PROJECT ON

SERVICE
QUALITY OF
Type Private (Limited liability)
Founded 1970 (Incorporation: 1989)

Headquarters London, England, UK

Key people Richard Branson, Chairman
Stephen Murphy, CEO
Susannah Parden, CFO

Products Airlines, Trains, Games, Financial

services, Internet ,Cable TV, Music,
Radio, Cosmetics,
Jewellery ,House ware ,Retail
Mobile phones

Revenue US $20 billion

Employees Approximately 50,000 people, in 29
countries.
PRODUCTS
 The story unfolds……

• Branson was born at Stone field

Nursing Home in South London.
•
• His mother used to set challenges
for him and his sisters, in order
to make them independent.
•
• Virgin brand took off in the year
1970.
•
• Branson started with a student
magazine at the age of 17 which
focused on the issues of students
in school.
 “ RichardBranson
is Britain's top
boss says Learning
& Skills Council ”

“ Think small to score b

Virgin brand so far: Transport & Travel
Virgin brand so far: Leisure & Entertainment
Virgin brand so far: Retail
Virgin brand so far: Communications. Money.
Virgin Mobile India Entry….
Virgin brand so far: Health. Renewables. Charity.
 …. one of the most exciting brands in the world

200 companies worldwide, employing 48 500

people, an annual Virgin Group turnover
of £10.8bn/US$20.4bn
 KEY ASPECTS
qCustomer Service
q
qSystematic Role
q
qRole of Technology
q
qComments
q
qConsistent Service
q
qCommunication
Channels
 Dimensions of
Service Quality

qEfficiency qAssurance
q q
qTangible qTrust
q q
qEmpathy qReliability
q
qResponsiveness
 Relative
Importance of
Service
qReliability 32 %

qTangibles 11 %

qResponsiveness 22 %
qEmpathy 16 %

qAssurance 19 %

16
 Determinants
Dimensions of Service
Word of Personal Past
Quality Mouth Needs Experience
1. Access
2. Communication
3. Competence
4. Courtesy External
5. Credibility Expected Communication
Service to Customers
6. Reliability
7. Responsiveness
8. Security Service Perceived
9. Tangibles Quality Service
Gap Quality
10 .
Understanding / Knowing
the Customer
Perceive
d
Service

17
 Nature of Service
Expectations

Level Customers
Desired Believe Can and Should Be
Delivered
Service
Zone
of
Tolerance
Minimum Level
Adequate Customers Are Willing
to Accept
Service
18
 The Two Levels of
Expectations Imply
Two
Corresponding
Measures of GAP 5 :
Measure of Service Perceived Adequate
Adequacy ( MSA ) = Service - Service

Measure of Service Perceived - Desired

Superiority ( MSS ) = Service Service

19
 Technology ’ s Role
Serving Customers
Company
Internal External
Marketing
` Marketing

Te ch no lo gy

Employees Customers

Interactive
Marketing
20
PROCESS MODEL FOR CONTINUOUS MEASUREMENT AND
IMPROVEMENT OF SERVICE QUALITY

DO YOUR CUSTOMERS PERCEIVE YES CONTINUE TO MONITOR

YOUR OFFERINGS AS MEETING CUSTOMERS ’ EXPECTATIONS
OR EXCEEDING THEIR EXPECTATIONS? AND PERCEPTIONS

NO
DO YOU HAVE AN ACCURATE NO TAKE CORRECTIVE ACTION
UNDERSTANDING OF
CUSTOMERS ’ EXPECTATIONS?

YES

ARE THERE SPECIFIC NO

STANDARDS IN PLACE TO MEET TAKE CORRECTIVE ACTION
CUSTOMERS ’ EXPECTATIONS?

YES

DO YOUR OFFERINGS MEET OR NO TAKE CORRECTIVE ACTION

EXCEED THE STANDARDS?

YES

NO
IS THE INFORMATION TAKE CORRECTIVE ACTION
COMMUNICATED TO CUSTOMERS
ABOUT YOUR OFFERINGS ACCURATE?
YES
21
 Conceptual
Model for
Understandin
g
Customer

Fulfillm
ent
Gap
Customer
Customer Purchase/
Web site Perceived Perceived
Web site Repurchas
Requirement e-SQ Value
Experiences e
s

Company Informa
tion
Gap

Management’
Design and s
Marketing
Operation Beliefs
of the
of the about
Web site
Web site Customer
Requirements
Communi
Design
cation
Gap
Gap
 Customer
satisfaction

üDirect selling of goods and services

to consumers
ü
üVirgin Atlantic & Virgin Mobile“ Our goal
ü cannot be
üAmenities on the flight profit at any
ü cost , because
üLuxury Boat Service we know that
tomorrow ’ s
success
depends on
the trust we
PRINCIPLE
S
 SOCIAL
RESPONSIBILITY

üVirgin Unite
üVirgin Green Fund
üVirgin Earth Challenge,
save the earth
 To w a rd s
E m p lo y e e s
 “Staff first,
 Then Customers and

Shareholders”



“Strength through Unity.”
 Waste
Management
•
üRecycling – IT equipment and
mobile phones
ü
üSustainable Printing
•
“ W E H ATE
W A STE”
TECHNOLOGY
&
VIRGIN
V IR G IN C O N N E C T

- WIMAX NETWORK
C O V E R IN G 2 0 C IT IE S
VIRGIN LAUNCHES
ONLINE MUSIC
SERVICE
VIRGIN MOBILE IN SOUTH
AFRICA, INTRODUCED
'PER SECOND' BILLING
Virgin Retail Saves
8.5 Hours a Week in
Each Store With
stock-control
solution
Virgin Megastores
Opens Music and
Video Vault to
Customers With
THINKH A T K E
COMPANIES
“ Wallpap
er
awards
Virgin
Atlantic
with
world's
Fastest
Airport
Check
In ”
“ Virgin
Blue is
named
2008 Asia
Pacific
Low Cost
Airline
Of The
Year ”
“ The
Institut
e of
Customer
Service
names
Virgin
Trains
as Best
Train
Operator
”
Virgin Atlantic Airways Case
 Case Objectives
• To integrate the concepts of
services marketing as a
capstone to the course.
• To examine the themes of
service quality, innovation,
public relations and
pricing as they relate to
success in a service.
• To demonstrate the delivery
of customer value.
• To illustrate service
positioning as a
competitive strategy.
 Attributes and Dimensions of
Customer Value

Offered by VAA
• Value for Money D y n a m ic

• Innovation Tre n d y
F u n
• Non Conformist Service
D a v id a g a in st G o lia th
• Alternative to BA
Quality
L ife S ty le
• Entertainment P e rso n a l
Entertainment
L o w P rice
Fun
• Cheapest Deal
C o n v e n ie n ce
• Young
F rie n d ly
Innovation
• Richard Branson’s In fo rm a l
Airline

• Service
 VAA’s Weaknesses

• MARKETING • SERVICE AND

STRATEGY ORGANIZATIO
– No clear customer NAL
targets
– “Wild” image not CAPABILITIES
good for all – Punctuality
customers
– Age of fleet
– Public relations
efficient but less – Losing momentum
controllable than on innovation?
advertising – For how long can
– Low trial rate staff be kept
– Power of motivated?
competing
frequent flyer
 VAA’s Weaknesses

• ECONOMIC • DEPENDENCE
VULNERABILI ON BRANSON
TY – Value of VAA
without
– High break-even
Branson?
point
– Real value of
– Lack of economies
Virgin brand?
of scope
– Capital
 VAA Possible Actions

• PRESERVE AND
IMPROVE
CURRENT
STRENGTHS
– Innovation
– Service quality
– Fun
– Staff motivation
– Punctuality
– Fleet renewal
– Expand Virgin
Freeway
AA Possible Actions
Action

• BUILD A NEW STAGE

IN THE
DEVELOPMENT OF
VAA
– Transform core
values into
unambiguous
positioning
strategy
– Design
differentiated
marketing
strategy for
specific target
groups
– Break the trial rate
wall
– Build selected
 VAA - What Happened?

q VAA announced joint Heathrow-Sydney service

via Hong Kong with Ansett Airlines
q Announced another partnership with Malaysia
Airlines for flights from London to Kuala Lumpur
q Alliance with Delta approved
q VAA renamed its full-fare Mid Class cabin
Premium Economy because of confusion
q VAA won yet another Executive Travel Airline of
the Year award in January 1995
q Branson ranked in eleventh place in 1994 among
Britain’s rich with 895 million net worth
Conclusion
 THANK YOU !

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THANK YOU ! TH A N K THANK YOU !

YO U !
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THANK YOU !