Chapter 11 Developing a Service Culture Simon Hudson

Chapter 11: Developing a Service Culture Simon Hudson

Topic Covered o Why service excellence is so critical o Creating a service culture o Converting guests into apostles o Managing service promises o Service recovery

Spotlight Andrew Dunn: From bacon to beluga o High-spending clientele is relatively recession-proof o Focuse on guest loyalty and brand enhancement o Skiing has changed beyond recognition o The importance of the family in today’s marketplace

Why service excellence is so critical o Service quality • reliability, assurance, empathy, responsiveness, and tangibles o Customer satisfaction o Spend more on service excellence o Service profit chain

The service profit chain Source: Adapted from Heskett et al. , 1997

Lifetime value of a skier/snowboarder starting at the age of 10 Item Skis Boots Bindings Apparel Accessories Lifts tickets Food/beverage Lodging TOTAL Avg/Year Retail price $358 $283 $164 $218 $34 $71 $34 $203 Units/Year 0. 2 0. 1 1 10 10 4 Years 35 35 Total ($) $2, 506 $1, 981 $1, 148 $763 $1, 190 $24, 850 $11, 900 $28, 420 $72, 758 $2, 079 Source: Adapted from Snowsports Industries America, 2012

Creating a service culture o Service culture • policies, procedures, reward systems, and actions o Service marketing program o Establish a service culture easier in some places o Employees trained based on certain specific standards

Converting guests into apostles o The Apostle Model • Loyalists: high satisfaction and high loyalty • Hostages: low satisfaction and high loyalty • Mercenaries: high satisfaction, but low loyalty • Defectors: low satisfaction and low loyalty

The Apostle Model Source: Adapted from Jones & Sasser, 1995

Profile: Customer service ‘Kiwistyle’ o Customer service has to be key in heliskiing operations o Southern Lakes Heliski • safety and customer satisfaction

Managing services promises o Four strategies in managing service promises o Marketing communications tools • print advertising, websites, sales promotions, public relations, direct marketing and personal selling. o Realistic promises and communication mechanisms o Service guarantee

Four strategies that are effective in managing service promises Source: Adapted from Zeithaml et al. , 2007

Service recovery o The service recovery paradox o The service recovery process • Apology • Urgent reinstatement • Empathy • Symbolic atonement • Follow-up o The consequences of an effective recovery

The service recovery paradox Source: Adapted from Schindlholzer, 2008

The Customer Complaint Iceberg Source: Adapted from TARP, 1979

Case study: Customer-centric service at Steamboat Springs o Steamboat • Western-style, familyfriendly atmosphere o Improving customer service is a trend in ski resorts o SSRC guidelines