Understanding Your Customer - Revised

8/3/2019 Understanding Your Customer - Revised

1/73

Understanding Your Customers

By: Razaki PutehB.Econ(Hons), M.B. A

18hb Julai 2010 10.30 Pg

1


2/73


24/29/2012


3/73


34/29/2012


4/73


44/29/2012


5/73


6/73


64/29/2012


7/73


74/29/2012


8/73

8

What is Marketing?

Process by which individuals andgroups obtain what they need and

want through creating andexchanging products and value

with others.

Simply put: Marketing is the deliveryof customer satisfaction at a profit.

4/29/2012


9/73

Core Marketing Concepts

Needs, wants,and demands

Productsand services

Value,satisfaction,and quality

Exchange,transactions,

and relationships

Markets

94/29/2012


10/73

Production Concept

Selling Concept

Market Concept

Societal Marketing Concept

Marketing Management

Philosophies

104/29/2012


11/73

Market and Sales Concepts Contrasted

FactoryExisting

Products

Sellingand

Promoting

ProfitsthroughVolume

The Sales Concept

StartingPoint

Focus Means Ends

MarketCustomer

Needs

IntegratedMarketing

Profitsthrough

Satisfaction

The Market Concept114/29/2012


12/73

Key Issues

CUSTOMER VALUE

CUSTOMER SATISFACTIONS

BUILDING RELATIONSHIPS

124/29/2012


13/73

Customer Development Process

134/29/2012


14/73


15/73

CUSTOMER RETENTION

Customer retention is powerful than customersatisfaction.

Research

60% revenue- existing customer

96% customer dont complaint- but share with others.

82-95% customer retain if responded properly.

It costs 5 times to attract a new customer.

154/29/2012


16/73

Facts about Customers

The Customer is the business biggest asset

The Customer pays all our salaries wages and bonuses

The customer will go where he/she receives the bestattention

There is no profit, no growth, no jobs without the customer

Life blood of business.

.

J Hence, You must be your customers best choice!164/29/2012


17/73

A typical dissatisfied customer will tell 8-10 people about

their problem.

7 out of 10 complaining customers will do business with

you again if you resolve the complaint in their favor.

If you resolve a complaint on the spot, 95% will do

business again.

J Satisfied customers create profits. Profits, in turn create

organizational success and the ability to pay employees

Facts about Customers

174/29/2012


18/73

Starbucks doesnt sell expensive coffee.

Starbucks solves the problem of where to find acomfortable, relaxing, sociable environment,

where you can enjoy 40 minutes of friendly

conversation with friends....priceless!

Customers want Benefits and Solutions

Customer satisfaction is about problem solving

and enabling achievement

What does your product or service really deliver?

184/29/2012


19/73

Customer Expectations

PERFORMANCE

Primary operating characteristics

FEATURES

Bells and whistles

RELIABILITY

CONFORMANCE

DURABILITY

Length of practical use

SERVICEABLITY speed, courtesy, and competence

of repair

AESTHATICS How a product looks, feels,

sounds, taste or smell

Probability of survival

Degree to which a products meetstandard

194/29/2012


20/73

Japanese Value Delivery Process

1 Zero customers feedback time

2 Zero product improvement

time

3 Zero purchasing time

4 Zero setup time

5 Zero defects204/29/2012


21/73

1. Performance

Fitness for use

Product/ service is ready for use.

Availability

Reliability

Maintainability

2. Features

Secondary character

Extra facilities214/29/2012


22/73

3. Service

Provide the service at right time, even though

the customer dont complaint.

4. Warranty

Represents a promise of a quality product.

Force the org to focus on customer needs.

Forces the org to correct the action system.

It attracts and build the market224/29/2012


23/73

5. Price

Nowadays customer is ready to give high price

towards Quality. Expects to get good product in lower price.

Customers perception of value is continuously

changing. To Succeed the org should identify, verify the

perception of value.

234/29/2012


24/73

6. Reputation

Customer wills to buy product from a known

company.

Reputation brings market to the Org.

So org should strive for customer for life.

244/29/2012


25/73

Determinants of

Customer Perceived Value

Image benefit Psychological cost

Personal benefit Energy cost

Services benefit Time cost

Product benefit Monetary cost

Total customer benefit Total customer cost

254/29/2012


26/73

Added value satisfies customers

Product: Bigger Simpler More compact More reliable More convenient More durable Easier to maintain

Delivery: Quicker More Frequent

Service: Friendlier More imaginative

Literature: More informative Better written More visual

264/29/2012


27/73

27

How Do Consumers Choose Among Products

and Services?

Interfunctional activities involves Improving the Quality ofProducts, Servic es, and Marketing Processes

Products Perceived Performance in Delivering Value Relative to

Buyers Expectations isCustomer Satisfaction

Value Gained From Owning a Product and Costs of

Obtaining the Product is Customer Value

4/29/2012

F t Th t Aff t Th C


28/73

Factors That Affects The Consumer

Decision-Making Process

Cultural Culture and values

Social class

Social Reference group

Opinion leader family

Individual Gender

Age & family

Personality Self concept

Life style

Buy/Dont buy

Consumer

decision making

process

Psychological Perception

Motivation

Beliefs & attitudes

284/29/2012


29/73

CUSTOMER

SATISFACTION

294/29/2012


30/73

Customer Loyalty VS Satisfaction

Customer

Expectations

Not meeting

expectations

Meeting

expectations

Exceeding

expectation

Customer

Satisfaction

Dissatisfaction

Satisfaction, but

taken for granted

Enthusiasm &

Surprise

Customer

Loyalty

Defection

Variety Seeking

Customer Loyalty

304/29/2012


31/73

The Bridge to Our Customers

Customer Delight

314/29/2012


32/73

324/29/2012


33/73

Any or all interactions which the customer has with your

organization while conducting business

It is the ability to provide a service or product in the way

it has been promised

It is also about treating customers with respect,

individuality, and personal attention

Customer Service

334/29/2012


34/73

TELEPHONE STANDARDS

Answer phone by third ring

Smile and Greet customer bysaying Askm, Thank you for

calling TTI, This is Inform customer before placingon hold or transferring the call

Your emotions and feelings are

transferred to people callingyou

Return calls same day beforesundown

344/29/2012


35/73

Customer Service - GUEST

Greet the customer

Understand customer needs

Explain features & benefits

Suggest additional items

Thank the customers354/29/2012


36/73

The Customer Wants You To

. . . Invite me back.

. . . Listen to me.

. . . Value me.

. . . Greet me.

. . . Help me.

364/29/2012


37/73

YOU as a customer

Share an experience of Good

Customer Service

374/29/2012


38/73

YOU as a customer

Share an experience of Bad

Customer Service

384/29/2012


39/73

9%

9%

13%

69%

Others

ProductDissatisfaction Better Prices

Elsewhere

Poor Service

Why Customers leave?

394/29/2012


40/73

Do You Know Why They Leave?

1% die.

3% move away.

5% develop other relationships.

9% leave for competitive reasons.

14% are dissatisfied with

product or service. 68% leave because of rude or

discourteous service.

404/29/2012


41/73

Cost of a Negative Experience

Some facts

On average, customers who have had a bad experience will

tell at least 9 other people.

For every customer who complains, there are 26 other

customers who have had similar problems.

96% of the customers who have had a bad experience will

not complain 90% of these customers will not return.

414/29/2012


42/73

Good, Bad, & Excellent Service

424/29/2012


43/73

Good Customer Service

Good service is when the customer gets

treatment that meets his/her expectations.

CustomerExpectation

What Customerreceives

434/29/2012


44/73

Bad Customer Service

Bad Service is when customer gets treatment

which is less than his/her expectations

CustomerExpectation


444/29/2012


45/73

Excellent Customer Service

When the customer gets a little more than what

he/she expected, Good Service becomes Excellent

Service

CustomerExpectation


+

454/29/2012

Wh t liti i t t t


46/73

2. Completeness

is everything customer asked for provided?is a mail order from a catalogue company

complete when delivered?

1. Time and timeliness

how long must a customer wait for service,and is it completed on time?is an overnight package delivered overnight?

What qualities are important to

our customers?

464/29/2012

Wh t liti i t t t


47/73

4. Consistency

is same level of service provided to eachcustomer each time?

is your newspaper delivered on time everymorning?

3. Courtesy

how are customers treated by employees? are catalogue phone operators nice and are

their voices pleasant?


our customers?

474/29/2012

What q alities are important to


48/73

6. Accuracy

is service performed right every time? is your bank or credit card statement correct

every month?

5. Accessibility and convenience

how easy is it to obtain service?does service representative answer you callsquickly?


our customers?

7. Responsiveness how well does company react to unusual

situations? how well is a telephone operator able to

respond to a customers questions?484/29/2012


49/73

Final Perspective

Consumers and producers

perspectives depend on each other

Producers perspective:

Production process and COST

Consumers perspective:

Fitness for use and PRICE

Consumers view must dominate

494/29/2012


50/73

Handling difficult customers is

like removing obstacles that

block the customer path to be

a committedlong-term loyal

customer.

504/29/2012


51/73

The

Pareto Principal

. also

Known By

Many Other Names

514/29/2012

A GREAT Management Tool


52/73

A GREAT Management Tool ..

With Many Names!

The Pareto Principle

The Law of The Vital Few

and the Trivial Many

The Power Law

Participation Inequality The 80 20 Rule

ABC Analysis Technique

524/29/2012

Alfred PARETO


53/73

Alfred PARETO

In 1879, the famous Italian economist Alfred

Pareto, noticed that 80% of Italys wealth was

controlled by 20% of the population.

This concept is known as Paretos Law or

Paretos Rule or Pareto Principle or Principle

of imbalance or simply The 80/20 Rule.

534/29/2012


54/73

Examples of

Pareto Principle / 80 20 Rule

Input Output

Products

EffectCause

Efforts


55/73

20 80 Rule

20% of your customers

Generate 80% of your profit

2080

554/29/2012


56/73

Have YOU Become An 80/20 Individual?

An 80/20 Individual is a person who has learnedthat in order to have success, they don't need

to be increasing their effort by 110%. Most

people who do this are simply doing the wrongthings more often.

Instead, an 80/20 individual looks at the 20%that is responsible for 80% of their results and

then they focus on improving this 20%!

564/29/2012


57/73

Questions and Comments are Welcome

THANK YOU

574/29/2012

U d t di Y C t


58/73


584/29/2012

U d t di Y C t


59/73


594/29/2012



60/73


604/29/2012


61/73

Service Quality Culture

Where serving customer is primary businessobjective

Where everyone takes personal responsibilityand initiative for providing quality services

Where managers ensure that the staff givescustomers more importance than their bosses

Where staff support each other and depts.collaborate rather than compete.

Where customer complaints are considered asopportunities to improve

614/29/2012

H d t i


62/73

How does a customer perceive

a caring Organization?

Customer-focused Organization

Convenient

Appreciates/

Values

Customers

Responsive

Take

Ownership

Transparent

(fees, rates,

policies)

624/29/2012


63/73

63

Service Quality Dimensions

RELIABILITYAbility to provide

what waspromised,

dependably &accurately

ASSURANCEKnowledge &courtesy of

employees that

conveys trust &confidence

TANGIBLES

Physical facilities& appearance

EMPATHY

Degree of caring &individual attention

provided tocustomers

RESPONSIVENESS

Willingness to helpcustomers & provide

prompt services

4/29/2012


64/73

Positioning the Firm

COST SPEED

QUALITY FLEXIBILITY

644/29/2012


65/73

Key Dimensions of Service Quality

ability to provide what waspromisedRELIABILITY

knowledge and courtesy ofemployees and ability to conveytrust

ASSURANCE

physical facilities andappearance of personnelTANGIBLES

654/29/2012


66/73

Key Dimensions of Service Quality

degree of caring and individualattentionEMPATHY

willingness to helpcustomers and provide

prompt service

RESPONSIVENESS

664/29/2012



67/73


674/29/2012



68/73


684/29/2012


69/73

Identify & anticipate needs Customers dont just

buy products/service; they buy good feelings &

solutions

Make customers feel important & appreciated

Avoid rushing or doing too many things at once

Smile

Apologize when something goes wrong

Service a little more than they expect Use positive verbal & body language

Smile

Tips for Good Customer Service

694/29/2012


70/73

Key Dimensions of Quality

Performance primary operating characteristics

Featuresbells and whistles

Reliability probability of operating for specific time

and conditions of use Conformance degree to which characteristics match

standards

Durability - amount of use before deterioration or

replacement

Serviceability speed, courtesy, and competence of

repair

Aesthetics look, feel, sound, taste, smell704/29/2012

C S i


71/73

Customer Service

"Customer service is the ability to provide aservice or product in the way that it has been

promised

"Customer service is about treating others as

you would like to be treatedyourself

"Customer service is an organization's ability

to supply their customers' wants andneeds

"Customer Service is a phrase that is used todescribe the process of taking care of our

customers in a positive manner"

714/29/2012


72/73

Quality is what customer perceives to be.

Customer needs goes on changes

Quality level needs are to be improved

accordingly.

ASQ survey ranked six customerperceptions value

724/29/2012


73/73

Quality and Profitability

Documents

Understanding Your Customer - Revised