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Customer Satisfaction
(Applied on Beirut Restaurant)
Submitted By:
Supervised by:
Dr. Marwa Sayed
Assistant Lecturer:
Sara El Menawy
May, 2017
Acknowledgement
This project could not have been written without Dr. Marwa Sayed for
her invaluable help and for her guidance, advice, constructive feedback
and positive comments.
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CHAPTER ONE: GENERAL FRAMEWORK
1.1. Introduction
In today’s world, service industry is dominating the business world. Now Service
Industry is largest growing area of business in developing countries.
During the past few decades customer satisfaction have become major areas of
attention to researchers. Improve service leads to greater satisfaction and
ultimately increase profitability. There must be different strategies that can be used
by restaurant’s owners in order to attract and retain customers and to gain a
sustained competitive advantage. The restaurant business is one of the service-
oriented businesses, which is very popular in Egypt as well.
There are various factors that relates to the customer satisfaction in a restaurant
industry. We take 4 factors that are most important in customer satisfaction study
that is employee performance, food quality, physical environment and price. We
have selected Beirut Restaurant that provides food items with unique taste and at
low prices and in a comfortable environment.
Restaurant is place where people can eat and drink and make themselves relaxed
and entertained due to a comfortable environment. The groups of people, which
are dealing with the customers, are known as the internal customers (employees)
and these internal customers should be satisfied in order to delight the external
customers, which ultimately increase the profit of the restaurant. In our study this
restaurant is satisfying the customers by providing high quality of food at low prices
in comfortable environment. Hence the aim of this study was to find out that how
employee performance, price, food quality and physical environment are related
with customer satisfaction in restaurant industry.
Consumers all over the world have become more quality conscious; hence there
has been an increased customer demand for higher quality service. Service
operations worldwide are affected by this new wave of quality awareness and
emphasis . Therefore service-based companies like the resturants are compelled to
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provide excellent services to their customers in order to have sustainable
competitive advantage, especially in the current trend of globalization.
High patronage of services depends on the satisfaction customers derived from a
service. Sales are directly related to customer satisfaction; sales increase requires
improvement in the quality of service delivery to encourage continuous patronage.
Generally, it is believed that services which continuously and consistently delight
customers make them happy and satisfied. In such situation, they become loyal
customers and will continue to demand the service which in turn will result in profit
and growth of an organization.
service quality remains critical in the service industries, as businesses strive to
maintain a competitive advantage in the marketplace and achieving customer
satisfaction. The financial services, particularly resturants, compete in the
marketplace with generally undifferentiated products; therefore service quality
becomes a primary competitive weapon. Literature has proven that providing
quality service delivery to customers retains them, attracts new ones, enhances
corporate image, lead to positive referral by word of mouth, and above all
guarantees survival and profitability
Good customer service quality is the main factor that will determine, in the future,
whether the businesses will survive or fail. Maintaining effective customer service
helps to build and maintain customer’s relationship that is the key success. In order
to satisfy customer’s needs, many companies need to set up web sites that provide
quality information and services to customers.
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1.2. Literature review
Over the past few decades, the concept of customer satisfaction has attracted the
attention of researchers. Although mostly, used as a business performance
&consumer choice indicator (Lou and Homburg, 2007) there are different views as
to what this multidimensional concept mean. Some researchers have conceptualize
this concept as an emotional response to an evaluative process (Oliver, 1997)
This has been observed since decades that the business world has been dominated
by services. Now a day’s service industry is largest, rapidly growing and more
profitable industry in the developing countries due to the reason of cross culture
encounter ships of business and worldwide company cultures. The only industry
which even survives in recession is the restaurant industry. The result for restaurant
industry to boom is, people don’t have to cook and can eat out. Now days, people
have meal outside not only on planned occasions even more as an afterthought
(Mogelonsky, 1998).
One study shows that delivering high quality services and increasing customer
satisfaction are widely known as key factors boosting the performances of
companies in the restaurant industry (Barsky &Labagh, 1992; Le Blanc, 1992,; Le
Blanc et al., 1996; Stevens et al., 1995, Opermann, 1998). Restaurants with best
service quality will leads to greater profitability (Oh & Parks, 1997).
During the dining experience, customers are affected by a various mechanic clues,
as shown by research in environmental psychology and marketing. Physical
environment have a strong effect on people’s cognition, emotions, and behavior
(Mehrabian and Russell1974; Spangenberg, Crowley, and Henderson
1996).Another research shows that environment can influence feelings that
encourage people to remain in or to leave the environment. (Mehrabian and
Russell 1974). Bitner (1992) had presented a model for understanding how the
physical surroundings of a service organization may impact individual satisfaction.
The dimensions include variables such as noise, music, lighting and temperature,
layout which includes the arrangement of furniture and equipment etc. The
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physical environment (Wall and Berry, 2007) can affect customers’ physical
comfort. On the contrary, Voon et al, (2007) found that physical environment have
no effect on customer physical comfort.
The restaurant industry of Egypt has become more competitive due to high quality
services and it has a direct impact on profitability and success that is why many
local fast food restaurants are competing with international fast food chains and
restaurants. In Egypt these restaurants provide quality services at affordable prices
(Siddiqi, 2007).
Service researchers tends to measure the relationships among service quality and
customer satisfaction (e.g. Dabholkar et al., 2000; Kueh & Voon, 2007; Qin and
Prybutok, 2008; Zeithaml et al., 1996).Service quality perceived by customer is
found to be positively related to loyalty. Other researchers (e.g. Dabholkar et al.,
2000; Brady and Robertson, 2001; Tam, 2004) found that customer satisfaction
interven the effect of service quality on behavioral intentions. The role of food
quality is also considered as one of the major determinant of customer satisfaction.
Good quality of food can be helpful to satisfy and retain the youth customers who
enjoy eating tasteful food. There are many youth customers who prefer hot and
spicy food available in fast food restaurants. Researchers have found that the
quality of menu items affects customer’s intention to dine at the restaurant (e.g.
Qu, 1997; Kivela et al., 2000; Soriano, 2002; Zopiatis and Pribic, 2007).
Pricing is another factor that has been studied in relation to customer satisfaction.
Furthermore, post-purchase intentions were more strongly influenced by
perceived value (Tam, 2004). Qin and Prybutok (2008) also investigated the role of
price/value in determining customer satisfaction for fast-food restaurants but did
not find it to be of significance. But for the youth who are not economically strong
may find that price is important to attract them to restaurants.
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1.3. Importance of research
Every study has two parameters, one is theoretical contribution and the other one
is applied aspects. Theoretical contribution is that either it is contributed by or it is
a contribution to the body of knowledge.
Applied aspects are that who is going to benefit from this research. The results and
findings of the study would be applicable to the industry so that by taking this into
account they can improve their productivity also. If the service quality effects
negatively then it will decrease the productivity and as a result, profitability of
Beirut Restaurant will decrease.
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1.5 Research Model
In this research, we will study the effect of Service quality on the customers’
Satisfaction examining the variables as follow:
Independent variable Dependent variable
Service Customer
Quality Satisfaction
Responsiveness Employee
Performance
Reliability
Food Quality
Tangibility Physical
Environment
Assurance
Price
Empathy
VARIABLES OF STUDY
Customer satisfaction can be measured with the help of these following factors:
1. Employees performance
2. Food quality
3. Physical environment
4. Price
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1974.Her articles have appeared in the "Journal of Clinical Social Work" and
various corporate newsletters.
2. Price: Price in terms of value in the sense of desirability, estimation, subjective
value (including cases in which value is merely said to be reflected in some degree
by price, or is merely in the background of the thought).(Frank A. Fetter published
by American Economic Association Vol. 2, No. 4 (Dec., 1912), pp. 783-813)
3. Food quality: The total sum of product’s features that ascribe its suitability to
meet all expressed and implied consumer’s needs as determined by the product’s
conditions of use and its purpose. Quality also incorporates the product’s
defectives and its impacts on environment. Juozas Ruzevicius , Jurate Sauciuniene,
Quality models and systems and their influence to the business, 2006 m. Nr2(11).
To test the relationship if any between the two variables , service quality
and customer satisfaction.
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1.7. Research methodology
DATA COLLECTION
The primary and secondary data were collected for the survey. Primary data were
collected through questionnaires and secondary data were collected from books,
journals, and magazine.
SAMPLE
The study limited to customers of Beirut Restaurant which is located in Maadi.
Convenience sampling method has been adopted to select customers. Researcher
circulated (60) questionnaires to customers but only (40) customers responded Out
of sixty customers.
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PART TWO: THEORETICAL FRAMEWORK
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CHAPTER TWO: SERVICE QUALITY
2.1. Services Marketing - Definition and Characteristics
Introduction
The world economy nowadays is increasingly characterized as a service economy.
This is primarily due to the increasing importance and share of the service sector in
the economies of most developed and developing countries. In fact, the growth of
the service sector has long been considered as indicative of a country’s economic
progress.
Economic history tells us that all developing nations have invariably experienced a
shift from agriculture to industry and then to the service sector as the main stay of
the economy.
This shift has also brought about a change in the definition of goods and services
themselves. No longer are goods considered separate from services. Rather,
services now increasingly represent an integral part of the product and this
interconnectedness of goods and services is represented on a goods-services
continuum.
Intangibility: Services are intangible and do not have a physical existence. Hence
services cannot be touched, held, tasted or smelt. This is most defining feature of
a service and that which primarily differentiates it from a product. Also, it poses a
unique challenge to those engaged in marketing a service as they need to attach
tangible attributes to an otherwise intangible offering.
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1. Heterogeneity/Variability: Given the very nature of services, each service
offering is unique and cannot be exactly repeated even by the same service
provider. While products can be mass produced and be homogenous the
same is not true of services. eg: All burgers of a particular flavor at
McDonalds are almost identical. However, the same is not true of the service
rendered by the same counter staff consecutively to two customers.
2. Perishability: Services cannot be stored, saved, returned or resold once they
have been used. Once rendered to a customer the service is completely
consumed and cannot be delivered to another customer. eg: A customer
dissatisfied with the services of a barber cannot return the service of the
haircut that was rendered to him. At the most he may decide not to visit that
particular barber in the future.
3. Inseparability/Simultaneity of production and consumption: This refers to
the fact that services are generated and consumed within the same time
frame. Eg: a haircut is delivered to and consumed by a customer
simultaneously unlike, say, a takeaway burger which the customer may
consume even after a few hours of purchase. Moreover, it is very difficult to
separate a service from the service provider. Eg: the barber is necessarily a
part of the service of a haircut that he is delivering to his customer.
Types of Services
1. Core Services: A service that is the primary purpose of the transaction. Eg: a
haircut or the services of lawyer or teacher.
2. Supplementary Services: Services that are rendered as a corollary to the sale
of a tangible product. Eg: Home delivery options offered by restaurants
above a minimum bill value.
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Difference between Goods and Services
Goods Services
A physical commodity A process or activity
Tangible Intangible
Homogenous Heterogeneous
Production and distribution are Production, distribution and
separation from their consumption consumption are simultaneous
processes
Can be stored Cannot be stored
Transfer of ownership is possible Transfer of ownership is not possible
Services marketing first came to the fore in the 1980’s when the debate started
on whether marketing of services was significantly different from that of products
so as to be classified as a separate discipline. Prior to this, services were
considered just an aid to the production and marketing of goods and hence were
not deemed as having separate relevance of their own.
The 1980’s however saw a shift in this thinking. As the service sector started to
grow in importance and emerged as a significant employer and contributor to the
GDP, academics and marketing practitioners began to look at the marketing of
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services in a new light. Empirical research was conducted which brought to light
the specific distinguishing characteristics of services.
By the mid 1990’s, Services Marketing was firmly entrenched as a significant sub
discipline of marketing with its own empirical research and data and growing
significance in the increasingly service sector dominated economies of the new
millennium. New areas of study opened up in the field and were the subject of
extensive empirical research giving rise to concepts such as - the product-service
spectrum, relationship marketing, franchising of services, customer retention etc.
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the customer in service delivery process by taking into consideration his
requirements and feedback. Thus they offer greater scope for customization
according to customer requirements thus offering increased satisfaction
leading to higher customer retention.
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resort is better situated in the countryside away from the rush and noise of
a city.
4. Promotion: Since a service offering can be easily replicated promotion
becomes crucial in differentiating a service offering in the mind of the
consumer. Thus, service providers offering identical services such as airlines
or banks and insurance companies invest heavily in advertising their services.
This is crucial in attracting customers in a segment where the services
providers have nearly identical offerings.
We now look at the 3 new elements of the services marketing mix - people, process
and physical evidence - which are unique to the marketing of services.
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2.4. Services Marketing - Moment of Truth
Every business knows that in order to thrive it needs to differentiate itself in the
mind of the consumer. Price has proved inadequate since there is a limit to how
much a firm can cut back on its margins. Product differentiation is also no longer
enough to attract or retain customers since technological advances have resulted
in products becoming almost identical with very few tangible differences from
others in the same category. Consequently, marketers have realized the
importance of service differentiation as a sustainable strategy for competing for a
portion of the customer’s wallet.
Importance
In today’s increasingly service driven markets and with the proliferation of multiple
providers for every type of product or service, moments of truth have become an
important fact of customer interaction that marketers need to keep in mind. They
are critical as they determine a customer’s perception of, and reaction to, a brand.
Moments of truth can make or break an organization’s relationship with its
customers.
This is more so in the case of service providers since they are selling intangibles by
creating customer expectations. Services are often differentiated in the minds of
the customer by promises of what is to come. Managing these expectations
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constitutes a critical component of creating favorable moments of truth which in
turn are critical for business success.
Moment of Misery: These are instances where the customer interaction has a
negative outcome. A delayed flight, rude and inattentive shop assistants or poor
quality of food served at a restaurant all qualify as moments of misery for the
customers. Though lapses in service cannot be totally avoided, how such a lapse is
handled can go a long way in converting a moment of misery in to a moment of
magic and creating a lasting impact on the customer.
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expectations. This will help in developing a service design that will help the provider
to effectively manage customer expectations leading to customer delight.
Based on the quality of the service experience a customer will either be satisfied,
dissatisfied or delighted. Knowing a customer’s expectation is instrumental in
developing a strategy for meeting and exceeding customer expectations.
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3. Customer Delight: This is an ideal situation where the service provider is able
to exceed the customer’s expectations creating a Moment of Magic for the
customer. Such customers bond with the brand, are regular and loyal and
will not easily shift to other brands.
Exceeding customer expectations is all about creating that extra value for the
customer. The hospitality industry specializes in creating customer delight.
Example, most 5 star hotels maintain customer databases detailing room order
choices of their guests. So if a guest has asked for say orange juice to be kept in the
mini bar in his room, the next time that he makes a reservation at the hotel, the
staff ensures that the juice s already kept in the room. Such small gestures go a long
way in making customers feel important and creating customer delight.
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2.6. Maintaining Service Quality
After having attained the desired service level, the next great challenge faced by
service providers is to maintain service standards at levels of excellence. This is as
important, and as tough, as establishing service standards and attaining to them in
the first place.
There are basically two approaches that any organization can have towards
maintaining service standards - a proactive approach or a reactive approach.
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price hike of its existing services. For example, when a fast food chain
increases the price of its existing products, the staff has to handle multiple
customer queries regarding the hike. Lack of a satisfactory explanation
would signify poor service standards and lead to customer dissatisfaction.
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2.8. The Changing Face of Services Marketing
Marketing of Services has emerged as an important sub discipline of marketing in its own right.
It has evolved phenomenally to emerge as a major field of study with far reaching
implications in today’s increasingly service driven economies. It is then, only
natural, to wonder what is the future course that this field of study is most likely to
take.
At first glance, one can see that there are as yet many opportunities available for
Services Marketing to evolve and gain in relevance as the role of the service
economy continues to expand. A large chunk of Third World economies are now
beginning to move into the service domain. The role and share of the service sector
in these economies is growing with an increased monetization of services
However, there are several challenges also. There has been a change in the basic
nature of services. Services, today, can no longer be described according to the
parameters of - intangibility, heterogeneity, inseparability and perishability. These
changes are detailed below:
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service restaurants follow the & steps of the service cycle that starts with
greeting the customer (using standard phrases) through to saying good bye.
3. Inseparability: Even this criterion does not hold true for all services
rendered. Inseparability implies that the production and consumption of
services is simultaneous. Thus, consumers need to be present and/or
involved in the production process. In reality however, there are several
services that are separable. Example: insurance, repair and maintenance
where production happens prior to consumption and the customers need
not necessarily be present at the time the service is rendered. The same is
witnessed in the phenomenon of outsourcing of services.
4. Perishability: even though this is true for a lot of services, there are several
notable exceptions. In today’s information era there are several information
based services that can be recorded and saved in electronic media and
reproduced on demand. Moreover, for greater clarity in this regard it is
necessary to have a distinction between the perishability of productive
capacity, of customer experience and of the output.
Thus the definition of services is not as clear cut as it was once assumed to be.
Consequently this is one of the major challenges lying ahead for the field of Services
Marketing.
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CHAPTER THREE: CUSTOMER SATISFACTION
3.1. Customer Relationship Management - What is CRM?
Every business unit emphasizes on spurting a long term relationship with customers
to nurture its stability in today’s blooming market. Customer’s expectations are
now not only limited to get best products and services, they also need a face-to-
face business in which they want to receive exactly what they demand and in a
quick time.
Lets take an example of an international call center which uses a CRM tool called
‘xyz’ and is integrated with a phone and a computer system or laptop. Now this
system automatically perceives which customer is calling. Before the executive
attends the phone the CRM system brings forth the customer details on the
computer or laptop screen and also indicates what the opportunity of deals is with
that particular customer, what the customer had already purchased or ordered in
past and what is the probability of buying in future. Not only this, it can also
highlight what all products best suit this customer. For finance department it may
show the information regarding the current balance and for accounting
department it may pop out the information regarding the recent purchases by the
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customer. All these pieces of data are stored in the CRM database and are available
as and when it is needed.
According to this example, CRM system provides a well defined platform for all
business units to interact with their clients and fulfill all their needs and demands
very effectively and to build long-term relationship.
Wangling this kind of relationship with customers is not easy to manage and it
depends on how the systematically and flexibly a CRM system is implemented or
integrated. But once it’s accomplished it serves the best way in dealing with
customers. In turn customers feels gratitude of self-satisfaction and loyalty which
results in better bonding with supplier and hence increasing the business.
A CRM system is not only used to deal with the existing customers but is also useful
in acquiring new customers. The process first starts with identifying a customer and
maintaining all the corresponding details into the CRM system which is also called
an ‘Opportunity of Business’. The Sales and Field representatives then try getting
business out of these customers by sophistically following up with them and
converting them into a winning deal.
Customer Relationship Management strategies have given a new outlook to all the
suppliers and customers to keep the business going under an estimable
relationship by fulfilling mutual needs of buying and selling.
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3.2. Origin of CRM
CRM originated in early 1970s when the business units had a manifestation that
it would be advisable to become ‘customer emphatic’ rather that ‘product
emphatic’. Birth of CRM was because of this heedful perceptiveness.
The famous writer and management consultant Peter Drucker wrote; ‘The true
business of every company is to make and keep customers’. Traditionally every
transaction was on paper and dependent on goodwill which created hindrance in
clutching customers. People used to work hard in entertaining customers by
presenting new products with astonishing services; they were ready to work
overtime for grasping more and more customers for increasing business. This too
resulted in customer satisfaction and loyalty up to some extent, but at the end of
the day there was no such bonding or relation between the two to carry on with
future business smoothly.
Previously business was quite easy as it was mere a one-to-one dealing without any
specific process. But with time, due to incoming complexities in communication, it
found itself in troubled waters. Emerging of new strategies and technologies in
global marketplace and a mammoth degree of competition in business, the
approach needed to be changed to proactive rather than reactive. Origination of
CRM turned out to be a piece of cake for all suppliers and customers due to its
advantages. Customer relationship management came as a process that dealt
with relationships with customers surpassing the whole business.
1. The belief that customers are the real assets and not just the people in the
audience.
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2. The maturation of one-to-one transaction advent.
3. Extensive use of software and technologies to maintain useful information
and no manual labor.
4. The realization of the benefits of utilizing information proactively and not
reactively.
5. The change of business view to relationship approach rather than
transactional approach.
6. The approach of concentrating more on customer values rather than
concentrating on how the product is delivered to the customer.
7. The approach of focusing on customer satisfaction and loyalty rather than
focusing self satisfaction and profit.
8. The acceptance of the fact that using high end technologies and software the
cost can radically be decreased without compromising on quality and service
of products.
9. The increasing tendency to retain existing customers and trying to get more
and more business out of them.
10.The realization that the traditional trends of marketing and selling are
increasingly fading out in the current economic scenario.
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3.3. Features of CRM
Customer Relationship Management is a strategy which is customized by an
organization to manage and administrate its customers and vendors in an efficient
manner for achieving excellence in business. It is primarily entangled with following
features:
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should focus on is customer satisfaction. Hence, customer loyalty is an
influencing aspect of CRM and is always crucial for business success.
5. Customer Retention- Customer retention is a strategic process to keep or
retain the existing customers and not letting them to diverge or defect to
other suppliers or organization for business. Usually a loyal customer is
tended towards sticking to a particular brand or product as far as his basic
needs continue to be properly fulfilled. He does not opt for taking a risk in
going for a new product. More is the possibility to retain customers the more
is the probability of net growth of business.
6. Customer Complaints- Always there exists a challenge for suppliers to deal
with complaints raised by customers. Normally raising a complaint indicates
the act of dissatisfaction of the customer. There can be several reasons for a
customer to launch a complaint. A genuine reason can also exist due to which
the customer is dissatisfied but sometimes complaints are launched due to
some sort of misunderstanding in analyzing and interpreting the conditions
of the deal provided by the supplier regarding any product or service.
Handling these complaints to ultimate satisfaction of the customer is
substantial for any organization and hence it is essential for them to have
predefined set of process in CRM to deal with these complaints and
efficiently resolve it in no time.
7. Customer Service- In an organization Customer Service is the process of
delivering information and services regarding all the products and brands.
Customer satisfaction depends on quality of service provided to him by the
supplier. The organization has not only to elaborate and clarify the details of
the services to be provided to the customer but also to abide with the
conditions as well. If the quality and trend of service go beyond customer’s
expectation, the organization is supposed to have a good business with
customers.
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3.4. Importance of Customer Relationship Management
Once this personal and emotional linkage is built, it is very easy for any organization
to identify the actual needs of customer and help them to serve them in a better
way. It is a belief that more the sophisticated strategies involved in implementing
the customer relationship management, the more strong and fruitful is the
business. Most of the organizations have dedicated world class tools for
maintaining CRM systems into their workplace. Some of the efficient tools used in
most of the renowned organization are BatchBook, Salesforce, Buzzstream, Sugar
CRM etc.
1. A CRM system consists of a historical view and analysis of all the acquired or
to be acquired customers. This helps in reduced searching and correlating
customers and to foresee customer needs effectively and increase business.
2. CRM contains each and every bit of details of a customer, hence it is very
easy for track a customer accordingly and can be used to determine which
customer can be profitable and which not.
3. In CRM system, customers are grouped according to different aspects
according to the type of business they do or according to physical location
and are allocated to different customer managers often called as account
managers. This helps in focusing and concentrating on each and every
customer separately.
4. A CRM system is not only used to deal with the existing customers but is also
useful in acquiring new customers. The process first starts with identifying a
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customer and maintaining all the corresponding details into the CRM system
which is also called an ‘Opportunity of Business’. The Sales and Field
representatives then try getting business out of these customers by
sophistically following up with them and converting them into a winning
deal. All this is very easily and efficiently done by an integrated CRM system.
5. The strongest aspect of Customer Relationship Management is that it is very
cost-effective. The advantage of decently implemented CRM system is that
there is very less need of paper and manual work which requires lesser staff
to manage and lesser resources to deal with. The technologies used in
implementing a CRM system are also very cheap and smooth as compared
to the traditional way of business.
6. All the details in CRM system is kept centralized which is available anytime
on fingertips. This reduces the process time and increases productivity.
7. Efficiently dealing with all the customers and providing them what they
actually need increases the customer satisfaction. This increases the chance
of getting more business which ultimately enhances turnover and profit.
8. If the customer is satisfied they will always be loyal to you and will remain in
business forever resulting in increasing customer base and ultimately
enhancing net growth of business.
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3.5. What is Customer Relationship?
In CRM the alphabet ‘R’ means relationship. But there is always an ambiguity to
understand the actual meaning of this relationship. This relationship between
supplier and customer is not a personal relationship or a one-time transaction
relationship; for example buying a refrigerator from a consumer’s outlet would not
be called as a relationship.
Relationship with customers can change from time to time because it is evolved
under distinguished situations. Following are the stages from where the
relationship with customers can evolve-
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Dissolution- Dissolution is a stage when customer requirement suddenly
changes and he looks for better perspectives. This sudden change is the end
of relationship.
Relationship can come to an end due to many reasons like - customer is not
satisfied with the services of supplier or customer diverges to other better brands
and products. Suppliers can also prefer to break relationships due to customer
failing to be a part to increase sales volume or when the suppliers are entangled
with fraud cases.
1. Trust: Trust means confidence and security in any relationship and can be
treated as the biggest investment in building long term relationships. Trust
is developed between the two parties when they experience flawless and
satisfied motives between each other. As a result of knowing more about
each other, all the doubts and risks are minimized and leads to inevitably
smooth business. Lack of trust on the other hand weakens the relationship
foundation and chances of uncertainty and conflicts increases.
2. Commitment: Commitment is yet another milestone that should be
achieved to set a long term mutual relationship. Commitment can only be
attained when there is mutual trust and the two parties share each other’s
values. In a committed relationship both suppliers and customers strive to
uphold the relationship and never want to exit which in turn results in
building the relationship stronger and sharper. There is, in fact, huge cost
which is incurred in switching from committed relationships of one supplier
and build new relationships with other suppliers from scratch.
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3.6. Different Types of Customers
Customers play the most significant part in business. In fact the customer is the
actual boss in a deal and is responsible for the actually profit for the organization.
Customer is the one who uses the products and services and judges the quality of
those products and services. Hence it’s important for an organization to retain
customers or make new customers and flourish business. To manage customers,
organizations should follow some sort of approaches like segmentation or division
of customers into groups because each customer has to be considered valuable and
profitable.
1. Loyal Customers- These types of customers are less in numbers but promote
more sales and profit as compared to other customers as these are the ones
which are completely satisfied. These customers revisit the organization over
times hence it is crucial to interact and keep in touch with them on a regular
basis and invest much time and effort with them. Loyal customers want
individual attention and that demands polite and respectful responses from
supplier.
2. Discount Customers- Discount customers are also frequent visitors but they
are only a part of business when offered with discounts on regular products
and brands or they buy only low cost products. More is the discount the more
they tend towards buying. These customers are mostly related to small
industries or the industries that focus on low or marginal investments on
products. Focus on these types of customers is also important as they also
promote distinguished part of profit into business.
3. Impulsive Customers- These customers are difficult to convince as they want
to do the business in urge or caprice. They don’t have any specific item into
their product list but urge to buy what they find good and productive at that
point of time. Handling these customers is a challenge as they are not
particularly looking for a product and want the supplier to display all the
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useful products they have in their tally in front of them so that they can buy
what they like from that display. If impulsive customers are treated
accordingly then there is high probability that these customers could be a
responsible for high percentage of selling.
4. Need Based Customers- These customers are product specific and only tend
to buy items only to which they are habitual or have a specific need for them.
These are frequent customers but do not become a part of buying most of
the times so it is difficult to satisfy them. These customers should be handled
positively by showing them ways and reasons to switch to other similar
products and brands and initiating them to buy these. These customers could
possibly be lost if not tackled efficiently with positive interaction.
5. Wandering Customers- These are the least profitable customers as
sometimes they themselves are not sure what to buy. These customers are
normally new in industry and most of the times visit suppliers only for
confirming their needs on products. They investigate features of most
prominent products in the market but do not buy any of those or show least
interest in buying. To grab such customers they should be properly informed
about the various positive features of the products so that they develop a
sense of interest.
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3.7. Quality of Relationship with Customers
Satisfying customer needs ensures the business survival for an organization. A
periodical check is required to enhance the quality of services and product to build
a quality relationship with customers. For fulfilling this goal organizations must
have a set of rules to measure and improve this quality.
Delivering best quality services to customers is considered the most efficacious way
to ensure that an organization stands out from a group of competitors and avail the
privilege to be known as best among all. The main ingredients that are involved in
a high quality relationship between customer and supplier are trust and
commitment. Trust means confidence and security in any relationship and can be
treated as the biggest investment in building long term relationships. Trust is
developed between the two parties when they experience flawless and satisfied
motives between each other. As a result of knowing more about each other, all the
doubts and risks are minimized and leads to inevitably smooth business. Lack of
trust, on the other hand, weakens the relationship foundation; as a result chances
of uncertainty and conflicts increases.
Commitment is yet another milestone that should be achieved to set a long term
mutual relationship. Commitment can only be attained when there is mutual trust
and the two parties share each other’s values. In a committed relationship both
suppliers and customers strive to uphold the relationship and never want to exit
which in turn results in building the relationship stronger and sharper. There is, in
fact, huge cost which is incurred in switching from committed relationships of one
supplier and build new relationships with other suppliers from scratch.
There are other attributes as well which promote a high quality relationship,
these include the following:
Courtesy- Many times customers become irritated and uncivil due to some
unpredictable reasons. But it is substantially important for supplier to keep
his calm and deal accordingly. Delivering the responses in calm voice with
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courtesy and sympathetic sense could dramatically act as a catalyst in driving
customer’s satisfaction.
Availability- Manic customers always prefer human responses instead of
electronic emails or messages. Hence, it is important for an organization to
make its executives always available for customers for responding and
dealing with customer queries and needs. Provision of these services always
promotes emotional bonding between customers and suppliers which in the
end is always fruitful and drives to profitable business.
Responsive- The suppliers should always have prompt, responsive and
experienced executives to serve customers. For example, if a customer calls
and asks about some critical features of any product and the executive fails
to explain it or being non-responsive to most of his questions then the
customer could probably divert his way to some other organization for better
response which could definitely result in end of the deal and relationship
with that customer.
Intelligent- Many customers are attracted towards good deals which consist
of discounts and feasible prices. A supplier should be intelligent enough to
deal with these situations and offer the best price and deal so that the
customer is not lost to the supplier who is able to make some substantial
profit if not more. This requires predefined strategies to be created and to
respond intelligently towards fulfilling these strategies.
Futuristic- Always be futuristic to technological changes. The strategies,
types of services and products could gradually deteriorate with time due to
huge competition and higher rate of technological changes. Keeping this in
mind an organization should always focus on renovating business strategies
periodically and convince the customers accordingly.
Inheriting the above quality attributes into business will always improve
quality relationship between customers and suppliers and is always fruitful for
both.
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3.8. Need of Relationship with Customers
Building relationship with customers in current market trends is the most
important aspect that an organization should focus on. Distinction and eminence
are now most sustainable and affirm for which developing good relationship with
customers is must. Some of the substantial outcomes of building a quality
relationship is explained below by which need of relationship with customer are
insight:
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when there is a quality relationship between customer and supplier. Usually
a loyal customer is tended towards sticking to a particular brand or product
as far as his basic needs continue to be properly fulfilled. He does not opt for
taking a risk in going for a new product. More is the possibility to retain
customers the more is the probability of net growth of business.
5. Chances of getting referrals- It is always a cost-free advocacy by customers
to provide referrals to supplier when they feel satisfied and encouraged and
when they have a healthy relationship with customers. These referrals or
customer’s reference of other customers acts like a piece of cake for
suppliers as there is no cost and struggle involved in this. This could be
treated as the best outcome of quality relationship what a supplier can think
of.
6. Growth in revenue- When suppliers have healthy relationship with
customers the revenue of the organization always increases as customers
tend to buy more and more. There is possibility that a satisfied customer seek
to buy special category of related products apart from the regular ones from
that particular supplier. For instance if a satisfied and loyal customer has a
home insurance from an insurance company then there are positive chances
that he could also insure his property and car also if he is fully satisfied with
the services of that insurance company. This will definitely result in growth
of business.
7. Cost to serve is low- Cost to serve existing satisfied customers is always very
less for the supplier as they know and understand customers. Customers
never come back with complaints and queries because they know the actual
business flow and completely rely on the relationship with supplier.
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3.9. Customer Life Cycle
If in an organization, many customers diverge their way to other organizations and
customer acquisition program shows less aggressiveness then the organization
faces terrible cash flow problems. This is the time when tracking the number of
customers in each stage of customer life cycle becomes essential. This helps the
organization to determine the purchasing power and pattern of customer and
coping up the cash flow problem. There are basically following stages of customer
life cycle:
1. Prospects- Prospects are the people who are not actual customers but could
be converted into one. These people should be treated like initial customers
as they have the potential value same as that of a customer. Initially the
prospect makes a set of expectation regarding the products and services
towards the supplier. If supplier wins to meet the expectation of the
customer, the supplier has the golden chance to convert the prospect into
liable customer. During the process it is very important for the supplier to
meet all the cut off’s of the prospect by providing efficient marketing
communications and explaining the value of having business with them.
2. First time buyers- After making the first buy, the customer enters this stage.
Such customers probably have the lowest retention rate as they have not yet
explored all the facets offered by the supplier. They may fall in satisfied
customers’ category but have not yet evaluated the product features. Hence
it is the duty of supplier to convince them more on the product value and
services to meet their second level of expectation. If they succeed in doing
this then customers would continue to buy the products and could be
retained as long as they are overall satisfied. During this process the failure
of meeting even one aspect of customer could cause the customer to defect.
3. Early repeat buyers- Customers will fall into this stage when they make at
least one repeated buy. These customers are more tended towards regular
buying as compared to the first time buyers. Suppliers have chance of getting
more and more business out of them as they have already created influence
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on them. However, these are the satisfied customers but still they are in
process to evaluate the relationship between the two parties, hence a small
mishap could lead to defect these valuable customers.
4. Core Customers- Customers are said to be core customers when they are
fully satisfied with the product value and services provided to them as well
as when the supplier is able to maintain a quality relationship with them.
These customers are flexible and considerable as they ignore small mistakes
which they know, will be efficiently and quickly resolved. Having highest
retention rates these customers are the most valuable assets for an
organization and it is important to give special treatment to these customers.
Unless and until there is major problem, these customers do not defect.
5. Core Defectors- There comes a stage when the core customers tend to
switch to different supplier due to some specific reasons. These reasons
include availability of more efficient and competitive products and brands in
market, any of the important service not entertained or any defect not
rectified within a given time-frame, boredom due to same product usage
repeatedly etc. It is difficult to retain customers if above reasons are
pertained. But strategically coping up with the situation could result in
retaining them.
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3.10. Customer Loyalty - Meaning and its Important
Every supplier wants to create and retain a loyal customer who engages in
continued profitable business with him. Customer Loyalty is the measure of success
of the supplier in retaining a long term relationship with the customer.
Thus customer loyalty is when a supplier receives the ultimate reward of his
efforts in interacting with its customer. Customer loyalty tends the customer to
voluntarily choose a particular product against another for his need. The loyalty
may be product specific or it may be company specific. When a loyal customer has
repetitive requirement of the same product, such customers may be described as
being ‘brand loyal’. On the other hand he may also require different products of
the same manufacturer. That is to say he makes significant purchases direct from
the same supplier and that counts as the company specific loyalty.
Loyalty also means that customer is sticking to the supplier on certain grounds
though he may be having other options also. It may be possible that the supplier
may not have the best product or the customer may be having some problems with
the supplier in respect of his supply of the product but the customer likes to ignore
other options and prefers to continue with the same supplier as the customer
thinks the supplier provides him more value and benefit than others. Such loyal
customers tend to spend more money buy more, buy longer and tell more people
about the product or supplier. This type of long-term customer loyalty can only be
created by making the customers feel that they are number one priority with the
supplier.
Some customers are inherently predictable and loyal, irrespective of the supplier
with which they are doing business. They simply prefer long-term relationships with
him. Loyal customers are predisposed to stay with one product or supplier, resisting
competitive offers and also recommend the supplier to others.
In case the business is done directly the relationship is direct so also the loyalty. But
if the selling is through two or more intermediaries then the loyalty has to be
measured at different levels. In that case the end customer loyalty is influenced by
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the loyalty of the intermediate customers. Then the supplier has to focus his loyalty
retention plan accordingly and has to judge and analyze the loyalties of the
intermediaries. This process depends on what amount of importance he gives to
each of the intermediaries and how much to the ultimate customer. But it is certain
that well-managed customer retention programs are sure to give the ultimate
customer loyalty.
True, the customers who are targeted by a retention program demonstrate higher
loyalty to a business. Therefore such customer retention programs should include
regular communication with customers, and provide them opportunities to remain
active and choosing to do business with the supplier.
Loyalty is demonstrated by the actions of the customer. But it doesn’t mean that
the customer satisfaction level can measure his loyalty. Customer loyalty is not
customer satisfaction. Customer satisfaction is the basic entry point for a good
business to start with. A customer can be very satisfied with the deal and still not
be loyal. On the other hand a customer may not express satisfaction but wants to
remain loyal to the supplier due to some reasons which keeps him benefited from
that supplier. For the same degree of satisfaction, the loyalty level may also be
different for different suppliers.
On the other hand, loyalty should not be considered as just an attitude. Customer
loyalty should have a direct connection to a company’s financial results. The
supplier should be able to plan a clear and direct economic benefit of some kind,
as the result of the strategies and tactics he employs to increase its customers’
loyalty.
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3.11. Customer Loyalty and Satisfaction
Most of the organizations have murkiness in considering customer loyalty and
satisfaction. They feel that both are same and a satisfied customer is always loyal
to them. But this is not true as the customer can be delightfully satisfied but he may
be or may not be loyal. This is because satisfaction an emotional and slushy feeling
over the job done. But loyalty is related to the action taken by the customer future.
There can be following two combinations of aspect when satisfaction and loyalty
are treated together:
1. Satisfied but disloyal customers: A customer can be fully satisfied but may
not be loyal due to following reasons:
a. Entrepreneur Customer: These types of customers like to experiment
a lot and hence try to create various options for them to get more
benefits. So even if they are satisfied they diverge to other options
available in the market.
b. Pressure from Competitors: Due to the pressure in market the
customer tends to follow the competitors path and divert from the
existing supplier to remain sustain in the global marketplace.
c. Outdated Suppliers: The customer may be satisfied with the existing
customers but sometimes feel that the product and services he is using
are outdated in market. Due to the changing technology there is
always a need to update the technical aspects and product features
even if the old products and services are satisfactory. Focusing on
these facets the customers normally go to other suppliers for his new
requirements.
2. Unsatisfied but loyal customers: The other abnormal situation is when the
customer is loyal but is unsatisfied. The reasons for this are following:
a. Lack of available options: There can lack of options available for
customers. This situation arises when the existing supplier is having a
monopoly in a particular segment of products or when all other
competitors are worse then the existing supplier. The customer feel
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trapped in this type of situation and is forced to be loyal to the supplier
but at the end of the day he will be an unsatisfied customer.
b. Improved Supplier: In another situation the suppliers may take the
customers in confidence by convincing them to provide improved
products and services in the coming future. This is an important tactic
that supplier implement in their marketing strategy to become
customer centric and to have customers stick to them and be loyal. To
remain in a healthy relationship the customers also remain loyal but
have a feeling of dissatisfaction beneath. But finally if the supplier
continuously supply degraded products and services the customer
could easily divert from them in search of better prospects.
c. Customer Inertia: There are some customers who afraid to change the
supplier. Even if they have bad experience with the supplier, they
continue to have business with them. This may be due to the
emotional and business attachments or bonding of customers with
those particular suppliers. Their could be many others reason for this
like, the customers’ feel reluctant to face the complexity of the process
of changing their way to other suppliers and prominently when they
already have a long term relationship with their suppliers. Under this
situation the customer tries to ignore the feelings of being unsatisfied
and remain loyal to them.
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3.12. Drivers of Customer Loyalty
It is very important for an organization to identify the factors and facets which drive
customer loyalty. These factors help the organization to manage customer loyalty
in a better and efficient way. Following are the drivers of customer loyalty:
2. Product and services: Following are the important aspects of product and
services that could substantially help in retaining loyalty of customers.
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a. Differentiated Products and Services- Differentiation in products and
services help the organization to reduce competition in market and have
substantial influence on customers’ mindset.
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could add a status symbol for most of the customers. ‘Mercedes’
automobiles and ‘RayBan’ sun-glasses are example of this. The customers
uses these products only for maintaining or enhancing their lifestyle and
always be loyal to them.
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customers get enhanced and user friendly product features then it acts like
additional incentives for them to migrate.
6. Product Services: Providing products with low or bad service components will
result in ending up loyalty with customers. Customers not only use the
products but also demands valuable and spontaneous service. Hence apart
from manufacturing good and sound products it is very important for the
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supplier to provide enhanced service components along with the product
which will act as a roadblock for customer to divert.
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actually loyalty variation of the customer to supplier. This process is
normally implemented
in the initial stages after the supplier identifies that there are chances that
customer can divert. If corrective measures are not taken at this stage then
it becomes difficult for the supplier to retain the customer.
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Tracking customer loyalty is very important process that all the organization should
implement continuously to track customer buying trend and force them be loyal to
them and increase business values and profits.
b. Some customers will get attached with supplier just because of the
excellence in technical aspects of product which also includes best service
and healthy organizational culture. These types of customers only believe
in the fact that all the products and services work in accordance to them
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and in an efficacious and efficient way. This attachment results in
customer to become loyal.
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customer mostly tends to be a loyal customer hence customer satisfaction is
an important factor that increases customer loyalty.
Customer satisfaction is the measure of how the needs and responses are
collaborated and delivered to excel customer expectation. It can only be attained
if the customer has an overall good relationship with the supplier. In today’s
competitive business marketplace, customer satisfaction is an important
performance exponent and basic differentiator of business strategies. Hence, the
more is customer satisfaction; more is the business and the bonding with customer.
Customer satisfaction is the overall essence of the impression about the supplier
by the customers. This impression which a customer makes regarding supplier is
the sum total of all the process he goes through, right from communicating supplier
before doing any marketing to post delivery options and services and managing
queries or complaints post delivery. During this process the customer comes across
working environment of various departments and the type of strategies involved in
the organization. This helps the customer to make strong opinion about the
supplier which finally results in satisfaction or dissatisfaction.
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Customer’s perception on supplier helps the customer choose among the supplier
on basis of money value and how well the delivered products suit all the
requirements. The supplier’s services never diminishes after the delivery as
customer seeks high values post marketing services which could help them use and
customize the delivered product more efficiently. If he is satisfied with the post
marketing services then there are good chances for supplier to retain the
customers to enhance repeated purchases and make good business profits.
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3.17. Why Dissatisfaction in Customers?
When the suppliers are unable to entertain customers or their business strategies
fail to build a good relationship with customers, they probably end up with
customers’ dissatisfaction. There can be many reasons for the customers to
become dissatisfied. Some of these reasons are:
1. Taking example of India, most of the population here are vegetarian. They
do not require a bigger space in their refrigerator for deep freeze option. But
still, following foreign trend of making refrigerators most of the
manufacturers are providing huge capacity deep freezers. If the people are
not able to use this space or option, it is waste for them. Obviously they feel
dissatisfied with this.
2. Vacuum cleaner, one of the modest innovative equipment which was
invented to reduce manual household works on just click of a button. It is a
huge success in European countries where the environment is dusty as
compared to other parts of the world and the cost for managing household
work is pretty expensive. But in countries like United Stated where the
environment is very different and dust free, there is no need for installing
this equipment in house as it would be kept uselessly in house. In India the
environment is lot dusty but the cost exempted for managing the household
work is very cheap and affordable, so why people will go and buy a vacuum
cleaner and invest a lot of money in that, if they can hire a manual cleaner
boy without investing much. If they buy a vacuum cleaner and later on feel
that it is turning out to be expensive and tedious deal then it brings
dissatisfaction among them.
3. The eating tradition in India is very much different from other countries. In
Europe, people usually eat continental food and they have habit of
appetizing the main course with bread, so they usually keep a small plate
(normally called quarter plate) in the left hand side so that the bread is
available to eat in between with left hand. In India, people prefer ‘Roti’
(Indian version of bread) and they like to eat it with right hand so they want
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the small plate to be kept on right hand side. But in India, most of the good
restaurants are influenced by European traditions and keep on serving the
small plates on left hand side on the table. This creates uneasiness for the
people to eat food which leads to dissatisfaction.
4. Problem also occurs when the customers get wrongly customized products.
This is because of the communication gaps between supplier and customers
and forcing the customer to become dissatisfied due to this.
5. Apart from delivering good and quality products it is equally important for
the suppliers to provide excellent post deal services. For example, a
customer bought a Fax machine from a supplier and suddenly something
went wrong and the machine stopped sending fax at the time when there
was an urgent fax to be sent. Customer called the supplier and asked for
urgent support but none of the executive at the supplier’s side was available
for fixing this issue. Customer finally took some local vendor’s help to fix as
it was very urgent. Such a situation can develop an irritating gesture for
customers against the supplier and to his dissatisfaction.
Apart from the above examples many more similar reasons could lead to
customer’s dissatisfaction. It is very important for the supplier to concentrate on
customer’s needs and provide him the required products and services. If desired
measures are not taken, customer’s dissatisfaction could possibly build poor
relationships between the two parties which could break anytime.
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3.18. Measuring Customer Satisfaction
For improving customer satisfaction it is essential for the supplier to measure it. It
is purely believed that if anything is not measurable then it is not authentic.
Customers are the most important asset for any organization as they are only
responsible to drives the business. Measuring customer satisfaction helps in
identifying specific customer information which is needed to run business
smoothly. Following are the information and details that could be generated after
measuring customers’ satisfaction:
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b. Specifically which customers have been defected?
c. Reason why they have defected and where exactly they have
defected?
d. Measurement of customer satisfaction always helps a supplier to
analyze appropriate reasons of lost of customers and take measures
to avoid this. It also provides analyzed information about the business
loss in the coming future. This actually helps the supplier to be
profitable because cost involved in acquiring a customer is
comparatively higher then the cost involved in retaining an existing
customer.
e. It also helps the supplier to identify the value of their products and
services according to the customers’ perception. If customer is
dissatisfied with products and services then there is a need for supplier
to check the performance and quality of the product and services so
that other customers could not complaint regarding the same.
f. It can also analyze the exact need and requirement of customer so that
measures are taken accordingly to satisfy each and every customer.
3. Suppliers Related: Following are the supplier’s specific information that
could be generated while measuring customer satisfaction:
a. It helps the supplier to conclude about his own image, strength and
weak points.
b. It helps the supplier to identify his area of perfection and competency
so that they flourish in monopoly of specific products and services.
c. It helps in encompassing the organization’s position according to the
benchmark possessed in the market by competitors.
The best way to improve customer satisfaction is to first measure it and then apply
methods to enhance it. It helps the supplier to always keep a check on allover
business processes by identifying strong and weak aspects and creating strong
bond with all their customers to enhance business.
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3.19. Methods of Measuring Customer Satisfaction
Managing customers’ satisfaction efficiently is one the biggest challenge an
organization face. The tools or methods to measure customer satisfaction needs to
be defined sophisticatedly to fulfill the desired norms. There are following methods
to measure customer satisfaction:
Apart from the above methods there is another very popular direct method
which is surprise market visit. By this, information regarding different
segment of products and services provided to the customers could be
obtained in an efficient manner. It becomes easy for the supplier to know
the weak and strong aspects of products and services.
2. Indirect Method: The major drawback of direct methods is that it turns out
to be very costly and requires a lot of pre compiled preparations to
implement. For getting the valuable feedbacks the supplier totally depends
on the customer due to which they looses options and chances to take
corrective measure at correct time. Hence there are other following indirect
methods of getting feedback regarding customer satisfaction:
a. Customer Complaints: Customer’s complaints are the issues and
problems reported by the customer to supplier with regards to any
specific product or related service. These complaints can be classified
under different segments according to the severity and department. If
the complaints under a particular segment go high in a specific period
of time then the performance of the organization is degrading in that
specific area or segment. But if the complaints diminish in a specific
period of time then that means the organization is performing well
and customer satisfaction level is also higher.
b. Customer Loyalty: It is necessarily required for an organization to
interact and communicate with customers on a regular basis to
increase customer loyalty. In these interactions and communications
it is required to learn and determine all individual customer needs and
respond accordingly. A customer is said to be loyal if he revisits
supplier on regular basis for purchases. These loyal customers are the
satisfied ones and hence they are bounded with a relationship with
the supplier. Hence by obtaining the customer loyalty index, suppliers
can indirectly measure customer satisfaction.
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3.20. Factors affecting Customer Satisfaction
Customer satisfaction is the overall impression of customer about the supplier and
the products and services delivered by the supplier. Following are the important
factors that could affect customer satisfaction:
The above factors could be widely classified under two categories i.e. suppliers
behavior and performance of product and services. The supplier’s behavior mostly
depends on the behavior of its senior subordinates, managers and internal
employees. All the functional activities like customer response, direct product and
maintenance services, complaint management etc. are the factors that rely on how
skillful and trained the internal and human resources of the supplier are. The
second category is regarding all the products and services. This depends on the
capability of supplier to how to nurture the products and service efficiently and
how skilled the employees are. It’s all about how the skills are implemented to
demonstrate engineering, re-engineering and technological aspects of the
products and services. The quality and efficaciousness of the products is also an
important factor that enables compatible and hassle free functions and operations.
This bears to lower maintenance and higher life of the product which is highly
admired by the customers.
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If the product is having some problem or compatibility issues and requires frequent
maintenance and support than the customers could get irritated and possibilities
of sudden divert is there which lead to supplier’s financial loss. In the same way if
the product is expecting huge amount of financial and manual resources then
customers could get a feeling of dissatisfaction and worry. However, if these
aspects are handled efficiently by giving class services and dealing with complaints
effectively then dissatisfied customers could be converted into long time satisfied
customers and retaining them becomes easy.
It is practically impossible for the supplier to provide all the above explained
features. There are always some positive as well as negative features in products
and services which could lead to delight or irritate customers. The final opinion is
the sum of overall experiences which a customer percept. But it is also true that
more the positive aspects, the more the customer is satisfied. Hence the aim of the
supplier should be always to enhance these positive feelings among all the
customers to increase customer satisfaction. The supplier must identify how to
enhance these positive aspects to maximum level by analyzing the customer’s data
and information using CRM system. The individual liking and disliking of customers
differ from customer to customer. It is hence required to target a customer and
identify individual requirement to make them satisfied.
Having discussed the above factors that affect customer satisfaction we can say
that higher the satisfaction level, higher is the sentimental attachment of
customers with the specific brand of product and also with the supplier. This helps
in making a strong and healthy customer-supplier bonding. This bonding forces the
customer to be tied up with that particular supplier and chances of defection are
very less. Hence customer satisfaction is very important panorama that every
supplier should focus on to establish a renounced position in the global market and
enhance business and profit.
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3.21. Meaning and Scope of Marketing Research
According to American Marketing Association, “Marketing Research is the function
that links the consumer, customer and public to the marketer through information-
information used to identify and define marketing opportunities and problems,
generate, refine and evaluate marketing actions; monitor marketing performance;
and improve understanding of marketing as a process.”
Marketing Research is systematic problem analysis, model building and fact finding
for the purpose of important decision making and control in the marketing of goods
and services.
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3. While in Marketing Research information is for specific purpose, so it is not
rigid; in MIS information is more rigid and structured.
Marketing Research is essential for strategic market planning and decision making.
It helps a firm in identifying what are the market opportunities and constraints, in
developing and implementing market strategies, and in evaluating the
effectiveness of marketing plans.
Marketing Research is a growing and widely used business activity as the sellers
need to know more about their final consumers but are generally widely separated
from those consumers. Marketing Research is a necessary link between marketing
decision makers and the markets in which they operate.
1. Producers
a. To know about his product potential in the market vis-à-vis the total
product;
b. New Products;
c. Various brands;
d. Pricing;
e. Market Structures and selection of product strategy, etc.
2. Business and Government
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b. Expenditure levels and budgeting;
c. Agricultural Pricing;
d. The economic policies of Government; and
e. Operational and planning problems of business and industry.
3. Market Research Agencies
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CHAPTER FOUR: SURVEY METHOD
The Survey method is the technique of gathering data by asking questions to people
who are thought to have desired information. A formal list of questionnaire is
prepared. Generally a non disguised approach is used. The respondents are asked
questions on their demographic interest opinion.
1. Telephonic Interview
2. Personal Interview
3. Mail Interview
4. Electronic Interview
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Telephonic Interview Telephone Interviewing stands out as the best method
for gathering quickly needed information. Responses are collected from the
respondents by the researcher on telephone.
Personal Interviewing It is the most versatile of the all methods. They are
used when props are required along with the verbal response non-verbal responses
can also be observed.
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14.Knowledge of past and future is possible.
15.In-depth research is possible.
16.Verification of data from other sources is possible.
17.The information obtained is very reliable and dependable and helps in
establishing cause and effect relationship very early.
Mail Survey Questionnaires are send to the respondents, they fill it up and send
it back.
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Electronic Interview Electronic interviewing is a process of recognizing and
noting people, objects, occurances rather than asking for information. For example-
When you go to store, you notice which product people like to use. The Universal
Product Code (UPC) is also a method of observing what people are buying.
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PART THREE: APPLIED STUDY
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CHAPTER FIVE: APPLIED STUDY
5.1. History of Beirut restaurant
Beirut, bring the familiar Lebanese street Food to Egypt through street 9 Maadi
gate. use only the authentic Lebanese recipes to create simple, flavorful, tasty
meals and sandwiches.
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5.2. Questionnaire analysis
Age
55 or more 3
35 to 54 4
16 to 34 32
Under 16 1
55 or more 7.50%
35 to 54 10%
16 to 34 80%
Under 16 2.50%
The majority of the sample 80% between 16-34 years and the minority 2.5% under
16 years.
75
Gender
Male 22
Female 18
Female 45%
Male 55%
The majority from our sample males 55% and the minority females 45%
76
Nationality
Egyptian 28
American 4
European 4
Other 4
70%
77
Are you a regular customer in beirut restaurant ?
Yes 32
No 8
No
20%
Yes
80%
78
Restaurant environment and service
No. Questions Most % Some % Never %
time time
1 I have to queue for a long time 4 10% 19 47.5% 17 42.5%
2 The restaurant is very clean 38 95% 2 5% 0 0
3 The portion sizes are about right 35 87.5% 5 12.5% 0 0
4 The staff are helpful 36 90% 4 10% 0 0
5 The staff are well presented 39 97.5% 1 2.5% 0 0
6 The general service is good 34 85% 6 15% 0 0
7 The quality of the food is excellent 6 15% 34 85% 0 0
8 The food meets the price value 35 87.5% 5 12.5% 0 0
9 The menu has a good variety of items 29 72.5% 11 27.5% 0 0
120%
100%
80%
60%
40%
20%
0%
1 2 3 4 5 6 7 8 9
79
What grade from 1 to 5 would you give to beirut restaurant ?
1 Star 1
2 Stars 0
3 Stars 1
4 Stars 18
5 Stars 20
60.00%
50.00%
40.00%
30.00%
20.00%
10.00%
0.00%
80
You overall satisfied from beirut restaurant ?
Yes 38
No 2
No
5%
Yes
95%
81
5.3. Conclusions
1-The results shows that the service of beirut restaurant was of moderately high
quality.
2-The results found that the respondents of beirut restaurant are quite satisfied
with the restaurant services.
3-The results found that the respondents have loyalty to beirut restaurant and they
will recommend the services of beirut restaurant to their friends and family.
4-Major regular customers in beirut restaurant equal 80% and the minor equal
20%.
6-Major gender in beirut restaurant 55% from males and the minor gender 45%
from females.
5.4. Recommendations
Based on the analysis and the findings, the following are recommended
to help improve service performance in beirut restaurant.
1-Increase the restaurant space and open new branches.
2-Increase size of sandwiches and increase food quantity.
3-Add new varieties of food grilled chicks , shish barak , man'oucheh zaatar
4-Add breakfast and diet meal and dessert.
5-Home delivery improvements and reduce the delivery price.
82
REFERENCES
1-http://www.managementstudyguide.com/services-marketing.htm
2-http://www.managementstudyguide.com/seven-p-of-services-marketing.htm
3-http://www.managementstudyguide.com/moment-of-truth-services-
marketing.htm
4-http://www.managementstudyguide.com/customers-expectations-and-
delight.htm
5-http://www.managementstudyguide.com/maintaining-service-quality.htm
6-http://www.managementstudyguide.com/leadership-in-service-industry.htm
7-http://www.managementstudyguide.com/service-industry-at-cross-roads.htm
8-http://www.managementstudyguide.com/changing-face-of-services-
marketing.htm
9-http://www.managementstudyguide.com/what-is-crm.htm
10-http://www.managementstudyguide.com/origin-of-crm.htm
11-http://www.managementstudyguide.com/features-of-crm.htm
12-http://www.managementstudyguide.com/importance-of-crm.htm
13-http://www.managementstudyguide.com/what-is-customer-relationship.htm
14-http://www.managementstudyguide.com/types-of-customers.htm
83
15-http://www.managementstudyguide.com/quality-relationship-customers.htm
16-http://www.managementstudyguide.com/need-relationship-customers.htm
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measurement.htm
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satisfaction.htm
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21-http://www.managementstudyguide.com/measuring-customer-
satisfaction.htm
22-http://www.managementstudyguide.com/customer-satisfaction.htm
23-http://www.managementstudyguide.com/marketing_research.htm
24-http://www.managementstudyguide.com/sources_of_data.htm
25-http://www.managementstudyguide.com/survey_method.htm
26-http://www.managementstudyguide.com/survey_method_techniques.htm
27-(Andaleeb & Conway, 2006; Dominici & Guzzo, 2010; Hanzaee & Khonsari,
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& Minai, 2009; Kau & Loh, 2006; Tian & Wang, 2010; Tronvoll, 2011; Ueltschy,
84
Laroche, Eggert, & Bindl, 2007; Voon, 2011; Wall & Berry, 2007; Wong & Sohal,
2006)
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12.
30-Hanzaee, K. H., & Khonsari, Y. (2011). A review of the hedonic and utilitarian
31-Hasan, S. A., Subhani, M. I., & Rehman, A. (2011). Relationship between varios
85
33-Kasim, N. A. A., & Minai, B. (2009). Linking CRM strategy, customer
34-Kau, A.-K., & Loh, E. W.-Y. (2006). The effects of service recovery on consumer
22(1), 111-134.
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423.
86
39-Wall, E. A., & Berry, L. L. (2007). The combined effects of the physical
264.
87
APPENDIX
88
Customer Satisfaction Questionnaire
We are constantly striving to provide a good food service. This survey is part of the process. Please help
us to do this by completing this questionnaire.
Yes
No
89
3. What grade from 1 to 5 would you give to beirut restaurants?
1 2 3 4 5
4. What improvements and comments, if any, would you like to see in the variety of foods on offer?
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Yes
No
Thank you for completing this questionnaire. Results will be treated in confidence
90