Challenges for Services

 Defining and improving quality

 Designing and testing new services
 Communicating and maintaining a consistent
image
 Accommodating fluctuating demand
 Ensuring the delivery of consistent quality
 Motivating and sustaining employee commitment
 Coordinating marketing, operations, and human
resource efforts
 Setting prices
 Finding a balance between standardization
versus personalization
 Differentiation and competitive advantage may be
difficult to achieve
 Marketing orientation is still relatively new to
many managers
 Operations management, rather than marketing,
continues to dominate
 Customer service management and marketing is
often in the hands of lower paid subordinates,
possibly in multiple locations
 Limited data on competitive performance is
available
 Problems in determining costs for pricing
purposes
 Organisation
Organisation

Internal Traditional
marketing marketing

Satisfaction; Quality;
Brand Loyalty

Employees
Employees Relationship management Customers
Customers

The Services Marketing Triangle

Company
(Management)
Internal External
Marketing Marketing
“enabling the “setting the
promise” promise”

Employees Interactive Marketing Customers

“delivering the promise”
Based on the disconfirmation model, these models
view service quality as the gap between the expected
level of service and the customer’s perceptions of the
actual service received. The gaps model proposes
that consumers’ overall service quality perceptions
are a result of comparisons between expectations and
perceptions. The higher the service quality
expectation in relation to actual performance, the
lower the level of perceived service quality. Similarly,
the lower the expectation in relation to actual
performance, the higher the level of perceived service
quality. In this way the gaps model sees service
quality as a disconfirmation between expectations and
perceptions. The gaps model (see figure 4.2) serves
as a useful diagnostic tool for evaluating why service
quality is failing, and comprises two primary sections.

The first section section, comprising four gaps that

are aimed at management, reflects potential service
failure as a result of management’s actions. These
gaps provide a framework for management to
understand the causes of service quality failure. The
second section, or fifth gap, occurs at the consumer
level. This gap suggests that the difference between
expected and perceived levels of service form
consumers’ overall perception of service quality. It is
this gap that is the central focus of the gaps model. It
is also this gap that the SERVQUAL instrument
measures
Gaps Model of Service Quality

 Provider Gap 1 (The Knowledge Gap):

 not knowing what customers expect
 Provider Gap 2 (The Service Design &
Standards Gap):
 not having the right service designs and
standards
 Provider Gap 3 (The Service Performance
Gap):
 not delivering to service standards
 Provider Gap 4 (The Communication Gap):
 not matching performance to promises
Key Factors Leading
to the Customer Gap

Customer
Custome Expectations
r
Gap

 Provider Gap 1: Not kno

 Provider Gap 2: Not sel

Customer
Perceptions

 Provider Gap 3: Not del

 Provider Gap 4: Not ma