IMPACT OF PERCEIVED QUALITY ON PROFITABILITY
ABSTRACT
The introduction of free trade policy and globalisation has forced businesses to review their strategies and focus on achieving customer satisfaction through quality services and products. Recognizing that fulfilling customers need fulfils the organizations needs as well, focussing on customer satisfaction by attracting, retaining and enhancing customer relationships has become a goal for every organization. This essay will examine how customer’s perceived quality can have a bearing on the profitability of a company. The essay concludes that providing quality services and products enhances customer satisfaction and perceived quality, which leads to customer loyalty and retention ultimately leading to success.
INTRODUCTION
Businesses are embracing marketing concepts and strategies with the objective of fulfilling their needs of increasing revenue, and reducing cost as a percentage of sales at the same time build business to gain a competitive edge (Fanning ,2013; Andronikidis, Georgiou, Gotzamani, & Kamvysi, 2009).Through the study of marketing one is able to understand and analyse the market (Fanning,2013), and adopt strategies to gain competitive edge by understanding the concepts and philosophies of marketing.
Kotler (1988) defined marketing as an activity geared towards satisfying human needs and wants by entering an exchange process. Fanning (2013), supports the same that the exchange process involves both the parties (customers and organizations) to mutually benefit by fulfilling each other’s needs. The strategies for achieving this are to attract new customers, retain existing customers and enhance value of relationships (Fanning, 2013).
It has been found that due to rising competition in the global environment, businesses are focussing on delivering quality service to achieve market leadership (Dagger & Sweeney, 2000; Parasuraman, Zeithaml & Berry,1985). While every organization aims to deliver 100 % customer satisfaction because it
The introduction of free trade policy and globalisation has forced businesses to review their strategies and focus on achieving customer satisfaction through quality services and products. Recognizing that fulfilling customers need fulfils the organizations needs as well, focussing on customer satisfaction by attracting, retaining and enhancing customer relationships has become a goal for every organization. This essay will examine how customer’s perceived quality can have a bearing on the profitability of a company. The essay concludes that providing quality services and products enhances customer satisfaction and perceived quality, which leads to customer loyalty and retention ultimately leading to success.
INTRODUCTION
Businesses are embracing marketing concepts and strategies with the objective of fulfilling their needs of increasing revenue, and reducing cost as a percentage of sales at the same time build business to gain a competitive edge (Fanning ,2013; Andronikidis, Georgiou, Gotzamani, & Kamvysi, 2009).Through the study of marketing one is able to understand and analyse the market (Fanning,2013), and adopt strategies to gain competitive edge by understanding the concepts and philosophies of marketing.
Kotler (1988) defined marketing as an activity geared towards satisfying human needs and wants by entering an exchange process. Fanning (2013), supports the same that the exchange process involves both the parties (customers and organizations) to mutually benefit by fulfilling each other’s needs. The strategies for achieving this are to attract new customers, retain existing customers and enhance value of relationships (Fanning, 2013).
It has been found that due to rising competition in the global environment, businesses are focussing on delivering quality service to achieve market leadership (Dagger & Sweeney, 2000; Parasuraman, Zeithaml & Berry,1985). While every organization aims to deliver 100 % customer satisfaction because it
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