Service Marketing Essay Example | Topics and Well Written Essays - 2000 words

Service Marketing - Essay Example Hart (1990) stated that recruiting a new customer costs five times than to keep current customers happy and content. This statement holds great value in every sense as organizations often try hard to keep customers happy by offering great services. At the same time, organizations have service recovery tools that help in gaining customers loyalty and trust back. Service recovery tools often help in enhancing customer’s retention by properly responding to service failures. The assignment aims at highlighting the impact of service failure on the business along with developing a service recovery model based on understanding and empowering customers. The organization chosen for this purpose is Tiger Airways Australia based in Melbourne, Victoria. In the past, Tiger Airways has received a number of complaints ineffective customer care service, flight delays and improper handling of grievances. This can be considered as a serious service failure offering a reason to be dissatisfied a nd frustrated with the services being offered. The analysis would help in understanding and analyzing the ways through which service failure can be addressed using service recovery tools in an effective and efficient manner helping the organization to win customer’s trust and loyalty back. An Overview of the Organization Tiger Airways Australia is a low cost airlines based in Melbourne, Australia. It started its operations in the year 2007 with strong focus on domestic markets. The organization has been performing well but not that well to compete with other competitors because of serious problems pertaining to the services being offered. As per the Bureau of infrastructure, Transport and Regional Economics in Australia, Tiger Airways have consistently lower percentage of on-time arrival and departure with high percentage of cancellations. Tiger Airways also used marketing strategies to boost its sales figures and presence across the country through an advertisement campaign named â€Å"The Low Fare Revolution†. Tiger Airways have been hit by a number of criticisms pertaining to its services and can be considered as an ideal organization to analyze the concepts of service failure and recovery. Concept of Service Failure When organizations offer services to customers, the only motive is to make them feel good and content with the offered services. Customers also have pre-conceived and experienced notions on services and when these notions do not match with the services being offered; it is termed as a service failure. Service failure often frustrates customers along with making them change the service provider. It creates negative a negative impact on the business activities along with offering an edge to customers. It needs to be mentioned that service failure is bound to happen and organizations are supposed to be good enough to tackle service failures. Tiger Airways have been accused of poor customer service and high rate of cancellation. Furth er, the support and guidance from the management is almost negligible that has reduced the satisfaction level of customers. The service recovery tools that could have been of great help in dealing with service failures have been discussed in the following part in an analytical manner. Service Recovery and its Importance