1. Explain how the characteristics of a service apply to SRI. SRI has all the characteristics of a service since it focuses on intangiblebenefits and you can’t see these (e.g., leisure activities and experiences rather than physical products). This seems key to their strategy of exceeding expectations since expectations can’t be calibrated in advance. These activities are produced and consumed at the same time - inseparability. You can see the service provider—or indeed many of them during service encounters as there are 10,000 staff in the 19 resorts. They cannot be stored as you could do for manufactured products - perishability. Here the business intelligence system picks up on occupancy rates, so perishability is measured. They would presumably be monitoring perishability of the amenities too. Having different segments using the resorts at different times of year is good for matching demand and supply (e.g., families with kids would come in public holidays). These characteristics also involve a lack of ownershipof the service, as after the holiday at the resort customers cannot bring with them any part of the service product. But SRI in encouraging returning customers are building a community; which would give customers a sense of ownership and having a stake in the service. Finally, SRI heavily depends on the performance on their employees and staff, which can vary over time and across the different resorts - heterogeneity. They heavily emphasise educating the staff and maintaining a happy workforce. 2. Customer Retention is at the centre of relationship management. Suggest why SRI has been successful in encouraging over half its customers to return. First, SRI has a great business intelligence systemthat can track customers’ information and keep in touch with them, offering the latest promotions and customize their offer. This is a micro-targeting approach that would be based on a detailed record of what they did and with whom while on holiday. Since customers won’t often visit the resorts (a problem for generating consumer insights in this sector) it is crucial as much data as possible is collected while they are in the resort.
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- Fall '16
- Sandra Bernie
- Marketing, Customer retention