Service Marketing: Analysis of Woolworths and Managerial Insights

This report analyzes the service marketing strategies of Woolworths, a major Australian supermarket chain. It begins with a flowchart illustrating backstage and front stage activities. The report emphasizes the significance of service encounters, defining them as critical interactions between customers and company representatives, which significantly impact customer satisfaction and loyalty. It highlights the importance of assisting customers, both in-store and online, addressing issues related to product pricing, finding items, and online order problems. The report then delves into the managerial implications of service marketing, focusing on the importance of effective backstage activities like supply chain management, quality control, and efficient backend operations. The role of managers in coordinating these activities, ensuring timely product delivery, and managing customer feedback is also discussed. The report stresses the need for managers to maintain customer satisfaction and retain loyal customers through efficient front-end and back-end operations, ultimately contributing to Woolworths' success as a leading grocery chain. References from various authors are included to support the analysis.

Running head: SERVICE MARKETING
Service Marketing
Name of the student:
Name of the University:
Author Note:

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1. Flowchart of backstage and front stage activities

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Figure 1: Backstage and front stage activities flowchart
(Source: Created by author)
2. Significance of service encounter
The chosen company for this assignment is Woolworths. Woolworths is one of the largest
supermarket and grocery chain of Australia. They specialise in selling groceries and stationary
items. Along with these items, they sell clothing and home decor items as well. Being a leader in
the Australian market, the service encounter of the grocery chain is significant enough (Ahsan
and Rahman 2016). As an employee of Woolworths, I have to ensure that I am able to maintain
the customer service level that the company has set for the world. I need to endure that the
customers of Woolworths are able to shop with a good shopping experience. The customers are
often unable to understand the price of the products, according to the weight. As a customer
service manager, it is essential that I assist them in understanding the price they have to pay for a
certain quantity. Moreover, the customers have to be assisted and guided in finding certain items.
Woolworths provides assistance to the elderly customers. They need physical assistance as well
as guidance to find the products that they are looking for. Thus, the assistance given to the
elderly customers are essential.
Along with the in-store assistance, the online customers also need assistance. The
customers, buying their products online, often complain that their products that are delivered are
not up to the expected standard or does not match with the one displayed in the website.
Moreover, the customers, booking their products online often feel that they need guidance
regarding the products they would buy. Thus, it is essential that the customer service managers
assist those customers. Online payment issues are also faced, and customers are unable to pay
online. Hence, assistance is needed from the customer services executives. However, the service

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encounter is much more than just assisting the customers. It is defined as the transactional
interaction between the customers of Woolworths and the representatives of the company. The
service encounter is not only limited to the transactional interaction with the customers, but also
includes the establishment of a relation with the customers. The moments of interaction with the
customers are significant, since it is that moment when the impression on the customers is made.
This moment is often known as the decisive moment or “the moment of truth”. In this moment of
interaction, the customer is either satisfied or dissatisfied. Another essential aspect of the service
encounter is the recovery of the services of the dissatisfied customers, such that they could be
retained as loyal customers.
The significance of the service encounter lies in the fact that it has a significant impact on
the quality perception of the customers of Woolworths. If the customers are happy and satisfied
with the services provided by the customer service representatives, then the level of satisfaction
of the customers increases (Lovelock and Patterson 2015). While the customers have a negative
experience regarding the customer interactions, then they are deflected from the company. As an
employee of Woolworths I need to ensure that the interaction with the customers are positive and
the level of customer satisfaction is achieved. Satisfying each customer is a key to success for
any organization. In Woolworths, every customer is given importance and the customer
interactions are significant. The qualities of the services that are provided to the customers are
superior and ensure that the customers could be retained successfully (Bijmolt et al. 2014). The
loyal customers are given loyalty bonus and special discounts such that the company is able to
retain the customers successfully. Failure to provide the expected level of customer services
might destroy the long built reputation of the business organization. Hence, the service encounter
activities are significant enough to retain the reputation of Woolworths.

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3. Analysis of managerial implications
Managerial implications refer to the practical utilization of the collected data and
information. The information that is used is collected from practical scenario and decisions. The
managerial implications highlights the fact that the collected information is used to understand,
whether the decisions taken by the manager are appropriate in the given scenario or not. In case
of Woolworths, the managerial implications include the backstage activities that has to be taken
up, in order to ensure that supply chain management activities are taken up effectively, such that
the satisfaction of the customers are achieved (Armstrong et al. 2014). As a store manager, it is
important to ensure that the back stage tasks are completed successfully. As a manager, I have to
check the availability of the products in the store and place an order to the suppliers accordingly.
The supply chain management activities have to be monitored and ensured the timely delivery of
the products. The suppliers of the raw materials have to be traced for timely delivery (Ryan
2016). Moreover, the backend activities, such as quality check of the groceries, proper packaging
and such activities have to be monitored from time to time by the manager, in order to ensure
that the best quality of the products are delivered in store and to the customers who placed their
products online.
The backend services and processes ensure that the front-end activities are taken up and
completed successfully. For example, if the supply chain management is not done effectively,
then the products will not reach the stores on time, and thus will delay the overall process and
will reduce the sale of the products (Batt 2014). Moreover, if the backend activities are not
monitored and managed, then the customers will not be able to get the products as and when
required, thus triggering customer dissatisfaction. The managerial implications thus are essential
for the effective operations in Woolworths. The guidance of the managers are important in order

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to ensure the successful and effective operation of Woolworths. Thus, the efficiency of the
managers and the management operations highlight the effectiveness of service encounters and
helps the company to achieve customer satisfaction. Regular feedback is taken from the
dissatisfied customers such that the managers are able to win them back as loyal customers, with
high level of customer services being provided. With efficiency in both the front end and the
back end operations Woolworths will be successful in retaining its position as a leader as a
grocery chain and retailer. As given in the flowchart, the backend activities are dependent on a
variety of factors such as suppliers, logistics and the contractors (Hollensen 2015). Thus, as a
manager it is essential to co-ordinate all the activities such that effective management could be
displayed which is essential for achievement of customer satisfaction. Developing various
policies such as co-ordination with the suppliers, looking for alternatives, quality assurance,
checking and eliminating the product that do not match with the standards of Woolworths
(Fernie and Sparks 2014). The effective waste management and CSR activities also needs to be
given importance, as a part of the back end activities.
Thus, it could be concluded the service encounter has a special significance in the
business operations. The managerial implications are also needed for the back stage operations of
Woolworths. As an employee, I have to ensure that the customer satisfaction activities are given
importance, along with the managerial implications. Both these activities have to be given
importance and completed with diligence, in order to ensure smooth operations.

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References
Ahsan, K. and Rahman, S., 2016. An investigation into critical service determinants of customer
to business (C2B) type product returns in retail firms. International Journal of Physical
Distribution & Logistics Management, 46(6/7), pp.606-633.
Armstrong, G., Adam, S., Denize, S. and Kotler, P., 2014. Principles of marketing. Pearson
Australia.
Batt, P.J., 2014. How do consumers differentiate between fresh food stores. In XXIX
International Horticultural Congress on Horticulture: Sustaining Lives, Livelihoods and
Landscapes (IHC2014): XVII 1103 (pp. 61-68).
Fernie, J. and Sparks, L., 2014. Logistics and retail management: emerging issues and new
challenges in the retail supply chain. Kogan page publishers.
HA Bijmolt, T., KRE Huizingh, E. and Krawczyk, A., 2014. Effects of complaint behaviour and
service recovery satisfaction on consumer intentions to repurchase on the internet. Internet
Research, 24(5), pp.608-628.
Hollensen, S., 2015. Marketing management: A relationship approach. Pearson Education.
Lovelock, C. and Patterson, P., 2015. Services marketing. Pearson Australia.
Ryan, D., 2016. Understanding digital marketing: marketing strategies for engaging the digital
generation. Kogan Page Publishers.