All successful businesses are certainly familiar with the well-known four P's of marketing - product, promotion, price and place. These are the controllable variables that marketers have at their disposal to tailor and hone their marketing strategy for a particular target market in order to ensure that customers have the right product, they are positively informed or influenced with the right marketing communication, the product or service is offered at the right price and is available at the right place.
But the concept of the marketing mix and the four P's was developed in the 1960s with a very product-centric and industrial mindset, and in the current customer-centric experiential world we live in, where companies have to deal with highly empowered customers, new marketing models are needed. This is not to say that the four P's are not important or relevant anymore. But some authors have tried to modernise them by looking at the four P's from the customer's perspective in order to be more customer-centric, and they have proposed new ways of describing the marketing mix, which translates the four P's to the customer's point of view. Two of these schemes are the four C's (customer needs, communication, cost and convenience), and SIVA (Solutions, Information, Value and Access).
It has also been acknowledged that the four P's are inadequate in the service-dominant business world we find ourselves in. To the four P's three more P's were therefore added to cater for service businesses - people, processes, and the physical evidence of the service. These three additional P's all relate to services marketing and the customers' journey through the interactions that customers have along all the touchpoints of an organisation.
But what are the universal guidelines that are more specific to help businesses manage these interactions better in order to ensure high levels of customer satisfaction and loyalty? Based on my teaching of services marketing and consulting in the field for many years, I believe that there are six E's that are of critical importance in achieving services marketing success. These six E's relate specifically to the people and processes part of the marketing mix and, if managed correctly, will greatly enhance the success of any service organisation. These six E's are:
It is critical to align service delivery to brand promises. Service quality has been defined in the marketing literature as "meeting or exceeding customer expectations". But expectations are not static and one of the most important jobs of a service marketer is to actively manage the customer's expectations. This is done through communication and promises. If AVIS car rental for instance promises "we try harder", this is what customers expect to experience at the point of delivery.
A service is co-created by the customer. Therefore, in achieving an optimal service outcome both the provider and the customer must know what their roles are, and fulfill them. Therefore a business has to educate customers as to what they must do so that the business can provide a better service to them. Think, for instance, of an airline. It cannot fly passengers safely from point A to B if customers are not informed about what they must do, and if they do not fulfill their roles to ensure order, safety, and a good experience for other passengers.
"Customer experience" has been one of the popular buzzwords in marketing in the past few years. But managing the customer experience during all interactions and at various touch-points along the customer journey is critical to achieving customer satisfaction and loyalty. These experiences should be intentional, well planned, and cover all relevant experiential dimensions - sensory, emotional, intellectual, behavioural, and relational.
4. Ease of doing business
A major realisation of marketers in the past few years is that an important driver of the customer experience is the ease of doing business with a company. Some authors translate this into the amount of effort a customer must put in in order to achieve a desired service outcome. Companies like Capitec Bank have capitalised on this need and their value proposition, which offers the benefits of simplicity, accessibility, affordability and personal service as its foundation, delivers an effortless banking experience to customers. Their incredible success clearly illustrates the importance of this dimension.
A service is mostly produced and delivered at the same time and services cannot be inventorised in a warehouse. Service marketers must therefore carefully manage and create equilibrium between supply and demand in order to achieve customer satisfaction and loyalty. Overbooking an aircraft, for instance, which results in stranded passengers missing important appointments and connecting flights, clearly illustrates this management imperative. Supply and demand management in services is mostly managed through queuing and reservation systems.
6. Exception management
Service quality management is essentially about delivering at the desired level of service all the time. It is therefore of critical importance to manage the variability of service delivery to an absolute minimum. Exception management is therefore of vital importance in identifying service failures and complaints, resolving complaints and fixing root causes of failures. Businesses therefore need sound service recovery strategies and systems to manage exceptions successfully.
Think of your own experience and frustrations as a customer and the six E's discussed above. If your service providers managed all these extremely well, would you not be more satisfied and loyal towards them?Dr Kosie de Villiers is a business consultant and lecturer/training facilitator. He specialises in marketing, corporate and business strategy, alliance management and international relations. He will be presenting the Programme in Customer Experience Leadership at USB-ED which will be taking place from 2 - 3 June 2014.