Download - 48317137 Service Marketing Ppt
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MANAGING
SERVICEPROMISES
MANAGING
SERVICEPROMISES
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CUSTOMER
COMPANYExternal
Communicationsto CustomersThe
Communicatio
n Gap
Provider Gap 4
ServiceDelivery
Part 6 Opener
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Pricing and services
Lecture 11
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Pricing of Services
Discuss three major ways that service pricesare perceived differently from goods prices by
customers
Articulate the key ways that pricing ofservicesdiffersfrom pricing ofgoodsfrom a companys
perspective
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Overview (cont.)
Demonstrate what value means to customers
and the role that price playsin value
Describe strategies that companies use to
price services
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3 key differences
Customer knowledge ofservice prices: Service variability limits knowledge
Providers are unwilling to estimate prices
Individual customer needs vary
Collection ofprice information is overwhelming
Prices are not visible
Role ofnon-monetary costs:
Time costs
Search co
sts
Convenience costs
Psychological costs
Price as an indicator ofservice quality
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Three Basic Marketing Price Structures and
Challenges Associated with Their Use for Services
P= DC+OC+ProfitChallenges:1. Costs difficult to trace.
2. Laboris more difficult to
price than materials.
3. Costs may not equal the
value that customers
perceive the services areworth.
Challenges:1. Small firms may charge too
little to be viable.
2. Heterogeneity ofservices
limits
comparability.3. Prices may not reflect
customer value.
Challenges:1. Monetary price must be adjusted to reflect
the value ofnon-monetary costs.
2. Information on service costsis less available to
customers; hence, price may not be a central factor.
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Value is low price.Value is everything
I want in a service.
Value is thequality I get for
the price I pay.
Value is all thatI get for all
that I give.
Four Customer Definitions of Value
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Value is low price.
Discounting
Odd pricing
Synchro-pricing
Penetration pricing
Pricing Strategies When the Customer Defines
Value as Low Price
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Value is everythingI want in a service.
Prestige pricing
Skimming pricing
Pricing Strategies When the Customer Defines
Value as Everything Wanted in a Service
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Value is the quality I
get for the price I pay.
Value pricing
Market segmentation
pricing
Pricing Strategies When the Customer Defines
Value as Quality for the Price Paid
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Value is low price. Value is everything
I want in a service.
Value is the quality
I get for the price I pay.
Value is all that I get
for all that I give.
Discounting
Odd pricing
Synchro-pricing Penetration pricing
Prestige pricing
Skimming pricing
Value pricing
Market segmentation
pricing
Price framing
Price bundling
Complementary pricing
Results-based pricing
Summary of Service Pricing Strategies for
Four Customer Definitions of Value
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Integrated marketing
communications
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Integrated Services Marketing
Communications
Service communication challenges.
Integrated service marketing communications
Present four ways to integrate marketing communications
in service organizations Present specific strategiesfor managing promises,
managing customer expectations, educating customers,
and managing internal communications.
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Communications and the Services
Marketing Triangle
Internal MarketingVertical communications
Horizontal communications
Interactive MarketingPersonal selling
Customerservice centerService encounters
Servicescapes
External MarketingCommunication
AdvertisingSales promotionPublic relationsDirect marketing
Company
CustomersEmployees
Source: Kotler, Philip, MarketingManagement: Analysis, Planning, Implementation,and Control,9th Edition, 1997.
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Goal:Delivery is
greater thanor equal topromises
Offerserviceguarantees
Createeffectiveservicescommunications
MANAGING SERVICE PROMISES
Makerealisticpromises
Coordinateexternalcommunication
Approaches for Managing
Service Promises
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Services Advertising Strategies Matched
with Properties of Intangibility
Source:Adapted from B. Mittal, The Advertising ofServices: Meeting the Challenge ofIntangibility, Journalof Service Research,2, no. 1, August1999, pp. 98116.
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Goal:Delivery is
greater thanor equal topromises
Preparecustomersfor theserviceprocess
Clarifyexpectationsafter the sale
Teachcustomers toavoid peakdemand periodsand seek slowperiods
Confirmperformanceto standards
Approaches for Improving Customer
Education
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Goal:Delivery is
greater thanor equal topromises
Createeffective verticalcommunications
Align back-officepersonnel with
external customers
Createeffective horizontalcommunications
Createcross-functional
teams
Approaches for Managing Internal Marketing
Communications