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Chapter 13 1. Which of the following is a characteristic of a service? A) It is essentially tangible. B) It does not result in the ownership of anything. C) Its production is majorly tied to a physical product. D) Services are typically produced and consumed at different times. E) A client's presence is not required for rendering a service. Answer: B Rationale: The characteristic of not resulting in the ownership of anything distinguishes services from tangible goods. Services are intangible actions or performances provided to consumers, such as consulting, education, or healthcare, and they do not transfer ownership of a physical product to the consumer. 2. Which of the following is an example of a pure tangible good? A) massage B) shampoo C) e-mail D) restaurant meal E) air travel Answer: B Rationale: Shampoo is an example of a pure tangible good because it is a physical product that can be touched, seen, and stored. Unlike services, tangible goods are typically products that can be owned and possessed by the consumer. 3. To which of the following categories of services does a cell phone belong? A) major service with accompanying minor services B) major service with accompanying minor goods C) pure service D) pure tangible good E) tangible good with accompanying services Answer: E Rationale: A cell phone belongs to the category of tangible goods with accompanying services. While the cell phone itself is a tangible good, it often comes with accompanying services such as network connectivity, customer support, and software updates. 4. A computer falls into the ________ category of service mix. A) pure tangible good B) tangible good with accompanying services C) hybrid D) major service with accompanying minor goods E) pure service Answer: B Rationale: A computer falls into the category of tangible goods with accompanying services because it is a physical product that is typically accompanied by services such as warranties, technical support, and software updates. 5. Which of the following is an example of a hybrid service? A) teaching B) car C) restaurant meal D) soap E) air travel Answer: C Rationale: A restaurant meal is an example of a hybrid service because it involves both the provision of a tangible product (the food) and intangible services (dining experience, waiter service, ambiance). 6. A flight with complementary drinks is an example of a ________. A) major service with accompanying minor goods and services B) pure service C) pure tangible good D) tangible good with accompanying services E) hybrid Answer: A Rationale: A flight with complementary drinks represents a major service (air travel) accompanied by minor goods (the drinks) and services (customer service, in-flight entertainment). 7. Which of the following is an example of a pure service? A) air travel B) psychotherapy C) baby oil D) a laptop E) a restaurant meal Answer: B Rationale: Psychotherapy is an example of a pure service because it is an intangible action provided by a professional to address psychological or emotional needs, without transferring ownership of any physical product to the consumer. 8. Which of the following is true for services? A) All services are people-based, while goods are equipment-based. B) Service providers can be both for-profit or nonprofit. C) All service companies follow the same process to deliver their services. D) The client's presence is a hindrance during the service delivery process. E) Service providers develop similar marketing programs for personal services and business services. Answer: B Rationale: Service providers can be either for-profit or nonprofit entities, indicating that services are not inherently tied to profit motives. Nonprofit organizations often provide services such as healthcare, education, and social services. 9. Some services require that the client be present to conduct the service. Which of the following is an example of such a service? A) pest control B) furniture polishing C) surgery D) car repairing E) tax services Answer: C Rationale: Surgery is an example of a service that requires the client (patient) to be present during the service delivery process. The presence of the client is crucial for the surgical procedure to be performed effectively. 10. Services high in ________ have characteristics that the buyers can evaluate before purchase. A) search qualities B) experience qualities C) credence qualities D) privacy qualities E) storing qualities Answer: A Rationale: Services high in search qualities are those that can be evaluated by buyers before purchase. These qualities are readily observable or known before the purchase decision, such as the appearance, price, or availability of the service. 11. Services high in ________ qualities have characteristics that the buyer can evaluate after purchase. A) privacy B) experience C) credence D) search E) stock Answer: B Rationale: Services high in experience qualities are those where the evaluation by the buyer occurs after the purchase and consumption. These qualities are assessed based on the experience of using the service, such as the satisfaction level, performance, or outcome. 12. Services high in ________ are those services that have characteristics the buyer normally finds hard to evaluate even after consumption. A) trial qualities B) search qualities C) experience qualities D) privacy qualities E) credence qualities Answer: E Rationale: Credence qualities refer to characteristics of services that are difficult for the buyer to evaluate even after consumption. These qualities often involve aspects such as safety, effectiveness, or reliability, which may require specialized knowledge or experience to assess. 13. Which one of the following would be considered high in credence qualities? A) an interior of a house B) a restaurant C) a haircut D) psychotherapy E) a computer Answer: D Rationale: Psychotherapy involves aspects that are difficult for the buyer to evaluate even after consumption, such as the effectiveness of the therapy, the qualifications of the therapist, and the long-term impact on mental health. Therefore, it is high in credence qualities. 14. Which one of the following is highest in search qualities? A) a play at a theater B) a meal at a restaurant C) a haircut D) psychotherapy E) a computer Answer: E Rationale: A computer is highest in search qualities because its features, specifications, and performance can be readily evaluated by the buyer before purchase. This information is typically available through product specifications, reviews, and comparisons. 15. Unlike physical products, services cannot be seen, tasted, felt, heard, or smelled before they are bought. This is known as the ________ aspect of services. A) inseparability B) intangibility C) variability D) perishability E) heterogeneity Answer: B Rationale: Intangibility refers to the characteristic of services that makes them unable to be perceived by the senses before purchase or consumption. Unlike physical products, services lack physical form and cannot be evaluated through traditional sensory means. 16. Which of the following will most help service providers overcome the limitation of intangibility of services when positioning itself? A) using brand symbols B) sharing services C) working with larger groups D) cultivating non-peak demand E) creating a service blueprint Answer: A Rationale: Using brand symbols such as logos, slogans, or characters helps to make the service and its key benefits more tangible and recognizable to consumers, thereby overcoming the limitation of intangibility. 17. A brand that is action-oriented and causes consumers to engage in physical actions appeals to the ________ dimension of brand experience. A) sensory B) affective C) behavioral D) intellectual E) social Answer: C Rationale: The behavioral dimension of brand experience relates to how a brand influences consumer behavior and actions. An action-oriented brand that encourages physical engagement appeals to this dimension. 18. BRZ Shoes targets the youth market with vibrant, visually appealing ads in modern styles. BRZ ads appeal to the ________ dimension of brand experience. A) sensory B) affective C) behavioral D) intellectual E) social Answer: A Rationale: The sensory dimension of brand experience involves how a brand stimulates the consumer's senses. Vibrant and visually appealing ads appeal to this dimension by engaging the consumer's visual senses. 19. BRZ Shoes positions itself as a young, adventurous brand. Its logo and brand communication try to give consumers a feeling of excitement and bravery. These ads appeal to the ________ dimension of brand experience. A) sensory B) affective C) behavioral D) intellectual E) social Answer: B Rationale: The affective dimension of brand experience relates to the emotional connection and feelings evoked by the brand. Ads that convey excitement and bravery aim to appeal to consumers' emotions, thereby targeting the affective dimension. 20. ________ refer(s) to logos, symbols, characters, and slogans that service providers use in order to make the service and its key benefits more tangible. A) Brand engagement B) Brand orientation C) Brand elements D) Brand loyalty E) Brand equity Answer: C Rationale: Brand elements such as logos, symbols, characters, and slogans help to make the service and its key benefits more tangible and recognizable to consumers. They serve as visual and auditory cues that evoke associations with the brand and its offerings. 21. Which of the following is true regarding services? A) Services are typically produced, stored, and then consumed. B) Services are generally low in experience and credence qualities. C) Service providers develop similar marketing programs for personal services and business services. D) There is less risk associated with the purchase of services than with the purchase of goods. E) Provider-client interaction is a special feature of services marketing. Answer: E Rationale: Provider-client interaction is indeed a special feature of services marketing. Unlike goods, services often require direct interaction between the provider and the client, which can influence the overall customer experience and satisfaction. 22. The fact that services are typically produced and consumed simultaneously is known as the ________ aspect of services. A) perishability B) intangibility C) heterogeneity D) inseparability E) variability Answer: D Rationale: The aspect of services known as inseparability refers to the simultaneous production and consumption of services. This means that services are often produced and consumed at the same time, making the provider-client interaction a critical component of the service experience. 23. Service quality depends on who provides them, when and where, and to whom. Thus, services are highly ________. A) inseparable B) tangible C) variable D) perishable E) intangible Answer: C Rationale: Services are highly variable because their quality depends on various factors such as who provides them, when and where they are provided, and to whom they are provided. This variability can impact the consistency and reliability of the service experience. 24. Which of the following will help a service provider overcome the limits imposed by the inseparability of services? A) using differential pricing B) working with larger customer groups C) providing complementary services D) concentrating on physical evidence and presentation E) standardizing the service process Answer: B Rationale: Working with larger customer groups can help service providers overcome the limits imposed by the inseparability of services by allowing them to serve multiple customers simultaneously, thereby increasing efficiency and reducing wait times. 25. Which of the following steps will help service firms to increase their quality control? A) standardizing the service-performance process B) providing complementary services to customers C) giving personnel authority in handling situations D) adopting differential pricing E) cultivating nonpeak demand Answer: A Rationale: Standardizing the service-performance process can help service firms increase their quality control by ensuring consistency in service delivery. This involves defining and implementing standard procedures and protocols for delivering the service to customers. 26. In order to map out the service process, the points of customer contact, and the evidence of service from the customer's point of view, service firms should develop a ________. A) marketing plan B) service floor plan C) Gantt chart D) business plan E) service blueprint Answer: E Rationale: Service firms should develop a service blueprint in order to map out the service process, identify the points of customer contact, and visualize the evidence of service from the customer's perspective. This helps in understanding and improving the service delivery process. 27. Jake had an appointment at the doctor's, but couldn't make it on time because he was caught in traffic. By the time he reached the doctor's office, the doctor had already begun with the next patient. This illustrates the ________ of services. A) variability B) heterogeneity C) perishability D) intangibility E) homogeneity Answer: C Rationale: This scenario illustrates the perishability of services, as the appointment slot with the doctor cannot be stored or resold once it has passed. The opportunity for service delivery is lost once the appointment time has elapsed. 28. When a theater sells matinee movie tickets at low prices, it aims to shift some demand from the peak to the off-peak period. What is the strategy that the theater is said to be adopting? A) It is providing complementary services. B) It is increasing peak-time efficiency. C) It is using linear pricing. D) It is using differential pricing. E) It is sharing services. Answer: D Rationale: The theater is adopting the strategy of differential pricing by offering discounted prices for matinee movie tickets, which encourages some customers to shift their demand from the peak (regular) to the off-peak (matinee) period. 29. A travel agency offers weekend discounts for car rentals. What can be deduced from this? A) It is increasing peak-time efficiency. B) It is using differential pricing. C) It is using linear pricing. D) It is cultivating peak demand. E) It is providing complementary services. Answer: B Rationale: The travel agency is using differential pricing by offering weekend discounts for car rentals, which varies the price based on the timing of the service usage. This strategy aims to attract customers during off-peak periods and maximize revenue. 30. In which of the following cases is a service provider trying to increase non-peak demand? A) A fine dining restaurant is promoting a breakfast service in addition to its popular lunch and dinner options. B) An upscale restaurant has a cocktail lounge where customers can wait until a table is ready. C) AXA Bank set up automated teller machines so that its customers could avoid standing in line. D) Chesterton College hired part-time teachers as enrollment increased significantly. E) Big department stores usually hire extra staff to handle the rush during the holiday season. Answer: A Rationale: A fine dining restaurant promoting a breakfast service is trying to increase non-peak demand by attracting customers during a time when demand is typically lower. This helps in maximizing the utilization of resources and increasing revenue during off-peak periods. 31. The Caesar Park Hotel generally caters to business customers during the week, but has now decided to promote minivacation weekends for non-business customers as well. What is the Caesar Park Hotel trying to do? A) It is implementing premium pricing. B) It is trying to cultivate nonpeak demand. C) It is promoting complementary services. D) It is putting reservation systems in place. E) It is implementing differential pricing. Answer: B Rationale: The Caesar Park Hotel is trying to cultivate nonpeak demand by promoting minivacation weekends for non-business customers. This strategy aims to attract customers during periods when demand is typically lower, thereby increasing occupancy rates and revenue during offpeak times. 32. Cocktail lounges in restaurants are examples of ________. A) differential pricing B) cultivating nonpeak demand C) complementary services D) reservation systems E) shared services Answer: C Rationale: Cocktail lounges in restaurants are examples of complementary services, as they are additional offerings provided to enhance the overall dining experience for customers. These services complement the primary service (food and beverage) provided by the restaurant. 33. Which of the following is an example of a complementary service? A) Big department stores usually hire extra staff to handle the rush during the holiday season. B) The Caesar Park Hotel generally caters to business customers during the week, but has now decided to promote minivacation weekends for non-business customers as well. C) More paramedics are on hand to assist physicians during times when emergency admissions are highest. D) AXA Bank set up automated teller machines so that its customers could avoid standing in line. E) Chesterton College hires part-time teachers when enrollment goes up. Answer: D Rationale: Setting up automated teller machines (ATMs) so that customers could avoid standing in line is an example of a complementary service. It enhances the overall banking experience for customers by providing additional convenience and accessibility. 34. Walmart has decided to hire extra clerks during the holiday season. It is said to be ________. A) matching its supply with the existing demand B) generating non-peak demand C) increasing its customer participation D) sharing its services E) facilitating for its future expansion Answer: A Rationale: By hiring extra clerks during the holiday season, Walmart is matching its supply with the existing demand. This ensures that the store has sufficient staff to meet the increased demand from holiday shoppers, thereby optimizing its operational efficiency. 35. Kaya, a chain of skin clinics, requests each new visitor to fill up their own details on a printed form. This is a step in ________. A) increasing its peak-time efficiency B) creating nonpeak demand C) increasing consumer participation D) sharing its services E) facilitating its future expansions Answer: C Rationale: Requesting each new visitor to fill up their own details on a printed form is a step in increasing consumer participation. It involves actively involving customers in the service process, which can enhance their engagement and satisfaction. 36. Customers today want separate prices for each service element and they also want the right to select the elements they want. The customers are said to be pressing for ________. A) complementary services B) perishable services C) variable services D) unbundled services E) shared services Answer: D Rationale: Customers pressing for separate prices for each service element and the ability to select specific elements they want are demanding unbundled services. This allows customers to customize their service experience according to their preferences and needs. 37. Often, a service problem arises from a customer's lack of understanding or ineptitude. Which of the following can help to minimize customer failures? A) giving customers exclusive primary service packages B) redesigning processes to simplify service encounters C) using differential pricing and shared services D) minimizing service intangibility E) working with more customers at the same time Answer: B Rationale: Redesigning processes to simplify service encounters can help minimize customer failures by making the service delivery process more user-friendly and intuitive. This reduces the likelihood of misunderstandings or errors on the part of the customer. 38. ________ refers to the normal work of preparing, pricing, distributing, and promoting the service to customers. A) Interactive marketing B) Internal marketing C) External marketing D) Promotional marketing E) Direct marketing Answer: C Rationale: External marketing refers to the activities involved in preparing, pricing, distributing, and promoting the service to customers. It encompasses various marketing strategies and tactics aimed at attracting and retaining customers. 39. ________ refers to training and motivating employees to serve customers well. A) External marketing B) Promotional marketing C) Direct marketing D) Internal marketing E) Interactive marketing Answer: D Rationale: Internal marketing refers to the process of training and motivating employees to serve customers well. It involves fostering a customer-centric culture within the organization and empowering employees to deliver exceptional service. 40. ________ describes the employees' skill in serving the client. A) External marketing B) Internal marketing C) Promotional marketing D) Direct marketing E) Interactive marketing Answer: E Rationale: Interactive marketing describes the employees' skill in serving the client and engaging in effective communication and interaction with customers. It focuses on the quality of customer service and the overall customer experience provided by employees. 41. Susanna wanted to check out a new salon in her locality, so she decided to go for a hair styling session. She was very happy with the way her stylist connected and related with her concerns. She is judging the service based on its ________. A) promotional marketing B) functional quality C) technical quality D) search qualities E) external marketing Answer: B Rationale: Susanna's satisfaction with the way her stylist connected and related to her concerns indicates that she is judging the service based on its functional quality, which pertains to how well the service meets her needs and expectations. 42. In which of the following does a customer respond to the technical quality of a service? A) Sara's preferred hair stylist is some miles away, but Sara goes to him because his styles suit her looks. B) Kathy tries out a new restaurant every week, because she likes to experience the variety. C) Bill has gone to the same chiropractor for the past fifteen years, because he is friendly and takes the time to listen to Bill. D) Ray avoids going to the bank as far as possible because the manager is rude and unhelpful. E) Alex has no interest in theater, but goes often because her best friend loves plays. Answer: A Rationale: Sara's preference for a hair stylist whose styles suit her looks demonstrates her response to the technical quality of the service, as she values the stylist's skill and ability to meet her styling preferences. 43. In which of the following does a customer respond to the functional quality of a service? A) Sara's preferred hair stylist is some miles away, but Sara goes to him because his styles suit her looks. B) Kathy tries out a new restaurant every week, because she likes to experience the variety. C) Bill has gone to the same chiropractor for the past fifteen years, because he is friendly and takes the time to listen to Bill. D) Ray's mechanic charges high prices for service, but his work is good and worth the price. E) Alex has no interest in theater, but goes often because her best friend loves plays. Answer: C Rationale: Bill's loyalty to the same chiropractor for the past fifteen years, based on the chiropractor's friendliness and attentiveness, reflects his response to the functional quality of the service, which addresses his healthcare needs effectively. 44. Firms have decided to raise fees and lower service for those customers who barely pay their way and to coddle big spenders to retain their patronage as long as possible. This is an example of organizing customers by ________. A) retailer convenience B) profit tiers C) psychographic characteristics D) social influence E) customer preference Answer: B Rationale: Organizing customers by profit tiers involves adjusting service offerings and treatment based on the profitability of customers. This strategy aims to prioritize high-value customers while minimizing resources allocated to low-value customers. 45. Charles Schwab's best customers are instantly directed to customer service representatives, while other customers have to wait longer. Charles Schwab is trying to ________. A) monitor its service systems B) empower the customers C) retain the patronage of profitable customers D) increase consumer participation E) standardize the service-performance process Answer: C Rationale: By prioritizing service for its best customers, Charles Schwab is attempting to retain the patronage of profitable customers. This strategy ensures that high-value customers receive prompt attention and service to enhance their loyalty and satisfaction. 46. The ________ rates the various elements of the service bundle and identifies required actions. A) company performance analysis B) voice of customer measurement C) customer factor measurement D) importance-performance analysis E) customer importance analysis Answer: D Rationale: The importance-performance analysis (IPA) rates the various elements of the service bundle by assessing both their importance to customers and the performance of the service provider in delivering them. It helps identify areas for improvement and prioritize actions. 47. Customers who view a service as homogeneous ________. A) only patronize a preferred service provider B) judge services on the basis of the providers C) care less about the provider than about the price D) pick a service provider based on functional attributes E) opt for the service with the highest price, irrespective of quality Answer: C Rationale: Customers who view a service as homogeneous are primarily concerned with the price rather than the provider. They perceive little differentiation between service providers and prioritize affordability over other factors. 48. Belling Hotels provides complimentary breakfast buffets to all its guests. This is an example of a ________. A) primary service package B) service interface C) service support D) service frequency E) secondary service feature Answer: E Rationale: Providing complimentary breakfast buffets to all its guests is an example of a secondary service feature, as it enhances the overall experience for guests but is not the primary service offered by the hotel. 49. Although Brenda previously used the U.S. Postal Service because it offered better prices on package shipping, she now uses only FedEx, because it gives her the facility of shipping from any FedEx Kinkos location 24 hours a day. Which of the following factors led to Brenda's customer switching behavior? A) inconvenience B) pricing C) response to service failure D) ethical problems E) involuntary switching Answer: A Rationale: Brenda's decision to switch from the U.S. Postal Service to FedEx was likely influenced by inconvenience, as she valued the added convenience of being able to ship from any FedEx Kinkos location 24 hours a day. 50. Angela switched to a new hair stylist after getting a bad haircut from her previous stylist. This is an example of which of the following factors leading to customer switching behavior? A) service encounter failure B) core service failure C) response to service failure D) involuntary switching E) competition Answer: B Rationale: Angela's decision to switch to a new hair stylist after receiving a bad haircut from her previous stylist reflects a core service failure. The failure to meet her expectations in the primary service (haircut) led to her decision to switch providers. 51. Dean recently had a BRZ broadband connection installed. However, the connection was bad and he didn't get the quality he required. He contacted BRZ about the problem, but the company did not solve his problem. Dean switched to Blue Broadband. Which of the following was the cause of Dean's switching behavior? A) involuntary switching B) competition C) response to service failure D) service encounter failures E) inconvenience Answer: C Rationale: Dean's switching behavior was a response to service failure. The inability of BRZ to address his connectivity issues despite his complaint led to his dissatisfaction and subsequent decision to switch to another broadband provider. 52. MGC Inc. organizes a company-wide picnic once a year. The organizers arranged for the best possible menu thinking that food would be a priority, but the staff were disappointed because the activities were very poorly planned. What kind of a gap is apparent here? A) gap between perceived service and expected service B) gap between service delivery and external communications C) gap between service-quality specifications and service delivery D) gap between management perception and service-quality specification E) gap between consumer expectation and management perception Answer: E Rationale: The gap apparent here is between consumer expectation and management perception. Management perceived that providing a great menu would meet the expectations of the staff, but the staff's disappointment with poorly planned activities indicates a disparity between what management assumed and what the staff actually expected. 53. Which of the following is an example of a gap between management perception and the service-quality specifications? A) The college brochure showed state-of-the-art classrooms, but when the visitors walked in, they saw peeling walls and dull lighting. B) A nurse visits a patient to show care, but the patient interprets this as an indication that something is very wrong. C) The hotel administrators think that guests want better food, but guests are more concerned with the courtesy of the waiters. D) A service center manager has asked his subordinates to provide fast service, but has not specified a time for the service to be performed. E) Customer service representatives are asked to give ample time to each customer, but must serve a minimum of 50 customers a day. Answer: D Rationale: The example of a service center manager asking subordinates to provide fast service without specifying a time for the service to be performed illustrates a gap between management perception and service-quality specifications. Management perceives the need for fast service, but fails to clearly define what constitutes fast service, leading to ambiguity and potential service delivery issues. 54. The customer service representatives at a call center have been asked to handle each call in not more than five minutes. A recent customer survey by the company revealed that customers appreciate it when employees take the time to answer their questions fully and listen to their grievances. What kind of service gap is apparent here? A) gap between perceived service and expected service B) gap between service delivery and external communications C) gap between service-quality specifications and service delivery D) gap between management perception and service-quality specification E) gap between consumer expectation and management perception Answer: D Rationale: The service gap apparent here is between management perception and service-quality specification. Management perceives that handling each call in under five minutes is a priority, while customers expect fully answered questions and attentive listening, indicating a mismatch between management's perception and customer expectations. 55. The customer service representatives at a call center have been asked to handle each call in not more than five minutes. At the same time, they have been asked to answer all customer queries in detail and provide appropriate solutions. What kind of service gap is apparent here? A) gap between perceived service and expected service B) gap between service delivery and external communications C) gap between service-quality specifications and service delivery D) gap between management perception and service-quality specification E) gap between consumer expectation and management perception Answer: C Rationale: The service gap apparent here is between service-quality specifications and service delivery. The conflicting expectations placed on customer service representatives, to handle calls quickly while also providing detailed answers and solutions, create challenges in meeting both sets of specifications simultaneously. 56. Which of the following is an example of a gap between service delivery and external communications? A) The employees at GBL have been asked to take time to listen to customers, but they must serve them fast as well. B) Amanda chose to shop at Alison's Fashions because the store's website offered on-the-spot alterations. However, when she did buy a dress, she had to wait a week to get it altered. C) Customers at LUX appreciate the personalized services the salespeople offer, but do not like the store design. D) Clearwater Spa attendants are well-trained in massage therapy and the services they offer, but customers rarely return because they don't like the attendants' impersonal service. E) When sales dropped, Styx modernized its stores in order to retain customers, but didn't realize that the product quality was the main problem. Answer: B Rationale: The example of Amanda choosing to shop at Alison's Fashions due to the promise of on-thespot alterations on the store's website, but experiencing delays in getting her dress altered, demonstrates a gap between service delivery and external communications. The discrepancy between the promised service (on-the-spot alterations) and the actual service delivery (delayed alterations) reflects a failure in aligning external communications with service delivery. 57. Ellen came across an ad for a new restaurant which promised authentic French cuisine. When she ate there, however, she was disappointed to find that the food was mediocre and not very authentic. Which of the following gaps of service performance does this demonstrate? A) gap between service-quality specifications and service delivery B) gap between perceived service and expected service C) gap between service delivery and external communications D) gap between consumer expectation and management perception E) gap between management perception and service-quality specification Answer: C Rationale: Ellen's disappointment with the restaurant's food quality despite the promise of authentic French cuisine in the advertisement demonstrates a gap between service delivery and external communications. The disparity between the restaurant's marketing claims and the actual dining experience highlights a failure to deliver on the communicated service promises. 58. When Aaron went to his doctor for his annual checkup, he was asked to undergo a number of tests. Although the doctor assured Aaron that the tests were routine, Aaron thinks that the doctor is hiding a grave problem from him. What kind of a gap is apparent here? A) gap between perceived service and expected service B) gap between service delivery and external communications C) gap between service-quality specifications and service delivery D) gap between management perception and service-quality specification E) gap between consumer expectation and management perception Answer: A Rationale: The gap apparent here is between perceived service and expected service. Aaron's perception that the doctor is hiding a grave problem from him contrasts with his expectation that the tests were routine. This mismatch between what Aaron perceives and what he expected contributes to his apprehension. 59. The most important determinant of service quality is ________ which refers to the ability to perform the promised service dependably and accurately. A) empathy B) assurance C) responsiveness D) reliability E) tangibles Answer: D Rationale: Reliability is the most important determinant of service quality as it ensures that the service is performed dependably and accurately, meeting customers' expectations consistently. 60. The customer service representatives at G.K.'s customer service center must know as much about the products as possible, so that they can help the customers solve their difficulties without sounding hesitant or unsure of themselves. Which of the following determinants of service quality are they being asked to demonstrate? A) responsiveness B) assurance C) empathy D) reliability E) tangibility Answer: B Rationale: The customer service representatives are being asked to demonstrate assurance, which involves instilling confidence in customers by being knowledgeable about the products and services offered. This helps customers trust the representatives' ability to address their concerns effectively. 61. Josh gets his bike serviced at Dean's Garage even though there's another garage much closer to home. He prefers Dean's because the work is usually done quickly and the staff try to solve the issues with the bike as soon as possible. Dean's Garage excels at which of the following five determinants of service quality? A) reliability B) responsiveness C) assurance D) empathy E) tangibles Answer: B Rationale: Dean's Garage excels at responsiveness, as they prioritize quick service and promptly address issues with the bike, which meets Josh's preference for efficient and timely service. 62. The ________ determinant of service quality refers to the knowledge and courtesy of employees and their ability to convey trust and confidence in the service they provide. A) conscientious B) assurance C) empathy D) reliability E) responsiveness Answer: B Rationale: The assurance determinant of service quality refers to the knowledge and courtesy of employees and their ability to convey trust and confidence in the service they provide. It ensures customers feel secure and confident in the service they receive. 63. Leo's manager has asked him and his teammates to demonstrate caring towards customers. They are instructed to learn the customers' names, and use the customers' names while interacting with them. Repeat customers should get special attention, and the team members should remember their preferences and habits. The manager is asking the team to be ________. A) assuring B) candid C) empathetic D) reliable E) responsive Answer: C Rationale: The manager is asking the team to be empathetic by demonstrating care and understanding towards customers, acknowledging their individual needs and preferences, which fosters a sense of connection and rapport. 64. Gloria goes to the same bagel shop every morning because the workers there remember her name and know her order. They always make her feel welcome. The employees of this bagel shop excel at which of the following determinants of service quality? A) reliability B) responsiveness C) assurance D) empathy E) tangibles Answer: D Rationale: The bagel shop employees excel at empathy by remembering Gloria's name and order, making her feel valued and understood, which enhances her overall experience and perception of service quality. 65. The zone of ________ is a range where a service dimension is deemed satisfactory, anchored by the minimum level consumers are willing to accept and the level they believe can and should be delivered. A) immunity B) tolerance C) reliability D) assurance E) flexibility Answer: B Rationale: The zone of tolerance is a range within which customers perceive a service dimension to be acceptable, bounded by the minimum level they are willing to accept and the level they believe should be delivered. 66. According to the dynamic process model, two different types of expectations have opposite effects on perceptions of service quality. One of these is that ________. A) increasing customer expectations of what the firm will deliver improve the perceptions of overall service quality B) increasing customer expectations of what the firm will deliver decrease the perceptions of overall service quality C) decreasing customer expectations of what the firm should deliver decrease the perceptions of overall service quality D) decreasing customer expectations of what the firm will deliver improve the perceptions of overall service quality E) increasing customer expectations of what the firm should deliver improve the perceptions of overall service quality Answer: A Rationale: According to the dynamic process model, increasing customer expectations of what the firm will deliver improves perceptions of overall service quality. This suggests that meeting or exceeding customer expectations positively influences their perception of service quality. 67. When customers calculate the perceived economic benefits of a continuously provided service in relationship to the economic costs, they are gauging the ________. A) private equity B) brand equity C) payment equity D) customer-service equity E) product-service equity Answer: C Rationale: When customers calculate the perceived economic benefits of a continuously provided service relative to the economic costs, they are gauging payment equity, which involves assessing whether the value received justifies the monetary expenditure. 68. A ________ refers to any place at which a company seeks to manage a relationship with a customer, whether through people, technology, or some combination of the two. A) customer-service interface B) product-customer interface C) tangible user interface D) attentive user interface E) crossing-based interface Answer: A Rationale: A customer-service interface refers to any point or platform where a company interacts with customers to manage relationships, utilizing personnel, technology, or a combination of both to facilitate interactions and deliver services. 69. Regular maintenance and repair costs are known as ________. A) service contract costs B) out-of-pocket costs C) fixed costs D) facilitating services costs E) value-augmentation costs Answer: B Rationale: Regular maintenance and repair costs are categorized as out-of-pocket costs, referring to expenses incurred for ongoing upkeep and servicing of a product or service. 70. The product's purchase cost plus the discounted cost of maintenance and repair less the discounted salvage value gives the ________. A) service warranty cost B) out-of-pocket cost C) life-cycle cost D) facilitating services cost E) value-augmentation cost Answer: C Rationale: The product's purchase cost plus the discounted cost of maintenance and repair less the discounted salvage value gives the life-cycle cost, which accounts for the total expenses associated with owning and maintaining a product or service over its useful life. 71. Expensive equipment manufacturers not only install the equipment but also train the staff and undertake the maintenance and repair activities of the equipment. By doing so, they are providing ________. A) payment equity B) value-augmenting services C) differential pricing D) facilitating services E) a primary service package Answer: D Rationale: By providing installation, training, maintenance, and repair services along with their expensive equipment, manufacturers are offering facilitating services. These services help facilitate the effective use and maintenance of the equipment, enhancing its overall value to the customer. 72. When Johnson Controls reached beyond its climate control equipment and components business to manage integrated facilities by offering products and services that optimize energy use, it was said to be providing ________. A) facilitating services B) a primary service package C) value-augmenting services D) service contracts E) service warranties Answer: C Rationale: Johnson Controls' expansion into managing integrated facilities and offering services to optimize energy use represents value-augmenting services. These services go beyond the core product offerings to enhance the overall value proposition for customers. 73. When sellers agree to provide free maintenance and repair services for a specified period of time at a specified contract price, they are offering ________. A) a complementary service B) payment equity C) a service blueprint D) differential pricing E) an extended warranty Answer: E Rationale: Offering free maintenance and repair services for a specified period of time at a specified contract price constitutes an extended warranty. This type of warranty provides additional value to customers by ensuring their equipment or product is maintained and repaired without extra cost during the warranty period. 74. The private non-profit sector is a provider of services. Answer: True Rationale: Non-profit organizations often provide various services to their communities, such as education, healthcare, social services, and humanitarian aid. 75. A service is essentially intangible. Answer: True Rationale: Services are intangible in nature, meaning they cannot be touched, felt, or seen before they are experienced. Examples include healthcare, education, and banking. 76. A service results in ownership on the part of the client. Answer: False Rationale: Unlike goods, which result in ownership transferring to the buyer, services typically do not result in ownership. Instead, clients pay for the benefits or experiences provided by the service. 77. The production of a service is never tied to a physical product. Answer: False Rationale: While many services do not involve physical products, some services do require physical products in their production process. For example, a haircut service requires scissors, a barber chair, and other physical tools. 78. Soap is an example of a pure tangible good. Answer: True Rationale: Soap is a physical, tangible product that can be touched and seen. It does not involve the provision of any accompanying services. 79. Salt is an example of a hybrid. Answer: False Rationale: Salt is a tangible good and does not involve the provision of services. Therefore, it is not an example of a hybrid. 80. A hybrid consists of unequal parts of goods and services, with services being in the majority. Answer: False Rationale: A hybrid product consists of both goods and services, but there is no requirement for services to be in the majority. The proportion of goods and services can vary depending on the specific product. 81. A pure service requires a capital-intensive good, but the primary item is a service. Answer: False Rationale: A pure service does not require any accompanying physical product. It is entirely intangible and involves the provision of expertise, experiences, or performances without the transfer of ownership of any tangible goods. 82. All services require the client to be present. Answer: False Rationale: While some services may require the client's presence, many services can be provided remotely or without the client being physically present. Examples include online education, consulting services, and telemedicine. 83. The search qualities of a service are the characteristics the buyer can evaluate before purchase. Answer: True Rationale: Search qualities refer to the attributes of a product or service that buyers can assess before making a purchase decision. In the case of services, examples of search qualities include price, location, and reputation. 84. Credence qualities of a service are difficult to evaluate before purchase, but easy to evaluate after consumption. Answer: False Rationale: Credence qualities of a service are characteristics that are difficult for consumers to evaluate even after consumption. These qualities often relate to aspects such as safety, effectiveness, or trustworthiness, which may require specialized knowledge or experience to assess accurately. 85. The experience qualities of a good or service can be evaluated after purchase. Answer: True Rationale: Experience qualities refer to aspects of a product or service that can only be assessed after purchase or during consumption. Examples include taste, comfort, and enjoyment, which can only be evaluated through firsthand experience. 86. Furniture is high in credence qualities. Answer: False Rationale: Furniture typically has low credence qualities, as aspects such as durability, safety, and material quality can often be evaluated before purchase or through warranties and certifications. 87. While goods meet personal needs, services meet business needs. Answer: False Rationale: Both goods and services can meet both personal and business needs. Goods are tangible products that can fulfill various personal or business requirements, while services provide intangible benefits that can also cater to personal or business needs. 88. Services have five distinctive characteristics, one of these being "pure service." Answer: False Rationale: Services have four distinctive characteristics: intangibility, inseparability, variability, and perishability. "Pure service" is not one of these characteristics. 89. Intangibility with regards to a service means that the service cannot be duplicated across providers. Answer: False Rationale: Intangibility refers to the inability to touch or physically experience a service before it is consumed. It does not necessarily mean that the service cannot be duplicated by other providers, as services can be replicated or imitated to varying degrees. 90. Service companies try to demonstrate their service qualities through physical evidence and presentation. Answer: True Rationale: Since services are intangible, service companies often rely on physical evidence, such as facilities, equipment, and employee appearance, to convey the quality of their services to customers. 91. Inseparability in the context of a service means that there is a provider-client interaction involved as the provider is part of the service. Answer: True Rationale: Inseparability refers to the idea that the production and consumption of services often occur simultaneously and that the service provider is often part of the service experience, interacting directly with the customer. 92. A service provider can work with larger groups to get around the limitations of inseparability. Answer: True Rationale: Service providers can mitigate the limitations of inseparability by serving larger groups of customers simultaneously or by implementing technologies that facilitate remote service delivery, reducing the need for face-to-face interactions. 93. The quality of services is independent of who provides them. Answer: False Rationale: The quality of services can vary significantly depending on factors such as the skills, training, attitude, and experience of the service provider. Different providers may deliver the same service with varying levels of quality. 94. Customers want unbundled services, with separate prices for each service element and the right to select the elements they want. Answer: True Rationale: Many customers prefer unbundled services as it allows them to select and pay for only the specific service elements they need or desire, rather than paying for a bundled package that includes unnecessary components. 95. External marketing describes the training and motivation required by employees in order to properly serve the customers. Answer: False Rationale: External marketing refers to activities aimed at promoting a company's products or services to customers outside the organization. Training and motivation of employees to serve customers effectively would typically fall under internal marketing or human resource management. 96. Interactive marketing describes the employees' skill in serving the client. Answer: True Rationale: Interactive marketing focuses on the interaction between the service provider and the customer, emphasizing the importance of effective communication, responsiveness, and personalized service delivery, all of which are skills essential for serving clients effectively. 97. Clients judge service not only by its technical quality but also by its functional quality. Answer: True Rationale: Clients evaluate services based not only on their technical aspects, such as accuracy and reliability but also on their functional aspects, such as convenience, responsiveness, and empathy displayed by the service provider. 98. Importance-performance analysis rates the various elements of the service bundle and identifies required actions. Answer: True Rationale: Importance-performance analysis assesses the importance of different elements of a service and compares it to the performance of those elements, identifying areas where improvements are needed to meet customer expectations. 99. Customers who view a service as fairly homogeneous care less about the provider than about the price. Answer: True Rationale: When customers perceive a service as fairly homogeneous or similar across providers, they may prioritize price over the provider, as they believe that the service quality will not vary significantly between providers. 100. What the customer expects from a service is called the primary service package. Answer: True Rationale: The primary service package refers to what customers expect to receive when purchasing a particular service. It includes the core benefits or features that fulfill the customer's needs or wants. 101. Secondary service features are the features that the customer himself adds to the service. Answer: False Rationale: Secondary service features are additional enhancements or extras provided by the service provider beyond the core service offering. Customers do not add these features themselves but may value them as part of the overall service experience. 102. Pricing has no negative effect on customer loyalty. Answer: False Rationale: Pricing can have a significant impact on customer loyalty. Customers may switch to competitors if they perceive better value or lower prices elsewhere, making pricing strategies crucial for maintaining customer loyalty. 103. If the expected service falls below the perceived service, customers are disappointed. Answer: False Rationale: If the perceived service falls below the expected service, customers are disappointed. Expectations are formed based on factors such as past experiences, word of mouth, and marketing communications, and when the actual service experience fails to meet these expectations, customers may feel disappointed. 104. Responsiveness is a company's willingness to help customers and provide prompt service. Answer: True Rationale: Responsiveness refers to a company's ability and willingness to provide prompt assistance and service to customers, addressing their needs and concerns in a timely manner. 105. Reliability refers to the company's willingness to help customers and provide them with prompt service. Answer: False Rationale: Reliability refers to a company's ability to deliver its services consistently and dependably, meeting or exceeding customer expectations every time. It does not specifically refer to the company's willingness to help customers or provide prompt service, which is more closely associated with responsiveness. 106. The appearance of physical facilities, equipment, personnel, and communication materials are the tangibles that convey service quality to consumers. Answer: True Rationale: Tangibles such as the appearance of physical facilities, equipment, personnel, and communication materials play a crucial role in shaping customers' perceptions of service quality. They serve as tangible cues that customers use to evaluate the overall quality of the service being provided. 107. The zone of tolerance for a service is the perceived economic benefits in relationship to the economic costs. Answer: False Rationale: The zone of tolerance refers to the range of acceptable service quality levels that customers are willing to tolerate. It is not directly related to perceived economic benefits and costs but rather to the variability in service quality that customers find acceptable. 108. The payment equity for a service is a range from the minimum level of service consumers are willing to accept to the level they believe can and should be delivered. Answer: False Rationale: Payment equity refers to customers' perceptions of the fairness of the price they pay for a service in relation to the value they receive. It does not specifically relate to the range of service quality levels consumers are willing to accept. 109. A customer-service interface is defined as any place at which a company seeks to manage a relationship with a customer. Answer: True Rationale: A customer-service interface refers to any point of contact or interaction between a company and its customers, where the company seeks to manage and maintain a relationship with the customer. This can include physical locations, websites, call centers, social media platforms, etc. 110. If the length of the downtime increases, the cost incurred decreases. Answer: False Rationale: Typically, if the length of downtime increases, the cost incurred also increases. Downtime often leads to lost productivity, missed opportunities, and potential damage to reputation, all of which can result in higher costs for the company. 111. A product's purchase cost plus the discounted cost of maintenance and repair less the discounted salvage value is known as the product's activity cost. Answer: False Rationale: The described formula represents the calculation of the total cost of ownership (TCO) of a product, not the product's activity cost. The TCO includes the initial purchase cost, ongoing maintenance and repair costs, and any salvage value at the end of the product's life. 112. Out-of-pocket costs are what the customer spends on regular maintenance and repair costs. Answer: True Rationale: Out-of-pocket costs refer to the expenses that customers incur directly from their own pockets, such as regular maintenance and repair costs, rather than costs covered by insurance or warranties. 113. Value-augmenting services include installation, staff training, maintenance and repair services, and financing. Answer: False Rationale: Value-augmenting services refer to additional services provided by a company to enhance the value of its core product or service. Examples may include warranties, customization options, or after-sales support. The mentioned services like installation, staff training, maintenance, and repair are considered core or support services rather than value-augmenting services. 114. List and briefly explain with examples the five categories of service offerings. Answer: The five categories of service offerings are: a. Pure tangible goods: These are tangible goods with no accompanying services. For example, soap or toothpaste. b. Tangible good with accompanying services: The tangible good is accompanied by one or more services. Typically, the more technologically advanced the product, the greater the need for high-quality supporting services. For instance, car or computer. c. Hybrid: It is an offering of equal parts goods and services. For example, a meal in a restaurant. d. Major service with accompanying minor goods and services: This offering requires a capital-intensive good, but the primary item is a service. For instance, an air travel that is accompanied by snacks and drinks. e. Pure service: This refers primarily to an intangible service. For example, psychotherapy or massage. 115. List and briefly explain the four distinctive characteristics of services. Answer: The four distinctive service characteristics that greatly affect the design of marketing programs are: a. Intangibility: Services cannot be seen, tasted, felt, heard, or smelled before they are bought. To reduce uncertainty, buyers will look for evidence of quality by drawing inferences from the place, people, equipment, communication material, symbols, and price. b. Inseparability: Services are typically produced and consumed simultaneously. Both the provider and the client are a part of the service. c. Variability: Because services depend on who provides them and when and where, and to whom, services are highly variable. Service buyers are aware of this variability and often talk to others before selecting a service provider. d. Perishability: Services cannot be stored, so their perishability can be a problem when demand fluctuates. That is why public transportation companies must own much more equipment because of rush-hour demand than if demand were even throughout the day. 116. List three steps that service firms can take to increase quality control over services and reduce variability. Answer: Three steps that service firms can take to increase quality control and reduce variability in services are: a. Invest in good hiring and training procedures: Recruiting the right employees and providing them with excellent training is crucial, regardless of whether employees are highly skilled professionals or low-skilled workers. Better-trained personnel exhibit six characteristics: competence, courtesy, credibility, reliability, responsiveness, and communication. b. Standardize the service-performance process throughout the organization: A service blueprint maps out the service process, the points of customer contact, and the evidence of service from the customer's point of view. c. Monitor customer satisfaction: Service firms can employ suggestion and complaint systems, customer surveys, and comparison shopping. Customer needs vary in different areas. This allows firms to develop region-specific customer satisfaction programs. Firms can also develop customer information databases and systems for more personalized service, especially online. 117. Several strategies exist for managing the supply and demand of services. List the strategies for managing each and give an example of each strategy. Answer: Several strategies can produce a better match between service demand and supply. On the demand side, these strategies include the following: a. Differential pricing: This will shift some demand from peak to off-peak periods. For example, low matinee movie prices and weekend discounts for car rentals. b. Nonpeak demand: This can be cultivated. For instance, McDonald's pushes its breakfast service, and hotels promote minivacation weekends. c. Complementary services: These can provide alternatives to waiting customers. For example, cocktail lounges in restaurants and automated teller machines in banks. d. Reservation systems: These are one of the many ways to manage the demand level. For instance, airlines, hotels, and physicians employ them extensively. On the supply side, these strategies include the following: a. Part-time employees: They can serve peak demand. For example, colleges add part-time teachers when enrollment goes up and stores hire extra clerks during holiday periods. b. Peak-time efficiency: These routines can allow employees to perform only essential tasks during peak periods. For instance, paramedics assist physicians during busy periods. c. Increased consumer participation: This frees service providers' time. For example consumers can fill out their own medical records or bag their own groceries. d. Shared services: These can improve offerings. For instance, several hospitals can share medical-equipment purchases. e. Facilities for future expansion: This can be a good investment. For example, an amusement park can buy surrounding land for later development. 118. Define customer failures and list four methods to tackle them. Answer: Customer failures refer to situations where service problems arise from a customer's lack of understanding or ineptitude. Some of the methods to solve such situations include the following: a. Redesigning processes and redefining customer roles to simplify service encounters b. Incorporating the right technology to aid employees and customers c. Creating high-performance customers by enhancing their role clarity, motivation, and ability d. Encouraging "customer citizenship" so that customers help customers 119. Marketing excellence with services requires excellence in three broad areas. List and explain the three areas. Answer: The three areas in which services require excellence are: a. External marketing: This describes the normal work of preparing, pricing, distributing, and promoting the service to customers. b. Internal marketing: This describes training and motivating employees to serve customers well. c. Interactive marketing: This describes the employees' skill in serving the client. Clients judge service not only by its technical quality but also by its functional quality. 120. List the eight different variables that influence service outcome and customer loyalty. Answer: The eight major variables that influence service outcome and customer loyalty are: a. Pricing: High price, price increases, unfair pricing, or deceptive pricing prompt customers to change their loyalty. b. Inconvenience: If a customer is made to wait for his appointment or service, there is a chance that he will think of shifting his loyalty. c. Core service failure: Service failures, billing errors, or service catastrophe influence service outcome and customer loyalty. d. Service encounter failures: If the customer service representative is uncaring, impolite, unresponsive, or unknowledgeable, the service outcome and customer loyalty is influenced. e. Response to service failure: If the customer service representative exhibits negative response or reluctant response or no response at all, the customer's loyalty is likely to shift. f. Competition: A customer's loyalty changes if he finds a better service. g. Ethical problems: If a customer thinks that the service provider is a cheat or his services are unsafe, then he starts looking for another service provider. h. Involuntary switching: If the customer has to shift his base or the service provider has to close down, the customer's loyalty undergo an involuntary shifting. 121. The service-quality model highlights the main requirements for delivering high service quality. Which are the five gaps that cause unsuccessful delivery? Answer: The five gaps that cause unsuccessful customer service delivery are as follows: a. The gap between consumer expectation and management perception: The management does not always correctly perceive what customers want. b. The gap between management perception and service-quality specification: The management might correctly perceive customers' wants but not set a performance standard. c. The gap between service-quality specifications and service delivery: The employees might be poorly trained, or incapable of or unwilling to meet the standard, or they may be held to conflicting standards, such as taking time to listen to customers and serving them fast. d. The gap between service delivery and external communications: The consumers' expectations are affected by statements made by company representatives and ads. e. The gap between perceived service and expected service: This gap occurs when the consumer misperceives the service quality. 122. Based on the service-quality model, researchers have identified five determinants of service quality. List and briefly explain each. Answer: The five determinants of service quality are: a. Reliability: It is the ability to perform the promised service dependably and accurately. b. Responsiveness: It refers to the willingness to help customers and to provide prompt service. c. Assurance: It is the knowledge and courtesy of employees and their ability to convey trust and confidence. d. Empathy: It refers to the provision of caring, individualized attention to customers. e. Tangibles: It is the appearance of physical facilities, equipment, personnel, and communication materials. 123. Traditionally, customers have had three specific worries about product service. What are they? Answer: Manufacturers of equipment—small appliances, office machines, tractors, mainframes, airplanes—all must provide product-support services. The three specific worries about product services that customers face are: a. They worry about reliability and failure frequency. For example, a farmer may tolerate a combine that will break down once a year, but not two or three times a year. b. They worry about downtime. The longer the downtime, the higher the cost. The customer counts on the seller's service dependability which refers to the seller's ability to fix the machine quickly or at least provide a loaner. c. They worry about out-of-pocket costs, which refers to the amount they have to spend on regular maintenance and repair costs. 124. There are five categories of service offerings depending upon whether or not the service component is minor or major. In which of the five categories would you place a haircut? Answer: A hair salon would be considered a pure service because the service provided by a hair salon is primarily intangible in nature. 125. Give an example of a pure service provided by a company. Answer: Examples of a pure service include babysitting, psychotherapy, career counselling, or a massage. 126. Bryson's is a mid-sized hotel chain that is entering a competitive market. The chain needs to differentiate its service from that of competitors, positioning itself as a hotel with excellent service at an affordable price. However, the intangible nature of services makes this difficult to demonstrate. How can Bryson's convey its message effectively to prospective guests using marketing tool of place? Answer: Bryson's should try to demonstrate its service quality through physical evidence and presentation. Bryson's can use 'place', i.e., the hotels themselves, by designing the hotels to reflect its desired attributes. The hotel design should not be too ornate or fancy, but not too basic either. 127. In developing a service blueprint, The Flower Shop has outlined each step in the delivery process of the service it provides. Which characteristic of services is The Flower Shop attempting to minimize? Answer: By developing a service blueprint, Beth's Inc. is making an attempt to reduce the variability of the service. Because the quality of services depends on who provides them, when and where, and to whom, services are highly variable. A service blueprint will standardize the entire service process. 128. Fingerpainted organizes art camps and craft activities for children. The company has noticed that demand is highest during summer vacations and drops during the year. What can Fingerpainted do to attract customers at other times of year? Answer: Fingerpainted can use differential pricing to shift some demand from peak to nonpeak periods, pricing courses outside vacations lower than vacation courses. It can try to generate non-peak demand by introducing specialized courses for weekends or a few evenings a week. 129. Debbie's is a specialty bakery that sees a huge volume of orders during the holiday season. The owner knows that orders triple during the three-month period and the current staff cannot handle the volume. What supply strategy can Debbie's use to handle the demand? Answer: Debbie's can employ people on contract just for the holiday season to help the company cope with the spike in demand. 130. Bryson's is a mid-sized hotel chain that is entering a competitive market. The chain needs to differentiate its service from that of competitors, positioning itself as a hotel chain with excellent service at an affordable price. How can it achieve this using internal marketing? Answer: Internal marketing describes training and motivating employees to serve customers well. Employees must be trained to provide the required service quality, as well as motivated to achieve that level. Bryson's can use incentives for the best performers in order to encourage this. 131. When Hayley had some problems with the applications on her cell phone, she gave her cell phone to the service center for a software update. The service center returned the phone to Hayley the next day, with the software update complete. Two days later, the service center called Hayley to enquire if the phone was functioning well. Which area of services marketing does this incident illustrate? Why is this important? Answer: This situation illustrates interactive marketing, which deals with the employees' skill in serving the client. This is important because clients judge a service not only by its technical quality (how successful it was) but also by its functional quality (the attitude of the employees performing the service. 132. Some WesternSlope Cleaning customers have long-term contracts for full-service cleaning, while others call the company as and when they require a particular service. The long-term customers have their queries handled by the company's customer service representative. The rest of its customers are directed towards voice messages when they want their inquiries to be processed. What strategy is the company adopting to achieve marketing excellence? Answer: The company is trying to differentiate its high-profit tier customers from its lowprofit tier customers. 133. Retail chain REB wants to find out how its customers perceive its services and what it can do to improve these. What methods can the company use to discover this? Answer: REB can audit service performance, both their own and competitors', on a regular basis. It can collect voice of the customer (VOC) measurements to probe customer satisfiers and dissatisfiers. It can use comparison shopping, mystery or ghost shopping, customer surveys, suggestion and complaint forms, and service-audit teams to find out customer reactions to the company. 134. Clearwater Spa operates on the premise that service quality is the main reason that customers come to the spa, and the attendants are trained to provide excellent service. Despite this, the spa rarely has repeat customers. Clearwater began collecting feedback from customers to find out the reason for this. The management realized that although the customers were happy about the services they did not like the ambience. What kind of a gap is causing the unsuccessful service delivery in this situation? Answer: In this situation, there is a gap between the consumers' expectations and the managements' perception. Management does not always correctly perceive what customers want. The spa management believes that customers want service quality, when the ambience is the real customer demand. 135. The manager of a computer service center knows that quick service is the top priority for customers. Accordingly, the employees are encouraged to solve customer difficulties fast, but there is no set time period for service delivery. Which gap could cause unsuccessful service delivery in this situation? Answer: In this situation, there exists a gap between the management perception and the service-quality specification. Although, the management has correctly perceived the customers' want, it has not set a specific performance standard for employees. 136. In the customer support center where Carl works, employees are taught to make conversation to put customers at their ease. As customers don't like being kept waiting, they must also try to minimize the time that customers spend waiting for service. Thus, when there are a number of customers lined up, Carl usually has to decide whether to answer a customer's questions in detail or move on quickly to the next customer. The firm's standards are not clear on how they want him to perform. When asked, his boss answers, "You make the decision." This is an example of which service-quality gap? Answer: This is an example of a gap between the service-quality specifications and service delivery. Employees are held to conflicting standards, having to decide between taking time to listen to customers and serving them fast. 137. The advertisement for a pool reads "a vinyl pool from Parker's for just $5000." When David contacted the firm for the pool, the customer service representative tells David that the total cost will be $8000. When David enquires about the extra $3000, the customer service representative says that is for installation. Which service-quality gap does this situation demonstrate? Answer: This is an example of a gap between service delivery and external communications. Consumer expectations are affected by statements made by company representatives and ads. Here, the ad promised a pool for one price, but the actual price is much higher than the consumer is led to expect. 138. The last time Betty visited Zing's, the dinner served was excellent. Tonight is her anniversary and she was looking forward to an enjoyable evening. After the meal, she starts feeling that the service was not up to par and the evening was not as successful as she had hoped. According to the service-quality model, which gap is obvious here? Answer: The gap prevalent here is the gap between perceived service and expected service. This gap occurs when the customer misperceives the service quality. 139. A cosmetics store sees to it that customers who walk in are assisted by store personnel. These personnel are trained to ask customers questions, find out what they want, and make suggestions accordingly. Which of the five determinants of service quality is reflected here? Answer: The determinant of service quality that is reflected here is the empathy. The outlet not only cares about its customers, but also gives them individualized attention. 140. Josh travels often on business trips. He usually uses the services of the Sunshine Cab Company to take him to the airport and pick him up from the airport. Though the fares are usually higher than those of other private taxi companies, he prefers to use Sunshine cabs because they're always on time and have well-maintained cabs. Which determinant of service quality does this demonstrate? Answer: This demonstrates the determinant of reliability, which is the ability to perform the promised service dependably and accurately. 141. Package delivery company UPS uses distinctive brown trucks that have become almost an icon. Explain why such physical facilities are important for UPS while it provides package delivery services. Answer: Services are intangible. But when they are given a tangibility by using physical facilities, equipment, personnel, or communication material, customers find it easier to determine the service quality and distinguish the services of one firm from that of its competitor. Thus, UPS's trucks help the company differentiate its services from its competitors'. 142. An oil drilling company ordered a number of pumpjacks for its operations. The pumpjack is an essential part of its operations and the company needs the equipment to be operational at all times. How can the pumpjack manufacturer demonstrate its service dependability? Answer: The manufacturer can demonstrate its dependability by being prompt to repair the equipment when it fails, and providing replacements when the repairs will take a long time. 143. An oil drilling company ordered a pumpjack for its operations. The pumpjack manufacturing company not only set up the machine but also provided training to the people who needed to use it. It also let the drilling company know that it would be undertaking the maintenance and repair services for the pumpjack. What kind of a service is the manufacturing company providing? Answer: The manufacturing company is said to be providing facilitating services. Test Bank for Marketing Management Philip T Kotler, Kevin Lane Keller 9780132102926, 9780273753360, 9781292092621, 9780133856460, 9789332587403, 9780136009986
