Relationship quality in services selling an interpersonal

Service quality, trust, and patient satisfaction in interpersonal-based medical service encounters

relationship quality in services selling an interpersonal

Antecedents and consequences of relationship quality in athletic services. Relationship quality in services selling: An interpersonal influence perspective. Jul 22, Keywords: relationship quality, customer advocacy, trust, Relationship quality in services selling: An interpersonal influence perspective. according to the relationship quality dimensions for the purpose of testing the characteristics relationship quality lies in the focus of marketing services. Crosby .. Crosby, L.A., Evans, K.R. and Cowles, D. (), “Relationship Quality in Services Selling: An. Interpersonal Influence Perspective” Journal of Marketing , Vol.

Satisfied, loyal customers are likely to provide a firm with strong word-of- mouth endorsements. Further, researchers report those customers show up based on a referral tend to be better quality customers in terms profitability, likelihood of being loyal than the customers who are attracted through other promotional campaigns like price promotion and advertising.

relationship quality in services selling an interpersonal

Employee retention may be an indirect benefit of customer retention. It is easier for a firm to retain employees when it has a stable base of satisfied customers. People like to work for companies whose customers are happy and loyal. Figure 3 explains this with a causal loop diagram. The positive signs within brackets show a positive change in the dependent variable with one unit change in the independent variable. The overall changes on all the variables will be positive as well.

Having discussed the benefits of Relationship Marketing let there be a discussion on one recent development in this field, which is helping popularising the concept among practicing marketers.

Lifetime Value LTV is a concept through which the marketers can find out the profitability of a customer in advance. Lifetime value of a customer is a concept or calculation that looks at customers from the point of view of their lifetime revenue and profitability contributions to a company.

The lifetime value of a customer is influenced by the length of an average "lifetime," the average revenues generated per relevant time period over the lifetime, sales of additional products and services over time, and referrals generated by the customer over time.

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LTV sometimes refers to lifetime revenue stream only; other times, when costs are considered, LTV may truly mean "lifetime profitability. Reichheld and Sasser, Jr observed -"If companies knew how much it really costs to lose a customer, they would be able to make accurate evaluations of investments designed to retain customers.

Unfortunately, today's accounting systems do not capture the value of a loyal customer. During calculation, time present value of money may be considered for the future transactions those are expected from the customer, from the new customers generated through referrals of the customer under consideration. Following important aspects might as well be considered while calculating the LTV of a customer. Importance of referrals to the new customers The frequency at which existing customers refer the product to new customers.

Attrition curve indicates how many customer become inactive as a percent of total base every year. An attrition curve is derived by analysing the activity of multiple cohorts- customer groups that started at different times- to see how many survived with each successive year.

Attrition rates are influenced by many factors, ranging from population age and mobility in product life cycle, and will differ from one business sector to another. Average life time of a customer based on the attrition curve. Average annual spending by the customers Direct Cost: Includes merchandising, operating and fixed costs.

Includes the costs of advertising and promotion, and cost of maintaining a marketing database system. It is well appreciated that the first step in relationship marketing is the retention of the customer. Unless the company is able to retain the customer, it is meaningless to talk about relationship marketing. For this the company as well as the products under sale must meet certain criteria.

relationship quality in services selling an interpersonal

These are, A consistently good quality product, so that the consumer satisfaction is assured for a long time. Proper market segmentation is done and right target is selected. If more than one segment is targeted the segments must be compatible with each other.

The product should be competitive in the target market. That means the product must be very best among the competitors. Thorough monitoring and evaluating relationship quality over time.

Basic market research in the form of annual customer relationship survey may be carried out for this evaluation.

Berry and Parasuraman, two early advocates of relationship marketing have developed a framework for understanding the type of relationship strategies. The framework suggests that retention marketing can occur at different levels and that each successive level of strategy results in ties that bind the customer a little closer to the firm.

Relationship Quality in Services Selling: An Interpersonal Influence Perspective - Dimensions

At each successive level, the potential for sustained competitive advantage is also increased. Building on the levels of the retention strategy idea, Figure 4 illustrates four types of retention strategies, which are discussed below. At level I, the customer is tied to the firm primarily through financial incentives- lower prices for greater volume purchases or lower prices for customers who have been with the firm a long time. Examples of level 1 relationship marketing are not hard to find.

Airline industry and related travel service industries like hotels and car rental companies are following this type of incentive for a long time. Frequent flier programs provide financial incentives and rewards for travelers who choose their airline for long time. Hotels and car rental companies do the same. Long-distance telephone companies in the United States have engaged in a similar battle, trying to provide volume discounts and other price incentives to retain market share and build a loyal customer base.

Unfortunately, financial incentives do not generally provide long-term advantages to a firm since, unless combined with another relationship strategy, they don't serve to differentiate the firm for a long period.

Many travelers belong to several frequent flyer programs and don't hesitate to trade off among them. While price and other financial incentives are important to customers, they are generally not difficult for competitors to imitate, since the primary customized element of the marketing mix is price.

Other types of retention strategy are cross selling of services, like the tie up of airlines industry with hotel chains and credit card companies. Level 2- Social Bonds: This strategy bonds the customers to the firm through more than financial incentives. While price is still assumed to be important, level 2 retention marketers build long term relationship through social and interpersonal as well as financial bonds.

Customers are viewed as clients rather than mere customers. The clients are the individuals whose wants and needs the firm tries to understand and design the product accordingly.

Services are customised to fit individual needs, and the marketers find ways of sticking to the customers, thereby developing social bonds with them. Social, interpersonal bonds are common among professional service providers e. A dentist who takes a few minutes to review his patient's file before coming in to the exam room is able to jog his memory on personal facts about the patient occupation, family details, interests, dental health history.

By bringing these personal details into the conversation, the dentist reveals his genuine interest in the patient as an individual and builds social bonds. Sometimes relationships are formed with the organization due to the social bonds that develop among customers rather than between customers and the provider of the service. Over time the social relationships they have with other customers are important factors that keep them from switching to another organization.

While social bonds alone may not tie the customer permanently to the firm, they are much more difficult for competitors to imitate than are price incentives.

In the absence of strong reasons to shift to another provider, interpersonal bonds can encourage customers to stay in a relationship. In combination with financial incentives, social-bonding strategies may be very effective. Level 3 strategies involve more than social ties and financial incentives, although there are common elements of level 1 and 2 strategies encompassed within a customisation strategy and vice-versa.

Two commonly used terms fit within the customization bonds approach: Mass customization and customer intimacy. Both of these strategies suggest that customer loyalty can be encouraged through intimate knowledge of individual customers, and through the development of one-to-one solution that fits the individual customers needs. Mass customisation has been defined as the use of flexible processes and organisational structures to produce varied and often individually customized products and services at the price of standardised mass-produced alternatives.

Mass customisation, however, does not mean providing customers with endless solutions or choices that only make them work harder for what they want; rather, it means providing them through little effort on their part with tailored services to fit their individual needs. Level 4- Structural Bonds: Level 4 strategies are the most difficult to imitate and involve structural as well as financial, social, and customization bonds between the customer and the firm.

Structural bonds are created by providing services to the client that designed right into the service delivery systems.

Often structural bonds are created by providing customised services to the client that are technology based and serve to make the customer more productive.

Tools of Relationship Marketing: One of the most important and basic tools of relationship marketing is the customer database. For some organisations, the database is so huge and complex, it is often called as Marketing Warehouse or data warehouse. However, smaller version of the database is known as data mart.

In all these types of database efforts are made to save, as many data about the customer as available and to retrieve them on demand. For example, a world-renowned chain of hotels makes it a policy to treat each and every customer in customised manner. One such customisation is delivering the customer his or her favourite newspaper in the morning. This information is stored in the central network of the chain and the housekeeping staff at any country can have access to the customer preferences database when the customer books himself or herself for that particular branch of the chain.

The customer remains satisfied with such individual attention and will in all probability be loyal to the chain. It is observed that even with the fastest microprocessors available for data warehousing serious problems are encountered in retrieving the required information on time.

Data Mining is a development in Information Technology, through which required information is mined from the server. However, a detail discussion on this is beyond the scope of this material and hence no further discussion is offered. Therefore, the influence of trust on service quality and customer satisfaction could not be ignored in interpersonal-based service encounters. However, the lack of existing literature on the correlation between service quality, patient trust, and satisfaction from the prospect of interpersonal-based medical service encounters has created a research gap in previous studies.

In the process of service delivery, replacing the simple concept of medical service quality with the concept of interpersonal-based medical service encounters will enhance the dynamic nature and specificity of connotation. Therefore, in recent research, the original service quality studies were replaced by the interpersonal interactive connotation of service encounters [ 29 ].

relationship quality in services selling an interpersonal

As for the nature of relationship between the business proprietors and consumers during the process of service delivery, and the phenomenon of different interactive quality between the two, few studies have been conducted, and thus these areas are not sufficiently interpreted.

This is particularly true for industries with relatively high level of interaction between the service deliverers and service recipients, such as the ever more prevalent professional service industries in recent years: The study aims at seeking to develop and design high-quality medical service solutions, measures, training or public relation activities, etc.

Many scholars have suggested that the physical environment where services occur may be helpful to service marketing and it has affected service behavior since earliest trading times, indicating the necessity of proper planning and design of such a physical environment.

However, what influence does a service environment have on customers? For general industries, pricing, advertising, and promotion activities are usually more able to attract customers and allow them to feel satisfied with the services more than the physical settings.

This phenomenon indicates that physical settings simply play an auxiliary role in terms of the internal corporate goals and external marketing goals for an enterprise. For the service industry, however, things may be different since customers usually arrive and stay at the place where services occur. Hence, strategic planning and space design are apparently more important in the service industry than in other industries.

Booms and Bitner [ 14 ] have proposed that the newly added 3Ps in the 7Ps for service industry, physical evidence, participant, and service procedure, might compensate the shortcomings of the traditional 4Ps in marketing: From the above statements, the following hypotheses are formed: Hypothesis 1 Perception of interpersonal-based medical service encounters positively influences service quality.

Hypothesis 2 Perception of interpersonal-based medical service encounters positively influences patient satisfaction. Relationships among service quality, patient trust, and satisfaction Rodolfo et al [ 16 ] have conducted an empirical study on tourism businesses and explored the functional quality facet and customer trust in service quality.

The result suggests that when functional quality of service quality is perceived as superior by consumers, the employees of a service business are more trusted. Foster and Cadogen [ 17 ] have confirmed that perceived service quality will significantly and positively influence customer trust.

relationship quality in services selling an interpersonal

Coulter and Coulter [ 18 ] have proposed that service quality is an important preliminary factor to customer trust [ 1920 ]. In their study on service quality and relationship quality, Chang and Chang [ 21 ] and Wong and Sohal [ 22 ] have pointed out that service quality has positive, significant influence on relationship quality trust, satisfaction, and commitment.

Ribbink et al [ 23 ] have suggested that service quality has significantly positive influence on trust in their study. In regard to the relationship between trust and satisfaction [ 2024 ], it has been found that the degree of trust positively influences satisfaction, and furthermore [ 2526 ], that prior trust directly and positively affects consequent satisfaction. Much service-related literature also demonstrates that trust positively influences customer satisfaction.

Coulter and Coulter [ 19 ] have indicated that trust is an important factor for the service industry to maintain customer satisfaction.