Business Letter and Literature Summary - Assignment Example

Running Header: Business letter and literature summary Student’s Name: Instructor’s Name: Course Code Date of Submission: Dear Bill Bryce, REF: Mumbai to Heathrow 7th December 2008 I apologise on behalf of the Virgin brand for the services you received onboard. I’m sorry about that and I want to ensure you that action is being taken in order to solve the problems you faced. It is important to note that you love Virgin brand despite the unfortunate incidents over the past few years. It is a shame that the brand provided such shameful services to you which can obviously true that such things are possible to bring the company down and lack loyal customers. Thank you for raising your concern about the services offered to you on the above date. I understand how you feel about the situation. I believe it was the company’s mistake for the provision of poor quality food. We are pleased to inform you that we will see what we can do to solve the solution as soon as possible. I sincerely thank you for the chance to win your continued business and renewed loyalty. Yours Sincerely, Richard Branson. Literature Summary Introduction Proper customer service is the lifeblood of any company and business. This is because it brings about more customers and makes them come back. Parasuraman (2006, pp. 590-593) describes that retaining customers is one way of is the major practice of good customer service. One of the best ways of helping unhappy customers and in order to change their attitude towards the services offered by the company is by listening to their complaints. It is necessary to be polite, friendly and helpful. This is because if the problem is not fully resolved, the customer will feel less negative about the business by the fact that the business did everything possible. According to the letter, there are various problems identified by the passenger complainant. Problems faced by the customer Some of the problems faced by the customer include; poor services offered by Virgin brand. These services include being served with low quality desert. The complainant was also served with sour gel that looked like a baaji and which was poorly cooked. The customer states that this is not what he expected since the company had been his best for a long time. He therefore feels that the services have started deteriorating in terms of quality and good customer care. Other poorly offered services include services that the customer complained about in the letter was the onboard entertainment which showed unclear pictures and was hard to capture the pictures. This showed that the company is not keen about the services offered on board apart from the flight services. Poor customer service leads to bad reputation which spreads fast causing further loss to the business. It is necessary for every manager to ensure that they understand and implement effective customer service tools as this attracts more clients and builds a stable reputation. Solutions for the problems Once customers complain, business should offer a solution. There are various ways of offering solutions which could turn a disappointed customer into a happy one. One way is by replacement. This is for example if the company sells a product that is broken, a replacement should be offered. If there is no extra replacement available, a similar model can be used to replace according what the customer prefers. This replacement may cost the business the value of a new product but it is worthy losing the product than losing the customer who will cost much more value in the long run (Wirtz and Mattila 2004, pp. 150-166). The other method of solving complains involves giving a refund. A customer who is unhappy with the services offered for example in a hotel may be given a refund of their money. To the business, this means a loss of the sale revenue though it is a way of strongly improving the chances of the customer returning again. McCole (2004, pp. 345-354) explains that partial refund solves minor problems and may bring about more profits from the customer in future. Fixing the problem is the other way of solving customer’s complaints for example in the case above, the customer had a problem of viewing the onboard entertainment due to improper connectivity. This problem can be solved by the company’s’ technicians. Other problems such as poor quality food may be solved by giving training to employees. Know customers needs In order to solve the problems stated in the letter from the customer. It is necessary for the company to understand the need to provide proper goods and services to their clients. These include the new customers and old ones. This is because the approach to customer service matters and determines whether one is able to retain loyal customers. Wirtz and Mattila (2004, pp. 150-160) shows the essence of good customer service is being capable of forming a lasting relationship with customers where the customer feels like pursuing. To form a good relationship with the customer it is important to remember a secret in customer service which states that one is judged by what they do and not what they say. To solve the problems faced in this case it is necessary to listen to the customers and understand their needs and expectations. This would be important if the company carried out a market research. To achieve maximum goals, the company aims at carrying out a market research that will enable it discover the needs of their customers who are a greatest asset in business. Market research involved organised process for gathering information about markets and analysing the needs of customers. Kau and Wan-Yiun (2006, pp. 111-101) shows market research form a significant part of the business strategy that shows an organisation which direction to take in order to attain a competitive advantage against the competitors. The objective for carrying out a market research is to examine the importance of marketing research in achieving organisational goals. The other objective is to outline the contents of research brief and proposal. Finally, market research aims at explaining how the information collected helps the company. The marketing research was carried out to identify directions, discover new business models and web distribution models. Record information Information got from a marketing research does not guarantee success neither does it make business decisions. Final decisions are made by the marketing managers and therefore are necessary for them to obtain research report showing the courses of action. Market research therefore analyses the marketing needs, the size of the market and the scope of competition. Magnini et al. (2007, pp. 225-213) puts it that market research information is important as managers are in a better position to determine the needs of their service delivery. It is also clear on the likelihood to sell, and how to formulate strategies for target market demographics. The information will benefit all the departments in the firm for example the finance department will be capable of keeping resources of developing its other departments. Train staff According to Kau and Wan-Yiun (2006, pp. 101-111) to solve the problems stated in the case above, it is important for a marketing manager to train staff members. The manager should either train his workers or hire a trainer. This is for example by training staff members on good customer service and how it is undertaken. It is necessary for the manager to give staff members enough information and power to make customer decisions. This will enable them to have experience with what the customers really prefer and what they expect to be offered onboard. As a marketing manager I should also be able to formulate new strategies that will be necessary to meet the needs of consumers and to attain a competitive position in the market environment. Market research is also necessary as it enables an organisation to discover new business ideas and to evaluate the kind of ideas that will be effective to use. There various methods needed to find information about markets; they also show how to meet the target marketing needs. The information provided by the market research will give managers a clear picture of the market. Robbins and Miller (2004, 109-119) argue that this will be by analysing consumer information which involves gender, age and their buying behaviours. Evaluate customer commitment Consumer commitment is one powerful predictor of various activities related to consumer retention for example through staying intentions and repurchasing intentions. It is also shown that it is necessary to build and enhance a long-term relationship with customers. This is because the relationships generate positive returns into the business. Hocutt et al. (2006, pp. 199-207) explains consumer commitment is therefore a key to marketing success and every business should ensure that they observe. Consumer involves provision of better services and the fact that services need ongoing membership as it is difficult to evaluate intangible services. Commitment is the desire to maintain a valued relationship between buyers and sellers and is also applied in channel relationships (Jones and Farquhar 2007). It also involves consumer relationships with the service providers, retail stores and brand owners. Commitment is applied in the field of psychology, organisational and marketing. The definition in all the these terms reflect that commitment is a relationship that involves both psychological state which include having a binding force, a link or a dedication to a particular brand or service provided. A motivational phenomenon of commitment involves maintaining a relationship with the sellers of repurchasing or in remaining in the organisation. Commitment therefore involved studies of psychology and organisational behaviour. Researchers show that people become committed due to various factors and to various targets such as commitment to people, organisations, pets, goals or ideals. The organisational behaviour differentiates commitment to an organisation, a profession, supervisor and a worker. Marketing on the other hand distinguishes commitment between service provided and commitment to service organisation. This is because retaining loyal customers yields an organisation more benefits and also set a focal point giving members the right direction to formulate necessary strategies. It also involves observing better job performance, having a positive word of mouth, socialising with others which bring about discretionary responses. Affective commitment gives predictive effects of both focal and discretionary responses as normative and continuance commitment only gives discretionary responses (Hocutt et al. (2006, 199-207). Evaluate customer emotions Emotions are said to be mental states of readiness that arise as a result of appraisals of events or a persons thoughts. Emotions are markers, mediators and moderators of consumer responses which are then analysed. Customer satisfaction is influenced by their emotions and how they feel deep inside their hearts about a particular service provided. This question therefore will analyse the role of emotions in marketing and it gives practical suggestions on how emotions can help in selling a product. Emotions can be defined as a mental stage of readiness that arises from cognitive appraisal of events or thoughts they have a phenomenological tone and accompanied by physiological processes. Emotions are often expressed physically and may result in specific actions to affirm or cope with the emotion, depending on its nature and meaning for the person having them. Emotions are put in two categories, which include positive emotions and negative emotions. Researches in the marketing discipline have largely adopted the appraisal theory of emotions to study customer emotions in service consumption. The theory has the ability to integrate the informational and directive roles of specific emotions in goal-directed. Equally, cognitive appraisal theory of customer emotions is appropriate for this research as it allows predictive ability of both antecedents and consequences of customer emotions in collective hedonic services. Consumer behaviour is essential in the understanding of what motivates and helps in decision strategies between products with varying importance. The subject is more important in helping marketers to adapt and improve their marketing campaigns and marketing strategies to effectively reach the consumer. Consumer behaviour is applied in the marketing strategy to make better marketing campaigns; in public policy, in social marketing to get ideas to consumers instead of selling something and to make people to be better consumers. According to Robbins and Miller (2004, pp. 95-109) the services provide by a company has a positive influence on customer emotions, particularly in collective hedonic services. The conceptualisation of the second antecedent, termed social surroundings, is guided by four seminal works in the literature, discussion of the role of environment, the concept of social-service scope and social surroundings and the concept of social presence. Prior research has mainly concentrated on investigating direct customer-to-customer interactions, customer dysfunctional behaviour and considered social surroundings as a dimension of service quality. As such, prior research has failed to consider the possible array of social dimensions relevant to service encounters. This shows that the influence of social elements on customer emotions remains largely unknown in collective hedonic services. Social surroundings refer to the social elements in the service setting that can affect a customer’s experience. Social surrounding is found to comprise three dimensions which include non-verbal crowd behaviour, verbal crowd behaviour and social atmospherics. It was therefore assumed that social surroundings significantly influence customer emotions. The third antecedent of customer emotions, service performance, is based predominantly on the service quality study included in the servqual model. Service performance is used in this research to evaluate both the process and outcome of the service delivery, and to consider the performance of for example athletes and performer in service delivery. Based on the study and the findings, service performance was assumed as comprising two dimensions which include entertainer performance and service delivery performance. Customer emotions have various effects on the marketing of products. These effects include customer satisfaction, perceived value and behavioural intentions. Customer satisfaction is seen as an overall affective based post-consumption judgment. La and Kamdampully (2004, 390-401) shows customer emotions influence customer satisfaction in product, utilitarian and retail service contexts. Perceived value shows the overall evaluation of the utility of a service. Studies show customer emotions influence perceived value in a collective hedonic service for example sporting match thus, it is useful to revisit and extend this relationship by studying it in a variety of collective mass hedonic services contexts. According to Magnini et al. (2007, pp. 225-213) behavioural intentions are defined as the subjective probability that an individual will take a particular action. The interrelationship between satisfaction, perceived value and behavioural intentions has not been investigated in the context of collective hedonic services. It is therefore seen that emotions are ubiquitous in marketing as they influence the processing of information, and mediate responses in order to form persuasive appeals. Emotions also measure the effects of marketing stimuli, initiate goal setting, and enact goal directed behaviours and measures consumers welfare. Emotions are also subject to actions. They also influence cause and effect and are root of motivation. Evaluate customers’ behaviour Consumer behaviour entails the psychological processes that consumers go through in the recognition of their needs, in finding ways of resolving these needs, when making purchasing decisions, when interpreting information, when making plans and when implementing these plans. By studying consumer behaviour, firms are able to understand the psychology of how consumers think, feel, reason and select between different alternatives of brands. Consumer behaviour is also essential in the understanding of how consumers shop and make other marketing decisions. Firms are in a better position of understanding how consumer knowledge or information processing limitation impact on decisions and marketing outcome. According to Hocutt et al. (2006, pp. 199-207) consumer behaviour is essential in the understanding of what motivates and helps in decision strategies between products with varying importance. The subject is more important in helping marketers to adapt and improve their marketing campaigns and marketing strategies to effectively reach the consumer. Consumer behaviour is applied in the marketing strategy to make better marketing campaigns; in public policy, in social marketing to get ideas to consumers instead of selling something and to make people to be better consumers. One of the questions that consumers ask themselves when making decision on liking a particular brand for example how the customer liked Virgin brand concerns the originality of the brand. Compensation Customers need to get the most for their money and therefore it is important that they get what they expect from their favourite brand. This is because by not meeting customer’s expectations, the company makes a withdrawal from customers’ goodwill. Compensation is therefore a powerful tool to invest in customers but should be used as the last resort. It is a way of putting something back when the business disappoints its clients. This is because when a business surprises a customer for example through offering good service more than they were expecting, this has an impact on their loyalty to the company (Thwaites and Williams 2006, pp. 641-653). Once customers are loyal, they tend to buy more from the company and recommend the company to their friends. They also stay with the company for a longer time therefore improving profitability as well as increased job satisfaction and staff morale. Jones and Farquhar 2007, 172-161) shows in order to compensate for the problems caused to the customer by the company, it is necessary to first introduce training activities. The company should be able to ensure that their staff members identify good examples from their own experiences. The training resource should be intended for use by trainers in order to help participants in examining the issues of compensation from both business and customer viewpoints. They should also suggest better ways of achieving win-win situations and at the same time focusing on the overall performance of the business (McColl-Kennedy et al. 2003, pp. 66-70). Giving extra services It is important to take an extra step for example by providing extra customer service. It is also necessary to throw in something extra for example coupons for a future discount, additional information on how to use the product or give people more than they expect for example the company may decide to offer more services for example transport services after reaching their destinations to their homes. Thwaites and Williams (2006) shows the extra service should however not be too large to be effective but should be in a way that customers will appreciate and remain loyal to the company. It is also meant to make the customers forget past experiences with the company therefore acting as compensation. Give customer full attention In order to solve customers’ complaints, it is necessary to focus on what they say by having an open mind. This shows that one is prepared to hear the things they may not to hear though they are of value to the company as they help in satisfying customers. White and Yanamandram (2007, pp. 98-316) give that managers should also ensure that they listen to real issues as not all that are given relevant to the business. It is also necessary to appreciate customers concerns by understanding their situation. Showing empathy for example enables helps in establishing rapport and also helps in salvaging relationships with the unhappy customers. Managers should ensure that they do not make excuses of try to defend the products offered by the company. It is necessary to side with the customers no matter the situation as this will enable them to realise that in future they are promised satisfactory solutions to their problems. Solving customers’ complaints also needs managers to work out a mutually beneficial plan of action. It is important to tell a customer that a situation can be solved other than telling them that it can not be done. Finding a possible solution enables the company to salvage the customer relationship. Finally it is important to thank the customer for bringing the complaint to the attention of the management. This is because customers who bring out their problems simply give the business a second chance. It is necessary to thank such customers sincerely for the chance to win their continued business and renewed loyalty (White and Yanamandram 2007, pp. 298-316). Special bonus It is important to ensure that the customer is completely satisfied and this is done by provision of special service for through giving reduced price. The company may also give another product that the customer may wish to have in order to solve the problem. A generous return policy should be formed by the business as a way of satisfying dissatisfied clients. Complaints may act as blessing in disguise since the problems are able to be fixed before causing serious negative problems or even legal issues. Companies should therefore ensure that one complaint is not repeated as the issues raised should be used to start a remedial action. Money- off next purchase is a way of compensating to the customer who complained about the services of the company. It may be satisfactory to offer the customer money off of their next flight as a way of appreciation and to form a lasting relationship with the client. This ensures that the customers return and minimises the cost of solving the problem (Magnini et al. 2007, pp. 225-213). Conclusion Good customer service brings in more customers than promotions or reduction of prices. This is because once customers approach a company to be helped, there is a manner that they expect to be treated and the services provided should also be commendable. Though it is not possible to please all people at the same time, it is necessary to provide the best service to the loyal customers as they act as advertising agents for the company. Complaints should however be given more attention. it is important to note that customer service can make or break a brand as poor services for example those offered by Virgin drive away customers as they feel their needs are not met and that the company is unresponsive. References Hocutt, MA, Bowers, MR & Donavan, DT 2006, The art of service recovery: fact or fiction? The Journal of Services Marketing, vol. 20, pp. 199-207. Jones, H & Farquhar, JD 2007, Putting it right: service failure and customer loyalty in UK banks. The International Journal of Bank Marketing, vol. 25, pp. 161-172. Kau, AK & Wan-Yiun Loh, E 2006, The effects of service recovery on consumer satisfaction: a comparison between complainants and non-complainants, The Journal of Services Marketing, vol. 20, pp. 101-111. La, KV & Kamdampully, J 2004, Market oriented learning and customer value enhancement through service recovery management, Managing Service Quality, vol. 14, pp. 390-401. Magnini, VP, Ford, JB, Markowski, EP & Honeycutt, JE 2007, The service recovery paradox: justifiable theory or smoldering myth? The Journal of Services Marketing, vol. 21, pp. 213-225. McCole, P 2004, Dealing with complaints in services. International Journal of Contemporary Hospitality Management, vol. 16, pp. 345-354. McColl-Kennedy, JR, Daus, CS & Sparks, BA 2003, The role of gender in reactions to service failure and recovery. Journal of Service Research, vol. 6, pp. 66-82. Parasuraman, A 2006, Modeling Opportunities in Service Recovery and Customer-Managed Interactions. Marketing Science, vol. 25, pp. 590-593. Robbins, TL & Miller, JL 2004, Considering customer loyalty in developing service recovery strategies. Journal of Business Strategies, vol. 21, pp. 95-109. Thwaites, E & Williams, C 2006, Service recovery: a naturalistic decision-making approach. Managing Service Quality, vol. 16, pp. 641-653. White, L & Yanamandram, V 2007, A model of customer retention of dissatisfied business services customers. Managing Service Quality, vol. 17, pp. 298-316. Wirtz, J & Mattila, AS 2004, Consumer responses to compensation, speed of recovery and apology after a service failure. International Journal of Service Industry Management, vol. 15, pp. 150-166. Read More