Summary!Services!Marketing! ! Claudia!Laven! !

Proposition*6a:!When&the&reference&level&is&variable,&a&service&failure&followed&by&a&service&delight&has&a&less&
adverse&effect&on&PSQ&than&a&service&delight&followed&by&a&service&failure.!
!
o As! downward! reference! level! triggered! by! failure! regresses! back! to! initial! level,! gain! of!
delight! becomes! smaller! !! differential! advantage! of! a! failure! followed! by! delight!
weakened!over!time!
!
Proposition*6b:!When&the&reference&level&is&variable,&the&advantage&of&a&service&failure&followed&by&a&service&
delight& over& a& service& delight& followed& by& a& service& failure& diminishes& as& the& time& gap& between& the& two&
occurrences&increases.&
&
Discussion!
Theoretical!Implications!
o Prospect!theory!and!mental!accounting!principles!underlie!framework!
o Extension!of!prospect!theory!!!conceptual!+!mathematical!derivation!of!proposition!
o Examination! of! multiple! occurrences! and! aspects! of! failure! and! delight! (frequency,!
timing,!proximity,!sequence)!
o Reveals! theoretical! need! to! carefully! examine! the! distribution! patterns! of! service!
failure/delight! to! understand! their! effects! on! customer! perceptions! beyond! previously!
researched!factors!such!as!attribution!and!controllability!!!new!research!avenue!
o Examination!of!dynamic!reference!levels!
Managerial!Implications!
o Enabling!firms!to!allocate!resources!optimally!for!failure!prevention!
o Loss!integration!more!effective!than!loss!segregation!
o Sequence! of! failure! and! delight! matters! !! better! to! offer! delightful! surprise! after! (vs.!
before)!an!unpleasant!service!experience!
o Managerial!implications!of!both!controllable!and!uncontrollable!service!failures!
o Controllable:!predict!+!prevent!failures!
o Uncontrollable:!choose!optimal!way!to!communicate!failures!to!customers!
!

Chapter!3:!Customer!Expectations!of!Service!
Customer* Expectations! =! beliefs! about! service! delivery! that! serve! as! standards! or! reference!
points!against!which!performance!is!judged!
Most! important:! types! of! expectations,! influencing! factors,! role! of! the! factors! to! change!
expectations,!how!to!meet!or!exceed!expectations!

Meaning!and!Types!of!Service!Expectations!
Level!of!expectation!can!vary!widely!depending!on!reference!point!the!customer!holds!
Dual!customer!expectation!levels:!
o Desired*service!=!level!of!service!the!customer!hopes!to!receive!!the!wishedMfor!level!of!
performance!
o Adequate* service! =! threshold! of! acceptable! service,! level! of! service! the! customer! will!
accept,!minimum!tolerable!expectation!or!bottom!level!of!performance!acceptable!to!the!
customer!
Levels!of!expectation!are!why!two!organisations!in!the!same!business!can!offer!far!different!levels!
of!service!and!still!keep!customers!happy!
Desired!service!expectations!seem!to!be!the!same!for!service!providers!within!industry!categories!
or!subcategories!that!are!viewed!as!similar!by!customers!
Adequate!service!expectation!level!may!vary!for!different!firms!within!category!or!subcategory!
Services!are!heterogeneous,!they!vary!from!time!to!time!because!of!its!characteristics!
Zone*of*tolerance!=!extent!to!which!customers!recognise!and!are!willing!to!accept!this!variation;!
range!of!window!in!which!customers!do!not!particularly!notice!service!performance!
o Zone! of! tolerance! varies! within! a! customer! (e.g.! when! customer! is! in! a! rush,! zone! of!
tolerance!shrinks)!
o Individuals! zone! of! tolerance! increases! or! decreases! depending! on! a! number! of! factors!
including!companyMcontrolled!factors!such!as!price!
o Different!customers!possess!different!zones!of!tolerance!

! 22!
Summary!Services!Marketing! ! Claudia!Laven! !

o Zones!of!tolerance!vary!for!service!dimensions!(e.g.!Reliability!or!Tangibles)!
o Desired! service! is! relatively! idiosyncratic! and! stable! compared! with! adequate! service,!
which!moves!up!and!down!and!in!response!to!competition!and!other!factors!

Factors!that!Influence!Customer!Expectations!of!Service!
Sources!of!Desired!Service!Expectations:!
o Personal!needs!=!states!or!conditions!essential!to!physical!or!psychological!wellMbeing!of!
the!consumer!
o Lasting! service! intensifiers! =! individual,! stable! factors! leading! the! customer! to! a!
heightened!sensitivity!to!service!
" Most! important! one:! derived! service! expectations! =! occur! when! customer!
expectations!are!driven!by!another!person!or!group!of!people!
" Personal!service!philosophy!=!customers!underlying!generic!attitude!about!the!
meaning!of!service!and!the!proper!conduct!of!service!provider!
Sources!influencing!adequate!service:!!
o Predicted!Service!=!the!level!of!service!that!customers!believe!they!are!likely!to!get!
Sources!of!Both!Desired!and!Predicted!Service!Expectations!
o Explicit! Service! Promises! =! personal! and! nonMpersonal! statements! about! the! service!
made!by!the!organisation!to!customers,!completely!in!control!of!the!service!provider!
" Often!overMpromising!
" Direct!effect!on!desired!service!expectations!
" Indirect!effect!on!adequate!service!expectations!via!predicted!service!
o Implicit!Service!Promises!=!serviceMrelated!cues!other!than!explicit!promises!that!lead!to!
inferences! about! what! the! service! should! and! will! be! like! (e.g.! price! or! associated!
tangibles)!
" The! higher! the! price,! the! more! impressive! the! tangibles,! the! more! a! customer!
will!expect!
o WOM!communications!
" Perceived!as!unbiased!
o Past!experiences!

!
Issues!Involving!Customer!Service!Expectations!
5!most!frequently!asked!questions!about!customer!expectations:!
o What!does!a!service!marketer!do!if!customer!expectations!are!unrealistic?!
" Service! marketers! have! fear! of! asking! about! customer! expectations! since! they!
are!afraid!that!they!are!unrealistic!

! 23!
Summary!Services!Marketing! ! Claudia!Laven! !

" But:!customers!just!want!performance,!not!empty!promises!
" Some!try!to!deliberately!underMpromise!to!increase!the!likelihood!of!meeting!or!
exceeding!expectations!(but!this!may!reduce!competitive!appeal!of!the!service)!
o Should!a!company!try!to!delight!a!customer?!

Musts!

Satisniers!

Delights!

!
" When!considering!to!offer!delights,!weigh!its!benefits!+!costs,!2!aspects:!
" Staying! Power! =! involves! how! long! a! company! can! expect! an! experience! of!
delight! to! maintain! the! customers! attention! (also! thinking! about! that! delights!
raise!the!bar!for!the!future)!
" Competitive! implications! =! impact! on! expectations! of! other! firms! in! the! same!
industry!(should!not!be!easily!copied!by!other!firms)!
o How!does!a!company!exceed!customer!service!expectations?!
" Companies!are!supposed!to!be!accurate!and!dependable!and!provide!the!service!
they!promised!to!provide!!nothing!more!and!nothing!less!
" Approach! to! exceed! customers! expectations:! develop! customer! relationship,!
underMpromise!+!overMdeliver,!position!unusual!service!as!unique!rather!than!the!
standard!
o Do!customer!service!expectations!continually!escalate?!
" Adequate!service!expectations!rise!as!delivery!or!promises!rise,!very!dynamic!
" Thus:!expectations!can!rise!quickly!in!a!highly!competitive!and!rapidly!changing!
industry!
" Desired!service!expectations!are!more!stable!
o How! does! a! service! company! stay! ahead! of! competition! in! meeting! customer!
expectations?!
" Perform!above!adequate!service!expectation!level!+!reach!desired!level!to!ensure!
consumer!loyalty!

Chapter!4:!Customer!Perceptions!of!Service!
Satisfaction!vs!Service!Quality!(terms!used!interchangeably,!but!they!are!different)!
o Satisfaction!=!broader!concept!
o Service!Quality!=!focuses!specifically!on!dimensions!of!service!
o Thus:!Perceived!service!quality!is!a!component!of!customer!satisfaction!

! 24!