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Terms in this set (190)
HR management
Can be the basis of sustainable competitive advantage
HR management: Labor costs
Effective management can produce a cost advantage
HR management: Employees
Customer experience is determined by the employees who select merch, provide info and assistance, and stock displays
HR management: Replication
Potential advantages are difficult for competitors to duplicate
HR management strategic objectives
Align the capabilities and behaviors of
employees with short and long term goals of retail firm
Failure can result in mismanaged HR and downward performance spiral
HR performance measures
Employee productivity and employee turnover
Employee productivity
Retailer's sales or profits divided by the # of employees, can be improved by increasing sales generate, reducing employees or both
Employee turnover
# of employees leaving their job during the year divided by the # of positions, turnover greater than 100% is quite substantial and not good
HR Triad
Full potential of retailers HR is realized when HR professionals, store managers, and employees work together
HR Triad: HR professionals
Work out of the corporate office, has specialized knowledge of HR practices and labor laws, establish policies, enforce retailer's strategy, and provide tools for training staff
HR Triad: Store managers
Work in stores, bring policies to life through daily mgmt of employees
HR Triad: Employees
Provide feedback on policies, manage their careers, define nob functions, and evaluate managers and coworkers
Special HR conditions
Is very challenging due to need for part-time employees, emphasis on expensive control, and changing demographics of the workforce
Part-time employees
Can be more difficult to manage because they are less committed to the company and their job and more likely to quit
Expensive control
Often hire people with little or no experience to work at low skill jobs, since these types of jobs (waitress & sales associates) are in direct contact with customers, if there is a negative experience it can affect customer loyalty and sales
Changing demographics
Will result in a chronic shortage of qualified employees, retailer need to explore various approaches for operating effectively in tight labor market
Organization structure
Identifies the activities to be performed by specific employees and determines the lines of authority and responsibility in the firm
Determine tasks that need to be
performed
Then divide tasks in 4 categories: strategic management, merchandise management, store management, administrative management
Important issues of retail organization design
The degree to which decision making centralized or decentralized, and the approaches used to coordinate their merch and store management
Centralized decision making
Authority for retailing decision is delegated to corporate managers rather than to geographically dispersed managers
Advantages of centralized decision making
Can reduce costs and personnel in administrative functions, allows the best people to make the best decisions, and increases efficiency
Disadvantages of centralized decision making
Makes is more difficult for a retailer to adapt to local market conditions, no tailoring merch to local needs and competition, pay competitive wages
Decentralized decision making
Authority for retail decisions is assigned to lower levels in organization
Coordinating merch and store management for small independent retailer
More difficult for them, work with their salespeople to sell it and are in close contact with customers and know what they want
Coordinating merch and store management for large retailers
Organize these functions into separate divisions and assign specialized buyer for them, but don't understand customer need
Improve appreciation for the store environment
Increase buyers' contact with customers and improve informal communication between buyers and store personnel
Making store visits
Work with the departments for which they buy, provides richer view of store and improves buyers' understanding of customer needs
Assigning employees to coordinating roles
Maintain people in the merchandising division, planners and allocators who work with buyers, and stores who are responsible for coordinating buying and selling activities
Motivating retail employees
Can be difficult because employee goals my differ from those of the firm
Use written policies and supervision, incentives, and organizational
culture
Policies and supervision
Indicates what employees should do and have supervisors enforce them. Will make actions consistent with retailer strategy, but too many rules can reduce employee motivation
Incentives
Can be in the form of commission, bonuses, or stocks but can also distract employees from other tasks and reduce commitment
Organizational culture
A set of values traditions and customs of a firm that guides employee behavior passed from experienced employees to new ones
Are developed and maintained through stories and symbols
Building employee commitment
Reduce high turnover to increase sales and decrease costs by building an atmosphere of mutual commitment in their firms from retailer and employee
Building employee commitment with developing skills
Recruiting the right people, selective hiring, and good training program
Building employee commitment with empower employees
Mgmt shares power and decision making authority with employees making them more confident in their abilities and more opportunity to provide service and commitment
Building employee commitment with creating a partnering relationship
Reduce status differences, promoting from within, and enable employees to balance their careers and families
Building employee commitment with flextime
Job scheduling system that enable employees to choose the times they work
Building employee commitment with job sharing
Two employees voluntarily are responsible for a job that was previously held by one person
The Customer Relation Management process
Ccollecting customer data --learning→ analyzing customer data and identifying target customers → Developing CRM programs --action→ implementing CRM program then start over
Retailers concentratation
Providing more value to their best customers using targeted promotions and services to increase their share of wallet
Share of wallet
The percentage of the customers purchases made from the retailer from these customers
The objective of CRM
Customer loyalty
Customer loyalty
Customers resisting the activities of competitors attempts to attract them
Have emotional connection, they develop when customer receive personal attention or from an unusual experience
Programs to encourage repeat visits can easily be copied by
competitors
Collecting customer data
First step of CRM process
Should contain information on transations, customer contacts, customer preferences, descriptive information, responses to marketing activities
Collecting identifying information from customers
Ask for phone number, email, name when ringing up a sale, info is then
used to create a transaction database for the customer
Customers may be reluctant and associated may forget to ask
Collecting identifying information from customers: Offer a frequent shopper card/loyalty program
Customer provides demographic and other info when they signed up and incentivize to identify themselves at checkout and are motivated by incentives to visit frequently
Collecting identifying information from customers: Connecting internet purchasing data with the store
Customer info is captured when they use the same credit card in multiple channels from a retailer and update the purchase and record/capture info about where the customer lives
Privacy and CRM concerns
Customer control over their personal information and their knowledge about collection
Cookies
Are text files that identify visitors when they return to a web site, collect info about other sites the person has visited and what pages they have downloaded
Protecting privacy
Personal info definition is debatable
Notice and awareness, choice/consent, access/participate,
integrity/security. enforcement/redress
Opt-in: consumer must explicitly agree to share this personal information
Opt-out: consumer must explicitly tell retailer they cannot use their personal information
Data mining
Commonly used to develop information to help retailers develop programs for building customer loyalty and identifies patterns in data
Market basket analysis
Focuses on the composition of the basket, or bundle, of products purchased by a household during a single shopping occasion. Often used useful for suggesting where to place merch in store
Lifetime customer value
The expected contribution from the customer to the retailer's profits over their entire relationship with the retailer
Retailers use past behaviors
to forecast future purchases, the gross margin from these purchases, and the cost association with servicing the customers to estimate
Are based on the assumption that the customer's future purchase behavior will be the same as they have been in the past
Customer pyramid
Platinum, gold, iron, and lead
80-20 rule: 80% of sales or profits come from 20% of the customers
Customer pyramid: Platinum
Top 25% LTV, typically most loyal customers, aren't concerned about price and place more value in customer service
Customer pyramid: Gold
Second 25%, more price sensitive than platinum, not as loyal and probably patronize retailer competitors
Customer pyramid: Iron
Third 25%, don't deserve much special attention from the retailer
Customer pyramid: Lead
Fourth 25%, can cost the company money, often demand a lot of attention but do not buy much
Recency, frequency, monetary (RFM) analysis
Often used by catalog retailers and direct marketers, is a scheme for segmenting customers according to how recently they've made a purchase, how frequently they've made a purchase, and how much they bought
Customer alchemy
Increasing the sales made to good customers, converting gold customers to platinum, involves offering and selling more products and services to existing customers and increasing the retailer's share of wallet
Cross selling
Selling complementary product or service in a specific transaction, utilizes the retailer loyalty card and the shopping history ot collects to alert customers of sale items they might've previously purchased
Add-on selling
Involves selling additional new products and services to existing customers
Implementing CRM programs
Increasing
sales and profits is a challenge
For it to be effective it requires the close coordination of activities by different functions in a retailers organization
More than appointing a manger, installing a computer system to manage and analyzing database, and reminding importance of the customer
Most retailers are product centric not customer centric, typically no area of retail firm organized by customer type
Value of brand image
Brands provide value in both customers and retailers
Provide info about store, customer confidence in retailer, and enhance customer satisfaction
Customer loyalty to brands arise from heightened awareness of the brand and emotional ties to it. Customer's identify and have strong relationships with some brands
Can increase margins
Can leverage brand image when introducing new retail concepts
Brand equity
Value that the brand offers retailers
Building brand equity
Create a high level of brand awareness, develop favorable association with brand name, consistently reinforce image of brand
Brand awareness
The ability for a potential customer to recognize or recall the brand name
Aided recall
Consumer indicates they know the brand when the name is presented to them
Top-of-mind awareness
Highest-level of awareness, occurs when consumers mention a specific brand when they are asked about a retailer, merch category, or service
Can be built by having a memorable name
Association
Anything linked to or connected with a brand in the consumers memory
Common associations
Merch category, price/quality, specific attributes or benefits, or lifestyle
Brand image
A set of associations that are usually organized around some meaningful themes
Reinforce image of brand
Consistently portray the same message to customers over time and across all the elements of their retail mix
Can be difficult for multichannel retailers
Integrated marketing communication program
A program that integrates all of communication elements to deliver a comprehensive., consistent message
Extend brand name
Used to support growth strategies
Extend brand name pros
Minimal communication expenses are needed to create awareness and a brand image for the new concept
Customers will quickly transfer their awareness and association
Extend brand name cons:
Retailer may not want there to be an association
Paid impersonal communication
Advertising, sales promotion, store atmosphere, website
Advertising
Paid for communication using impersonal mass media like TV, radio, or internet
Sales promotion
Offer extra value and incentives to customers to visit a store or make a purchase during a specific time (ex: sales, special events, in-store demo, coupons, and contests)
Store atmosphere
Reflects the combination of the stores' physical characteristics which together create an image in the customers mind. Communicates information about the store' service, pricing, and merch
Website
Used to build brand image, inform about locations, events, and merch. Also offers service of selling
Paid personal communication
Personal selling and e-mail
Personal selling
Sales people help customer satisfy their needs through face-to-face exchanges of info
Used to inform customers of new merch, confirm orders, and updates. Also use targeting capabilities of the Internet to send personalized message
Unpaid impersonal communication
Publicity
Publicity
Primary method of generating unpaid impersonal communication. Communication through significant, unpaid presentations about the retailer usually a news story directed toward potential customers. Also often used to communicate with employees and investors
Unpaid personal communication
Word-of-mouth
Word-of-mouth
Very effective, but retailers encounter difficulties in generating it so they may reach out to services that help them
Control in communication
more using paid vs. unpaid, have less over the content/time of its delivery.
Retailers have less over personal selling than other paid communication
Flexibility in communication
Personal selling is the most because sales people can talk with each customer, discover individual needs, and develop
unique presentation
Emails are also because they can be personalized to specific customer interests
Credibility in communication
Publicity and word-of-mouth are seen as the most because they are typically communicated by independent sources
Cost in communication
Publicity and word-of-mouth are classified as unpaid but
retailer do incur to stimulate them such as sponsorships
Personal selling is costly while mass media advertising publicity, websites, and store atmosphere are most cost effective
Planning the retail communication process: Setting objectives
Provide direction for people implementing program and basis for evaluating its effectiveness
Must be written in quantitative terms, defined target audience, degree of
change over a specific period of time
Points of conflict: long-term vs short, product vs. location, geographic location, breadth of merch
Communication objectives
Goals related to retail communication mix's effect on the customer decision-making process
Shelf-talkers
Signs on shelves providing info about merch and its price
Setting the communication budget: Marginal analysis
The economically correct method for setting the communication budget but very hard to do
Is based on the economic principle that firms should increase communication expenditures as long as each additional dollar spent generates more than a dollar of additional contribution
Setting the communication budget: Objective-and-task method
Determines budget required to undertake specific tasks to accomplish communication objectives. Retailer must first establish communication objectives then determine necessary tasks and their costs. Total cost will be budget
Setting the communication budget: Rule-of-thumb methods
use past sales and communication activities to determine the present communication budget
Affordable budget
Retailers first forecast their sales and expenses, excluding communication expenses, during their budgeting period. The difference b/w forecast sales and expenses plus desired profits is then budgeted for the communication mix
Percent-of-sales
Fixed percentage of forecast sales
Competitive parity method
Retailer's share of expenses equals its share of the market
Allocation of the promotional budget
Retailer decides how much of its budget to allocate the budget to specific communication elements, merchandise categories, geographic regions, or long and short term objectives
More important than
decision about amount spent on communications
Should use principles of marginal analysis
Planning, implementing, and evaluating communication programs: Advertising Campaign
Specify your target segment, create program to emphasize message, track results and evaluate
Planning, implementing, and evaluating communication programs: Sales promotion opportunity
Initiated by vendors, assess the impact on profitability before accepting, must consider: realized margin, cost of additional inventory, and potential increase and/or loss in sales
Special promotion using a CRM/ campaign management tool
Used to plan, design, evaluate, and implement promo
Decide communication channel or channels and costs associated with them,
examine number of what-if scenarios and build plan. Info is collected by database
Socialization
Set of steps taken to transform new employees into effective committed members, goes beyond simply orienting them to the firm
Orientation program
Are critical in overcoming entry shock and socializing new employees, can last a few hours to several weeks, must be accompanied by a systematic follow-up to ensure that any problems and concerns arising after the initial period are considered
Training store employees in structures program
New employees are taught basic skills and knowledge, might include lectures, presentations, manuals, and correspondence distributed to the new employees
Training store employees in on-the-job learning
Assigned job, given responsibilities, and coached by their supervisors. Learning by practicing what is being taught and getting hands on experience
Leader behaviors: Task performance behaviors
Store manager's efforts at planning, organizing, motivating, evaluating, and coordinating store employees' activist
Leader behaviors: Group maintenance behaviors
Activities store managers undertake to make sure that employees are satisfied and work well together. Include considering employee' needs, showing concern for their well-being, and creating a pleasant work environment
Leadership decision making: Autocratic leaders
Make all decisions on their own. Use their authority and position to tell employees what to do
Leadership decision making: Democratic leaders
Seeks information and opinions from employees and bases their decision on this info. Shares power and info with employees and accommodates to their needs
Leadership styles
The greatest leaders and store managers go beyond influencing employee behaviors to change the beliefs, values, and needs of their employees using all styles depending on the situation
Transformational leaders
Get people to transcend their personal needs for the sake of the group or organization. Generates excitement and revitalize organization, are self-confident and delegates challenging work to employees
Motivating employees
Most important but also frustrating tasks for leaders
Setting goals or quotas for employees
Employee performance improves when they feel like their efforts will achieve expectations from managers and will be rewarded
Maintaining morale at work
Direct relationship with employee motivation and sales. Can increase with meeting where info is shared and educating employees
Sexual Harassment
Establish and post anti-sexual harassment policy and including a complaint procedure, always treat it seriously, and get important information
Evaluating store employees and providing feedback
Identify employees who are
and aren't performing well. Those doing well should be rewarded and considered for promotion, and plans should be made to help those who aren't doing well.
Should by done be employees immediate supervisor
Employees should know what their evaluations are based off of like what they are required to do, expected level of performance, and how they will be evaluated
Evaluating store employees and providing feedback: Frequency
Most retailers evaluate annually or semi annually and the provide feedback. Can have informal evaluations in between formal ones
Evaluating store employees and providing feedback: Errors
Can be made by manager's personal opinions but try to use subjective data, frequent observation, and record of observation to avoid bias
Compensating and rewarding store employees: Extrinsic rewards
Rewards provided by either the employee's manager or the firm, such as compensation
Managers can offer a variety of rewards to motivate employees, but not all employees see the same rewards, can make employees lose sight of job
Extrinsic rewards: A la carte plans
Give effective employees a choice of rewards for their good performance,
enables employees to select the rewards they want
Public recognition is an important nonmonetary extrinsic reward that can motivate other employees
Compensating and rewarding store employees: Intrinsic rewards
Rewards employees get personally from doing their job well, such personal challenge and for fun
When employees find their job rewarding in this way, they're motivated to learn how to do them
better
Retailers can make work more fun by holding contests
Job enrichment: the redesign of a job to include a greater range of tasks and responsibilities, help employees who have lost interest in their job
Compensation programs
Attract and keep good employees, motivate them to undertake activities consistent with the retailer's objective and reward them for their efforts. Most effective for motivating and retaining employees when employees feel the plan is fair and that their compensation is related to their efforts
Straight salary compensation
Employees receive a fixed amount of compensation for each hour or week they work. Easy to understand but lack of immediate incentives to improve their productivity
Incentive compensation plan
Rewards
employees in the basis of their productivity
Straight commission: salesperson's income is based entirely on commission
Hard to get employees to perform non-selling activities, salespeople focus less on service and more on selling more expensive and faster moving merch, and salespeople don't develop loyalty to firm.
Quota compensation
A target level used to motivate and evaluate performances, usually set at the same level for all employees in a department
Quota-bonus plan compensation
Provides sales associates with a bonus when their performance exceeds their quota. Effectiveness depends on setting reasonable, fair quotas, which can be hard. Can be difficult to reach for new employees or people with different skill sets of selling environments
Group incentives compensation
Encourage employees to work together even in non-selling activities, some retailers provide additional incentives based on performance of the department or store as a whole
Design the compensation program
Determined by market conditions. Has two elements; the amount of compensation and the percentage of compensation based on incentives. Most effective when performance is measurable easily and precisely; hard to measure customer service and merch management
Legal issues in commission: Fair labor standards act
Set minimum wages, maximum hours, child labor standards, and overtime pay provisions
Legal issues in commission: Equal pay act
Prohibits unequal pay for men and women who preform equal work or work comparable worth
Controlling costs in Labor Scheduling
It is difficult because of the multiple shifts and part-time workers needed to staff stores 12 hours a day, seven days a week with various customer traffic, weather, holidays causing abnormal work days
Controlling costs in Store maintenance
Managing the interior and exterior of the store. A store's cleanliness and neatness affect consumer perceptions of the quality of it's merchandise.
Reducing inventory loss
Key is determining the most effective way o protect merch while preserving an open attractive store atmosphere and a feeling among employees that they are trusted
Calculating shrinkage
Difference b/w the recorded value of inventory based on merch bought and received and the value of actual inventory in stores and distribution centers divided by retail sales
Detecting and preventing shoplifting: Store design
Be mindful of where merch is displayed throughout the store. Reduce height of fixtures and maintain open sight lines to entrances and exits allows employees to watch customers
Detecting and preventing shoplifting: Employee training
Can be retailer's most effective tools against shoplifting, must be aware, visible, and alert to potential shoplifting situations
Detecting and preventing shoplifting: Security measures
Use of cameras/dummy cameras can make shoppers uncomfortable
Electronic
article surveillance systems use special tags that are placed on merch that are removed when being purchased which don't affect shoppers experience
Detecting and preventing shoplifting: Prosecution
Many have a policy for it which helps deter shoplifters
Reducing employee theft
Accounts for for more inventory loss than
shoplifting
Most effective way is to create a trusting, supportive work environment
Objectives of a good store design: Implement the retailer's strategy
Primary objective, design must be consistent by meeting needs of target market and building sustainable competitive advantage
Objectives of a good store design: Influence customer buying behavior
Would like design to attract customers, enable them to easily located merch, keep them in store, motivate them to make unplanned purchases, and provide them with a satisfying shopping experience
Objectives of a good store design: Provide flexibility
The ability to physically move and store componentes and the ease with which components can be modified
Fixtures: equipment used to display
merchandise
Objectives of a good store design: Control design and maintenance costs
Consider construction of layout and fixtures and shelving. Can affect labor costs and inventory shrinkage
Objectives of a good store design: Meet legal requirements
Compliance with the Americans with Disabilities Act and making store and merch accessible to those people
Objectives of a good store design: Trade-offs
Make these between stimulating impulse purchases or making it easy to buy products, and giving customers space to shop or using space for merchandise
customers may find this inconvenient but it varies depending on individual needs
Store layout
Facilitating a specific traffic pattern and interesting design elements encourages customer exploration
Store layout: Grid
Has parallel aisles with merchandise on shelves on both sides of the aisles with cash registers located at entrance/exit, doesn't provide a visually exciting design but is effective in costs and ease of getting customer through the store to easily locate products. Not all customers are exposed to all merch
Store layout: Racetrack
Aka loop, provided a major aisle that loops around the store guiding customer traffic around difference departments within the store with cash registers located in each department. Goal is getting customers to see merch in multiple departments and make impulse purchases, guided by aisles change in color or surface
Store layout: Free-form
Aka boutique layout, arranges fixtures and aisles in an asymmetric pattern providing an intimate, relaxing environment that facilitates shopping and browsing. It is costly because it sacrifices storage and display space and doesn't have well defined traffic pattern
Atmospherics
Refers to the design of an environment through visual communications, lighting, colors, music, and scent to stimulate customers; perceptual and emotional responses and ultimately to affect their purchase behavior
Atmospherics: Lighting
helps create sense of excitement in the store and must provide an accurate color rendition of the merch
Lighting: Popping the merch
Focusing spotlights on the special feature areas and items draws the customers strategically through the store
Lighting: Mood creation
Promote a warm cozy ambience to feel like someone's home
Lighting: Downplay features
Can hide errors and outmoded store designs
Atmospherics: Colors
Can enhance a retailer's image and help create a mood
Atmospherics: Music
Can either add or detract but can easily be changed, can use to affect customer behavior, control pace of store traffic, create an image, and attract or direct customers attention
Atmospherics: Scent
Has a large impact on emotions , may improve customer subjective shopping experience by making them feel that they are spending less time examining merch or waiting for sales help or check out, has positive impact on impulse buying behavior and customer satisfaction
Strategic advantage through customer service
Keeps customers returning to a retailer and generates positive word-of-mouth communication, which attract new customers. Increases value of merch
Is
difficult for retailers, hard for retailers to control the performance of employees, but offers an opportunity for s retailer to develop sustainable competitive advantage
Customer service strategies: Customization approach
Encourages service providers to tailor their service to meet each customer's personal needs, can be costly. Typically results in most consumers receiving superior service, but might be inconsistent depending on judgement and capabilities of provider. Used a lot for clothing
Customer service strategies: Standardization approach
Based on establishing a set of rules and procedures and being sure that they are implemented consistently, relies more on policy, procedures, and store and web design and layout. Used a lot in restaurants
Customer service strategies: Cost of customer service
Can be expensive but in many cases it can actually reduce costs and increase profits. The cost of acquiring a new customer than generate repeat business from present customers
Customer evaluation of service quality
They compare their perceptions of the service they receive with their expectations. Customers are satisfied when their perceived service meets or exceeds their expectations
Roles of expectations of service quality
Based on a customer's knowledge and experiences and can vary based on type of store
Technology is dramatically changing the way customers interact with retailers
Is not negotiable
Customer delight: when a retailer provides an unexpected service building high level of customer satisfaction
Perceived services
Base their evaluations of store service, affected by the actual service provided which is difficult to evaluate accurately
Customer evaluations are based on manner in which store employees provide service, not just the outcome
5 customer service characteristic: Reliability
Accuracy of billing, meeting promised delivery dates
5 customer service characteristic: Assurance
Or trust, guarantees and warranties, return policy
5 customer service characteristic: Tangibility
Appearance of store, salespeople
5 customer service characteristic: Empathy
Personalized services, receipts of notes and emails, recognition by name
5 customer service characteristic: Responsiveness
Returning calls and email, giving prompt service
Service Gap
The difference b/w customer expectations and perceptions of customer service
Key to improve is understand level of service customers expect, set standards
in customer service, implement program for delivering service, and undertake communication programs to inform customers of service that is provided
Knowing what customers want: Knowledge Gap
The difference b/w customer expectations and the retailer's perception of customer expectations
Delivery Gap
The difference b/w the retailer's service standards and the actual service provided to customers
Communication Gap
The difference b/w the actual service provided to customers and the service promised in the retailer's promotional program
Using customer research
The knowledge gap is only reduce when retailers use it to improve service. Managers should review the suggestions and comments made by customers daily, summarize the info, and distribute it to store employees and managers
Setting service standards: The standards gap
The difference b/w the retailer's perception of customer expectations and the customer service standards it sets.
Commitment to service quality
Occurs only when top management provides leadership and demonstrates commitment, must be willing to accept the temporary difficulties and even the increased costs
Defining the roles of service providers
Need clear direction and expectations of the retailer
Setting service goals
Need to be specific and measurable and made in collaboration with service providers, usually based on their beliefs about proper operation of the business rather than the customer' needs and expectations
Measure service performance
Need to assess service quality continuously to ensure that goals will be achieved, by conducting surveys or using mystery shoppers with feedback given at the end
Mystery shoppers: are professional shoppers who "shop" a store to
determine the service provided by store employees and the presentation of merch in the store
Giving information and training
Need to know about the retailer's service standards and the merch, and customer needs so that they can answer questions and suggest products
Instills confidence and sense of competence, improve interpersonal skills
Service recovery
Rather than dwelling on negative aspects of customer problems, retailers should focus on the positive opportunities they generate, offer excellent source of info about the retailer's merch and service to increase customer satisfaction
Enable retailer to demo its commitment to providing high-quality customer service and strengthen relationship with customers
Service recovery: Listen to customer
Allow customer to air complaints without interruptions and follow up with a sympathetic response and listen for a solution that will be perceived as fair to customer
Service recovery: Providing a fair solution
Focus on how to win the customer back not just solve the problem. Customers compare how they were treated in relation to similar problems/situations with other service providers
Providing a fair solution: Distributive fairness
A customer's perception of the benefits received compared with their costs
Providing a fair solution: Procedural fairness
The perceived fairness of the process used to resolve complaints; Did employee collect info on situation? Was info used to resolve complaint? Did the customer have some influence over outcome?
Service recovery: Resolving problems quickly
Store employees who deal with customers should be made as self-sufficient as possible to handle problems, can minimize time by reducing the number of people the customer must contact, providing clear instructions, and speaking in the customer's language
Customers should be told clearly and precisely what they need
to do to resolve a problem
Don't use company jargon when solving the situation
Don't spend too much or too little time solving an issue
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