CRM Lesson 12: Service Recovery Strategies

Questions and Answers

What is the primary function of complaint management?

To manage employee performance

To handle and respond to customer grievances (correct)

To enhance marketing strategies

To establish pricing policies

What is one of the most significant metrics for call center performance regarding customer complaints?

Average Time on Hold (ATH) (correct)

Customer satisfaction scores

Customer retention rates

Sales conversion rates

Which factor is NOT mentioned as influencing customer complaining behavior?

Quality of advertising (correct)

Cost of complaining

Personal importance of the service

Level of dissatisfaction

What could result from customers waiting more than two minutes on hold?

Increased likelihood of customers hanging up Signup and view all the answers

Effective complaint handling contributes to customer satisfaction by:

Ensuring the job is done right the first time Signup and view all the answers

What is mentioned as a tool to improve response times for customer complaints?

Complaint tracking software Signup and view all the answers

Which of the following actions may lead to customers not calling back after a complaint?

Long wait times on hold Signup and view all the answers

What does the customer satisfaction formula emphasize?

Effective complaint handling and first-time service quality Signup and view all the answers

What is a primary benefit of service guarantees for firms?

They help identify customer preferences. Signup and view all the answers

Which characteristic is essential for designing a service guarantee?

Credibility Signup and view all the answers

What does a single attribute-specific guarantee ensure?

An explicit minimum performance standard on one key attribute Signup and view all the answers

Which of the following is NOT a type of service guarantee?

Customer feedback guarantee Signup and view all the answers

What aspect of Mr.D's situation signifies a failure in service provision?

His request to cancel services was ignored. Signup and view all the answers

Which of the following describes a full satisfaction guarantee?

Customer satisfaction is guaranteed with no exceptions. Signup and view all the answers

What type of guarantee is a credit card charge for services not rendered an example of?

Breach of service promise Signup and view all the answers

Why is it important for a service guarantee to be easy to communicate?

It ensures customers understand their rights. Signup and view all the answers

What was the reason provided by the service provider for the continued billing to Mr.D after cancellation?

A system error Signup and view all the answers

What corrective action was taken by the service provider regarding Mr.D's account?

Mr.D was refunded and received an additional credit Signup and view all the answers

What was the main reason Mr.C filed a complaint with the CCTS?

To have a previous offer honored Signup and view all the answers

What did the service provider initially claim regarding the 10 GB data promotion for Mr.C?

There was no record of the promotion Signup and view all the answers

What action did the CCTS take to resolve Mr.C's complaint?

They insisted on obtaining the call recording Signup and view all the answers

What was the outcome for Mr.D after his issue was resolved?

He received an apology and a credit Signup and view all the answers

How did the recording obtained by the CCTS impact Mr.C's complaint?

It corroborated Mr.C's version of events Signup and view all the answers

What was Mr.C offered in the loyalty promotion according to the initial communication?

10 GB of data for $60/month Signup and view all the answers

What is a key aspect of service recovery?

Identifying service complaints Signup and view all the answers

Which factor is NOT considered in procedural justice during a complaint process?

Treatment by staff representatives Signup and view all the answers

What is the purpose of redesigning service processes in customer complaint management?

To establish preventative solutions Signup and view all the answers

Which element is NOT part of interactional justice?

Compensation for losses Signup and view all the answers

Which strategy can help prevent customers from switching to competitors?

Collecting data on customer failure points Signup and view all the answers

What does outcome justice refer to in the context of complaints?

Customer compensation for losses Signup and view all the answers

Which of the following actions is part of learning from the recovery experience?

Conducting root cause analysis Signup and view all the answers

Which demographic factor is likely significant in the complaint management process?

Customer age group Signup and view all the answers

Study Notes

Customer Complaints and Service Recovery

Definition of Complaint: Expression of dissatisfaction, signaling a grievance or concern from the customer.
Customer Satisfaction Formula: Achieving customer satisfaction involves 'doing the job right the first time' and effective complaint handling.

Customer Complaint Management

Process of Complaint Management: Involves handling, managing, responding to, and reporting customer grievances, necessitating a streamlined approach and constant monitoring.
Multichannel Complaint Tracking: Due to varied customer contact points, employing complaint tracking software with multichannel capabilities is essential for quick responses.

Customer Problems

Long Wait on Hold: Average Time on Hold (ATH) is crucial in call centers; customers tend to hang up after two minutes of waiting.
Impact of Long Waits: 34% of customers may not call back after a long wait, risking customer attrition.

Factors Influencing Complaining Behavior

Dissatisfaction Level: The greater the dissatisfaction, the higher the likelihood of complaints.
Service Importance: Personal importance of the service influences whether customers will complain.
Costs of Complaining: Time, anxiety, and resources required affect the willingness to voice complaints.

Strategies to Reduce Complaint Barriers

Data Collection: Gather insights on customer failure points to address and minimize issues.
Root Cause Identification: Understanding the underlying causes of complaints to develop preemptive solutions.
Process Redesign: Implementing technical solutions, customer education, and fostering customer citizenship.

Service Recovery

Objective: Actions taken to rectify issues and restore customer satisfaction after complaints.
Key Steps: Identifying service complaints, effectively resolving them, and learning from recovery experiences.

Perceived Fairness in Service Recovery

Justice Theory: Encompasses procedural, interactional, and distributive justice.
- Procedural Justice: Fairness of the complaint handling process; customers value speed, flexibility, and follow-up.
- Interactional Justice: Focus on firm representatives' behavior, emphasizing open communication and genuine concern.
- Distributive Justice: Customers expect compensation, such as refunds or apologies, when services fail.

Designing Service Guarantees

Characteristics of Effective Guarantees: Should be unconditional, easy to understand, meaningful to customers, and credible.
Types of Guarantees:
- Single Attribute-Specific: Guarantee on one important attribute, e.g., timely delivery.
- Multi-Attribute-Specific: Guarantees on several key attributes.
- Full Satisfaction Guarantee: Assurance that all service aspects will meet customer satisfaction without exceptions.

Case Studies

Mr. D’s Complaint: Canceled services but continued billing led to issues with charges. The service provider corrected the error and provided a refund, resolving the complaint satisfactorily.
Mr. C’s Complaint: Inquiries about a promised loyalty promotion displayed discrepancies between agent claims and recorded offers. The confirmation of the offer through call recording facilitated a fair resolution for the customer.

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Description

This quiz focuses on handling customer complaints effectively and managing service recovery within the context of Customer Relationship Management (MKT 2207). It highlights the importance of addressing customer dissatisfaction and the techniques that can be employed to resolve issues satisfactorily. Test your understanding of these vital marketing concepts.