Quality management is essential for service marketing because services have unique features that set them apart from physical products. It's harder to achieve and maintain high quality in service companies since services are based on customer expectations.
In this post, we’ll explain why it’s important to start using quality management, including an overview of the different methods your company can use to measure and improve service quality. In the end you will be able to use those methods and enhance your customer satisfaction.
Marketing for a service company differs significantly from marketing for a product-based business. This also affects the marketing mix. While the traditional 4 Ps (Product, Price, Place, and Promotion) apply to products, service marketing requires three additional Ps: People, Physical Evidence, and Processes. You can learn more about the 7 Ps in marketing in this article.
The reasons for these specific needs emerge from the special characteristics of services, which differ from physical products in several ways. One of them is intangibility—services are immaterial and cannot be tested before purchase. This makes it more difficult for customers to judge the quality of your service in advance, complicating their decision-making when selecting a service provider.
As a service provider, you may find it challenging to communicate the value of your service to potential customers, especially since they can't see the final result beforehand. One reason for this is that services are produced and consumed at the same time. This characteristic of services is known as the uno-actu principle, which adds complexity to ensuring consistent quality.
At the heart of these characteristics is the integration of the human element and its diversity in the service. Customers are diverse, each with different expectations and unique definitions of quality. That is the reason for the variation in the quality of a service even when the process is standardized. You may have noticed that a service that feels perfect to one customer might feel different to another—or even to the same customer at a different time. This variability is what makes quality management particularly challenging, as it is nearly impossible to ensure the same quality every time because a service is adapted to the needs of the individual customer.
This is why building trust and convincing customers of your value proposition and service quality is so essential. It's important for your company to earn the trust of your customers in both your brand and the service you provide.
Quality is increasingly becoming a critical factor in market competition, particularly for service companies. The quality factor serves as a fundamental basis for establishing long-term relationships with your customers. If you are running a service company, you must consider the expectations of costumers to ensure high quality.
Philip B. Crosby defines the essence of quality as the alignment of a service to the customers’ expectations. The greater the alignment, the higher the quality. Therefore, the core principle of quality management is prevention. Your company needs to be prepared for potential challenges and have a plan in place to prevent any drops in quality. The goal is to establish a zero defects performance standard for companies. The goal is to eliminate defects or errors entirely, rather than simply reducing them. Additionally, Crosby explained that the cost of quality is the cost of not meeting customer requirements. In other words, the expenses come from fixing mistakes or poor quality because the services didn’t meet the expectations of the customer. Learn more about Philip B. Crosby and his perspectives on quality in this article.
Quality is defined as the alignment of a service to the customers expectations.
The core principle of quality management is prevention.
The goal is to establish a zero defects performance standard for companies.
The cost of quality management is the price of non-conformance.
The quality of a product or service can be described using adjectives such as ‘good’ or ‘bad.’ However, there are no standardised definitions for the quality of a service. That’s why it is crucial for your company to understand your target audience and their expectations of quality.
To set a quality standard in the service sector, you can use a model called the “Magic Triangle” to identify service qualities. Each corner of the triangle stands for a requirement from the involved party. As shown in the illustration, the three parties are the customer, the service company, and its competitors.
All parties are connected, and to identify your service quality, it’s important to pay attention to these connections. This means knowing:
To maintain high-quality services, your quality management must go beyond planning and implementation, it also requires controlling of the quality. This can be achieved through many different methods that are categorized into customer-oriented and company-oriented. Customer-oriented methods can be further divided into objective and subjective measurements, while company-oriented methods are split into management-focused and employee-focused approaches. This can be seen in the image below.
Given the wide range of options available, selecting the right method requires careful consideration of the specific criteria:
Below we will go through examples of possible measurement methods for each approach. When combining different methods, it's important to keep the criteria in mind. Each method below addresses different criteria, and together they provide a more complete picture of service quality.
Objective measurement methods rely on criteria indicators or neutral third parties. In the case of the silent shopper, also known as a mystery shopper, a third party is used to ensure objective, unbiased results. A silent shopper is an observer and a test person who pretends to be a customer to experience the service process from a customer’s perspective. This method helps you to identify deficiencies in the service experience. There are three types of silent shoppers: an authorized employee, an expert or a real customer.
However, relying solely on objective measurement methods does not consider that the interaction between the employees and customers plays a significant role in customer satisfaction. These methods are based on assumptions about customer satisfaction rather than direct feedback from actual customers. For this reason, you should avoid using objective methods in isolation and instead combine them with other types of measurements for a more comprehensive approach.
A complaint is a negative statement from a customer without legal claim. You may have noticed that your customers take all complaints very serious, even though they are sometimes not that relevant or urgent for your company. Therefore, your company faces the challenge of categorizing the importance of the various complaints. This allows you to find solutions for each complain and prioritize your work, doing this can save you a lot of time.
The complain management also helps the continuous improvement of the company, as you can learn from the mistakes you made previously and avoid them in the future. However, it’s important to handle complaints properly. To maintain a good relationship with the customers, you need effective complaint management. This management helps maintain customer loyalty and satisfaction, enables your company to resolve issues promptly, reduce future costs, and protect its reputation.
Good complaint management starts with setting up different ways for customers to easily and quickly make complaints. If customers can complain early, problems can be fixed fast, and you benefit from valuable feedback. Have you noticed that customers often don’t feel satisfied with the service but rather keep that to themselves than reaching out to the company to complain? This is the reason why the first contact should be simple, organized, and quick, making sure the customers feel respected and taken seriously. This makes customers more willing to reach out and address the problems. This helps ensure continuous improvement within the company.
After solving the problem, it’s important to review the complaint management system and to optimise the process if needed.
In contrast to customer-oriented measurements, the company-oriented approach defines quality from the company's perspective rather than the customer’s. The focus is on translating customer expectations into performance standards, ensuring that these expectations are met through well-defined internal processes. This kind of measurement can be done through benchmarking.
Benchmarking involves comparing either different companies (competitive benchmarking) or various departments within the same company (internal benchmarking), depending on your company. For example, if your company operates as a franchise, it would be a good idea to use internal benchmarking to compare the performance of different branches. Learning from best practices helps evaluate and refine internal processes. To maximize its value, benchmarking should be used consistently to identify gaps and opportunities for improvement.
When using this method, it is essential to focus on specific aspects your company intends to compare. The key questions to ask when applying this method are:
After collecting the data, it must be analysed to identify alternative courses of action for continuous improvement.
The employee-focused methods are used to identify how employees perceive service quality, as they are directly involved with customers and understand their real challenges. One way to do this is through an employee survey, where your staff can provide feedback on service quality and point out critical customer interactions.
To conduct this survey, it's important to ask the employees two key questions:
In conclusion, quality management is essential for your service marketing due to the unique nature of your services, which rely heavily on the expectations of customers.
Ensuring consistent service quality requires a combination of both customer- and company-oriented measurement methods, each offering valuable insights. By using objective tools like silent shoppers and subjective methods such as customer complaint analysis, companies can better understand customer satisfaction. At the same time, internal benchmarks and employee surveys help translate customer expectations into actionable standards.
These four tools combine all the essential criteria, ensuring that the methods work together seamlessly to provide a comprehensive assessment.
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