In this essay the most common service characteristics - perishability, intangibility, inseparability and heterogeneity - will be applied to a well-known retail services brand. These characteristics create challenges for providers of services, and organisations differ in their approach to facing these challenges in order to gain a competitive advantage by offering a better service value in an intensely competitive market. In this case the focus shall be on how the aforementioned characteristics apply to Carphone Warehouse.
To begin with it is helpful to know a brief history of Carphone
Warehouse (which shall now be referred to as CPW) alongside their current corporate objectives. CPW was founded in 1989 as a mobile phone retailer.
The company expanded to own stores in Europe as well as the UK and became a Plc. in 2000 floating on the London Stock Exchange. In 2003 they launched TalkTalk as a direct competitor to BT in the UK telecom industry. In
2010 TalkTalk and The CPW demerged in to a separate telecom business and a mobile phone retailer respectively. The company has enjoyed continuous growth and following the FTSE UK December 2013 Quarterly
Review, CPW Plc. was added to the FTSE 250 index. They are a current leader in the telecom market with over 2,000 of their own stores and over 300 franchised stores operating in 8 different markets around the world.
Furthermore there is a big focus on providing services to companies looking to develop their own connected world network solutions.
CPW live by five rules: If we don't look after the customer, someone else will; Nothing is gained by winning an argument but losing a customer;
Always deliver what we promise. If in doubt, under-promise and over-deliver;
Always treat customers as we ourselves would like to be treated; The reputation of the whole company is in the hands of each individual.
Services are activities performed by the provider. Unlike physical products they cannot be seen, tasted, felt, heard or smelt before they are consumed. They are intangible. Since services are not tangibles they do not have features that appeal initially to the customer’s senses. Their evaluation,
unlike goods, is not possible before actual purchase and consumption. Some services are highly intangible, such as teaching, consulting or legal advice, while others combine intangibility with tangible aspects, such as with restaurants, hotels and hospitals. To improve the confidence of the client a retailer must increase the level of tangibility of the service offered, which they can do so, for instance, with display models or reviews from people who have used the service. To determine the quality of their offerings, services retailers often solicit customer evaluations and scrutinise complaints (Levy, 2012). In order to get around the issue of services being intangible it is important for customers to have faith in the retailer.
With regards to the challenge of intangibility, CPW has a combination of tangible and intangible aspects to their service. The service offered by the assistants in store and the contracts offered by service providers are the intangible aspect, and display models of the phones themselves that customers can purchase are the tangible aspect that can be used as a prop to improve the service given. Customers are able to see physical evidence of what the phone looks and feels like before even asking about it. If the phones features and the advertised price intrigue them they can then speak to a customer assistant and request a demo of the phone, which is where the service begins. Customer Assistants are trained to give demos and kept up to date with the knowledge of the phones so that the customer is confident that they are learning everything about their purchase before making it. To reassure customers to purchase with them, CPW offers augmented products such as a combined insurance and assurance policy providing cover
