Chapter 6 Chapter 6

Managing E-Service QualityManaging E-Service Quality

What is E-Service What is E-Service Quality?Quality?

Why it MattersWhy it MattersHow to Improve ItHow to Improve It

JW:sel#5

E-Service E-Service QualityQuality

A major change in 21st century marketingA major change in 21st century marketingcharacterized by:characterized by:

A A shift in emphasis from products and shift in emphasis from products and transactions to service and relationshipstransactions to service and relationships

> > Advanced technologies and ever Advanced technologies and ever expanding electronic networksexpanding electronic networks

DefinitionDefinition of E-Service of E-Service QualityQualityE-service quality is the extent to E-service quality is the extent to

which e-commerce providers which e-commerce providers effectively and efficiently manage effectively and efficiently manage customer interactions involving customer interactions involving searching, shopping, purchasing searching, shopping, purchasing and order fulfillment.and order fulfillment.

11 Major Dimensions11 Major Dimensions of of Perceived E-Service QualityPerceived E-Service Quality

ReliabilityReliability

ResponsivenessResponsivenessAccess

AssuranceAssurance

Empathy

Ease of Navigation

Price knowledge

Customization/Customization/personalizationpersonalization

Research InsightsResearch Insights A A business process orientationbusiness process orientation is fundamental to is fundamental to

service quality.service quality. Companies need to integrate front-office Companies need to integrate front-office applications like order generation and customer support applications like order generation and customer support with back-office processes such as logistics and order with back-office processes such as logistics and order fulfillment.fulfillment.

Online customer service has failed to live up to customer’s Online customer service has failed to live up to customer’s rising expectations, especially regarding rising expectations, especially regarding responsivenessresponsiveness..

Forrester Research found that online customer satisfaction is Forrester Research found that online customer satisfaction is

most affected by the business being well-staffed, responsive, most affected by the business being well-staffed, responsive, offering simple and easy returns, and providing order tracking offering simple and easy returns, and providing order tracking

capabilities.capabilities.

Online Service Quality for Luxury PurchasesGood customer service 4.55

Money-back guarantee 4.48

Easy return or exchange of merchandise 4.46

Control over use of personal data 4.43

Site reliability 4.42

Ease of use 4.33

Wide product selection 3.99

Fast site 3.97

Information related to products/services sold 3.93

Wide range of shipping/delivery options 3.88

Brand name 3.65

Site personalization 3.55

Physical presence 3.49

Discounts or coupons 3.24

Personalized product recommendations 3.12

Recommendations to complement previous purchases

2.95Source: Forrester Research Inc., 2001

E-Service E-Service andand Customer Satisfaction ☛ ☛ Service providers have come to realize Service providers have come to realize

that the Internet presents great that the Internet presents great opportunities as well as challenges in opportunities as well as challenges in serving customer needsserving customer needs

☛ ☛ The new e-consumer is more informed The new e-consumer is more informed and expects more from their service and expects more from their service

provider — traditional or onlineprovider — traditional or online

☛ ☛ Companies doing business online need Companies doing business online need to see the link between customer to see the link between customer

service and repeat visitsservice and repeat visits

Price KnowledgePrice Knowledge andand Customer Customer ExpectationsExpectations

☛ ☛ Price knowledge refers to the ability of online shoppers Price knowledge refers to the ability of online shoppers to determine shipping , comparison, and total prices to determine shipping , comparison, and total prices

☛ ☛ Online consumers are pretty clear Online consumers are pretty clear

about what they expect onlineabout what they expect online

☛ ☛ A recent study conducted by Mercer Management A recent study conducted by Mercer Management Consulting confirms the importance of Consulting confirms the importance of informationinformation and and

convenienceconvenience and why consumers value using the Internet and why consumers value using the Internet

E-Service QualityE-Service Quality andand Customer Customer LoyaltyLoyalty

e-Service quality is essential in creating e-Service quality is essential in creating customer e-satisfactioncustomer e-satisfaction

Customers must continue doing business Customers must continue doing business with most online firms for at least 2-3 with most online firms for at least 2-3 years just for them to recover their initial years just for them to recover their initial acquisition costsacquisition costs

VariablesVariables that that Predict Repeat Visits Predict Repeat Visits toto Websites Websites

■■TheThe most important variablemost important variable was site was site contentcontent: Respondents cited "frivolous : Respondents cited "frivolous content" as a primary reason respondents content" as a primary reason respondents do not return to the Websitedo not return to the Website

■■ TheThe 2nd most important factor2nd most important factor was was whether the respondent found the visit whether the respondent found the visit enjoyableenjoyable

■ ■ Finally,Finally, site layout was cited as the third site layout was cited as the third most important factor influencing the rate most important factor influencing the rate of repeat visitsof repeat visits

How to Improve E-Service QualityHow to Improve E-Service Quality

Research has proposed that 5 components be Research has proposed that 5 components be considered in delivering e-service quality:considered in delivering e-service quality:

The core serviceThe core service Facilitating services Facilitating services Supporting services Supporting services

Complementary servicesComplementary services The user interface The user interface

(how the customer accesses services)(how the customer accesses services)

Definitions Definitions and and Functions Functions of of E-ServiceE-Service Quality ComponentsQuality Components

Core servicesCore services are the “raison d’etre.” They are are the “raison d’etre.” They are designed to meet the primary demand needs of designed to meet the primary demand needs of specific target markets.specific target markets.

Facilitating servicesFacilitating services make it possible to use the make it possible to use the core service and, without them, the core service core service and, without them, the core service collapses. collapses.

Support servicesSupport services don’t facilitate using the core don’t facilitate using the core services but rather add value to them; support services but rather add value to them; support services might include the availability of useful services might include the availability of useful links or “virtual book clubs.”links or “virtual book clubs.”

Definitions and Definitions and Functions of Functions of Components (cont.)Components (cont.)

Complementary servicesComplementary services are services that are services that accompany the core service and support accompany the core service and support their acquisition and use or disposition. their acquisition and use or disposition.

The The user interfaceuser interface is a means of is a means of communication between the e-service communication between the e-service marketer and the potential customer.marketer and the potential customer.

KeysKeys forfor Building Building Website TrustWebsite Trust

Maximize cues that build trust onMaximize cues that build trust on your websiteyour website Use virtual-advisor technology to gain Use virtual-advisor technology to gain

customer confidence and beliefcustomer confidence and belief Provide unbiased and complete informationProvide unbiased and complete information Include competitive productsInclude competitive products Provide open and transparent organizational Provide open and transparent organizational

communicationcommunication Keep your promises!Keep your promises!

Improving Credibility with Online MerchantsImproving Credibility with Online Merchants

Disclose the physical location where products Disclose the physical location where products are produced, including an address, telephone are produced, including an address, telephone number, and e-mail addressnumber, and e-mail address

Clearly distinguish news and information from Clearly distinguish news and information from advertisingadvertising

Disclose financial relations, particularly when the Disclose financial relations, particularly when the relationships affect the cost to a consumerrelationships affect the cost to a consumer

Any posted incorrect information should be Any posted incorrect information should be immediately correctedimmediately corrected

Privacy policies should be easy to find and Privacy policies should be easy to find and clearly and simply statedclearly and simply stated

Improving E-Service QualityImproving E-Service Quality

AccessAccess PersonalizationPersonalization

ResponsivenessResponsiveness NavigationNavigation

AssuranceAssurance Price QualityPrice Quality

E-SQ – E-SQ – Concluding RemarkConcluding Remark

The challenge for e-service marketers is to The challenge for e-service marketers is to determine the relative performance and determine the relative performance and valence on each of the service quality valence on each of the service quality

attributes and devise strategies to improve attributes and devise strategies to improve in these areasin these areas