Page 347 - Foundations of Marketing

314 Part 4 | Product and Price Decisions

Client-Based Relationships
The success of many services depends on creating and maintaining client-based
relationships , interactions with customers that result in satisfied customers who use a
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service repeatedly over time. In fact, some service providers, such as lawyers, accoun-
tants, and financial advisers, call their customers clients and often develop and maintain
close long-term relationships with them. For such service providers, it is not enough to
attract customers. They are successful only to the degree to which they can maintain a
group of clients who use their services on an ongoing basis. For example, an accountant
may serve a family in his or her area for decades. If the members of this family like
the quality of the accountant’s services, they are likely to recommend the accountant to
other families. If several families repeat this positive word-of-mouth communication, the
accountant likely will acquire a long list of satisfied clients. Social media have made it
easier for customers to share information about service companies. Pinterest is a site that
helps increase traffic to company websites. On Pinterest users create separate pinboards
for different categories, such as a wedding or party they are planning, and other users can
use these boards for ideas and inspiration. Pinterest is growing by leaps and bounds and
is most popular among young and middle-aged women—the market segment in charge
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of most household purchasing decisions. To ensure that word-of-mouth actually occurs,
the service provider must take steps to build trust, demonstrate customer commitment,
and satisfy customers so well that they become very loyal to the provider and unlikely to
switch to competitors.

Customer Contact

Not all services require a high degree of customer contact, but many do. Customer contact
refers to the level of interaction between the service provider and the customer that is neces-
sary to deliver the service. High-contact services include health care, real estate, legal ser-
vices, and spa services. Examples of low-contact services are tax preparation, auto repair, and
dry cleaning. Some service-oriented businesses are reducing their level of customer contact
through technology. Most airlines use self-service kiosks to check in and obtain boarding
passes. Note that high-contact services generally involve actions directed toward people, who
must be present during production. A hairstylist’s customer, for example, must be present
during the styling process. When the customer must be present, the process of production
may be just as important as its final outcome. Although it is sometimes possible for the ser-
vice provider to go to the customer, high-contact services typically require that the customer
go to the production facility. Thus, the physical appearance of the facility may be a major
component of the customer’s overall evaluation of the service. Even in low-contact service
situations, the appearance of the facility is important because the customer likely will need to
be present to initiate and finalize the service transaction. Consider customers of auto-repair
services. They bring in the vehicle and describe its symptoms, but often do not remain during
the repair process.
Employees of high-contact service providers are part of a very important ingredient in cre-
ating satisfi ed customers. A fundamental precept of customer contact is that satisfi ed employ-
ees lead to satisfi ed customers. In fact, research indicates that employee satisfaction is the
single most important factor in providing high service quality. Thus, to minimize the problems
that customer contact can create, service organizations must take steps to understand and meet
client-based relationships
Interactions that result in the needs of employees by training them adequately, empowering them to make more deci-
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satisfied customers who use a sions, and rewarding them for customer-oriented behavior. The luxury hotel and fi ve-star
service repeatedly over time resort operator Ritz Carlton, which is known for providing high-quality customer service,
customer contact The level of trains all of its employees to be confi dent in their decisions and actively resolve customer
interaction between provider complaints. The company gives each of its employees a personal spending budget, which can
and customer needed to deliver be as much as $ 2,000 per complaint or incident, to use at their discretion to resolve issues with
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the service customers.

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