Customer services: A part of market orientation

Abstract

The aim of this paper is to present the importance of customer services as a part of market orientation from both the theoretical view and by selected results of the survey of Hi-Tech firms in the Czech Republic. The research was particularly focused on a customer. The first part of the paper briefly describes the main characteristics of customer services from the customers' view. The second part is focused on survey of Hi-Tech companies. The results from the research show that management of companies is usually aware of the importance of customers' satisfaction and of the quality supply of customer services as well. Customer services are widely seen as a necessity for today's survival on the market. The paper is written in the framework of research project "Research on implementation on market orientation in High-Tech Firms" supported by Grant Agency of the Czech Republic (GA 402/07/1493).

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CUSTOMER SERVICES - A PART OF MARKET ORIENTATION
Lucie Kaňovská
Brno University of Technology, Czech Republic, kanovska@fbm.vutbr.cz
Abstract
The aim of this paper is to present the importance of customer services as a part of market orientation
from both the theoretical view and by selected results of the survey of Hi-Tech firms in the Czech Republic.
The research was particularly focused on a customer. The first part of the paper briefly describes the main
characteristics of customer services from the customers’ view. The second part is focused on survey of Hi-
Tech companies. The results from the research show that management of companies is usually aware of the
importance of customers’ satisfaction and of the quality supply of customer services as well. Customer
services are widely seen as a necessity for today’s survival on the market. The paper is written in the
framework of research project “Research on implementation on market orientation in High-Tech Firms”
supported by Grant Agency of the Czech Republic (GA 402/07/1493).
Keywords: marketing, customer services, market orientation, Hi-Tech company, the Czech Republic.
Introduction
Every company should know customers’ needs and mostly they claim they know. However the ability
to provide a final product according to the expectations can be questionable. All company activities such as
manufacturing, sales and customer services as well should ensure customer satisfaction. Therefore customer
services are always very important and topical, because they can help to increase customer satisfaction with
the product using. Services can be seen as a source of company profit and possible differentiation, too.
Almost all companies have to be providers of customer services today. Moreover focusing on customers, e.g.
providing customer services, is one of the main benefit of well done application of market orientation in a
company. Market orientation is one of the key trends in the field of marketing today. The core elements of
market orientation are its focus on the customer, focus on competitors, the setting up of long-term objectives,
coordination of marketing activities and, last but not least, the importance of a good quality system of
business intelligence.
The aim of this paper is to present the importance of customer services as a part of market orientation
from both the theoretical view and by selected results of the survey of Hi-Tech firms in the Czech Republic.
The methodology of the paper is issued from the research project titled “Research on implementation
on market orientation in Hi-Tech Firms”. In the research part of the GACR project mentioned, two different
questionnaires are used (see more bellow). For the paper were used data from measurement of market
orientation only.
Customer services
Customer services are all what company does for satisfaction of its customers. They help to gain
higher profit from sold products. According to Bovée & Thill (1992), quality and customer services present
strong barrier against the competition, ensure customer loyalty; help to differentiate product and decrease
marketing costs and increase company profit.
Nowadays industrial producers are becoming providers of customer services too. This situation helps
to extend their activities for customers. In fact profit from provided customer services can be gained both for
customers and also for companies. Many customers make final purchasing decision not only according to the
product price, but also according to the range and level of customer services related to the product. The
companies which try to hold dominant position in provided customer services are forced to determinate and
evaluate specific needs of their market segment and adapt their company strategy for them. Most of
companies working in different spheres of economy know very well that strategy of differentiation on the
basis of special and “customized” services can be seen as an important opportunity to avoid a price war with
competitors. Therefore, customer services become an integral part of searching for competition advantages in
a wide range of economic spheres. There are some possible reasons concerning the above tendency, which
may be mentioned here: flattening of demand in traditional production, increasing of international
competition, a short life cycle of product innovations and important profit potential of services.
The perception of the term customer service was changing over the years, see Table 1. At the
beginning services were seen as an integration tool for intradepartmental activities (the definitions from

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LaLonde & Zinser, 1976 or Rinehart et al., 1989). Then marketing view of services has started to achieve
maximum effort to satisfy customers. Also services can add value to product. It is involved in the definitions
from Bovée & Thill, 1992, Horovitz, 1994, Amico & Zikmund, 2001 or Kotler, 2001. Also logistic view of
customer services increases their role to assure product delivery from producer to customer. This view is
seen by Horáková & Kubát (1999) or Christopher (2000). The last view, the current one, has the key role
connected with relationship with customers, see in definition by Lehtinen (2007).
Table 1. Perception of customer services
Author View and definition of customer services
Integration tool for intradepartmental activities
LaLonde &
Zinser (1976) Services are the kind of activities between the organization and customers to improve or simplify
sale and using of products. They involve also operations of producers provided for customers
during the whole transaction.
Rinehart et al
(1989) Services are common factor for integration of marketing and logistics.
Marketing view
Bovée & Thill
(1992)
Services involve all what organization makes for satisfaction of their customers and help to realize
as big advantage as possible from products bought by customers. Services are activities which can
add the value to products.
Horovitz (1994) Services are complex of promises which are expected from the product by a customer, as function
of price or image.
Amico & Zikmund
(2001) Services present company activities created to increase value of selling products to strengthen
customer satisfaction.
Kotler (2001) Services involve all aspects of mutual relationships among producers, distributors and customers.
Logistic view
Horáková and
Kubát (1999) Services present important activities from the purchase order of customer to delivery of products.
The activities are customer-oriented and depend on the kind of product and type of customer.
Christopher
(2000) Services are the system organized to assure continuity between the time of purchase order and
delivery of goods. The aim is to satisfy customer needs from the long-lasting view.
Relationship with customers
Lehtinen (2007) Services are all activities connected with assuring relationship with customer – from product
delivery to different ways of help by its using.
Perception of customer services shows the differences changes during years and confirms current
tendency to be in a very deep touch with customers. It means to have a long-term relationship with clientele
as well. Focus on customers is also one of main parts of market orientation. Market oriented companies are
mainly focused on customers, suppliers, competitors and distributors (see Table 3). Customers are usually
evaluated as the most important stakeholders. Therefore companies generally pay high attention to them.
Examples of customer services in Hi-tech companies
Customer services are often the last or even the first step in the process of considering the purchase of
a new product. Therefore it is very important to spend a long time to prepare and implement the strategy of
customer services, involving their supply for different customer segments on market.
Customer services provided by hi-tech companies can be the following ones: cooperation on R&D of a
product, its innovation and production, consultancy before and after sale, sufficient information about
product involving deep technical information. We should mention payment conditions, transport, packaging
and assembling of products according to customer requirements, after-sale services (such as replacement of
spare parts and also customer training for the first use and on regular bases as well), etc.
Indeed the fulfilling of customers’ needs is very individual in each company. Finally customer
services should be managed according to customer expectations. In Hi-Tech companies, the customer is in
the centre of attention and customer satisfaction becomes the priority.
Research design and methodology
The second part of the paper is focused on the brief overview on the research held in Hi-Tech
companies in the Czech Republic. The research project was titled as “Research on implementation on market

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orientation in Hi-Tech Firms” and two different questionnaires were used. The data from measurement of
market orientation, part: focus on customers, was only used for the paper. The data were gathered during the
first half of 2009 for the project. The questionnaire constituted by Tomášková (2005) along with the “New
Method” of the market orientation measuring was used. The 7 point Likert scale was used (0 – highly
disagree, 7 – highly agree).
The “New Method” includes external environment elements, branch environment elements and
internal environment elements of a company. The surveyed sample consisted of companies classified as hi-
tech companies according to the CZ NACE codes utilized by the Czech Ministry of Industry and Trade. For
the purposes of the research project, manufacturing companies operating mainly in mechanical and electric
engineering sectors (NACE codes 3x xxx) were selected. The database of the Kompass Czech Republic
Company was used to make the selection.
A total of 450 firms were included into the main research. The companies were contacted over the
phone line and asked to personally participate in the survey, or to fill in a questionnaire in electronic format
on the Internet. The data from the questionnaires were converted to electronic format and loaded to a special
designed programme where they were analyzed by standard statistical methods as well as other sophisticated
techniques. Incomplete data gathered by the questionnaires were discarded when checked. Data from only 88
companies were used for further processing.
Results
The problem connected to customer services was in the part of questions related to end users
(customers) in the questionnaire constituted by Tomášková (2005), see above. The statements related to
customers are seen in Table 2. Customers are a part of the branch environment elements, see in Table 3.
The highest rate, not only in the section about end users (customers), but in the whole elements of
questionnaire (external environment, branch environment and internal environment of a company), received
statement with number 3 “We use individual approach to our customers”. The average value was 6,34
(SD±0,858). The statement with number 4 from the section about end users “We offer wide range of after-
sales services” gained average value 5,17 (SD±1,565). The table 3 shows average values of branch
environment elements.
Table 2. Average values of statements related to end users
(0 – highly disagree, 7 – highly agree)
Statement in questionnaire Mean
1. We regularly analyze factors which influence sale behaviour of our customers. 5,21
2. We regularly monitor the requirements of current and potential customers. 5,77
3. We use individual approach to our customers. 6,34
4. We offer wide range of after-sales services. 5,17
5. We regularly find out the rate of satisfaction of final customers 5,53
6. We know the image of our products from our customers. 5,58
7. We find out why potential customers did not buy our products. 4,64
The results mentioned in the Table 2 confirm (statement no. 3) the importance of the individual
approach to customers as one of the most important step in today’s business. Focusing on customer using
individual supply and services is the most important benefit of market orientation.
The value of supply of customer services is not as high as statement in number 3, however it is
relatively high number and services are seen positively by company management. In conclusion, there can be
still some possibilities how to improve the supply of services. It is a good idea to try to find out customer
expectations and then compare with their perception of used services.
Table 3. Average values of market orientation, part branch environment elements
(0 – highly disagree, 7 – highly agree)
Branch environment elements Mean
End users (customers) 5,47
Distributors 5,06
Competitors 4,82
Suppliers 4,74

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From the Table 3 it is clear that orientation on the group of end users (customers) and distributors
received the highest value as it was mentioned in a theoretical part about customer services. Customers are
always seen as the most important stakeholders.
Conclusions
The lowest average value reaches the statement referring to the reasons why potential customers did not
buy companies’ products. The clue is probably in lack of company interest in searching for potential clients.
Managers are more focus on current customers than not on potential ones. This is visible also from the result
from statement relating to the individual approach to customers, which confirms high concentration on
current customers and their individual needs However reasons why potential clients deny company products
could help company to extend their activities and product supply, increase employee motivation, or just to
know more about competitors and their strategies. It is very stimulating to know about customer perception
on company products, customer services or even whole company. Even if they are potential ones.
Customer services are seen as a necessity not only for Hi-Tech firms. Almost every company provides
at least one possible customer service to its clients. The most used services are connected with after-sale
services, transport and training, especially in B2B. It is easy to recommend spending more time and effort for
the extension of wider and more attractive services in Hi-Tech firms, according to the survey. However it
could be complicated and long-time process sometimes. The reasons for the difficultness in this can be as
follow: lack of motivation to improve current situation, lack of interest to find out exactly what customers
need. A motor should lay in never-ending effort to be always in front of competitors as well. Not only prices
and technical criteria play a key role in decision making process during the purchasing of a new product. The
more positive points have customers about potential products, the more probable is their effort to buy them.
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