delivering service through intermediaries
TRANSCRIPT
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McGraw-Hill 2000 The McGraw-Hill Companies
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McGraw-Hill 2000 The McGraw-Hill Companies
Chapter 13
DELIVERING SERVICE
THROUGH
INTERMEDIARIES AND
ELECTRONIC CHANNELS
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Objectives for Chapter 13:Objectives for Chapter 13:Delivering Service throughDelivering Service through
Intermediaries and ElectronicIntermediaries and Electronic
ChannelsChannels Identify the primary channels through which
services are delivered to end customers
Provide examples of each of the key serviceintermediaries
View delivery of service from two perspectives--
the service provider and the service deliverer
Identify the benefits and challenges of each method
of service delivery
Outline the strategies that are used to manage
service delivery through intermediaries
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SM Service Provider ParticipantsService Provider Participants
service principal (originator)
creates the service concept
(like a manufacturer)
service deliverer (intermediary)
entity that interacts with the customer in theexecution of the service
(like a distributor/wholesaler)
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Key IssuesKey Issues
Involving IntermediariesInvolving Intermediaries
conflict over objectives and performance
conflict over costs and rewards
control of service quality
empowerment versus control
channel ambiguity
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SM Services IntermediariesServices Intermediaries
franchisees
e.g., Jiffy Lube, H&R Block, McDonalds
agents and brokers
e.g., travel agents, independent insurance agents
electronic channelse.g., ATMs, university video courses, TaxCut
software
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Exhibit 13-4Exhibit 13-4
Summary of Benefits and ChallengesSummary of Benefits and Challenges
for Franchisers of Servicefor Franchisers of Service
Leverages the business
format to gain
expansion and revenues
Maintains consistency
in outlets
Gains knowledge oflocal markets
Shares financial risk and
frees up capital
Difficulty in maintaining and
motivating franchisees Highly publicized disputes
and conflict
Possibility of inconsistent
quality that can underminethe company name
Control of customer
relationship by intermediary
Benefits Challenges
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Summary of Benefits andSummary of Benefits and
Challenges for Franchisees ofChallenges for Franchisees of
ServiceService
Obtaining an established
business format onwhich to base a business
Receiving national or
regional brand
marketing Minimizing the risks of
starting a business
Disappointing profits and
revenues Encroachment and franchise
saturation
High failure rates and unfair
terminations
Lack of perceived control
High fees and rigid contracts
Unrealistic expectations
Benefits Challenges
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Exhibit 13-6Exhibit 13-6
Summary of Benefits and ChallengesSummary of Benefits and Challengesin Distributing Services throughin Distributing Services through
Agents and BrokersAgents and Brokers
Reduced selling and
distribution costs Intermediarys
possession of special
skills and knowledge
Wide representation Knowledge of local
markets
Customer choice
Loss of control over
pricing and otheraspects of marketing
Representation of
multiple service
principals
Benefits Challenges
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Exhibit 13-7Exhibit 13-7
Summary of Benefits and Challenges inSummary of Benefits and Challenges in
Electronic Distribution of ServicesElectronic Distribution of Services
Consistent delivery for
standardized services
Low cost
Customer convenience
Wide distribution
Customer choice andability to customize
Quick customer feedback
Customers are active, not passive
Lack of control of electronic
environment Price competition
Inability to customize withstandardized services
Lack of consistency withcustomer involvement
Security concerns
Competition from widening
geographies
Benefits Challenges
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SM Strategies for Effective ServiceStrategies for Effective Service
Delivery through IntermediariesDelivery through Intermediaries
Measurement
Review
Control Strategies
Alignment of goals
Consultation andcooperation
Help the intermediary
develop customer-basedservice processes
Provide needed support
Develop the
intermediary to deliverservice quality
Change to a cooperativemanagement structure
Empowerment Strategies
Partnering Strategies