What is the Efficient Market Hypothesis and How it Works and Doesn’t Work in Practice
Are Markets Really Efficient in Delivering Optimal Outcomes for All Stakeholders? Are Free Markets really “free” in the real world? Are market forces allowed to deliver efficient outcomes or do governmental and private entities interfere in the workings of markets and distort the outcomes? Moreover, does Crony Capitalism introduce bias against the smaller players and […]
Knowledge Creation and Management
Introduction The concept of knowledge as the founding block for attaining competitive advantage has become quite prevalent in Management studies. All knowledge should begin form a piece of information. For the conversion of information into knowledge there is a critical aspect to be noted. This is related to the timing of the retrieval of information. […]
Survey Method
The Survey method is the technique of gathering data by asking questions to people who are thought to have desired information. A formal list of questionnaire is prepared. Generally a non disguised approach is used. The respondents are asked questions on their demographic interest opinion. Advantages of Survey Method As compared to other methods (direct […]
Service Industry at Cross Roads
No one would have ever imagined fifty years ago that the service sector would become a major contributor to the economy world over. Surprising but true, that in America as well as in India or in UK, service industry has grown beyond our imagination and continues to grow. Globalization and the advancement of technology has […]
Need for Market Segmentation – Why Market Segmentation?
A set-up where two or more parties (also called buyers and sellers) are engaged in transaction of goods and services in exchange of money is called a market. At the market place the sellers sell their goods to the consumers (buyers) in exchange of money. Let us go through the following examples: Nokia offers wide […]
Every business knows that in order to thrive it needs to differentiate itself in the mind of the consumer. Price has proved inadequate since there is a limit to how much a firm can cut back on its margins. Product differentiation is also no longer enough to attract or retain customers since technological advances have resulted in products becoming almost identical with very few tangible differences from others in the same category. Consequently, marketers have realized the importance of service differentiation as a sustainable strategy for competing for a portion of the customer’s wallet.
A moment of truth is usually defined as an instance wherein the customer and the organization come into contact with one another in a manner that gives the customer an opportunity to either form or change an impression about the firm. Such an interaction could occur through the product of the firm, its service offering or both. Various instances could constitute a moment of truth - such as greeting the customer, handling customer queries or complaints, promoting special offers or giving discounts and the closing of the interaction.
In today’s increasingly service driven markets and with the proliferation of multiple providers for every type of product or service, moments of truth have become an important fact of customer interaction that marketers need to keep in mind. They are critical as they determine a customer’s perception of, and reaction to, a brand. Moments of truth can make or break an organization’s relationship with its customers.
This is more so in the case of service providers since they are selling intangibles by creating customer expectations. Services are often differentiated in the minds of the customer by promises of what is to come. Managing these expectations constitutes a critical component of creating favorable moments of truth which in turn are critical for business success.
Moments of Magic: Favorable moments of truth have been termed as ’moments of magic’. These are instances where the customer has been served in a manner that exceeds his expectations. Eg: An airline passenger being upgraded to from an economy to a business class ticket or the 100th (or 1000th) customer of a new department store being given a special discount on his purchase. Such gestures can go a long way in creating a regular and loyal customer base. However, a moment of magic need not necessarily involve such grand gestures. Even the efficient and timely service consistently provided by the coffee shop assistant can create a moment of magic for the customers.
Moment of Misery: These are instances where the customer interaction has a negative outcome. A delayed flight, rude and inattentive shop assistants or poor quality of food served at a restaurant all qualify as moments of misery for the customers. Though lapses in service cannot be totally avoided, how such a lapse is handled can go a long way in converting a moment of misery in to a moment of magic and creating a lasting impact on the customer.
Note: Moments of Magic and Moments of Misery are trademarks owned by Shep Hyken. Used with permission. For more information go to http://www.hyken.com.
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