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REC 101 (45)
Lecture 5

Lecture 5 - Profit and building customer loyalty.docx

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Recreation and Leisure Studies
REC 101
Katie Misner

Lecture 5 – Profit and building customer loyalty Main point The relationship between frontline workers and customers’ needs to be the centre of management concern Customer overlaps the frontline worker Dimensions of service Quality  Tangibles – Appearance of equipment, facilities, and personnel  Reliability – Ability to perform the promised service dependably and accurately.  Responsiveness – Willingness to help customers and provide prompt service.  Assurance – Knowledge and courtesy of employees and their ability to convey trust and confidence.  Empathy – Caring, individualized attention the agency provides its patrons. Quality Indicators  Content – Are standard and accepted procedures being followed?  Process – Is the sequence of events in the service process appropriate?  Structure – Are the physical facilities and organizational design adequate for the service?  Outcome – What change in status has the service affected?  Impact – What is the long range effect of the service on the customer? Service Profit Chain 1. Customer loyalty drives profitability and growth  Customer loyalty is an important determinant of profit  A 5% increase in your customer loyalty can produce profit increases from 25% to 85%  Loyal customer provides all profits and covers losses incurred in dealing with less loyal customers. Three R’s:
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