Service Encounter - Customers and LUMO Energy, Optus, Foxtel, RACV, and Commonwealth Bank - Term Paper Example

The service encounter and Analysis Executive Summary Service encounters forms the daily basis of transactions in the marketing of services. Analysis of the service encounter gives the business an opportunity to improve the quality of service provided and encourage repeat purchases. This report analyses five service encounters that occurred in different setting in the recent past. The first service encounter is between the customer and LUMO Energy which is an electricity company. The customer calls to complain about an inflated bill. The second service encounter is between the customer and Optus, which telecommunication company. The customer calls seeking internet service. The third service encounter happens between the customer and Foxtel; which is a satellite and TV channels company. The customer calls to raise an issue about the local TV channel which does not work. The fourth service encounter is between the customer and RACV, which is an insurance company. The customer calls to be assisted concerning his car that had broken down on his way to Ballarat University. The final service encounter involves the customer and Commonwealth Bank. The customer has lost his Bank Card and needs to terminate it as he seeks a new one. The report contain an executive summary, table of contents, list of tables/images, introduction, summary, analysis of the service encounters, and conclusion. There is a list of references at the end and an appendix of labeled appendices consisting of the journal entries of service encounters analyzed in the report. Content Table Executive Summary 1 List of tables/images 3 Introduction 4 Summary 4 Customer and LUMO Energy 5 Customer and Optus 8 Failed service encounter 9 Customer and Foxtel 11 Customer and RACV 12 Customer and Commonwealth Bank 13 Conclusion 14 References 15 Appendix I 17 Service Journal Entry Form 17 Appendix II 19 Service Journal Entry Form 19 Appendix III 21 Service Journal Entry Form 21 Appendix IV 23 Service Journal Entry Form 23 Appendix V 25 Service Journal Entry Form 25 List of tables/images Disconfirmation of expectations model……………………………………………………….8 Failed service encounter……………………………………………………………………….11 Introduction Customer behavior is a major component of marketing. Services possess characteristics that are distinct which influence consumer behavior. A service involves a process, but not one single event. The customer takes part majorly or to a small degree in the production of the service. The culture of a place plays a vital role in impacting on the service delivery. The company has to understand the context of the culture to effectively provide the best services. Proper analysis of the service encounter offers an opportunity to the company to reflect on the quality of the service and assess the degree of application of the attribution theory. The customer has to be given a chance to feel that he is in control of the service delivery process. This paper analyzes five service encounters that have taken part recently giving insight of what led to dissatisfaction or delight of the customer. Theories, concepts, and models have been linked to the practical situation of the service encounter. Summary The objective of this paper is personal comprehension and evaluation of service encounters that have been experienced in the recent past. The report seeks of give a critical analysis and reflection of the quality of the service provided and the satisfaction or dissatisfaction of the customer. Concepts, models, and theories used within the cause have been applied in the evaluation of the service encounter. Each service analysis commences with a brief explanation of the service encounter and then followed by a critical analysis of the service encounter from a personal perspective but applying the concepts, models, and theories that have been studied on service marketing during the course work (Zeithaml & Bittner, 2000). The service encounter perception varies from one setting to another. Personalized service describes a situation where any behavior occurring in the interaction targeted to contribute to the process of individualization of the customer. Satisfaction is regarded as a function of the discrepancy between the performance and customer expectations. Services entail a series of social exchanges between people. The culture of the setting influences consumer behavior. Customer and LUMO Energy The service encounter between the customer and the electricity company LUMO Energy happens over the phone. This service encounter is labeled in this report as appendix I. As stated earlier, service encounter was conducted over telephone. The service encounter happened at around 3.30 pm in the evening. The customer realized that his Bill was inflated and it deemed very expansive as compared to the services he was receiving from LUMO Energy Company. After the service encounter, the customer gives a ranking of 4 out of 5 as being the rating of the service encounter. Service decisions involve pre-purchase, service encounter, and post-purchase. The pre-purchase phase involves the acknowledgement of a need or a want. An individual search for information, evaluates alternatives, and makes a choice of the intended purchase. The service encounter is the purchase of the service or its consumption. The final phase involves evaluation of the satisfaction which has been drawn from the service. Repeat purchases or customer loyalty can occur after the final phase. This can result in negative or positive ranking of the service by the customer. If the customer is dissatisfied he can switch to another service provider. The disconfirmation of expectations model shows the manner in which the customer perceives the service that is being rendered to him or her (Lovelock, Patterson, Wirtz & Walker, 2010). The model shows whether the process yields delight, mere satisfaction, or dissatisfaction. Disconfirmation of expectations model However, dissatisfaction and satisfaction are two different and separate constructs which are not placed in the same continuum (Sureshchandar, Chandrasekharan & Anantharaman, 2002). For the customer seeking classification from the electricity company concerning his inflated bill, he must have been quite delighted to give a ranking of 4 out of five. This is close of being delighted. The customer feels that equity theory was followed. Equity theory concerns fairness or the comparison between the feedback obtained and the inputs that the customer has put into the process of calling. The customer was almost delighted by the explanation of the company to relent his earlier suspicion of being exploited by the company. The employee of the LUMO Energy was helpful and respectable from the perception of the customer. The customer was satisfied with being told that the bill had rose owing a new payment plan that allowed the customers to pay the next four bills. Consequently his bill was not after all inflated but included four bills. The degree of personal involvement in this service encounter was high and the customer felt duly satisfied with the services rendered. It would be wise for the company to seek the approval of customers or alert them in advance before implementing anything new. The customer indicated that was likely to return to the customer for repeat services. Customer and Optus The second service encounter is labeled as appendix II in the appendix section that involves the service encounter between the customer and a telecommunication company called Optus. The service encounter occurred at 2.20 p.m. The medium of transmission was also through telephone conversation. The customer called with a request to be supplied with internet in his house. The customer rates the satisfaction derived from this service encounter at 3 out of the possible 5. This shows that the service only met the bare minimum. This means that the service delivery was not of desired expectation. The desired expectation is the optimum degree of performance from a service provider. The customer feels that the equitable or the deserved expectations of the service encounter was not met. The service rendered by Optus can only meet adequate or minimum tolerable expectations. The customer reckons that Optus has poor service. The original contract signed by the customer indicated that he has to pay $59.99 but he ended paying $77. The terms of the contract were violated as the judgment of the customer. According to attribution theory the company has to look for the cause of dissatisfaction. The company has to know whether the dissatisfaction from the service is within the control of its setting. The corrective measures have to ensure stability of service delivery. The attribution theory consists of causal, control, and stability (Stewart, 2003). The customer was not pleased with the explanation given by the employee. The customer suggests that the company has to focus on customer satisfaction. The chances of repeat purchases are very unlikely. The following diagram process of failed service encounter. Failed service encounter The customer has indicated in the journal entry in the appendix II that very unlikely for him to go back to the service provider for the same services. The service ranks the likelihood of going back to the company for similar service at a 2 out of the possible 5. The interaction value derived from the service encounter was ranked very poor (Lovelock & Wirtz, 2011). In the case of dissatisfaction with the services offered, the company has to find ways of analyzing the case through attribution theory and ensure that future incidences do not have negative impact on the performance of the company. The ideal expectations held by the customer were not met by the service offered by the company (Sivadasm & Baker-Prewit, 2000). The contract was forfeited and the customer felt cheated. Furthermore the employee assigned to give explanation to the customer was more confusing than helpful. Customer and Foxtel The third service encounter is recorded in the entry journal as appendix III in the appendix section of this report. The service encounter involved a customer and Foxtel which is a satellite and TV channels company. The medium of interaction was through a telephone conversation. The customer called to ask about the problem involving the local TV. This service encounter occurred at around noon. The customer rates the service encounter at 5 out of 5. The service encounter was excellent and it made the customer very delighted. The emotional value derived from this service encounter by the customer was very wonderful as per his judgment. The price for the service was well accounted for and the customer felt that he had quality for his money. The desired expectations which are the customer’s feelings about the service rendered were clearly met. The control theory states that the customer has to feel that he is in charge or in control of the purchase situation to dictate some of the terms (Mukherjee, Path & Pal, 2003). The customer discovered that the company offered a deal and very desirable packages. Foxtel could be obtained with no contract all and no additional charges. The customer was at will to change or switch to any other package. The company maintained a culture of calling the clients after a month to inquire if they were happy with the services offered. The employee of the company assigned to deal with the offers of the services was clear and easily understood by the customer. The employee was also helpful and respectable. Nevertheless, the customer still reckons that the company could increase service delivery by taking less than two days to delivery the promised box. When asked about going back for the same service, the customer puts this rank at 4 out of five. This shows that the customer is likely to go back to the company, but not extremely likely to do the same. If another competitor with better service surfaces, the customer is likely to switch brands. The customer will look for another company that best cater for his needs. Customer and RACV The fourth service encounter is labeled under the appendix section as appendix IV. The service provider was an insurance company. The service encounter happened at around 10.30 am in the morning. The medium of the service encounter was through telephone conversation. The service encounter was prompted by the breaking down of the customer’s car while driving to Ballarat University. The desired expectations of the service were duly met according to the response from the customer. The customer rates the service provided at 5 out of 5 indicating that he was very delighted by the services provided. When the desired expectations of the customer are met, the customer feels satisfied and delighted by the service provided (Weile, Boselie & Hesselink, 2002). The contract provided by the insurance company covered two years and it cost $200 which was fit well into the budget of the customer. The delivery of the service was within five minutes after the signing of the contract. The insurance policy that the customer needed was roadside assistance. The customer rates the service highly because he reckons that he was treated in the most desirable manner by the company. The customer suggests that the company has top introduce more offers than the present so as to get more customers. The customer ranks the likelihood of coming back to the company for the same service at 5 out of 5 which is extremely likely. Customer and Commonwealth Bank The final service encounter analysis happened between the customer and his service provider, Commonwealth Bank. The service happened at around 10.30 am in the premises of the Commonwealth Bank. The customer had lost his Bank Card and he went to the bank to stop or terminate the Card and request for a new one. The customer was almost delighted by the service provided. He ranks the service provided at 4 out of 5. The customer was happy that he was not made to wait for long before being served. The customer was given an opportunity to inquire about the where about of the card if he did not receive it within 3 working days. The customer was happy and the manner in which his case was handled, but he recommends instant issuing of cards instead of waiting for some days. The customer is extremely likely to go back for the same service on a second occasion. Satisfaction derived from the service was of high degree to occasion the positive feedback from the customer (Lovelock & Gummesson, 2004). Service personnel who are motivated in their jobs are more likely to offer the best services to customers. The marketing of services has to focus of identifying the needs of the customers and addressing the concerns raised. Conclusion Careful analysis of service encounter can provide a path way through which the company can improve its service provision. A service should not be taken as a single event but a process that requires careful planning. Positive feedback from the customer is likely to result into repeat purchases. The service encounter between the customer and Foxtel was rated highly because the customer felt that his needs were satisfactorily met by the service provider. Understanding the needs of the customer and the cultural setting is very important towards provision of services that receive positive feedback. The essence of service encounter analysis is to understand the process of service encounter and discovering what causes dissatisfaction on the part of the customer. Improvement cannot occur without thorough analysis of service encounter. References Lovelock, C., & Gummesson, E. (2004). Whither Services Marketing?: In Search of a New Paradigm and Fresh Perspectives. Journal of Service Research 7 (1) 20-41 Lovelock, C. & Wirtz, J. (2011). Services Marketing – People, Technology, Strategy. 7th ed., Upper Saddle River, New Jersey: Prentice Hall. Weile, T., Boselie, P. & Hesselink, M. (2002). Empirical evidence for the relationship between satisfaction and business performance. Managing Service Quality, 12 (3): 184-200 Lovelock, C.H., Patterson, P. Wirtz, J., & Walker, R.H. (2010). Services Marketing: An Asia-Pacific and Australian Perspective. Melbourne: Pearson Education Australia. Zeithaml, V.A. & Bittner, M.J. (2000). Services Marketing. Boston: Irwin and McGraw-Hill. Stewart, D. (2003). Piecing together service quality: A framework for robust service, Production and Operations Management, 12 (2): 246-265. Sivadasm, E. & Baker-Prewit, J.L. (2000). An examination of the relationship between service quality, customer satisfaction, and store loyalty, International Journal of Retail & Distribution Management, 28 (2): 73-82. Sureshchandar, G., Chandrasekharan, R. & Anantharaman, R. (2002). The relationship between service quality and customer satisfaction-a factor specific approach, The Journal of Services Marketing, 16 (4): 363-379. Mukherjee, A., Path, P. & Pal, M. (2003). Resource, service quality and performance triad: A framework of measuring efficiency in banking, The Journal of the Operational Research Society, 54 (7): 723-738 Appendix I Service Journal Entry Form Name of Firm/Service Provider: LUMO Energy Type of Service (e.g. bank, restaurant, petrol station): Electricity company Date: 05/08/2012 Time: 3:30 pm How did the encounter take place? (e.g.) in person, telephone, mail?) Telephone What specific circumstances led up to this encounter? (e.g. purpose, location, expectations, etc.) The Bill was too high and expansive ries as appendices. rvices encounters? huma How would you rate your level of satisfaction with the encounter? (Circle a number corresponding to your feelings) Terrible Delighted 1 2 3 4 5 What exactly made you feel that way? Because the employee explained why the bill is too high after that they made a payment plan and easier to pay it with next four bills ries as appendices. rvices encounters? humaries as appendices. rvices encounters? humaries as appendices. rvices encounters? huma What could the employee /firm have done to increase your level of satisfaction? What improvements need to be made to this service system? The employee was very respectable and helpful. Company needs to improve their services to send customers some items to let them use less electricity and save moneyries as appendices. rvices encounters? humaries as appendices. rvices encounters? humaries as appendices. rvices encounters? humaries as appendices. rvices encounters? huma How likely is it that you will go back to this service provider? Extremely Unlikely Extremely Likely 1 2 3 4 5 Appendix II Service Journal Entry Form Name of Firm/Service Provider: Optus Type of Service (e.g. bank, restaurant, petrol station): Telecommunication company Date: 15/06/2012 Time: 02:20 pm How did the encounter take place? (e.g.) in person, telephone, mail?) Telephone What specific circumstances led up to this encounter? (e.g. purpose, location, expectations, etc.) I need to have an internet in my house ries as appendices. rvices encounters? huma How would you rate your level of satisfaction with the encounter? (Circle a number corresponding to your feelings) Terrible Delighted 1 2 3 4 5 What exactly made you feel that way? Because they have a poor service, after I signed the contract with OPTUS, they said to me that I will use the internet within 10 working days, but unfortunately I have used the internet more than three weeks, also they charge me for the first three weeks .in addition, the contract was $59.99 and they charge me more than $77 ries as appendices. rvices encounters? humaries as appendices. rvices encounters? humaries as appendices. rvices encounters? huma What could the employee /firm have done to increase your level of satisfaction? What improvements need to be made to this service system? Unfortunately the employee was not good at explaining and dealing with customers, the company must focus on consumer’s satisfaction ries as appendices. rvices encounters? humaries as appendices. rvices encounters? humaries as appendices. rvices encounters? humaries as appendices. rvices encounters? huma How likely is it that you will go back to this service provider? Extremely Unlikely Extremely Likely 1 2 3 4 5 Appendix III Service Journal Entry Form Name of Firm/Service Provider: Foxtel Type of Service (e.g. bank, restaurant, petrol station): satellite and TV channels company Date: 1/07/2012 Time: 12:30 pm How did the encounter take place? (e.g.) in person, telephone, mail?) Telephone What specific circumstances led up to this encounter? (e.g. purpose, location, expectations, etc.) Because the local TV does not work in my house ries as appendices. rvices encounters? huma How would you rate your level of satisfaction with the encounter? (Circle a number corresponding to your feelings) Terrible Delighted 1 2 3 4 5 What exactly made you feel that way? There was offer, that anyone can get Foxtel with no contract, so I can cancel it anytime with no fees, also I can change packages. After one month the company calls me to ask me if I’m happy with the service What could the employee /firm have done to increase your level of satisfaction? What improvements need to be made to this service system? The employee was very respectable and helpful was explaining the contract clear and easily, on the other hand the company needs to improve their service to faster than now, e.g to get the box next day not within one weekries as appendices. rvices encounters? humaries as appendices. rvices encounters? humaries as appendices. rvices encounters? humaries as appendices. rvices encounters? huma How likely is it that you will go back to this service provider? Extremely Unlikely Extremely Likely 1 2 3 4 5 Appendix IV Service Journal Entry Form Name of Firm/Service Provider: RACV Type of Service (e.g. bank, restaurant, petrol station): Insurance company Date: 10/05/2012 Time: 10:30 am How did the encounter take place? (e.g.) in person, telephone, mail?) Telephone What specific circumstances led up to this encounter? (e.g. purpose, location, expectations, etc.) My car broken down when I was driving to Ballarat University ries as appendices. rvices encounters? huma How would you rate your level of satisfaction with the encounter? (Circle a number corresponding to your feelings) Terrible Delighted 1 2 3 4 5 What exactly made you feel that way? The way of helping, when I called RACV to assist me, then the employee said me I have to sign a contract it will cost me $200 and it will cover Two years, which is good for my budget. As soon as I sign the contract in (ROAD SIDE ASSISTENCE) they sent me the maintenance within five Minutes What could the employee /firm have done to increase your level of satisfaction? What improvements need to be made to this service system? The employee was very respectable and helpful. The company should make some offers to get more members­­­­­ and increase their profits ries as appendices. rvices encounters? humaries as appendices. rvices encounters? humaries as appendices. rvices encounters? humaries as appendices. rvices encounters? huma How likely is it that you will go back to this service provider? Extremely Unlikely Extremely Likely 1 2 3 4 5 Appendix V Service Journal Entry Form Name of Firm/Service Provider: Commonwealth Bank Type of Service (e.g. bank, restaurant, petrol station): Bank Date: 20/08/2012 Time: 10:30 am How did the encounter take place? (e.g.) in person, telephone, mail?) In person What specific circumstances led up to this encounter? (e.g. purpose, location, expectations, etc.) I had lost my Bank Card then I went to the bank to stop the Card, order a new one and chick the account ries as appendices. rvices encounters? huma How would you rate your level of satisfaction with the encounter? (Circle a number corresponding to your feelings) Terrible Delighted 1 2 3 4 5 What exactly made you feel that way? They did not let me wait longer at the end of the conversation they asked me that if I did not receive the new card within three working days I have to inform them. ries as appendices. rvices encounters? humaries as appendices. rvices encounters? humaries as appendices. rvices encounters? huma What could the employee /firm have done to increase your level of satisfaction? What improvements need to be made to this service system? The employee was very respectable and helpful. On the other hand, they need to improve their services to issuing cards at the same time. ­­­­ries as appendices. rvices encounters? humaries as appendices. rvices encounters? humaries as appendices. rvices encounters? humaries as appendices. rvices encounters? huma How likely is it that you will go back to this service provider? Extremely Unlikely Extremely Likely 1 2 3 4 5 Read More