PROVIDER GAP 1

PROVIDER GAP 1
• Not knowing what customers expect is one of
the root causes of not delivering to customer
expectations.

• Provider gap 1 is the gap between customer

expectations and company understanding of
those expectations.

• Company – Anyone in the organization who

has the responsibility and authority to create
or change service policies, procedures and
standards.
 PROVIDER GAP 1
Expected
Service
Custome
r

Gap 1

Compan
y
Company Perception of
Consumer expectation
 PROVIDER GAP 1
• Why does this provider gap occur?

• Many reasons like

– No direct interaction with customers,
– Unwillingness to ask about expectations,
– Unpreparedness to address them
 PROVIDER GAP 1
• If do not fully understand customer’s
need, may trigger a chain of bad decisions
and suboptimal resource allocations

– Ex. Spending far too much money on buildings

and appearance, while customer are more
concerned with how convenient, comfortable
the facilities are?

– Training of doctors on latest machines but

forget to educate them about patient’s need
for care and concern.
 PROVIDER GAP 1
• The necessary first step in improving
service quality is to acquire accurate
information about customers’
expectations.

– Various formal and informal methods of

market research, customer visits, survey
research, complaint systems, brain
storming, customer meets, mystery
shopping, future expectation research etc.
 PROVIDER GAP 1
– Also segmenting the market of
customers sharing similar requirements,
expectations and demographic and
psychographic profiles.

– Another strategies is to retain customers

and strengthen relationships with them.
Ex. Frequent flier, frequent buyers
program etc. Done through Relationship
marketing.
 PROVIDER GAP 1
– In service sector, sometimes service
failure is inevitable. Many firms
recognize that customers who complain
are best friends. Knowing why people
complain, what they expect when they
complain and how to develop effective
service recovery strategies
 Market Research for
Services
• Market research is a key vehicle for
understanding customer expectations and
perceptions of services.

• Some common research objectives in

services marketing are:
– To identified dissatisfied customers
– To discover customer requirements or
expectations
– Monitor and track service performance
– Monitor changing customer expectation in an
industry
– Forecast future expectations of customers etc.
 Market Research for
Services
• These research objectives are similar to the
physical products but some additional
elements that require specific attention in
case of services are

– Services research must continually monitor

and track service performance because
performance is subject to human variability and
heterogeneity.

– Services research needs to consider and

monitor the gap between expectations and
perceptions. This gap is dynamic. Does the gap
exist because performance declining or because
expectations are escalating?