A service is any activity or benefit that one party can offer to another that is essentially intangible and does not result in the ownership of anything.
Services do not always emerge out of physical products. When somebody rents a hotel room, deposits money in a bank, travels on an airplane, visits a physician, gets a haircut, gets a car repaired, watches a professional sport, watches a movie, and gets advice from a lawyer, he/she buys a service.
When designing marketing programs, a company must consider the characteristics of services.
Four characteristics of service are;
- intangibility,
- inseparability,
- variability and
- perishability.
Let’s discuss the 4 characteristics of the service.
Intangibility – Services Cannot Be Felt Before Buying.
Services are intangible in nature. It means that services can not be seen, tasted, felt, heard, or smelled before they are bought.
For example, an airline passenger has only a ticket and the promise of a safe and comfortable journey.
As the buyers are interested in service quality, the service provider must add tangible dimensions. The place, price, equipment, and communication material must indicate the service quality as claimed by the service provider.
Consider a bank that wants to convey the idea that its service is quick and efficient. It must make this positioning strategy tangible in every aspect of customer contact.
The bank’s physical setting must suggest quick and efficient service: Its exterior and interior should have clear lines; internal traffic flow should be planned carefully; waiting for lines should seem short at teller windows and ATMs, and background music should be light and upbeat. The bank’s staff should be busy and properly dressed.
The equipment – computers, copy machines, desks – should look modern. The bank’s ads and other communications should suggest efficiency, with clean and simple designs and carefully chosen words and photos that communicate the bank’s positioning.
The bank should choose a name and symbol for its service that suggest speed and efficiency. It is pricing for various services should be kept simple and clear.
Inseparability – Services Are Generated and Consumed Together.
Inseparability is a major characteristic of services. It means that services are generated and consumed simultaneously and can not be separated from their providers, whether they are people or machines.
As the customer remains present as the service is produced, provider customer interaction is important in services marketing. The result of services is affected by both the provider and the customer.
Variability – Service Quality Never Stay The Same.
Variability is another important characteristic of services, which means that their quality may vary greatly, depending on who provides them and when, where, and how they are provided.
For example, the Sheraton hotel has a reputation for providing better service than others.
One employee may be cheerful and efficient within a particular Sheraton hotel, while another may be unpleasant and slower. Even the quality of a single Sheraton employee’s service varies according to his or her energy and the state of mind at the time of each customer dealing.
Service variability can be managed in several ways. Employees can be selected and trained carefully to provide good service. Employee incentives can be introduced that emphasize service quality. Customer satisfaction can be checked regularly through suggestion and complaint systems, customer surveys, and comparison shopping.
Perishability – Services Cannot Be Stored.
Services are perishable, which means that services can not be stored for later sale or use. A ticket for the evening show of a movie can not be used for watching the night show.
The perishability of services has important implications for service providers. In the case of steady demand, perishability is not a problem.
But where demand fluctuates, service providers face adjustment problems.
For example, public transportation companies have to own much more equipment then they would as demand is not ever throughout the day.
Service providers can several steps to make better demand-supply adjustments.
Different prices can be charged at different times on the demand side, which will shift some demand from peak periods to off-peak periods. On the supply side, part-time employees can be hired to cater to peak demand.
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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.
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Which of the following is an example of a pure tangible good?A) massageB) shampooC) e-mailD) restaurant mealE) air travel
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To which of the following categories of services does a cell phone belong?A) major service with accompanying minor servicesB) major service with accompanying minor goodsC) pure serviceD) pure tangible goodE) tangible good with accompanying services
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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 goodsE) pure service
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Which of the following is an example of a hybrid service? A) teachingB) carC) restaurant meal D) soap E) air travel
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A flight with complementary drinks is an example of a ________. A) major service with accompanying minor goods and servicesB) pure serviceC) pure tangible goodD) tangible good with accompanying servicesE) hybrid
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Which of the following is an example of a pure service?A) air travel B) psychotherapyC) baby oilD) a laptopE) a restaurant meal
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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.
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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 polishingC) surgeryD) car repairing E) tax services
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Services high in ________ have characteristics that the buyers can evaluate before purchase. A) search qualitiesB) experience qualitiesC) credence qualitiesD) privacy qualitiesE) storing qualities
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Services high in ________ qualities have characteristics that the buyer can evaluate after purchase. A) privacyB) experience C) credenceD) searchE) stock
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Services high in ________ are those services that have characteristics the buyer normally finds hard to evaluate even after consumption. A) trial qualitiesB) search qualitiesC) experience qualities D) privacy qualitiesE) credence qualities
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Which one of the following would be considered high in credence qualities? A) an interior of a houseB) a restaurant C) a haircut D) psychotherapyE) a computer
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Which one of the following is highest in search qualities? A) a play at a theaterB) a meal at a restaurant C) a haircut D) psychotherapyE) a computer
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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) inseparabilityB) intangibilityC) variability D) perishability E) heterogeneity
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A brand that is action-oriented and causes consumers to engage in physical actions appeals to the ________ dimension of brand experience.A) sensoryB) affectiveC) behavioralD) intellectualE) social
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A brand that is action-oriented and causes consumers to engage in physical actions appeals to the ________ dimension of brand experience.A) sensoryB) affectiveC) behavioralD) intellectualE) social
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BRZ Shoes targets the youth market with vibrant, visually appealing ads in modern styles. BRZ ads appeal to the ________ dimension of brand experience.A) sensoryB) affectiveC) behavioralD) intellectualE) social
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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) sensoryB) affectiveC) behavioralD) intellectualE) social
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________ 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 engagementB) Brand orientationC) Brand elementsD) Brand loyaltyE) Brand equity
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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.
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The fact that services are typically produced and consumed simultaneously is known as the ________ aspect of services.A) perishabilityB) intangibilityC) heterogeneityD) inseparabilityE) variability
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Service quality depends on who provides them, when and where, and to whom. Thus, services are highly ________.A) inseparableB) tangibleC) variableD) perishableE) intangible
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Which of the following will help a service provider overcome the limits imposed by the inseparability of services?A) using differential pricingB) working with larger customer groupsC) providing complementary servicesD) concentrating on physical evidence and presentation E) standardizing the service process
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Which of the following steps will help service firms to increase their quality control?A) standardizing the service-performance processB) providing complementary services to customersC) giving personnel authority in handling situationsD) adopting differential pricingE) cultivating nonpeak demand
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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 planB) service floor planC) Gantt chartD) business planE) service blueprint
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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) variabilityB) heterogeneity C) perishability D) intangibility E) homogeneity
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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.
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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.
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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.
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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.
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Cocktail lounges in restaurants are examples of ________.A) differential pricingB) cultivating nonpeak demandC) complementary servicesD) reservation systemsE) shared services
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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.
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Walmart has decided to hire extra clerks during the holiday season. It is said to be ________.A) matching its supply with the existing demandB) generating non-peak demandC) increasing its customer participationD) sharing its servicesE) facilitating for its future expansion
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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 efficiencyB) creating nonpeak demandC) increasing consumer participationD) sharing its servicesE) facilitating its future expansions
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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 servicesB) perishable servicesC) variable servicesD) unbundled servicesE) shared services
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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 packagesB) redesigning processes to simplify service encountersC) using differential pricing and shared servicesD) minimizing service intangibilityE) working with more customers at the same time
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________ refers to the normal work of preparing, pricing, distributing, and promoting the service to customers.A) Interactive marketingB) Internal marketingC) External marketingD) Promotional marketingE) Direct marketing
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________ refers to training and motivating employees to serve customers well.A) External marketingB) Promotional marketingC) Direct marketingD) Internal marketingE) Interactive marketing
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________ describes the employees' skill in serving the client.A) External marketingB) Internal marketingC) Promotional marketingD) Direct marketingE) Interactive marketing
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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 marketingB) functional qualityC) technical qualityD) search qualitiesE) external marketing
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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.
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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.
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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 convenienceB) profit tiers C) psychographic characteristics D) social influence E) customer preference
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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 customersC) retain the patronage of profitable customers D) increase consumer participation E) standardize the service-performance process
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The ________ rates the various elements of the service bundle and identifies required actions.A) company performance analysisB) voice of customer measurementC) customer factor measurementD) importance-performance analysisE) customer importance analysis
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Customers who view a service as homogeneous ________.A) only patronize a preferred service providerB) judge services on the basis of the providersC) care less about the provider than about the priceD) pick a service provider based on functional attributesE) opt for the service with the highest price, irrespective of quality
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Belling Hotels provides complimentary breakfast buffets to all its guests. This is an example of a ________.A) primary service packageB) service interfaceC) service supportD) service frequencyE) secondary service feature
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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
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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
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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
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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
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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.
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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
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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
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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.
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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 deliveryB) gap between perceived service and expected service C) gap between service delivery and external communications D) gap between consumer expectation and management perceptionE) gap between management perception and service-quality specification
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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
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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
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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) responsivenessB) assuranceC) empathyD) reliabilityE) tangibility
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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) empathyE) tangibles
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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) conscientiousB) assuranceC) empathyD) reliabilityE) responsiveness
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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) assuringB) candidC) empatheticD) reliableE) responsive
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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
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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) immunityB) tolerance C) reliabilityD) assuranceE) flexibility
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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 qualityB) increasing customer expectations of what the firm will deliver decrease the perceptions of overall service qualityC) decreasing customer expectations of what the firm should deliver decrease the perceptions of overall service qualityD) decreasing customer expectations of what the firm will deliver improve the perceptions of overall service qualityE) increasing customer expectations of what the firm should deliver improve the perceptions of overall service quality
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When customers calculate the perceived economic benefits of a continuously provided service in relationship to the economic costs, they are gauging the ________.A) private equityB) brand equityC) payment equityD) customer-service equityE) product-service equity
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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 interfaceB) product-customer interfaceC) tangible user interfaceD) attentive user interfaceE) crossing-based interface
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Regular maintenance and repair costs are known as ________.A) service contract costsB) out-of-pocket costsC) fixed costsD) facilitating services costsE) value-augmentation costs
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The product's purchase cost plus the discounted cost of maintenance and repair less the discounted salvage value gives the ________.A) service warranty costB) out-of-pocket costC) life-cycle costD) facilitating services costE) value-augmentation cost
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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 equityB) value-augmenting servicesC) differential pricingD) facilitating services E) a primary service package
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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 servicesB) a primary service packageC) value-augmenting servicesD) service contractsE) service warranties
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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 serviceB) payment equityC) a service blueprintD) differential pricingE) an extended warranty
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The private non-profit sector is a provider of services.
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A service is essentially intangible.
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A service results in ownership on the part of the client.
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The production of a service is never tied to a physical product.
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Soap is an example of a pure tangible good.
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Salt is an example of a hybrid.
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A hybrid consists of unequal parts of goods and services, with services being in the majority.
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A pure service requires a capital-intensive good, but the primary item is a service.
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All services require the client to be present.
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The search qualities of a service are the characteristics the buyer can evaluate before purchase.
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Credence qualities of a service are difficult to evaluate before purchase, but easy to evaluate after consumption.
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The experience qualities of a good or service can be evaluated after purchase.
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Furniture is high in credence qualities.
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While goods meet personal needs, services meet business needs.
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Services have five distinctive characteristics, one of these being "pure service."
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Intangibility with regards to a service means that the service cannot be duplicated across providers.
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Service companies try to demonstrate their service qualities through physical evidence and presentation.
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Inseparability in the context of a service means that there is a provider-client interaction involved as the provider is part of the service.
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A service provider can work with larger groups to get around the limitations of inseparability.
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The quality of services is independent of who provides them.
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Customers want unbundled services, with separate prices for each service element and the right to select the elements they want.
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External marketing describes the training and motivation required by employees in order to properly serve the customers.
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Interactive marketing describes the employees' skill in serving the client.
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Clients judge service not only by its technical quality but also by its functional quality.
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Importance-performance analysis rates the various elements of the service bundle and identifies required actions.
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Customers who view a service as fairly homogeneous care less about the provider thanabout the price.
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What the customer expects from a service is called the primary service package.
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Secondary service features are the features that the customer himself adds to the service.
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Pricing has no negative effect on customer loyalty.
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If the expected service falls below the perceived service, customers are disappointed.
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Responsiveness is a company's willingness to help customers and provide prompt service.
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Reliability refers to the company's willingness to help customers and provide them with prompt service.
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The appearance of physical facilities, equipment, personnel, and communication materials are the tangibles that convey service quality to consumers.
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The zone of tolerance for a service is the perceived economic benefits in relationship to the economic costs.
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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.
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A customer-service interface is defined as any place at which a company seeks to manage a relationship with a customer.
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If the length of the downtime increases, the cost incurred decreases.
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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.
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Out-of-pocket costs are what the customer spends on regular maintenance and repair costs.
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Value-augmenting services include installation, staff training, maintenance and repair services, and financing.
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