Service Quality As A Core Competitive Strategy

Today’s world competition is very strong in every kind of businesses. Every organisations must provide high quality products or services in order to survive, however their competitors also providing the same or comparable products or services. An important way to an organisation to get an edge over its competitors is to provide extra service to satisfy and delight their customers, which can retain them and also gain new customers. Therefore the achievement of customer satisfaction must be a major objective in all organisations.

According to Pacelli “High customer satisfaction translates to customer loyalty, and loyalty is one of the biggest drivers of corporate growth” (PACELLI, 2011)

Customer loyalty is much harder to obtain that customer service satisfaction. The most important first step is to satisfy the customer by meeting their expectations. Customers only give a company one chance and if they aren’t satisfied they will not do business with that company again, as well as tell others of their experience. The next step would be to exceed the customer’s expectations. If a business goes above and beyond to assist the customer they begin to build loyalty. The next step is to truly surprise the customer. In order to dominate the marketplace the company must find a way to make them selves stand out with their product or service, accompanied with phenomenal customer service. Once this has been done customer satisfaction and loyalty will be gained. “Acquiring a new customer can cost four or five times more than keeping a current customer” (Bestmark, 2013). So it’s essential to keep the current customer’s happy and coming back for more.

Secondly, providing high quality customer service might be another essential factor in any customer loyalty strategy. The better a vendor treats their customers, the more likely the customers will return. As Cater and Cater (2009) state, an outstanding customer service could create a sustainable loyal customer

Researcher’s trust that the service quality theory depends on the literature of client satisfaction and product quality. In other words, service quality can be defined as the customer’s overall journey of experience with the product, which can be measured by customer satisfaction while experiencing the service.

Customer Satisfaction and Loyalty has become, throughout years, not only an important marketing tool but also an integrated part of a company structure. Competition has become fierce and competitors in a market are trying constantly to prove that their products and services are better than others. Therefore, being able to satisfy and retain customers will definitely create a competitive edge over competitors but will also reduce cost while creating long term relationship with customers.

Therefore, measuring this service quality will lead to the customer satisfaction through measuring quality dimension to evaluate the services and to measure the gap between customer perceptions and expectations, any bank that fails to surpass customer expectations and meet customer satisfaction will not be able to compete with other banks. It is the most difficult challenge for a bank that its customers transfer their accounts to rival banks because of better services. Five dimensions of SERVQUAL have been developed for the service sectors: assurance, empathy, reliability, responsiveness and tangibility (Van Iwaarden et al.,

In order to build and sustain a competitive edge, service organization need to strive to maintain a superior quality of services in an effort to gain customer loyalty, hence improving customer retention rates.(Kadampully,1998)

The combined multi-attribute and Kano model provide some guidance regarding how service is perceived by bank customers in the mass affluent segment. There exists a substantial heterogeneity in customer perceptions of the service quality items (Strandberg et al., 2012). An alternative model presented by Gronroos (1990) emphasizes the functional (how), technical (what), and servicescape (where) dimensions. Gronroos (1990) includes the servicescape attributes in the functional dimension, while others (Bitner, 1992; Rust and Oliver, 1994) see the servicescape as a discrete dimension. According to Kang (2006), recent studies have attempted to include more items in models of perceived service quality, particularly items related to Gronroos’ dimensions (Strandberg et al., 2012). According to Kano et al. (1984) quality attributes can be divided into four distinct categories: taken-for-granteds, which produce dissatisfaction if they are performed unsatisfactory but will not result in increased satisfaction if they are performed above that level; proportionals, which produce more satisfaction the superior the performance and more dissatisfaction the poorer the performance; delighters, which creates satisfaction if they are performed but not necessarily in dissatisfaction if they are not performed; & neutrals, which are traits to which the customer is indifferent (Strandberg et al., 2012).

A journal article which researches service equity, satisfaction and loyalty by Johnson and Olsen (2003). is an informative article through the use of different research models and study which culminates in an understanding that cumulative evaluations are an important measure of customer loyalty. Hence management that closely examines cumulative satisfaction has a better understanding of improvement for the customer

It is considered that the most critical thing for a company is to effectively and efficiently deliver the service to the customers. It does really matter which industry the organization is operating in, the features of services have be taken very seriously and in addition to that, customers have to be satisfied in order for the organization to grow. It has been argued by numerous scholars that the primary need of the customers in the modern business world is to have a good experience, along with added value to be served to them. It is important to note that regardless of the capabilities of a product, the organization is not likely to be successful in accordance with its full potential if the offered

In the past decades, there was a controversial issue about the relationship between customer loyalty and satisfaction. Actually, it is still a heated debate nowadays. Some people said that customer satisfaction bring customer loyalty, while some people believed that customer loyalty affect customer satisfaction. Interestingly, very few executives and managers understand the critical difference. The purpose of this paper is to find the relationship between customer loyalty and satisfaction and how should companies do to build loyalty. According to some previous researches, we found that customer satisfaction is just one of the factors of affect customer loyalty.

Service organisations must be in close relationship with their customers nowadays, mainly if they expect to enhance their service or gain a strategic advantage. Thereby most of firms interact consistently with the customer in order to perceive precisely what he needs and what he expects by buying the service. Many service management theories or techniques are applied by these organisations to obtain the desired outcomes. In this essay I will go through some of them: the service concept, understanding customer types and SERVQUAL customer perceptions and expectations. I am going to carry on a

The Importance of Customer Satisfaction in Relation to Customer Loyalty and Retention by Harkiranpal Singh

Service quality represents a fundamental aspect of delivery, which strongly influences consumer satisfaction and, as a result, loyalty. In today’s global market a customer’s service expectation has to be met and exceeded eventually in order to retain customers as well as achieve success. Perceived quality of a product or a service is becoming one of the major competitive factors in the business world and has led to the innovation of the ‘Quality Era’ (Peeler, 1996). In simple words, the comparison of customer expectations with service performance is service quality. On the other hand, customer satisfaction is defined as a pleasurable fulfilment response toward a good, service, benefit, or reward (Oliver, 1997). Both of these