Customer expectations

Definition

Customer expectations refer to the beliefs and assumptions that consumers hold regarding a product or service's quality, value, and performance before they make a purchase. These expectations are shaped by past experiences, marketing communications, and social influences, and play a crucial role in determining customer satisfaction and perceptions of service quality.

5 Must Know Facts For Your Next Test

1. Customer expectations can vary widely based on individual preferences, cultural influences, and previous experiences with a brand or similar products.
2. Meeting or exceeding customer expectations is essential for achieving high levels of customer satisfaction, which can lead to repeat business and positive word-of-mouth referrals.
3. When customer expectations are not met, it can result in dissatisfaction and negative feedback, affecting a company's reputation and customer retention.
4. Businesses often conduct market research to gauge customer expectations and adjust their offerings accordingly to align with what consumers want.
5. The rise of social media has amplified customer expectations, as consumers now share their experiences widely and expect prompt responses from companies regarding their concerns.

Review Questions

• How do customer expectations influence service quality assessments?
  • Customer expectations play a critical role in how individuals assess service quality. When customers have high expectations for a service based on prior experiences or marketing communications, they measure the actual service performance against these standards. If the service delivered meets or exceeds those expectations, customers are likely to perceive it as high quality; conversely, failing to meet those expectations can lead to perceptions of low quality.
• Discuss the relationship between customer expectations and customer satisfaction in a competitive market.
  • In a competitive market, customer expectations are directly linked to customer satisfaction. Companies that understand and manage these expectations effectively are better positioned to enhance satisfaction levels. When customers' needs and desires are met or exceeded, they tend to feel more satisfied with their purchases, leading to increased loyalty and positive referrals. Failure to do so can result in dissatisfaction and a loss of market share to competitors who meet those needs more effectively.
• Evaluate the impact of social media on shaping customer expectations in today's market.
  • Social media has transformed how customer expectations are formed and communicated. With platforms enabling instant sharing of experiences, customers now have access to a wealth of information about products and services before making purchases. This transparency elevates expectations as customers compare brands based on peer reviews, influencer endorsements, and real-time feedback. Companies must adapt by actively engaging with customers on social media to understand their evolving expectations and address any concerns swiftly to maintain satisfaction and loyalty.

Related terms

Service Quality: Service quality is the assessment of how well a delivered service meets customer expectations, often evaluated through dimensions such as reliability, responsiveness, assurance, empathy, and tangibles.

Customer Satisfaction: Customer satisfaction is the measure of how products and services meet or surpass customer expectations, impacting their loyalty and likelihood to repurchase.

Perceived Value: Perceived value refers to the customer's evaluation of the benefits of a product or service compared to its cost, influencing their expectations and purchasing decisions.