ServiceFriday: The Pitfalls and Promises of Expectation Management

Companies try to manage customer expectations by communicating their capabilities, by way of their salespeople and other, non-human channels such as websites. One oft-recommended method is to promise the customer less than the firm is capable of producing, then delighting the customer by over-delivering. But is this a smart strategy?

Research published in the Journal of Service Research suggests that success of the under-promise over-deliver strategy depends on both the customer’s ideas and the company’s communications: “The success of the expectation management strategy mostly hinges on the interaction between the [customer’s] preconceived expectation threshold levels and whether the expectations are induced by an interpersonal channel.”

While breaking a promise is almost always detrimental, exceeding promises (the strategy employed in the under-promise over-deliver scenario) may not always be the best strategy: “The results show that the effectiveness of the over-delivering strategy depends on whether the pre-purchase expectations are formed over or under the latent individual expectation threshold levels.”

In other words, when customers patronize a firm anticipating that their service expectations will be met, they are pleased if the results delivered are even higher. But, for customers who look for performance that exceeds their pre-conceived notions about the company, over-performing is not necessarily better than simply keeping the implied promise; this group “does not like surprises,” researchers warn. 

Does it matter whether those promises are made by a person? Researchers say yes, because “when the information is communicated at a personal level via a salesperson … customers seek trust and are less likely to tolerate inaccuracy.”

The under-promising strategy may also cost a company a place in a customer’s list of prospective providers. By lowering the level of expected service, a company may be perceived as unqualified for consideration. “Under-promising just to over-deliver also costs the firm sales because of increased customer dropouts.”

Managerial implications

This research makes the case for further marketing research at the company level:

• Marketing managers should consider conducting research “on the levels of service (both minimal and ideal) their customers desire so that the proper messages can be communicated.”
• Research the risk of customer dropouts and subsequent revenue loss from promising only minimal levels in the hopes of over-delivering.
• “Marketers should give serious consideration to abandoning the under-promise/over-deliver model in favor of making promises that meet the ideal thresholds for their target markets and expending their resources on making sure that those promises are fulfilled”

There are implications for the sales team and sales management as well:

• Customers expect more accuracy from a salesperson compared to a non-personal communication channel such as a website. Therefore, sales managers must provide processes and training to ensure that salespeople are providing an accurate picture of the firm’s capabilities.
• Additional training may be necessary to help salespeople accurately portray the firm’s offerings as well. Failure can result in “customer dissatisfaction because of either over-promising (which can lead to failure to meet customer expectations) or under-promising (which can lead to a lack of trust in the salesperson or firm).”

The full report is available from the Journal of Services Marketing. (A fee may apply.)