and Siskos (2009, p. 2) state that this happens because either of a particular attitude or the belief that the company will do little to redress the problem. “Listen to your customers” is the golden rule of business. Customer feedback can be defined as the key component of a customer service program. Those companies which are partnering with their customers and are using the feedback provided by them accurately are the ones which succeed. In order to know their customers better, the businesses usually make use of techniques such as questionnaires and surveys. The businesses nowadays also encourage the customers to leave comments on their websites. However, to make sure that the feedback is useful, the business should target the specific areas which, in its opinion need, to be improved. Once the remedial steps have been taken, the business should conduct another survey to see whether the changes have been beneficial or not. Hewlett Packard used a unique way of finding out the needs of the customer by organizing a “Day in the Life of a Customer” program. The employees of HP visited the customer sites and recorded a video of how the employees went about with their business and how they used the HP products. HP later analyzed the video and tried to figure out the possibilities of making the client’s business more efficient and profitable (Carroll 2011). In today’s busy schedule it is difficult for people to fill out questionnaires or respond to lengthy surveys; therefore the surveys or questionnaires should be short but effective enough to obtain the required information. For businesses retaining old customers is more profitable than making new ones. Old customers are less likely to switch loyalties. They are an efficient way of word of mouth marketing as they refer the business to others around them. Customers remain loyal as long as they are satisfied and customer feedback generates satisfaction. In Zemke’s (1999, p .376) words, customer loyalty is built when the service provided or the product exceeds the customer expectations. In order to achieve the level where the customer’s experience is a delightful and memorable one and which will encourage future interaction, the customer expectations must be managed. Measuring the customer expectations consistently is the best way to manage customer expectations. The expectations should be measured before providing the services or goods (to determine the requirements and needs of the customer), while providing the services and goods to keep up with the customer demands and after the service to assess and narrow the gap between the expectations and perceptions (Zemke 1999). The customers also expect prompt action from the firm in case a complaint arises. Dell, the computer firm, is a classic example of what sort of problems can arise if the complaints are not handled properly. The firm was doing a roaring business as it was committed to producing high quality cost effective products. The efficient customer service provided by Dell was also one of the reasons of its success. However, because of some performance related products, Dell started losing its customers. This was because the customer service had become faulty. The customers complained of long holds and too many call transfers. Also, to cut the cost, the company had set up customer service centers abroad where the technicians had poor English communications skills and could either not understand the nature of complaints or could not express themselves properly. This made the firm lose customers. Another thing which contributed to the downfall of the customer service was that Dell did not anticipate that the growth in sales would result in a greater number of complaints. The company, however, successfully solved this problem by making bigger call centers and giving intensive technical training to the customer representatives. Taking the ownerships of the complaints, the customer representatives successfully guide the customer through the process (Stoner et al. 2010). Planning Customer Service In order to be successful, every business must have a plan or a strategy (Donald 2006). A plan or a strategy is important for both big and small businesses as the absence of a plan means that the useful resources and efforts of a company can be wasted. A strategy helps the firm to differentiate itself from others in a positive manner and must include effective customer service which would help the company to achieve customer satisfaction. Customer service is an essential component of any business as it influences the buying power and loyalty of the customer. The business should encourage the customers to come forward with their complaints. The customer service must try to resolve the complaints on the very first call. It must act promptly to rectify the complaint. The customer service representatives should follow up to make sure that the customer has no other issues. The company should keep in touch with the customer through calls and e-mails; this is an effective method of retaining customers. Conclusion Due to increasing competition, the businesses are paying more attention to meet the customer expectations in order to satisfy customers. The customer expectations are those assumptions a customer makes about a product or a service. The customer measures these predetermined expectations with the actual performance of the product and can experience a negative, neutral or positive satisfaction. A customer experiences negative satisfaction which is also called the zone of pain when the actual performance of the product or the service falls short of his expectations. The neutral or the zone of mere satisfaction is when the client’s expectations and the actual performance of the product or the service match. The positive satisfaction or the zone of delight is when the performance of the product/service exceeds the customer’s expectations. A customer experiencing this level of satisfaction remains loyal to the business and refers it to others as well. To ensure customer satisfaction, the customer expectations should be identified and measured. Customer expectations keep changing and so it is difficult to identify the requirements of the customer. However, accuracy, ease of availability, quality and price are some basic needs of the customer. Successful businesses make sure that the customer expectations are met prior to the service, during the service and also after the product or the service has been used. Customer feedback is also an important issue of the customer service program. In order to provide a better customer experience and retain the customers, the businesses directly ask the customers what more can be done to satisfy them. The businesses can conduct surveys or encourage the customers to leave comments regarding their products and services. By making use of the response gathered from the surveys, the businesses can improvise. Customer service is the backbone of a business as it is instrumental in winning and retaining customers. The main aim of the customer service must be to resolve the issues of a customer, to regularly check on the customer and to make sure that the customer is happy. References Arthur, C 2012, Digital wars: Apple, Google, Microsoft and the battle for the Internet, Kogan Page Publishers, UK and USA. Carroll, B 2011, The hidden power of your customers: 4 keys to growing your business through existing customers, John Wiley & Sons, USA. Donald, R 2006, Successful career management: strategies beyond technical preparation, AuthorHouse, Bloomington, IN. 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