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American

Eagle

Outfitter

Improving Service Quality& Productivity

Laura Butcher, Nikita Iggulden, Claire Michaels,Trudy Blair, & Jerred Kostashuk

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Agenda

About AEO Why is AE a Serv ice Company ?

Perspectives of Service Quality Service Based Components ofQuality

Customer Dimensions to EvaluateService

Online Service Quality

American Eagle Execut ive Q&A Gaps Model

Activity 1 Soft Measures of Serv ice Quality

Hard Measures of Service Quality Activity 2

Root Cause Analy sis Service Blueprint

Measuring Product ivit y Improving Productivity

Recommendations

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About AEO

http://www.youtube.com/watch?v=50aEWFGbiu0&feature=related

http://www.youtube.com/watch?v=50aEWFGbiu0&feature=relatedhttp://www.youtube.com/watch?v=50aEWFGbiu0&feature=related

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How is AEs brand strategy

unique?

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Why AE is a Service

Company Similar products to other stores, servicedistinguishes AE from these othercompetitors

Brand image

Premium service and service scape needed tojustify premium price

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Different Perspectives of

Service Quality

1)Transcendent view of quality

2) Product based approach

3) User based definitions

4) Manufacturing based approach

5) Value based definitions

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Service Based Components

of QualityTangibles (appearance of physical elements)

Reliability (dependable, accurate performance)

Responsiveness (promptness and helpfulness)

Assurance (competence, courtesy, credibility,security)

Empathy (easy access, good communications,and customer understanding)

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ActivityDimensions Used by Customers to

Evaluate Service Quality

Credibility

Security

Access

Communication

Understanding the customer

Tangibles

Reliability

Responsiveness

Competence

Courtesy

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Online Service Quality

Efficiency

System availability

Fulfillment

Privacy

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What are the key factorschanging traditional

consumer behaviour?

Q & A

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Gaps Model

Gap 1 The Knowledge Gap

Gap 2 The Standards Gap

Gap 3 The Delivery Gap

Gap 4 The Internal Communications Gap

Gap 6 The Interpretation Gap

Gap 7 The Service Gap

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Activity

Refer to page 412

Each team will be assigned a gap

Come up with a real life situation that would bean example of your assigned gap

As a manager, how could you overcome this

gap

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Soft Measures Service Quality

Total market surveys Annual surveys

Transactional surveys

Service feedback cards

Mystery shopping

Analysis and unsolicited feedback Focus group discussions

Customer advisory panels

Employee surveys and panels

Qualitative measures based on customer perception

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Hard Measures Service Quality

Wait tim e for fitt ing rooms

Wait t ime to pay

Conversion rates

Average value/sale

Loyalty

Quantitative and objective measures

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Root Cause Analysis

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Activity

Class group discussions

Consider your latest experience in a retail-shopping

environment, which dimensions of servicequality have you most often experienced a largegap between your expectations and yourperceptions of service performance?

What do you think the underlying cause might be?

What steps could management take to improvequality?

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Service Blueprint

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Measuring Productivity

American Eagle has 2 specific productivitymeasures:

Length of time in store

$ Value of each customer

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Improving Productivity

Control costs

Labor scheduling

Replacement of workers with machines

Customer database

Equipment

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Improving Productivity

Training

Cross training

Accountability

Changing time of demand

Increasing customer involvement

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Recommendations

Reduce wait times and allocate more time for customers in fitting rooms byinstalling an additional 6 rooms Cost: $20,000 Benefit: $75/customer x 80% conversion rate x 30 customers = $1,800/day

ROI: 9%

Increase staff motivation by implementing sales contests Cost: $50/week

Benefit: $2,000 increase in sales/week

ROI: 400%

Increase conversion rates by holding quarterly training sessions withemployees after hours to reinforce the roles at each of the four service

steps Cost: $800 wages of sales associates + $320 wages of management + $500

food = $1,620

Benefit: 10% increase in sales x $575,000 sales/quarter = $86,250 increasequarterly

ROI: 3549%