chapter 23 marketing of services -marketing management
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Marketing of Services
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Marketing of
Services
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Marketing of Services
Defining ServicesA service is an activity or series of activities of more or less intangible nature
that normally, not necessarily, takes place in interactions between the customer
and service employees and/or physical resources or goods and/or system of the
service provider, which are provided as solutions to customer problems.
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Marketing of Services
Characteristics of Services
Typical characteristics of services include
1. Intangibility
2. Inseparability of production and consumption
3. Heterogeneity
4. Perishability
5. Client-based relationship
6. Customer contact.
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Marketing of Services
Service
Characteristics
Intangibility Difficult to evaluate, Marketer sells a promise, Difficult to
advertise, Difficult to justify prices, Goods augmented with
intangible services.
Inseparability Activities of service production and consumption are
simultaneous, Consumers must participate in production.
Consumer does not take physical possession of service, Role of
service provider critical.
Heterogeneity Considerable variation in man-based service quality, Quality
control difficult, Difficult to standardise service delivery.
Perishability Services cannot be stored. Very difficult to balance supply and
demand, Unused capacity lost for ever, Considerable variation in
demand.
Client-Based
Relationship
Success depends on satisfied customers in the long-run,
Customer relationship maintenance is critical. Retaining a groupof satisfied customers essential.
Customer
Contact
Service providers commitment critical to delivery, High-level of
employee training and motivation essential to success, Service
marketers try to change high-contact services into low-contact
services without affecting customer satisfaction.
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Marketing of Services
Classification of Services
Despite considerable diversity, services can also be classified on the basis of
different categories:
Type of market.
Degree of labour intensiveness.
Degree of customer contact.
Skill of service provider.
Goal of service provider.
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Marketing of Services
The
Service
Continuum
Education Ad
Agency
Health
Care
Air
Travel
Restaurant Retail
Store
Autos HouseSugar
Tangible(Good-Dominant)
Intangible(Service-Dominant)
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Marketing of Services
Developing Marketing Strategies for Services
Marketing mix for services is an extended one and includes 7Ps.
Three more Ps for service products marketing and include people, physical
evidence, and process.
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Marketing of Services
People of a service organisation involved in production and delivery ofservices are a vital element of the marketing mix.
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Marketing of Services
Physical evidence reduces the risk perception by customers byoffering tangible evidence of the promised service delivery.
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Marketing of Services
Process is of critical importance to consumers in high-contact services.
Service marketers can choose among different processes to deliver their
services to consumers.
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Marketing of Services
Services Involve
Three Types of
MarketingCompany
Internal
Marketing ExternalMarketing
Employees Consumers
InteractiveMarketing
ChildcareServices
FinancialServices
Air Travel
Services
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Marketing of Services
Service Quality and Differentiation
Service quality as the customers perception of how well a service meets or
exceeds their expectations.
CustomerSatisfaction = Perceived Delivered Service Expected Service
Service Quality Evaluation
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Marketing of Services
Model of
Service-
Quality
Word-of-MouthCommunications
Personal Needs Past Experience
ExpectedService
Perceived Service
Service Delivery(including pre and
post-delivery contacts
ExternalCommunicationsto Consumers
Translation ofPerceptions intoService-QualitySpecifications
Management'sPerceptionsof ConsumerExpectations
CONSUMER
MARKETER
GAP3
GAP5
GAP
4
GAP1
GAP
2
(Source: Slightly modified fromA. Prasuraman, Valarie A.
Zeithaml, and LeonardL. Berry, A Conceptual Model
ofService Quality and ItsImplications for Future
Research, Journal ofMarketing, Fall 1985).
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Marketing of Services
Monitoring Service Performance
Service companies can use several methods to monitor their
performance, such as ghost shopping, putting in place an efficient system
of receiving consumer complaints and suggestions, and conducting
surveys etc.