Đề tài Customer service recommendations to increase sales for kichi-Kichi hotpot bar on 61 ma may street, Ha Noi

that is, the feeling that a product or service has met the customer expectation." www.wikipedia.com In opinion of this customer, customer service can be a high quality product with suitable price. However, another customer can consider it on-time delivery while other customer measures it through service attitude of staffs. In fact, a huge range of factors can contribute to customer satisfaction, but your customers - both consumers and other businesses - are likely to take into account: how well your product or service matches customer needs; the value for money you offer; the professionalism, friendliness and expertise of your employees; how well you keep your customers informed; and the after-sales service you provide. 2. The importance of customer service to business Customer service is normally an integral part of a company’s customer value proposition. Every time you have contact with your customers you have an opportunity to improve your reputation with them and increase the likelihood of further sales. From the point of view of an overview sales process engineering effort, customer service plays an important role in an organization's ability to generate income and revenue. From that perspective, customer service should be included as part of an overall approach to systematic improvement. Customer service plays an important part in keeping existing and making loyal customer, attracting potential customer, thenceforth helping company reduce cost and increase turnover. Keeping existing customers and making loyal customers Firstly, customer service is an effective tool in keeping existing and making loyal customer. Generally, customer is divided into two kinds: existing and potential customer. Your sales and profitability depends on keeping your customers happy. It is also cheaper than attracting new customers. According to the Customer Service Institute, 65% of a company's business comes from existing customers, and it costs five times as much to attract a new customer than to keep an existing one satisfied. Losing a customer is even more expensive. According to studies by the Technical Assistance Research Programs Institute, 91% of unhappy customers will never buy again from a company that has displeased them and will also voice their dissatisfaction to at least seven other people. Thus, the goal of customer service is customer satisfaction. Customer satisfaction is what customer feels subjectively and sometimes irrationally. www.eDigitalPhoto.com When ordering a new service or maintaining an existing service, consumers must take into account the following three key factors: the quality of the service, the price of the service, and the customer service of the service provider. The first two factors are relatively objective and usually easy to control. As shown by Figure 1, the graphical representation of a market research study done a few years ago, customer service dissatisfaction is the most important key factor when a consumer decides to change service providers. Figure 1: Reasons for Switching to another Vendor (www.iec.org) Retaining existing customers mean making them keep buying company product or service. It means they are less likely to go to your competitors in the increasingly competitive markets where customers have more choices than ever. As satisfied customers, they will recommend you to other, resulting in an increase in new business. It is said that it costs up to ten times as much to win a customer than to keep an existing one. When being satisfied, they are less likely to tell other people of bad experiences. Customers experiencing poor service are likely to tell up to twenty people about their experience, which is not good advertisement for your business. This may deter other from even trying you out, and so you will not get a chance to impress them, even with the best or most innovative products and services. 2009, The Chartered Institute of Marketing, 10 Minutes Guide: Customer Service Program Businesses can improve profitability by focusing their attention on their customer that has the highest potential lifetime value. In their book Rules to Break and Laws to Follow (2008), Don Peppers and Martha Rogers, Ph.D. write that “customers have memories. They will remember you, whether you remember them or not." Further, "customer trust can be destroyed at once by a major service problem, or it can be undermined one day at a time, with a thousand small demonstrations of incompetence”. All the customers want to receive the highest attention from supplier, want their supplier considers their demand as the top priority. Only the fastest and most effective service can satisfy customers. Once companies provide an excellent customer service, they can retain their customer and make them loyal. These loyal customers help company retain a fixed income and even make more profit because when customers are pleasured, they will buy not only more but more regular. Existing customer relationships are opportunities to increase sales because your customers will already have a degree of trust in your recommendations. Employees who deal with customers' orders should be fully aware of current offers and keep customers informed. Sometimes brochures and other marketing materials are the best way of getting word out about a new customer incentive. Don't forget though that your customers' view of the overall service you provide will influence their loyalty much more than short-term rewards will Attracting new customers Loyal customers are so important to every business. However, to exist and develop in this competitive environment market, business must try its best to win new customers. The first step in attracting new customers in any economic climate is pleasing your regulars because the word-of-mouth buzz you gain from them will be a huge boon in attracting new business. Satisfactory customers will tell others about excellent service you provide that is more effective and trustworthy than anything you advertise or broadcast on public media. Next, you could reach your target groups by some direct means such as sales promotion, meeting, and free consultancy, etc. have function is to provide new customers with more information about company as well as product and service, along with gain sympathy and trust from potentials. To begin with, you have to let people know you exist – advertise yourself. If people don’t know where you are and what you do, they can’t buy from you and you will never make enough money to stay open. Advertising greatly increases your chances of success if you know who your customer is. Then you can tell them what they want to hear. However, good advertising techniques are useless without an effective message. An effective message gives people reasons to spend their money with your business. There are a number of free or nearly free ways to advertise your business or service. You could rely on word of mouth, that does not cost anything, but it might take a long time before word spreads. The second inexpensive method would be flyers. This method can be very effective for certain business, but the effect does not last long. Chances are the person will take one look and throw away the flyer. The third relatively inexpensive advertising method is newspaper advertisements. You could place a small ad that runs for a few weeks in a few local newspapers. This will give you great exposure to your selling area. However, the ads do not run forever unless you want to keep paying. An effective way to advertise that has a relatively low initial cost is with sales promotion. Sales promotion covers a wide variety of short-term incentive tools such as coupons, premiums, contents, buying allowances that are designed to stimulate consumers, the trade, and the company’s own sales force. Sales-promotion spending calls for setting sales-promotion objectives, selecting sales-promotion tools, developing, presenting, and implementing the sales-promotion programs, and evaluating the results. Philip Kotler, Principle Marketing In the sales promotion strategy, promotion products are a difficult question to many businesses. What are promotional products? Promotional products are items that proudly display your company's name and information. Sure, the initial cost is more than using flyers or newspaper ads, but, unlike the other methods, the promotional product makes a lasting impression. Every time customers use your promotion items, they will see and think about your company’s name. Then when they are ready to make a purchase, your company's name is at the top of their mind. With the right promotional product, a small business owner will see a great return on their investment. 2009, Reducing cost and increasing sales Good customer service can help company reduce cost. It is true. When customers aren't happy with your business they will complain. They, however, usually won't complain to you - instead, they'll probably complain to just about everyone else they know and take their business to your competition next time. As a result, you have to find solution to solve the trouble, and that task costs your budget. On the other hand, as mentioning above, satisfactory customers easily become loyal customers, and so you will save budget for attracting new users. Customer care is a tool increases your sales promptly. Your existing customers are among the most important assets of your business - they have already chosen you instead of your competitors. Keeping their custom costs far less than attracting new business, so it's worth taking steps to make sure that they're satisfied with the service they receive. Existing customer relationships are opportunities to increase sales because your customers will already have a degree of trust in your recommendations. Satisfied customers will contribute to your business for years, through their purchases and through recommendations and referrals of your business. 3. Requirements on customer service. Good customer service is all about bringing customers back. And about sending them away happy, happy enough to pass positive feedback about your business along to others, who may then try the product or service you offer for themselves and in their turn become repeat customers. If you’re a good salesperson, you can sell anything to anyone once. But it will be your approach to customer service that determines whether or not you’ll ever be able to sell that person anything else. The essence of good customer service is forming a relationship with customers, a relationship that individual customer feels that he would like to pursue. For all these above reasons, a business’s top priority task is a good customer service. How to deliver a good customer service? Put your customer first Firstly, be up front, even bold, in stating how your goods or services make things better for your customers, so that they can make a decision about whether to ask for more information. This respects their time and attention by answering the question, "What can you do for me?" A customer service is considered prompt when it is carried out on time and in time. When a problem related to customers’ interests appears, they want it to be solved immediately. To satisfy clients, you have to set them first. The first step is to set standards. Then, make certain everyone in the company understands them. Finally, reward employees for achieving your service goals. Seek out and solve any annoyances they might have that could lead to poor morale. Stay close to your customers Besides, staying close to customer is a decisive factor to quality of a business’s customer service. If you want your business to be successful, you must listen to and talk with customers as well. The best business owners are not only committed to staying close to their clientele, but also identify with them. They give their customers the level of service they themselves would expect to receive. Moreover, a good relationship with customers necessitates paying attention to every link in the distribution chain. That means listening to everyone who helps get your products to market and asking them for suggestions on improving your service. Pay attention to the details It means that all the information about your products or your service and other plans you provide customers must be accurate. The purpose of this accuracy is to avoid misunderstandings that can make further problems to your business. Monitor the quality of your services and products constantly. Satisfied customers who spread the word about your business are the best source of new customers. Pay attention to pricing, customer service, product availability and prompt delivery. Besides, you should be clear about what it takes for you to deliver consistent value. How much time? How much money? How much energy? What kind of commitment? What support? What resources? What else? When you know what you need in order to deliver good customer service, set your price, policies, and procedures accordingly and make it easy for your customers to understand them. Give Your Customers What They Want To succeed, you must give your customers what they want, not what you think they want. And, as you never know who might eventually become a customer, that means providing courteous, friendly service to your suppliers and others with whom you come in contact, as well as current customers. Critical to keeping customers happy is to understand them and the way they think. For example, customers do business on the basis of emotional desire - they want what they want when they want it. Customers also tend to gravitate toward a company or group of people they like. And, most customers have a strong tendency to stick with businesses with which they are familiar, and are slow to change buying habits unless given a very good reason. CHAPTER 3: ANALYSIS AND FINDING 1. Real state of using customer service activities at Kichi-Kichi Ma May – Customer satisfaction evaluation All the product and price policies at Kichi-Kichi Ma May and other units are the same. The first month of opening is the promotion month with price at about VND 99,000 excluding VAT per person. In addition, each customer will be tasted for free a dish of Australia beef and fizzy drink and fruit and ice cream in dessert. Proceeds that month were good. After opening month, stable price is VND 130,000 each serving (exclude drink). In February, turnover is down VND 217,744,291 - from VND 794,322,400 to VND 576,578,109; the number of customers decreases from 3,394 people in January to 2,965 people in February, 2010. “Eat 5 Free 1” program For increasing in purchasing power, in the first half of February, company applies a promotion program at Kichi-Kichi Ma May called “Eat 5 Free 1” which will last on 15th, April 2010. Objectives of program are to increase turnover by 50%; attract new customers to Kichi-Kichi Ma May, especially in lunch time. Mechanism of voucher delivery: There are two ways to deliver promotion voucher to customer. Firstly, customers will receive a voucher when buying open tickets at reception room. The second way is based on leaflet. Voucher is printed on about 10,000 leaflets that will be distributed at buildings around the Old Quarter and at the night market area. Schedule: 1st Feb-15th Mar: deliver vouchers From 9th Feb: validate vouchers 15th Apr: close the program Expected voucher: 10,000 units Content of program: Cashier will put a seal for each ration on customer’s voucher when they pay the bill. Once customers collect enough five stamps on their voucher, cashier will gather that voucher and give customer a free helping at Kichi-Kichi at lunch time. This program is not available for children ration. The voucher consists of two sides. Program name “Eat 5 Free 1” and logo of Kichi-Kichi are printed on the front side. There are five blank square coupons to add date, manager’s sign, and stamp; customer’s information including name, email, telephone number; series number; and content of program on the other side. Management mechanism: In order to control and evaluate the effect of each service channel, the series printed on voucher which is delivered at restaurant is different from series printing on leaflet voucher. Only if the voucher has the company seal and expire date is that voucher considered valid. Restaurant manager will resend these vouchers to Marketing and Accounting Department to monitor, collect, expand customer base. Communication: Sticking banners on glass and putting tent cards on reception desk to draw customers’ attention. Organizing a road show including five promotion girls who will ride bicycles around the Old Quarter to introduce the promotion plan and deliver leaflets at buildings. In the first period of campaign when vouchers are just delivered at reception desk, the increase in customer quantity is negligible. Only when leaflets are distributed, the situation becomes better. However, if the restaurant just aims at office area, it could not produce the desired effect because the Old Quarter is full of merchants and tourists, office staff is just a very small proportion. Thus, management determines a special direction for Kichi-Kichi Ma May. Realizing that “Eat 5 Free 1” campaign is so fit for the Old Quarter inhabitants, the second leaflets distribution is conducted by the writer along crowded streets in the Old Quarter including Hang Ngang, Hang Dao, Cau Go, etc., and up to West Lake area. People express their great interest to the promotion plan by asking so many questions about it for the writer. After 61 days from 10th Feb to 15th Apr 2010, the number of sent-out vouchers is 2,968 vouchers and return vouchers is 817. So, average 48.66 vouchers are sent out and 13.39 vouchers return each day. Returning voucher quantity accounts for 28% of send out voucher. Result of this whole program is shown in below table. Before campaign (13th Jan to 19th Feb, 2010) After campaign (10th Feb to 15th Apr, 2010) Revenue (VND) 494,694,600 1,352,410,509 Customer number (people) 3,703 10,197 Time (day) 27 61 Average of customer number a day (people) 137 167 Average of revenue a day (VND) 18,320,356 22,170,664 Source: Accounting Department Table 2: Effect comparison Cost for marketing in this program is VND 27,154,500 including VND 240,000 for poster, VND 2,500,000 for voucher, VND 7,000,000 for leaflet, VND 4,000,000 for e-PR, VND 300,000 for banner, and VND 13,114,500 for leaflet distribution and road show. Budget spent on marketing is VND 445,156 each day. Profit brought by “Eat 5 Free 1” campaign can be found here: Sales daily-average increase a day 3,850,309 Cost for free meal a day 1,580,426.23 Marketing cost per day 445,156 Turnover increase a day 1,824,726.56 Net profit increase a day 1,094,835.94 Net profit of whole campaign 66,784,992.07 Unit: VND Source: Accounting Department Table 3: “Eat 5 Free 1” effect So, after deducting expenses company gains VND 66,784,992.07 with an increase in customer quantity of 6494 people, average 30 people a day. However, the problem is that when the sales promotion is closed, customer number decreases again. Opinion poll summary Before, during, and after this promotion program, company holds an opinion poll in order to collect customer opinions and feedbacks about restaurant service (you can see the comment card sample in “Appendix” part). The card consists of two sides, one side is printed in Vietnamese and English on the other. Red is the major color on both sides. Contents of card comprise customer information including name, gender, age, and telephone number and email address. Then there are questions in closed and open forms for customers to score, comment, and give proposals. Through these questions, company will know what people think about food’s variety, freshness, and taste and service quality at Kichi-Kichi Ma May. The result from the survey allows company to know how well advertising channels effect, what features are decisive reasons for customers’ purchasing behavior, and frequency rate of visiting restaurant. Open questions provide company with customers’ expectation about Kichi-Kichi promotions and what they want restaurant to improve. Restaurant manager has responsibility to fill date on each card to make it easy for marketing staff to collect and classify information. Figure 2: Result of survey in week 4, January, 2010 Figure 3: Result of survey in week 2 and week 4, April, 2010 From data collecting from comment cards from Kichi-Kichi Ma May (as you can see in Figure 2 and Figure 3), the researcher sees that more than half quantity of customers (62%, 58%, and 64%) is female who are at the age from 26 to 30 (42% in week 4 January, 2010) and from 18 to 25 (43% in week 4 April, 2010). Besides, clients who are under 18 and over 45 years old are very few. Because of these majority female customers, on woman’s days 8th Mar and 20th Oct restaurant gives small gifts such as a free dish or a rose to their liking as a complements from restaurant. Alike other Kichi-Kichi, most of customers at Kichi-Kichi Ma May know it by their friends’ recommendation: 51% of customers in January, 2010. This number increase to 60% in week 2, April, 2010 and 74% in week 4 April, 2010. Eyes-catching hoarding and decoration also have use of attracting customers’ view. You also can see that advertising on LCD or frame at buildings and on radio brings no one to restaurant. In general, these figures do emphasize the importance of customer care to existing customers who play major role in word-of-mouth communication method. Besides, coming-back customer number to Kichi-Kichi is quite good. 27% among these polled go eating at Kichi-Kichi once per two week, just less than first-time-customer 4%, while quantity of customers who come back once a month accounts for 24% in week 4 January, 2010 and 48% in week 4 April, 2010. This result partly thanks to the “Eat 5 Free 1” program. Figure 4: Result of survey in week 4, January 2010 Figure 5: Result of survey in week 2 and week 4, April, 2010 In Figure 4 and Figure 5, we easily realize really good news for company that 100% of customers highly appreciate service attitude of all workers. This has proved the service quality high at Kichi-Kichi. Variety in food and broth taste satisfies almost all customers. Among those polled, just 11% score “average” for variety rate of food and 9% measure taste at “average” level. It can be seen new and fresh of conveyor hot pot, food variety, and price are the most attractive factors of Kichi-Kichi. However, looking at customer feedbacks, the researcher finds almost complements for variety of food come from first-time customers. People who are coming-back customers often score this rate at “average” level, even “need to improve” level by frequent customers. It means that new and fresh factors just have strong attraction in the first period, as for keeping customer and making them loyal require innovation exertion from restaurant. Following after these factors, 24% of customers select Kichi-Kichi for their gathering while other 20% consider Kichi-Kichi an original style that is suitable for them. One weakness of Kichi-Kichi is the freshness of food. There is too much frozen food. The lack of fresh food makes 26% customers disappointed. A joyful signal is that Kichi-Kichi six broth tastes satisfy 80% of customers, and no one scores them at “need to improve” level. The result from open question part tells the restaurant what customers want and expect it to do. The majority of opinions (about 80%) suggest restaurant to publish member card like Ashima system, discount for groups over ten and frequent customers, and enlarge and cool the room, promote drinks or add more fresh drinks, and diversify fresh food, etc. They all satisfy with service manner of Kichi-Kichi waiters and want restaurant to hold by that high quality. 2. Reasons for sales decrease Kichi-Kichi faces with follower’s competition As showing in Table 1, the quantity of Kichi-Kichi customer is about 100,000 people per month, accounts for 3.6% market size. Possibility of market penetration is still very high, as long as Kichi-Kichi continues to open widely and guarantee to do what Kichi-Kichi has committed to customer. Product Price Place Promotion Combine between fine dining and conveyor hotpot. Pay attention to all you can eat concept in conveyor hotpot Average check 119,000 VND/ person (included VAT) Good location for business and advertising, Hanoi city Free 1 dish of New Zealand beef for a month of opening Strength: As a follower, F1 does not take time to open new market Not have to spend expense for R&D, marketing Weakness: Also as a follower, customer would notice that and brand F1 would be very hard to reach the lead