Service quality in museums, a case study - cambridge and county folk museum

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By Eleutheria Kendristaki

This study investigates service quality in the museum sector. Service quality has become a central issue in service industries for many years. However, it has only recently been discussed and its importance emphasised in museums. As competition increases in the leisure sector, quality service is an advantage that increases the number of new and repeat users.

This dissertation includes a detailed literature review of service quality in general service industries and the issues of applying service quality to the museum sector. The case study-investigates whether or not the Cambridge & County Folk Museum delivers quality of service to external customers. The Folk Museum, like many major independent museums, faces decreasing visitor numbers due to changes in leisure patterns and public tastes. The service quality of the Museum needs to be reviewed, as it is preparing for a period of major redevelopment.

This research project includes several surveys. Potential audience and current visitor questionnaires are used to assess the Folk Museum's quality of service from the point of external customers through ten determinants of service quality. Staff and receptionists questionnaires identify the Folk Museum's perceptions of its service quality to the public and whether its operation is effective. The findings illustrate that there is no major disparity between the Folk Museum's internal objectives and the delivery of services. However, the Museum does need to explore which services outside audiences want the Museum to provide and to reinforce external communications in order to create positive and attractive images of the Museum for the public.

This research project will be of most relevance to independent museums, especially those of similar size and background as Cambridge & County Folk Museum.


1.1        Dissertation Topic

This dissertation focuses on the quality of service in the museum sector. The topic is significant because providing quality service has becoming an important and essential task for museums anxious to resist increasing competition from the leisure sector and create more funding opportunities.

Service industries have played a critical role in shaping the present economy. They involve around 18 million employees and account for over 66% of gross domestic product (GDP) in the UK. In the meanwhile, quality management has been introduced.

Museums have an essential position in post-industrial society. Excluding their roles in the cultural and educational sectors, museums make an important contribution to the economic sector. As museums have raised their profile in the last decade, they also face the pressure from the public, increasing competition from both the leisure and museum markets, and changes in customers' attitudes. The quality of service is thus an increasingly important subject.

There are some 2,500 museums in the UK, 1300 of which are in the independent sector. Though independent museums may receive grant aid, they do not have the guarantee of local authority support; many need income from admissions and sales to survive. These museums therefore need to pay great attention to quality service to create an advantage and attract more visitors in a competitive world.

The Cambridge & County Folk Museum, like many independent museums, is facing decreasing visitor numbers and changes of leisure patterns. As it enters the next millennium, the Museum is preparing for a period of major redevelopment. The service quality of the Museum therefore needs to be investigated.

This study is intended to provide some useful suggestions for the Folk Museum's redevelopment through interviews and self-completion questionnaire research. The result may also benefit other museums of the same size and situation.

1.2        Background to the Research

Since the Museums & Galleries Commission introduced a Registration Scheme in 1988, which set out minimum standards for museums and galleries in terms of collection care, public service and management, more than 1,800 museums have now achieved registration. The Cambridge & County Folk Museum has full registered status with the MGC.

The central focus of this dissertation is an assessment of service quality from the viewpoint of the customer. Interviews with potential audiences in the streets and current visitors in the Folk Museum are used to investigate the customer expectations and perceptions about museums through the ten determinants of service quality. In addition, the Folk Museum's internal operation is also investigated to see whether or not gaps exist in the Museum when it delivers services to outside customers through research of self-completion questionnaires.

Due to personal financial limitations the research was carried out in central Cambridge and the Cambridge & County Folk Museum. The Folk Museum was chosen because it is the only independent museum which charges admission fees in the centre of Cambridge. As mentioned, museums, which have admission charges, pay more attention to providing quality of service to customers. According to the Folk Museum's surveys, a high proportion of visitors who assessed the Museum's services was very satisfied; however, the number of visitors has been decreasing over the past decade. Therefore, service quality in the Folk Museum is re-investigated in this dissertation.

The sources of data in this research were collected from publications from the last decade, the Internet, the Museums & Galleries Commission, the Museums Association, the unpublished papers of the Cambridge & County Folk Museum, questionnaires and interviews with the staff in the Folk Museum. The primary research methodology of this dissertation is detailed in chapters five and six.

There are two previous researchers referred to in this dissertation. Nick Johns and Sue L. Clark (1993) who published a paper 'Customer Perception Auditing' which discussed quality audit in museums and galleries. Christine Williams (1998) of Lancashire Business School also contributed a paper which investigated whether or not accredited and non-accredited quality management systems have effected service quality delivery to external customers at six leisure related research sites, including a museum.

1.3 Definitions

 1.3.1 Service Industries

Every country has its own standard of classifying industries. In the United Kingdom, a Standard Industrial Classification (SIC) was first introduced in 1948. Because new products and the new industries emerge and shifts of emphasis occur in existing industries, the classification was revised in 1958, 1968, 1980 and most recently in 1992.

According to 'UK Standard Industrial Classification of Economic Actives - UK SIC (92)', Service Industries includes the following sections:


        G           Wholesale and retail trade;

Repair of motor vehicles, motorcycles and personal and                            household goods

        H        Hotels and restaurants

        I        Transport, storage and communication

        J        Financial intermediation

        K        Real estate, renting and business activities

        L        Public administration and defence;

                compulsory social security

        M        Education

        N        Health and social work

        O        Other community, social and personal service activities

        P        Private households with employed persons

Every section can divided several levels, for example:

 Section O                      Other community, social and personal service


Division 92                   Recreational, Cultural and Sporting Activities

Group 92.5                   Library, archives, museums and other cultural activities

Class 92.52                   Museum activities and preservation of historical sites and


Subclass 92.52/1          Museum activities

1.3.2 Museums

What is a museum? Harrison (1993:160) proposed that 'The traditional understanding of what constitutes a museum was couched in functional terms. Thus the purposes of museums were perceived as concrete and tangible, paralleling the essence of the "material evidence" (Weil, 1990: 46), which historically has been the focal point of museums. Collection, preservation, study, interpretation and exhibition of this 'material evidence' have been the components, which lie at the root of all definitions of what a museum is. ...The 20th century museum is a public democratic institution, and this does not flow smoothly from its conflicting 19th century scholarly and entertainment roots. Thus museums must have passed through some challenging times in search of firm foundations for their current mode of existence and its perpetuation. Although there is no universally agreed definition of a museum, here are three definitions currently in use.

• The International Council of Museums (ICOM, 1990:3)

'A museum is a non-profit making, permanent institution in the service of society and of its development, and open to the public which acquires, conserves, researches, communicates and exhibits, for purposes of study, education and employment, material evidence of people and their environment'.

The council also recognises that the following may fall under this definition:

• Natural, archaeological and ethnographic monuments and sites and historical monuments and sites of a museum nature that acquire, conserve and communicate material evidence of people and their environment;

• Institutions holding collections of and displaying live specimens of plants and animals, such as botanical and zoological gardens, aquaria and vivaria;

• Science centres and planetaria;

• Conservation institutes and exhibition galleries permanently maintained by libraries and archive centres;

• Nature reserves;

• Such other institutions as the Executive Council, after seeking the advice of the Advisory Committee, considers as having some or all of the characteristics of a museum, or as supporting museums and professional museum workers through museological research, education or training.

• The Museums Association (MA) (MGC, 1995:3-4)

'A museum in much simpler terms as an institution which collects, documents, preserves, exhibits and interprets material evidence and associated information for the public benefit'.

The Museums Association explains its definition as follows:

Institution implies a formalised establishment, which has a long-term purpose;

Collects embraces all means of acquisition;

Documents emphasised the need to maintain records;

Preserves includes all aspects of conservation and security;

Exhibits confirms the expectation of visitors that they will be able to see at least a representative selection of objects in the collection;

•  Interprets covers such diverse fields as display, education, research and publication;

Material indicates something that is tangible;

•  Evidence guarantees its authenticity as the real thing;

•  Associated information represents the knowledge which presents a museum object merely being a curio, and also includes all records relating to its past history, acquisition and subsequent usage;

•  For the public benefit is deliberately open-ended and is intended to reflect current thinking that museums are servants of society.

•  The Museum Training Institute (MTI)

'To acquire, preserve, research, exhibit and communicate material evidence and associated information of people and the environment for learning and enjoyment' (Ambrose, 1993:3).

In addition, the Museums & Galleries Commission (1999) indicates that museums can be broken down into six main groups.

National Museums: they have a board of trustees appointed by Government and Government wholly or mainly funds them.

Designated Museums: designation is a mark of status awarded to non-National Registered museums with pre-eminent collections of national and international importance.

University Museums: the first museum to be opened to the public was the Ashmolean Museum in Oxford, the oldest of more than 300 university museums and collections in the United Kingdom.

Armed Services Museums: these are museums, which cover the Army, Navy or Air Force. Most are regimental museums and most have charitable status.

Local Authority Museums: most councils operate some form of museum service. Many of these were formed in the 19th Century. Local Authority Museums vary greatly in size, quality and importance. These museums are often run as part of a larger department such as leisure services.

Independent Museums: Most UK museums are independent, that is they receive no regular funding from central or local government and almost all of them are set up as Charitable Trusts.


2.1 Introduction

Undoubtedly, service industries have played a critical role in shaping the present economy. As Figures 2-1 and 2-2 show, services account for over half the economy in most developing countries and for 66.6 per cent in the UK; over three quarters of new jobs were created by service industries in the past three years in the UK. In other words, today's economy is a service-based economy.


75                        66.9                 66.6

70                                                      65.9            65.2                        

65                                                                                    58.1

60                                                                                                      55.7



                USA                    Canada                UK                France             Italy               German             Japan


Figure 2-1 Services' Relative Importance-Services as % of GDP, 1992

Source:        The Economist Pocket Britain in Figures (1995:94)


                                1996                        1997                1998


Service industries                17192                        17590                17927

Manufacturing industries          4110                              4166                  4144

Production industries                  4339                          4394                   4361

All industries                        22702                        23257                 23698


Figure 2-2 Employee Jobs - United Kingdom (Annual)

Source: Economic Trends August 1999 (No. 549) (1999:T38)


Following the development of information and communications technology and of transport technology, former economic patterns have been transformed into a global economy. In addition, governments in many countries deregulated industries, and the economic trend is toward liberalisation. This results in increasingly competitive marketing which many industries need to face.

In many industries, providing quality service is no longer a matter of choice. However, previously quality control tended to be used in production or operations management. Service marketing really established itself in the 1980s, during the 'quality revolution' (Pickworth, 1996). The quick pace of developing technologies and customers who are more demanding make difficult for service industries to gain strategic competitive advantage. Thus service industries realised the significance of quality as a strategic marketing objective.

The primary purpose of this chapter is to orient readers to the concept of service quality via a literature review. Beginning with a definition of service quality, briefly introducing what service quality is, the difference between service and goods, and the ways for classifying service. The following two sections discuss in detail the two primary elements that influence the evaluation of service quality: customer expectations and perceptions of service, and shows how these two elements are composed of various factors. In the final sector, possible techniques that can be used to build service information systems are introduced, and ends with a brief illustration of the tool for measuring service quality: the five gaps model of service quality.

2.2 What is Service Quality?

2.2.1 What is Service?

Services 'include all economic activities whose output is no a physical product or construction, is generally consumed at the time it is produced, and provides added value in forms (such as convenience, amusement, timeliness, comfort or health) that are essentially intangible concerns of its first purchaser' (Quinn, Baruch and Paquette, 1987; Zeithaml and Bitner, 1996:5). This definition has also been used to delineate the service sector of the economy, as described in Chapter one.

In addition to the above definition, there are other common notions of service(s) (Zeithaml and Bitner, 1996:5; Lovelock and Wright, 1999:5):

  • services are deeds, processes, and performances;

  • A service is an act or performance offered by one party to another. Although the process may be tied to a physical product, the performance is essentially intangible and does not normally result in ownership of any of the factors of production;

  • services are economic activities that create value and provide benefits for

Customers at specific times and places, as a result of bringing about a desired change in-or-on behalf of the –recipient of the service;

  • Service is a performance that cannot be touched or wrapped up and taken away leads to a theatrical metaphor for service management - visualising service delivery as being like staging a play, with service personnel as the actors and customers as the audience.

Over time, services and the service sector of the economy have been defined in different ways. The variety of definitions can explain the confusion people have when discussing services and when describing industries that comprises the service sector of the economy. Therefore, except the definition of UK SIC (92), mentioned in Chapter 1.3, the following parts of this section can also help to form the concept of services.

The Difference between Service and Goods

There is general agreement that services and goods are different-services are actions, experiences or performances; goods are physical and tangible objects or devices. These differences present more management challenges for service organisations than product companies. Generally, services have four characteristics which products lack, there are as follows.

  • Intangibility

Services cannot be handled, owned or stored, because they are performances or experiences rather than objects. Therefore, it is more difficult and complex for customers to evaluate the quality of services than products. This means accurate and relevant promotion, communication and pricing strategies play crucial roles in service marketing.

  • Inseparability of production and consumption

Unlike products, which are bought and used by customers for a period of time after being purchased, services are consumed and produced at the same time. This means that 'participants' are important in the service delivery process: because individual customers are part of the transaction, they can affect it as well as other customers; similarly, staff can also affect the service quality.

  • Heterogeneity

No two services are ever the same, because services are performances and frequently produced by humans. Services vary across time, organisations, and people; thus it is a challenge to ensure consistent service quality. In other words, service delivery and customer satisfaction depends on the interaction between staff and customers, and how well service providers meet customer requirements.

  • Perishability

Perishability is the fundamental source of difference between services and products. Services, unlike products, which can be, stored, need to be consumed immediately and cannot be returned or resold. These characteristics lead to the difficulty of synchronising supply and demand for marketers in any service industry.

Ways of Classifying Services

It is important to acknowledge different categories of service when seeking to analyse consumer perceptions of service quality; these categories help to define the core services offered by the organisation and enable an understanding of both customer needs and competition. Various proposals have been made for classifying services. Two models, which span several standard industry classification sectors and their categorising processes, are shown as follow:

1.        Fitzgerald, Johnston, Brignall, Silvestro, and Voss (1991:4-6).

Three generic types of service organisation were identified (As Figure 2-3 shows on the next page):

Professional services;

Service shops;

Mass services.

These types are differentiated in terms of the number of customers processed by a typical business unit per day against six other classification dimensions:

 (1) People/equipment focus; (2) front/back office focus; (3) product/ process focus;

(4) Level of customisation of the service to any one customer; (5) discretion available to front-office staff;(6)contact time available with front-office staff.


                        Contact time

High                Customisation


                        People focus

                        Front office oriented Process oriented

                    Process oriented


                         Contact time

Medium           Customisation

                         People focus

                         Front office oriented Process oriented


      Low                              High

                         Contact time

Low                 Customisation                                        Number of customers                                                                        

                 Discretion                                       processed by a typical unit

                         Equipment focus                                                       per day

                 Back office oriented

                 Product oriented

Figure 2-3 Service Classification Scheme

Source: Fitzgerald and Moon (1996:6)

3.        Lovelock (1983): seven selected ways of classifying services.

  • Degree of tangibility or intangibility of service processes: depending on whether the service processes involve tangibility (e.g. food services) or intangibility (e.g. teaching).

  • Direct recipient of the service process: services are directed at customers themselves (e.g. haircutting) or the objects belong to them (dry cleaning).

  • Place and time of service delivery: service delivery occurs in organisations, by going to the customers, or through physical channels (e.g. mail, electronic).

  • Customisation versus standardisation: tailoring service characteristics to meet each customer's specific needs (e.g. taxi service), or reducing variation in service operations and delivery (bus service).

  • Nature of the relationship with customers: formal relationship (bank service and museum's members who need to apply), or ongoing relationships (bus service, museum visitors).

  • Extent to which demand and supply are in balance: while demand is fluctuating, how well supply meets customer demand. (School groups visit museums for workshops during school semesters, but rarely visit in vacations).

  • Extent to which facilities, equipment, and people are part of the service experience.

The Nature of Service Act

A service process involves transforming input into output. Therefore, in addition to service classifications, how the service acts can also help marketers obtain useful insights and then create valuable innovations for their own organisations.

Lovelock and Wright (1999:31) classified service processes into two broad categories:

  • tangible actions


  • intangible actions,

and each category has two sub-items. The details are shown as follow into the next page:

Figure 2-4 Understanding the Nature of the Service Act

What Is the Nature of                     Who or what is the Direct Recipient of the Service?

the Service Act?                People                                                 Possessions

Tangible Actions                (People Processing)                       (Possession Processing)

                               Services directed at people's                             Services directed at physical

                                     bodies:                                                                        possessions:

        Passenger transportation                        Freight transportation

        Health care                                Repair & maintenance

        Lodging                                        Retail distribution

        Beauty salons                                    Laundry & dry cleaning

        Restaurants/bars                                Landscaping/lawn care

        Funeral services                                Disposal/recycling

Intangible Actions (Mental Stimulus Processing)                 (Information Processing)

    Services directed at people's              Services directed at

          minds:                 intangible assets:

                                Advertising/PR                                     Accounting

                        Arts and entertainment                             Data processing

                        Education                                 Legal services

                        Information services                             Programming

                        Psychotherapy                                 Research

                        Religion                                             Securities investment




1.        People processing involve tangible actions to peoples' bodies.

2.        Possession processing includes tangible actions to goods and other physical possessions belonging to the customer.

3.        Mental stimulus processing refers to intangible actions directed at people's minds. Customers must be present mentally but can be located either in a specific service facility or in a remote location connected by broadcast signals or telecommunication linkages.

4.        Information processing describes intangible actions directed at a customer's assets.

2.2.2        What is Quality?

The Oxford English Dictionary defines quality as 'degree of excellence, relative nature or kind or character; class or grade of thing as determined by this; general excellence'. It derives from the Latin qualitas: state, nature, which in turn comes from qualis: of what sort. In service industry, 'quality' has been defined in many ways over the years; the most common definitions are basically the following (Stamatis,1996:6):

1. Conformance to requirements (Crosby 1979);

2. Fitness for use (Juran 1979);

3. Continual improvement (Deming 1982);

4. As defined by the customers (Ford 1984, 1990);

5. Zero defects (Crosby 1979).

2.2.3        What is Service Quality?

The construct of quality, as the service literature conceptualises it, focuses on perceived quality. Zeithaml (1987) defined perceived quality as 'the consumers' judgement about an entity's overall excellence or superiority'. Perceived quality is different from objective quality, which involves an objective aspect or feature of a thing or event. It is a form of attitude, related to satisfaction, and resulting from a comparison of expectations with perceptions of performance (Zeithaml and Bitner, 1996).

In other words, quality is customer defined. Service quality, as perceived by customers, is formed by a comparison of what they feel service organisations should offer (their expectations) with their perception of the performance of organisations providing the services. Figure 2-5 (below) illustrates how customers evaluate service quality:

Figure 2-5        The Relationship among Expectations, Customer Satisfaction, and Perceived Service Quality

Source: Adapted from Zeithaml, Berry and Parasuraman (1993); Lovelock and Wright (1999:92).

The gap between customer expectations and perceptions can be revised by two comparison standards for customer expectations: desired and adequate service. The comparison between desired service and perceived service is the perceived quality gap. The smaller the gap between desired service and perceived service, the higher the perceived quality measured by customers. Perceived service quality is a global judgement and based on long-term cognitive evaluations of an organisation’s service delivery; by contrast, satisfaction is a short-term emotional reaction to a specific service experience.

In the following three sections of this chapter, how customers expectations and perceptions are formed and how perceived quality of service organisations is measured is discussed in detail.

2.3        Customer Expectations of Service Quality

Figure 2-6 The Role of Expectations in Service

Source: Zeithaml and Bitner (1996:77)

There is no single answer to the question “what are customer expectations from services?” because they expect different things from different kinds of services. Customers also have different expectations about different service providers, even those that are offering the same basic core benefits. Therefore, service providers need to understand what the customer expectations of their specific service offerings are, because customer expectations tend to vary from service to service.

When customers evaluate the quality of a service, they are judging it against some internal standard that existed before the service experience. This internal standard is based on many factors, such as their personal previous experiences in the similar service, advertising, price or word of mouth. In other words, customer expectations are influenced by varied factors; some are controllable and some uncontrollable by service marketers.

In some industries, certain norms have developed for what customers can expect from various service providers. Both customer experience and company-controlled factors like advertising, pricing, and the appearance of the service facility and employees (Lovelock and Wright, 1999:89), reinforce these norms. Different industries may have their own norms for quality that affect customer expectations. Expectations may even differ for different demographic groups or from country to country.

In brief, customers hold three different types of service expectations:

  1. desired service;

(2) adequate service; and

  1. predicted service;

which are shown in Figure2-7 below, and explained in the following paragraphs.

Figure 2-7 Nature and Determinants of Customer Expectations of Service

Source: Zeithaml, Berry, and Parasuraman (1993); Zeithaml and Bitner (1996:91)

2.3.1        Two Levels of Expectations

Desired Service

This level is the type of service that customers hope to receive. It is a “wished for” level of performance - a combination of what customers believe “can be” or “should be” delivered for their personal needs. Although customers hope to receive their service desires, they recognise this is not always possible. Customers understand that companies cannot always deliver the best service, due to many external and internal factors. Therefore, they have another lower level expectation-adequate service.

Adequate Service

It is the “minimum tolerable expectation”, the level which customers can accept and believe they will get on the basis of their experience with services.

These two levels portray the idea that customers assess service performance on the basis of two standards: what they desire and what they are willing to accept. However, do customers hold the same or different expectation levels for service firms in the same industry? As Davidow and Uttal (1989) said: “Levels of expectation are why two organisations in the same business can offer far different levels of service and still keep customers happy. It is why McDonald's can extend excellent industrialised service with few employees per customer and why an expensive restaurant with many tuxedoed waiters may be unable to do as well from the customer's point of view”.

This quote shows that customers hold similar expectations across categories of service but that these categories are not as broad as whole industries. Customers have different expectations across subcategories of services in an industry. For example, expensive restaurants and fast-food restaurants are two different subcategories. A customer's desired service expectation for expensive restaurants is gracious employees, elegant decoration, and fine food. The desired service expectation for fast-food restaurants is cheap, quick, convenient, and tasty food in a clean setting. However, the adequate service expectation level is likely to vary for different business within the same subcategory. In fast-food restaurants, customers may except a higher level of adequate service from McDonalds than from Burger King.

Zone of Tolerance

Services are heterogeneous. Their performance may be different even in equivalent situations, such as involving the same providers or service employee. The zone of tolerance is the extent to which customers recognise and are willing to accept the variation.

The zone of tolerance can increase or decrease for individual customers depending on factors like price, competition, or specific service attributes. These factors most often affect adequate service levels, which go up or down depending on the situation at the time; by contrast, desired service levels tend to move up very slowly in response to accumulated experiences.

This zone is also a range in which customers do not notice service performance particularly. While it falls outside the range, the service rises customer's attention in either a positive or negative way. For example, when customers queue for train tickets, usually they hold expectations of a range of acceptable waiting times - five to ten minutes. If customers are served in this period, they will not pay attention to the wait. If they are served in two or three minutes, customers will think this service is excellent. On the other hand, if they wait for more than fifteen minutes, they will judge it as a bad service performance.

Customers' service expectations are characterised by a range of levels, bounded by desired and adequate service, rather than a single level. This tolerance zone, representing the difference between desired service and the level of adequate service, and contract within a customer (Zeithaml and Bitner, 1996:80). A train customer’s zone of tolerance will narrow when the customer is running late to catch a train. Three minutes queuing seems too long and the adequate service level increases. Conversely, if a customer has another half an hour, ten minutes will not be so noticeable. For this reason, marketing planners have to understand not just the size and boundary levels for the zone of tolerance, but also when and how the tolerance zone fluctuates within a given customer.

Another aspect of variability in the range of reasonable services is that different customer possess different tolerance zones. Some customers have narrow zones of tolerance, requiring a tighter range of service from providers, while other customers allow a greater ranger of service. Customers' tolerance zones also vary for different service attributes or dimensions. The more important the factor, the narrower the zone of tolerance is likely to be.

To summarise, customers have two different levels of expectations: desired service and adequate service. Each level is influenced by many different factors, which is described in the following paragraph. The desired service level is less subject to change than the adequate service level. A zone of tolerance separates these two levels. This zone of tolerance varies across customers and expands or contracts within the same customer. If service falls outside the range of this zone, the service gets the customer’s attention in either a positive or negative way.

To summarise, the model of the nature and determinants of customer expectations of service (Figure 2-7) are formed by three types of factors.

  1. Desired Service: the wished-for level which reflects what a customer wants;

(2)        Adequate Service: the minimum level of service that a customer will accept without being dissatisfied;

(3)        Zone of Tolerance: the range within which customers are willing to accept various in service delivery.

Customer expectations are influenced by several varied factors. Service providers can control some of the factors, others cannot. Customer expectations also change over time, due to competition increase, taste changes, and customers becoming more knowledgeable. Knowing the pertinent expectation sources for service providers' target customers and continuing to update their information and strategies, can encourage innovation and improvements of marketing their services.

2.4        Customer Perceptions of Service Quality

Figure 2-8 The Role of Perceptions in Service

Source: Zeithaml and Bitner (1996:77)

This section described how customers perceive services. As the Figure 2-9 (on the next page) shows, there are four factors and three primary elements, which influence and organise customer perceptions of service.

Starting from the discussion of the four factors (Service Encounters, Evidence of Service, Image, and Price) blocks of customer perceptions can be built. From the customers' viewpoints, the service encounter is the greatest impression they have about the organisation's quality. Therefore, the importance of encounters, the three levels of service encounters and the sources of customer satisfaction and dissatisfaction in encounters were described in the first part.

The Evidence of Service, or the three new marketing-mix elements, is also critical in forming customer perceptions. How to manage these three new elements -people, process, and physical evidence - is vital for service success, which manages the other strategic marketing-mix variables. Moreover, the roles of organisational image and price were also discussed in relation to forming customer perceptions of service.

The following part examined broader, more abstract customer perceptions of service

- Service Quality, Satisfaction, and Value. The difference between process and outcome quality in services was discussed. Service quality and its ten dimensions, customer satisfaction, and perceived value were examined in detail.

The final section ended with a brief description of strategies for influencing customer perceptions.

Figure 2-9 Factors Influencing Customer Perceptions of Service

Source: Zeithaml and Bitner (1996:104)

2.4.1. The Factors Influence Customer Perceptions of Service

Service Encounters - 'Moments of Truth'

  • The importance of Encounters

Service encounter, or “moment of truth”, is a point in service delivery where customers interact with service employees or self-serve equipment and the outcome may affect perceptions of service quality (Lovelock and Wright, 1999:54). Service encounter is not only the most vivid impression of service for customers when they interact with service provider, but an opportunity for service providers to increase customer loyalty.

To highlight the risks and opportunities associated with service encounters, Richard Normann (1991:16-17) borrowed the metaphor “moment of truth” from bullfighting:

“We could say that the perceived quality is realised at the moment of truth, when the service provider and the service customer confront one another in the arena. At that moment they are very much on their own. ... It is the skill, the motivation, and the tools employed by the firm's representative and the expectations and behaviour of the client which together will create the service delivery process”.

Some services have few service encounters, and others have many. Any encounter can potentially be critical in determining customer satisfaction. For example, a customer goes to a hotel he has never been to before, the service encounters could include the reception desk, a waiter guiding to a table, the restaurant meal, a morning call, and checking-out. The customer does not attach equal importance to each encounter: the more encounters customers find satisfactory, the higher the quality of service they think is provided. In the meanwhile, the customer is more willing to come again and introduce it to other people. For every service provider, certain encounters are probably key to customer satisfaction. However, some momentous encounters can simply ruin the relationship between customers and service providers, no matter how many satisfying experience customers received in the past. These can happen in connection with very important events, such as the failure to deliver air tickets before departure day. Therefore, ways of preventing one unsuccessful encounter from destroying what is already, or has the potential to become, a mutually valued, long-term relationship, are the goals of relationship marketing for each service provider.

  • Three Levels of Service Encounters

A service encounter is a period of time during which customers interact directly with a service (Zeithaml, Berry and Parasuraman, 1996). These encounters involve interactions between customers and self-service equipment. Shostack (1985) pointed out there are three general types of service encounters.

1. Remote encounters which occur without any direct human contact, such as when a customer interacts with a bank through the ATM system.

2. Phone encounters that occur over the telephone between customers and the organisation.

3. Face-to-face encounters: customers and staff contact directly

Moreover, Lovelock and Wright (1999:48-49) have a more detailed classification in their new book. They grouped services into three levels of customer contact. These levels represent the extent of interaction with service personnel, physical service, or both.

1.        High-contact services: customers visit the service facilities in person. Services that involve significant interaction among customers, service personnel, equipment and facilities. Nowadays, many high-contact services can be transformed into low-contact services, due to the development of high technology, such as home shopping via the Internet, and banking by telephone.

2.         Medium-contact services: services that involve less contact between customers and elements of the service operation. Management consulting, car repair and dry cleaning are on this level. Customers are not involved in the whole process while service providers deliver service products.

3.        Low-contact services involve little or no direct contact between customers and service providers. Typical examples are Internet-based services, Cable TV and home banking.

  • Sources of Satisfaction and Dissatisfaction in Service Encounters:

Due to the importance of service encounters in building quality perceptions and influencing customer satisfaction with an organisation, many researchers have extensively analysed service encounters in different contexts to find out the sources of customers' favourable and unfavourable perceptions. According to the book Services Marketing (Zeithaml and Bitner, 1996), there are four common themes that have been identified as the sources of customer satisfaction/dissatisfaction in memorable service encounters. The detail and its suggestions are as follows.


1.        Recovery-Employee Response to Service Delivery System Failures:

This theme includes all incidents where the service of delivery has failed and staff are to respond to the failure of the service delivery system and an employee is required to respond to a customer’s complains and disappointments. The form of the staff response is what establishes whether the customers remember the event favourably or unfavourably. The suggestions for service providers' behaviour are: apologise, acknowledge the problem, explain the causes, take responsibility, compensate etc.

2.        Adaptability-Employee Response to Customer Needs and Requests:

The satisfaction/dissatisfaction in service encounters depends on how adaptable the service delivery system is when the customer has special needs or requests. Therefore, service providers need to see individual needs from the customers' point of view rather than their own routine. Staffs service behaviour should be: recognising the seriousness of the need, acknowledging, anticipating, adjusting the system, explaining the organisation's rules or policies, and taking responsibility.

3.        Spontaneity-Unprompted and Unsolicited Employee Actions:

Even where there is no system failure or special request, customers can still remember service encounters which are very satisfying or very unsatisfying, such as receiving special attention or rudeness to customers. It emphasises the importance of staff behaviours. For this reason, the staff should be attentive, listen to customers, provide information, and show empathy.

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4.        Coping-Employee Response to Problem Customers:

It is very difficult for any organisation to satisfy every customer in each service encounter. Sometimes, customers are basically unwilling to co-operate with the service providers, other customers or regulations. In these cases, nothing the staff can do will in the 'problem customer’ feeling pleased about the encounter Therefore, when staff cope with these problem customer encounters, they should let the customer's dissatisfaction affect others less.

The Evidence of Service-Three Marketing-mix Elements

Because services are intangible, customers are often searching for any tangible evidence to help them understand the nature of the ...

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