Chapter 2 Tourism and Hospitality Service Marketing and Quality PDF

Chapter 2 Tourism and Hospitality Service Marketing and Quality SERVICE QUALITY  Characteristics of Tourism and Hospitality Service Marketing Intangibility - Services are described as intangible products, meaning that they cannot be experienced, heard, seen, smelt, tasted or...

Chapter 2 Tourism and Hospitality Service Marketing and Quality SERVICE QUALITY  Characteristics of Tourism and Hospitality Service Marketing Intangibility - Services are described as intangible products, meaning that they cannot be experienced, heard, seen, smelt, tasted or touched prior to being purchased - Marketing intangibles create difficulties for the service provider. Customers often sense higher level of risk and find difficulty in assessing quality. - Campaign materials must include pictures/ videos of the facilities and amenities.  Characteristics of Tourism and Hospitality Service Marketing Inseparability - Service inseparability also means that customers are the part of a product. The provider and customer must be present for the transaction to occur. - A service exists only during the period in which a person is engaged and engrossed in the experience. Characteristics of Tourism and Hospitality Service Marketing Perishability - Services and experiences cannot be stored because they are highly perishable. - If service is unused, it is wasted. - Example: once the airplane takes off, the opportunity to sell tickets on that flight is lost forever, and any empty seats represents revenue lost. - There is unstable demand pattern. (low and peak season) Characteristics of Tourism and Hospitality Service Marketing Variability - The quality of services depends when, where and by whom are they provided - Variability in experiences may be triggered by location, time, topography, season, the environment, amenities, events, and service providers. Characteristics of Tourism and Hospitality Service Marketing Seasonal - Seasonality does not only refer to seasons of the year or the weather conditions; it also refers to the behavioral patterns of the travel market. The seasonality of the tourism product hinders it from maximizing its profits all year round Characteristics of Tourism and Hospitality Service Marketing Substitutable - With new destinations emerging and competing in the global marketplace, one destination can be easily substituted for another. This also applies to hotels and restaurants.  The Service Profit Chain is a theory and business model developed by a group of researchers from Harvard University in the 90's. It forms relationships between profitability, customer loyalty, employee satisfaction, loyalty, and productivity.  The Service Profit Chain American economists W. Earl Sasser Jr., Leonard A. Schlesinger and American businessman James L. Heskett entitled – "The Service Profit Chain: How leading companies link profit and growth to loyalty, satisfaction and value, 1997 the fundamental principle of the theory concerns on the fact that customer satisfaction begins with good staffing and treatment of one's own employees. Loyal employees are pleasant and definitely express this to the customer.  The Service Profit Chain Strong Links that develop: 1. Profit and Customer loyalty 2. Employee loyalty and Customer loyalty 3. Employee satisfaction and Customer satisfaction ** Leadership plays an indispensable role in this chain. It is the manager’s task to generate a culture in which employees are optimally assisted and can grow  Delivering Service Quality Quality in the tourism and hospitality industry is defined as the reliable delivery of products and guest services based on anticipated standards. Creating value for the guest will lead to retain the guest successfully Customer satisfaction is considered as the main gauge of the service quality in tourism and hospitality industry.  Service Delivery Issues in the Tourism and Hospitality Industry quality practices (mismanagement, lack of trainings), security issue (terrorist attacks, mass protests), and employment (deficiency of competent labor).  Measuring Service Quality 1. SERVQUAL Technique - compares customer perceptions of quality against customer expectations  Measuring Service Quality SERVQUAL model, the five dimensions of service are: 1. Reliability-It is where the promised quality and level of service is delivered in a consistent and accurate manner. 2. Assurance-It is the knowledge and politeness of the employees and their ability to create trust and confidence. SERVQUAL model, the five dimensions of service are: 3. Tangibles - the organization's physical facilities such as the building, website, equipment and appearance of employees. 4. Empathy - It is the degree of caring individualized attention that the organization's employees provide to its customers. 5. Responsiveness - This is the willingness of employees to help customers and offer a speedy service.  Measuring Service Quality Satisfying these RATER dimensions, a company is very well on its direction to becoming customer oriented. Together, this concept can form part of Customer Relationship Management (CRM) strategy for tourism and hospitality businesses CRM - are tools used by businesses to select customers and continue relationships with them to grow their lifetime value to the business.  Some example of touch points where the relationship is maintained: 1. The first-time possible guests visit a website and give their email address to receive more information. 2. The time a reservation is made and the company gets their personal details. 3. The in-person service meetings from the front desk to the parking lot. 4. Welcome notes, personalized menus, friendly hellos, and other touches during the interaction. 5. Background messages together with clean facilities and equipment in good repair, pleasant decor and ambiance. 6. Follow-up communications like a newsletter 7. 7. More interactions on social media.  Measuring Service Quality 2. Mystery Shopping This is a widespread technique used for retail stores, hotels, and restaurants, but then works also for any other service. It entails hiring an "undercover customer" to examine the company's service quality  Measuring Service Quality 3. Post Service Rating -This is the practice of asking customers to rate the service right after it has been provided -rating scale and feedback  Measuring Service Quality 4. Follow-Up Survey - With this technique a company asks customers to rate the service quality through an email survey such as Google Forms  Measuring Service Quality 5. In-App Survey -the questions are requested while the visitor is on the website or in the app, instead of later after the service or via email. - It can be one simple question like "how would you rate our service"  Measuring Service Quality 6. Customer Effort Score (CES) - a surveys normally ask the question, on a scale of "very easy" to "very difficult", how easy was it to interact with a company name  Measuring Service Quality 7. Social Media Monitoring - This is a place where they can release their frustrations and be heard - they are the ideal place to hear the unfiltered opinions of customers given the right tools  Objective Service Metrics 1. Volume per channel – this tracks the amount of inquiries per channel. It permits customers to choose which channels to promote or cut. 2. First response time – measure trails how fast a customer receives response on his probe. 3. Response time – average of time between responses. 4. First contact resolution ratio – divide the number of issues that has been fixed using a single response by the number that need more responses. 5. Replies per ticket – shows how many replies a service team needs on average to close a ticket. It is a measure of efficiency and customer effort. 6. Backlog Inflow/Outflow – the number of cases submitted compared to number of cases closed. 7. Customer Success Ratio – shows whether customers have found what they looked versus those they did not.  Objective Service Metrics 8. "Handovers" per issue – tracks how many different service representatives are involved per issue. 9. Things gone wrong – number of complaints/ failures per customer inquiry. 10. Instant service/ Queuing ratio. Keeps track of the ratio of customers that were served promptly versus that had to wait. 11. Average queuing waiting time – the average time those queued customers have to wait to be served 12. Queuing hang-ups – this considers the customers abandoned the queuing process. 13. Problem resolution time – this concerns the average time before an issue is fixed. 14. Minutes spent per call – this can give a comprehension on who are the company’s most well-organized operators.  Capacity and Demand in the Tourism and Hospitality There is either excessively demand for the capacity, putting a strain on resources, or too little demand, giving upswing to unused capacity and a loss in revenue.  Capacity Management -Capacity management is to the ability of a given industry to balance demand from customers and the likelihood of the service providers to propose quality services. -Capacity management had to match supply with the demand that comes with amplified number of tourists  Demand Management - involves energetically managing overall demand by optimizing the usage of distribution channels to reach target customer segments influencing and improving current customer relationships, and taking effective revenue management (RM) actions  Managing Capacity and Demand Adjusting capacity to match demand- also known as "chasing demand" Altering demand to match available capacity - also known as "level capacity" and is an attempt to shift demand  1. Adjusting capacity to match demand 1. Lengthen the opening hours 2. Inspire employees to work harder 3. Cross-train employees 4. Recruiting part-time employees 5. Increase facilities 6. Hire or share facilities or equipment 7. Using customers as productive resources 8. Outsourcing – Ex. Web development, marketing, recruitment and training  2. Altering demand to match available capacity 1. Manipulate price –disappoint customers using the service during peak season and inspire them to select off seasons. 2. Offer a mobile service 3. Communicating with customers 4. Changing the service offer –converting rooms to cater more guests Thank you for listening!!!