Satisfaction is too Simplistic


There should be no surprises in the findings of researchers at the London School of Economics into the impact of the National Student Survey on student course and university selection.

It seems that students choose their university and course based on broader reputational ranking reviews such as those like the Times University Guide and other contextual factors rather NSS scores alone.

What I would like to suggest here is that students are making a value judgement rather than simply a satisfaction assessment.

Prospective students are imagining the future value of their course, being more concerned with what it will do for them rather than making their decision based on the particulars of an historic service experience.

What this means is that even if a customer feels that something is unsatisfactory it does not necessarily mean it lacks value.

Thus, studying long and hard and not having tutor contact on tap might not give a sense of satisfaction but the outcome can have huge value for the student.

Similarly dealing with ambiguity and being left to work things out for yourself might be deeply unsettling and disorientating and therefore could seem very unsatisfactory. However the value the student gains in seeing it through is potentially enormous.

Interestingly the question of why anyone would base their personal value judgment on the satisfaction assessment of others alone is apparently not considered by ‘student satisfaction evangelists’ who portray satisfaction as the only game in town.

One of the big problems with using service satisfaction as a form of competitive comparison is that students typically only experience one degree course at one university at a time. There is no way for them to personally compare different experiences.

Without some measure of satisfaction I realise that this could lead universities to act ‘as if’ they were no worse than anyone else and lapse into complacency. Nevertheless satisfaction scores can never be a true sense of competitive comparison unless a student can compare like for like experiences.

Recently I wrote an extensive literature review on the notion of customer value. Part of it covered the problematic nature of customer ‘satisfaction’. Here is the section:

Satisfaction versus Value

Woodruff (1997) points out that a particular difficulty in defining and determining the nature of value is that it is closely associated with other equally ambiguous terms such as utility, worth quality, satisfaction and benefits.

Scholars have identified a particular problem concerning the need to clearly distinguish between the ideas of customer satisfaction and customer value.

Eggert and Ulaga (2002) in their summary of conceptual differences between satisfaction and customer perceived value explain that satisfaction is a broadly affective construct restricted to a particular suppliers offer whereas value is a cognitive construct based on perceptions that includes a judgement of a range of competitor offers.

The idea of customer satisfaction management (CSM) is acknowledged by authors as a key contributory area to the development of thinking on customer value (Woodruff 1997, Payne and Holt 1999, 2001).

Nevertheless CSM is criticised on several counts (Cronin and Taylor 1992, Day and Crask 2000) which Salamonson, Aberg and Alwood (2012:146) summarise as the distinction that:

‘satisfaction can only be assessed after consumption, while value is possible to evaluate before, during and after consumption.’  

The implication here is that value judgements can be anticipated and they can change over time.

Woodruff (1997) in particular acknowledges the heritage of satisfaction measurement in the quality movement and its aspiration to bring the ‘voice of the customer’ (Akao 1990, Bharadwaj, Nevin and Wallman 2012) into the organisation however Woodruff concludes that problems occur with the choice of satisfaction metrics when they are internally originated, and focussed on product attributes rather than ‘backed up with in- depth learning about customer value’ including affective components of value.

Methodologically CSM survey instruments such as SERVQUAL Parasuraman, Zeithaml and Berry (1988) are criticised for relying on expectancy/disconfirmation models that measure a post purchase evaluation and affective response to the product or service experience in order to determine key buying criteria rather than understanding what it is that customer’s value prior to purchase (Oliver 1992).

Furthermore Patterson and Spreng (1997:420) also point out that models of satisfaction up to that date rarely consider the role of perceived value with the notable exceptions of Liljander, (1994) and Liljander and Strandvik (1995) observing that whilst:

‘most satisfaction models incorporate benefits (via a measure of performance), they ignore any sacrifice component.’

There is therefore a clear consensus amongst academics that the determination of customer value needs to account for facets and levels of perceived value that are frequently portrayed as the more abstract levels of hierarchical models and that there are time related factors that influence how value is judged.

Satisfaction metrics may have a use but believing them to be entirely indicative of the value of a product or service shows an impoverished understanding of contemporary marketing theory and the intuitions of seasoned practioners in commercial practice.

 

 

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3 Types of Brand Lie


Rob Goffee and Gareth Jones tell us in their recent HBR blog article Volkswagen and the end of corporate spin that the world has changed and that leaders need a new type of honesty that research for their new book (which they are subtly promoting btw!) tells them is Radical Honesty.

Interesting they didn’t tell us that this was their intention at the top of the article or in the title!

Imagine if the title read….Promoting our new book about Radical Honesty.

Radical Honesty they suggest  is amongst other things proactive, speedy and candid and in particular surprises people because the organisation is telling the truth.

All of this is needed they say to create a trusted authentic brand.

Now I wonder why we need a new type of honesty? You are either honest or you are not. The things that differ are the types of lies not honesty.

Well it’s the classic marketing ruse isn’t it? Being sold something we didn’t know we actually needed. Radical Honesty? I didn’t realise I needed that …blimey the world has changed and I could be left behind  I’d better get one!

So I suggest it’s in the lies not honesty where the difference is situated. There are 3 types of lies. Blatant untruths, such as buy this face cream and you will stop aging, lying by omission, such as we have met the emissions target but cheated with a gadget,  little white lies, you thought this was leading brand in the taste test but I swapped them.

It seems Radical Honesty is used to address the second type of lie. The cover up, the biased emphasis on only the good stuff. What we commonly call Spin.

There are then some tips for marketing communications managers brought up to fib for their brands on how to achieve the new norm and become Radically Honest. Basically use every channel you have, tell it warts and all and repeat.

No wonder if Fibbing was the old norm that critical marketing writers like Chris Hackley say marketing has earned a reputation for being mendacious.

Nothing new then to add to what my colleague Simon Kelly at Sheffield Business School hasn’t said before ‘you can’t put lipstick on a pig’ to disguise the fact it is still a pig.

Similarly you can’t ‘re-describe’ honesty to overcome the fact that a lie is a lie.

What are the ideas that have shaped today’s marketing thinking?

old and new hand

I’m just writing a lecture for Sheffield Business School International Marketing Masters students. I wanted to explain that in a literature review for their research proposal whilst contemporary articles are preferred there are always seminal articles that have lead and shaped thinking in the subject.

I created this list of some stand out articles that have endured.

McKitterick J.B (1957) What is the Marketing Concept? In Frontiers of Marketing Thought and Science. Frank M Bass.ed. Chicago. Amercian Marketing Association. Pp71-87

Bagozzi R.P. (1974) Marketing as Exchange. Journal of Marketing(38)

Kotler P. Levy, S.J. (1969) Broadening the concept of Marketing. Journal of Marketing Vol 33,(1) pp 10-15

Kotler P. (1972) A Generic Concept of Marketing. Journal of Marketing, 36, (April), 46-54

Levitt T. (1Holbrook M.B. (1999) Consumer value: a framework for analysis and research. Routledge, London960) Marketing Myopia. Harvard Business Review.

Levitt T. (1980) Marketing Success through the differentiation of anything. Harvard Business Review.

Levitt T. (1981) Marketing Intangible Products and Product Intangibles. Harvard Business Review.

Levy S. (1959) Symbols for Sale . Harvard Business Review

Borden N.H., 1964. The concept of the marketing mix. Journal of Advertising Research 4 (2), 2–7.
Aaker J. Dimensions of Brand Personality Journal of Marketing Research, 1 August 1997, Vol.34(3), pp.347-356

Holbrook M.B. (1999) Consumer value: a framework for analysis and research. Routledge, London

Ravald A. and Gronroos C. (1996) The Value Concept and Relationship Marketing, European Journal of Marketing, 30, No, 2, pp. 19-30.

Woodruff R.B. (1997) Customer value: The next source for competitive advantage: Journal of the Academy of Marketing Science. Volume 25, Issue 2, pp 139-153

Zeithaml V.A. (1988), Consumer Perceptions of Price, Quality, and Value: A Means-End Model and Synthesis of Evidence. Journal of Marketing, 52, (July), 2-22

Anderson J.C. and Narus J.A., (1998) Business marketing: understand what customer’s value. Harvard Business Review (November–December), 76 (6), 53–65.

McCarthy J. (1964), Basic Marketing. Homewood, IL: Richard D. Irwin.

There are obviously several more, so any suggestions are welcome.

Promises promises: Trent Barton Buses marketing vs reality 


There is an important difference between value and values. Often firms conflate the two.

Value is what the customer gets and values are what underpin the attitudes and behaviours of the people working for the firm. Customer too of course have values. Values are our deeply held beliefs that guide how we act in the world, such as being honest is good, or be kind to others, be a team player etc.

People are frequently passionate about what they stand for and this is often communicated in marketing claims. Trent Barton buses proclaim they are a ‘really good bus company’. Nothing wrong in being proud of what you do and how you do it.

I don’t know of course if this is a customer comment plucked from a research campaign or how the people of Trent Barton feel about their company. Either way it is bold claim and one that sets high customer expectations.

Today I didn’t think that Trent Barton were a really good bus company.

Normally service is fine and the drivers are excellent, always happy and helpful.

I commute from Nottingham and use Trent Barton buses Rushcliffe Mainline. This service is a re-brand of the rationalised service that stopped a more convenient service passing through my village with the promise of more frequent buses from a stop roughly 700 yards away.

So ok trade convenience for efficiency.  I can buy that.

Today though my day was screwed up. I rely on the bus to make a train connection. 10 mins early I was at stop waiting for the 8.54 which turned up displaying ‘a really good bus company’ liveried on the front at 9.17

Bunny and happy I was not.

So marketing people beware. Whilst your firm might aspire to be ‘a really good bus company’ or similar the reality might end up being very different.

The perceived pressure to stand out makes firms do weird things like over promise. So perhaps instead of bragging about a £5m investment in new buses you simply get the bus to turn up on time? Now THAT would be something to brag about!

Revealing the root cause of Brand failure?

 

 
To be honest I was a left a bit baffled by a recent article in the AMA blog by Nigel Hollis the executive vice president and chief global analyst at New York-based global market research firm Millward Brown. 

It was written in that ‘revelatory’ style you sometimes get when someone shares some pearls of wisdom from years of practice and they want to promote a methodology for success. 

To be fair at the heart of the post there are some important points but they aren’t exactly revelations. 

Marketing thinkers for decades have said that competitive advantage is achieved when:

1. Particular solutions and the enduring brands they sit within satisfy customer needs and expectations and constantly stay relevant to what the customer wants.
2. Cutting your price implies there is no meaningful difference between your offer of value and your competitors.

Why was I baffled? 

Well one claim being made in Pricing Power: A brands most valued yet under valued asset seemed to confuse cause and effect. 

Brands decline for reasons other than losing market share we are told. Really?

Isn’t market share the indicator of something amiss rather than its cause? It’s a bit like saying people are dead because they have stopped breathing. Factually correct but not a very helpful explanation.

Then we are told (as the rabbit is pulled out of the hat) that losing market share isn’t really the cause of brand demise it’s lack of pricing power. 

Really? Isn’t a cheap price point just another indicator of the lack of inherent customer value in the offer rather than its cause? Price is an indicator of quality. Therefore isn’t it a lack of customer value that is the root cause of brand decline?

Then we are treated to the revelation of revelations. 

The post observes that in reality Brands fail because of the inaction of the people that create and manage them and or competitive action. You don’t say! You mean brands aren’t stand alone entities that were created without the involvement of human mind and action? Shock! 

This is actually where I totally agree with Nigel. Competitive advantage is generated from the resources, competences and capabilities of the firm not your position in the market . Your market position is an outcome of your commercial imagination.

Brands lose market share simply when some marketeers make duff decisions and become complacent. They mis-manage solutions and brands that eventually drift into customer irrelevance.

Brands don’t decline because of the mystical intervention of ‘loss of market share’ or a pricing goof. These are symptoms of poor marketing management and a lack of market orientation.

The positive customer attitude measures that Nigel refers to as key to his suite of factors for ensuring Brand success surely isn’t rocket science either it simply means you are selling something the customer finds desirable and your customers agree.
As for Nigel telling us that what really matters is delivery of ‘meaningful difference’ isn’t this an unattributed repeat of what Ted Levitt was saying back in 1980s? Why has anything changed? 

The danger really lurks when brands try to, as Nigel suggests, ‘boost perceptions of positive differentiation’. Do this without grounding the differentation in things that are really matter to the customer and all you do is slap lipstick on a pig and it never works long term if at all (cf Simon Kelly – Sheffield Business School).

I’m not sure there is much mystery in any of this.

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