f10 mcs 1000 adlam notes

8/10/2019 F10 MCS 1000 Adlam Notes

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MARKETING FINAL EXAM NOTES

List of Topics:7 Ps of serviceBrand Equity

Competition-based pricing (services)Consumer buyer behaviorConsumer surplusConsumerismConventional distribution channel vs vertical marketing systemCore product !upplementary services (flo"er of service)Criticisms of marketingC#$ (Customer #elationship $anagement) !trategiesCycle of failure% mediocrity% success&emand management approaches&emand $anagement !trategies

&ifferentiation !trategies&imensions of service quality&istribution channel conflictEnvironmentalismEstablishing service levels'our categories of service'our service focus strategies'ront and back stage personnelaps in service design and deliveryeneral Pricing pproachesood vs* !ervice

+igh vs* ,o" involvement productsmportant vs determinant attributes.ack /rout0s four principles of positioning$arketing communications mi1$arketing concepts$arketing Environment$arketing ntelligence$arketing $i1$arketing #esearch$arketing2&istribution channels$aslo"0s +ierarchy of 3eeds

3eeds24ants2&emands3e" product &evelopment

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LECTURE 1

MARKETING INVOLVES:

-consumers

-government

-avert!sers

-"roucers

-manu#acturers

$%AT CAN &OU MARKET'

-ever(t)!ng* +ut a!r

$%AT CAN $E CONTORL IN MARKETING'

-target mar,et

-ava!a+!!t(.su""(

-eman

-"rouct

$%ERE CAN &OU MARKET'

-!nternet

-s!e o# +uses

-stoc,s

-maga/!nes

-"osters

-T0v0

-nes"a"ers

$%AT IS MARKETING'

-conce"t!on



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-"r!c!ng

-"romot!on

-!str!+ut!on o# !eas goos an serv!ces

-to create e2c)anges t)at sat!s#( !n!v!ua

SOME E3AM4LES O5 MARKETING:

-"rouct.serv!ces

-"r!c!ng

-"romot!on

-!str!+ut!on

Conce"t o# !#e* u2ur(* cot)es* cars

LECTURE 1

Who are the experts?

Consumers

E2"osure: to messages* tact!cs* "rograms

What is marketing?

Attract!ng ne customers +( "rom!s!ng an e!ver!ng su"er!or vaue

6u!!ng ong-term reat!ons)!"s !t) customers +( e!ver!ng cont!nue customer

sat!s#act!on

Creat!ng* +u!!ng* an manag!ng t)ese reat!ons)!"s "ro#!ta+( over t!me

The Marketing Process: (fig. 1.1)

10 Unerstan t)e mar,et"ace an customer nees an ants

70 8es!gn a customer r!ven mar,et!ng strateg(

90 Construct a mar,et!ng "rogram t)at e!ver su"er!or vaue



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0 6u! "ro#!ta+( reat!ons)!"s an create customer e!g)t

;0 Ca"ture vaue #rom customers to create "ro#!ts an customers e


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C)oose t)e r!g)t segment to target

O##er a un!ect!ve v!e o# t)e o##ers vaue com"are to com"et!t!ve o##ers

Customer sat!s#act!on:

customers su+>ect!ve v!e o# t)e vaue rece!ve !n return #or t)e "urc)ase "r!ce

Customer e!g)t

Customers su+>ect!ve v!e o# t)e !ncrease vaue rece!ve a+ove t)e "urc)ase

"r!ce

Non-For-Profit Marketing

Mar,et!ng o# !eas* vaues an !nst!tut!ons



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-!ncreas!ng aareness t)at t)ese organ!/at!ons must +u! reat!ons)!"s !t)

const!tuents an sta,e)oers

-c)aenge o# us!ng ne mar,et!ng tec)n!


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-M!ss!on Statement:

Statest)e organ!/at!ons "ur"ose

Mar,et an customer-or!ente 4rov!es !rect!on to !nterna sta,e)oers

-Customers are t)e #ront-!ne

Strategic Business Unit (SBU)

- a un!t o# t)e com"an( t)at )as a se"arate m!ss!on an se"arate o+>ect!ves an

t)at can +e "anne !ne"enent( #rom ot)er com"an( +us!nesses

- can +e a com"an( !v!s!on* a "rouct !ne !t)!n a !v!s!on or somet!mes a s!nge

"rouct or +ran

The Marketing Process

ana(/e current s!tuat!on

ana(/e mar,et!ng o""ortun!t!es

seect target mar,ets

eveo" t)e mar,et!ng m!2

manage t)e mar,et!ng e##ort

6CG- Grot)-S)are Matr!2

Value Delivery Network:

10 Com"an(=s Vaue C)a!n

70 Su""!ers

90 Customers0 8!str!+utors

Num+er one goa !n mar,et!ng- Long-term "ro#!ta+e customers reat!ons)!"s

Marketing Mix:



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T)e set o# controa+e* tact!ca mar,et!ng toos t)at #!rm +ens to "rouce t)e

res"onse !t ants !n t)e target mar,et

4rouct* 4r!ce* 4romot!on* 4ace

The Four Ps and the Four Cs

4rouct provides Customer Sat!s#act!on

4r!ce represents Customer Cost

4ace provides Conven!ence

4romot!on enables 2-way Commun!cat!on

Manage the Marketing Effort

6u! strong o"erat!ona Mar,et!ng "an

Organ!/e mar,et!ng e"artment

Leverage vae c)a!n an vaue netor,

E2erc!se Contro

-Set goas

-Measure an evauat!on "er#ormance

-Ta,e correct!ve act!on

$)at !s a Mar,et!ng 4an'

Marketing Control Process

Set goasMeasure 4er#ormanceEvauate "er#ormanceTa,e correct!ve act!on

CHAPTER 13: Introduction to Services

$)( Stu( Serv!ces'

Serv!ces 8om!nate Econom( !n Most Nat!ons

Most Ne o+s are Generate +( Serv!ces



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-5astest Grot) E2"ecte !n Knoege-+ase !nustr!es

-Man( ne >o+s are $e-"a! re


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10 4rouct eements

70 4ace an t!me

90 4r!ce an ot)er user outa(s

0 4romot!on an eucat!on;0 4rocess D

0 4)(s!ca env!ronment D

0 4eo"e D

Chapter 3 Overview:

$)at !s our roe as consumers'

$)at !s our roe o# "roucers'

$)at !s t)e roe o# t)e mar,et!ng s(stem'

Socially Responsible Marketing:

-Most Cana!ans #ee t)at com"an!es are F>ust averageF !n t)e!r soc!a res"ons!+!!t(

-%a# o# consumers sa( t)e( ou not "urc)ase #rom a com"an( t)at as not soc!a(

res"ons!+e

-Cana!ans )ave )!g) e2"ectat!ons o# t)e!r com"an!es

-$)at !s t)e !##erence +eteen +e!ng res"ons!+e an soc!a( res"ons!+e mar,eters'

- #oo!ng as.soc!a( oo,!ng a#ter commun!t(

Ethics:

In (our on ors:

-- 8!##erences a+out )atFs r!g)t an rong'

-- $)at !s meant +( "ro#ess!ona et)!cs'

-- $)at !##erent!ates F!egaF #rom Funet)!caF'

Gu!e!nes."o!ces an "roceures o# )at com"an( t)!n,s !s r!g)t an rong*

usua( mae "u+!c

s)oun=t o !t* cant o !t

Criticism of Marketing:

-%!g) 4r!ces: ea to )!g)er "r!ces ue to mar,et!ng act!v!t!es



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-Unnecessar( Avert!s!ng: E20 As !n as)rooms* ema! s"am

-%!g) "ressure se!ng: e20 !m!te t!me ea

-8ece"t!ve avert!s!ng: e20 vacat!on "r!ces ?ta2es@

-Creat!ng #ase nees: e20 coogne."er#ume

ConsumerismEnvironmentalism

Consumer Protection Act: Scanner Price Accuracy Voluntary Code

-I# t)e scanne !tem !s )!g)er t)an t)e s)eve "r!ce* (ou can get !t #or #ree* u" to a H1

ma2!mum

-enorse +( t)e Com"et!t!on 6ureau

-Over ; reta!ers across Canaa are Vountar( Coe "art!c!"ants

Lecture 9

C%A4TER

Marketing Environment Defined:

T)e "rocess an #orces outs!e mar,et!ng=s !rect contro t)at a##ect mar,et!ng

management=s a+!!t( to eveo" an ma!nta!n success#u transact!ons !t) target

customers0

Microenvironment:

5actors cose to t)e com"an( t)at a##ect !ts a+!!t( to serve !ts customers

Un!


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5actors:T)e com"an(* su""!ers* mar,et!ng !nterme!ar!es* customers*

com"et!tors* "u+!cs

Microenvironment:

Larger soc!eta #orces t)at a##ect t)e m!croenv!ronment

Cons!ere to +e +e(on t)e contro o# t)e organ!/at!on

5orces: 8emogra")!c #orces* econom!c #orces* natura #orces* tec)noog!ca

#orces* "o!t!ca #orces* cutura #orces

Demographics

Mar,eters trac, c)ang!ng age an #am!( structures* geogra")!c "o"uat!on s)!#ts*

eucat!ona c)aracter!st!cs an "o"uat!on !vers!t(

Baby Boomers:

J m!!on +orn +eteen 1J-1J

Account #or one-t)!r o# "o"uat!on

%!g) amount o# !s"osa+e !ncome

No mov!ng !nto m!e-age

Economic Environment:

A t)ose #actors t)at a##ect consumer +u(!ng "oer an s"en!ng "atterns-Income eves an !str!+ut!on

-T)e necess!t(= o# "roucts

-C)anges !n trens an consumer s"en!ng

-Econom!es o# !##erent nat!ons

Cultural Environment:

T)e !nst!tut!ons an ot)er #orces )at a##ect a soc!et(=s +as!c vaues* "erce"t!ons*

"re#erence an +e)av!ors

Cutura vaues are )!g)( "ers!stent

Learne #rom #am!( an commun!t(

International Trade Issues



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Trae restr!ct!ons

-tar!##s

-


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Mar,et!ng researc) !s conucte to coect ata- +ut mar,et!ng managers muc)

transate t)at ata !n#ormat!on

Customer Reat!ons)!" Management ?CRM@ s(stems)at are t)e( an )at

o t)e( o'-Com"an( +ase s(stem manag!ng "otent!a su""!ers

CRM Example:

Net#!2* VC0com* Ama/on Lea E-Reta!ers !n Customer Sat!s#act!on

-Keogg ants to !nvest!gate !# (oung c)!ren )ave an !m"act on t)e!r "arents=

ec!s!ons to +u( +rea,#ast #oos: seconar(* casua

-Un!vers!t( 6oo,store ants to get some !ns!g)ts !nto t)e !m"act on saes I# t)e(

!ncrease "rocess +( 7B: "r!mar(* casua* surve(

-G!ette ants to eterm!ne )et)er a mar,et e2!sts #or a ne !ne o# eoorant #or

c)!ren: "r!mar(* escr!"t!ve* #ocus grou"

Im"ortant to unerstan )o cutura* soc!a* "ersona* ")(s!oog!ca #actors

a##ect "urc)ase ec!s!ons0

-Same ec!s!on-ma,!ng "rocess a""!es to cars as !t oes to co##ee

From a buyers perspective

An e2am"e o# a +us!ness +u(er ou +e a )os"!ta

$)o o (ou t)!n, +u(s t)e sca"es an t)e 2-ra( mac)!nes* )o o t)e( ec!e

)!c) ones to +u('

-Same ec!s!on-ma,!ng "rocess a""!es to cars as !t oes to co##ee

The Consumer Buyer Decision Process:

5!gure 0

Business markets and business buyer behavior

$)at #actors ou !n#uence +us!ness +u(er +e)av!or'

-5!2e "r!ce vs0 negot!at!on



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-Cas).cre!t vs0 "a(ments

8ec!s!on cr!ter!a !s "ro#ess!ona* not "ersona

-Consumers +u( !tems one at a t!me an #ocus on +ran."r!ce

-6us!ness +u(ers "urc)ase +( t)e t)ousans* #ocus on tota cost o#oners)!" an a#ter-saes serv!ce

Types of Needs:

Overa as"ects* not categor!/e

Ma!n not !n!v!uas

Maslows Hierarchy of Needs

4ersona Nees:Goas* ac)!evements* se#-sat!s#act!on.actua!/at!on

Soc!a Nees:5r!ens* 5am!(

Sa#et( Nees:5ree #rom attac,

4)(s!oog!ca Nees:S)eter* 5oo

CHAPTER 14: Consumer 6e)av!or !n a SERVICES Conte2t

4re-"urc)ase StageServ!ce Encounter Stage4ost-"urc)ase Stage

Pre-purchase Stage:

R!s,-reuct!on strateg!es t)at serv!ce su""!ers can eveo"

Serv!ce e2"ectat!ons

Nee aareness



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In#ormat!on Searc)

Evauat!on o# Aternat!ves

4urc)ase 8ec!s!on

-Evoked set:set o# "oss!+e serv!ces or +rans t)at a customer ma( cons!er !n t)eec!s!on "rocess

-t)e !##erent aternat!ves nee to +e evauate +e#ore a #!na c)o!ce !s mae

Service Attributes: Style color texture taste soundExperience Attributes: vacations sportin! events medical procedures

Credence Attributes: "uality o# repair and maintenance work

Perceived Risks:

-5unct!ona

-5!nanc!a

-Tem"ora

P4)(s!ca

-")(s!oog!ca-#ears negat!ve emot!ons

-soc!a- )o ot)ers t)!n, an act

-sensor(-unante !m"act on ; senses

$ow to %andle t%em&

-see,!ng !n#ormat!on #rom res"ecte "ersona sources

-us!ng !nternet to com"are serv!ce o##er!ngs an searc) #or !ne"enent rev!es an

rat!ngs

re"(!ng on a #!rm t)at )as a goo re"utat!on

-oo,!ng #or guarantees an arrant!es

-v!s!t!ng serv!ce #ac!!t!es or tr(!ng as"ects o# serv!ce +e#ore "urc)as!ng

-as,!ng ,noegea+e em"o(ees a+out com"et!ng serv!ces

Service Encounter Stage:

Encounters range #rom )!g) to o contact

An !ntegrat!ve "ers"ect!ve: Serv!ce #ac!!t!es* 4ersonne* Roe an scr!"t t)eor!es

707

T)e Servuct!on S(stem 5!g0 7077



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Post Purchase Stage

-Evauat!on o# serv!ce "er#ormance

-#uture !ntent!ons

Lecture

Segmentat!on* Target!ng* an 4os!t!on!ng

Unerstan t)at a mar,et* a mar,et segment* an a target mar,et are a

var!at!ons o# t)e same conce"t-a grou" o# "eo"eQ

T)!n, o# a "!e

No suc) t)!ng as a "rouct t)at !s #or ever(one

Segmentat!on eas to stereot("es

8on=t +e a#ra! to oo, +e(on "us) (ourse# +e(on s!m"( !nent!#(!ng ever(

mar,et segment accor!ng to age an gener

8on=t +e a#ra!# touse emogra")!c an "s(c)oogra")!c c)aracter!st!cs

Overv!e o# t)e 9-Ste" 4rocess

Mar,et Segmentat!on: Ient!#( +ases #or segment!ng mar,et

8eveo" "ro#!es o# resut!ng segments

Mar,et target!ng: 8eveo" measures o# segment attract!veness

Seect t)e target segments

Mar,et 4os!t!on!ng: 8eveo" "os!t!on!ng #or eac) segment

8eveo" mar,et!ng m!2 #or eac) segment

Mar,et Segmentat!on

-6ases o# segmentat!on:Geogra")!c:

Area* "o"uat!on ens!t(* c!mate* etc

8emogra")!c:

Age* se2* !#ec(ce* !ncome* >o+* etc0



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4s(c)ogra")!c:

L!#est(e* "ersona!t(

6e)av!ora:

6ene#!ts soug)t* status* usage rate* o(at(* att!tues* etc0

E2am"e: La+att=s 6eer

Segments: $atc) s"orts )o aso "a( ant !g)t +eer

E2am"e 7: &ouTu+e v!eo

Segment: Lo(at( to (our #r!en* #ocuse on gu(s

Segment!ng 6us!ness Var!a+es

Ma>or Cr!ter!a #or segment!ng +us!ness mar,et!ngs are:

-o"erat!ng c)aracter!st!cs o# t)e com"an(

-"urc)as!ng a""roac)es

-s!tuat!ona #actors

-customer s!/e

-Geogra")!c ocat!on

Segment!ng Internat!ona Mar,ets

Geogra")!c ocat!ons

Econom!cs 5actors

4o!t!ca an ega #actors

Cutura #actors ?anguage@

Evauat!ng Segments

Mar,eters must evauate t)e e##ect!veness o# t)ose segments:

Measura+!!t(

-Can +e measure

Access!+!!t(

-Can +e reac)e an serve

Su+stant!a!t(



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-"ro#!ta+e.arge enoug) to serve

8!##erent!a+!!t(

-Su+stant!a( !##erent t)an ot)er segments

Act!ona+!!t(-E##ect!ve "rograms can +e es!gne

Mass Mar,et!ng

No segments an s!nge mar,et!ng m!2

8!##erent!ate ?segment@ Mar,et!ng

Large segments !t) s"ec!#!c mar,et!ng m!2es

Concentrate ?n!c)e@ mar,et!ng

Sma segments !t) s"ec!a!/e mar,et!ng m!2es

M!cromar,et!ng

Custom!/e mar,et!ng to !n!v!uas

4os!t!on!ng

8es!gn!ng t)e com"an(=s o##er!ng an !mage #or a !st!nct!ve "ace in t%e mind o# t%etar!et market'

Success#ul Positionin!

Product position:

%o a "rouct !s v!ee +( consumers reat!ve to com"et!ng "roucts

T)ree "os!t!on!ng ste"s

Ient!#( com"et!t!ve avantages on )!c) to +u! a !##erent!ate "os!t!on

C)oose t)e r!g)t com"et!t!ve !##erent!at!on

Seect an overa "os!t!on!ng strateg(

Ga!n!ng Com"et!t!ve Avantage

Ke( to !n!ng target customers !s to unerstan t)e!r nees +etter t)an (our

com"et!tors o an to e!ver more vaue

Com"et!t!ve Avantage: e2tent to )!c) a com"an( can "os!t!on !tse# as

"rov!!ng su"er!or vaue



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Ient!#(!ng Com"et!t!ve Avantage

1. 4rouct 8!##erent!at!on ?eg0 Cons!stenc( ura+!!t(* re!a+!!t(* re"ara+!!t(@

70 Serv!ces 8!##erent!at!on ?eg0 S"ee* conven!ence* care#u e!ver(@

90 Image 8!##erent!at!on ?eg0 Conve( +ene#!ts an "os!t!on!ng@0 4eo"e 8!##erent!at!on ?eg0 %!r!ng* tra!n!ng +etter "" t)an com"et!tors@

;0 C)anne 8!##erent!at!on ?eg0 Reta! outet stores vs0 t)e !nternet@

E2am"e: Mounta!n 8e:

-Image: (ou ! o an(t)!ng (ou can to get (our )ans on or "rotect (our r!n,

s"onsor!ng to e2treme s"orts* )!g) energ(* !ve on t)e ege consumer

Success#u 8!##erent!at!on

Im"ortant- o# vaue to consumers

8!st!nct!ve- o+v!ous an cear

Su"er!or- +etter vaue t)an com"et!tors

Commun!ca+e- e2"a!na+e

4re-em"t!ve- e#ena+e an un!


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6as!c 5ocus Strateg!es #or Serv!ces

Cons!erat!ons #or us!ng t)e 5ocus Strateg!es

Market #ocused: Narro mar,et segment !t) !e range o# serv!ces

Nee to ma,e sure #!rms )ave o"erat!ona ca"a+!!t( to o an e!ver eac) o# t)e

!##erent serv!ces seecte

Nee to unerstan customer "urc)as!ng "ract!ces an "re#erencesService (ocused:

Narro range o# serv!ces to #a!r( +roa mar,et

As ne segments are ae* #!rm nees to eveo" ,noege an s,!s !n

serv!ce eac) segment)n#ocused:

6roa mar,ets !t) !e range o# serv!ces

Man( serv!ce "rov!ers #a !nto t)!s categor(

8anger- +ecome a >ac, o# a trae an master o# none

Im"ortance o# 8eterm!nant Attr!+utes

Consumers c)oose +eteen aternat!ve serv!ce o##er!ngs

8eterm!nant attr!+utes eterm!ne +u(ers= c)o!ces +eteen com"et!ng

aternat!ves

Esta+!s)!ng Serv!ce Leves an T!ers

Nee to ma,e ec!s!ons on serv!ce eves-eve o# "er#ormance #!rm "ans to o##er

on eac) attr!+ute

Segment customers accor!ng to !!ngness to trae o## "r!ce versus serv!ce

eve

Serv!ce t!er!ng: "os!t!on!ng strateg( +ase on o##er!ng server "r!ce-+ase casses

o# serv!ce conce"t

DD5our 4r!nc!"es o# 4os!t!on!ng Strateg( ACK TROUTDD



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4os!t!on!ng as a 8!agnost!c too

Unerstan reat!ons)!"s +eteen "roucts an mar,ets

Com"are to com"et!t!on on s"ec!#!c attr!+utes Evauate "rouct=s a+!!t( to meet consumer nees.e2"ectat!ons

4re!ct eman a s"ec!#!c "r!ces."er#ormance eves

Ient!#( mar,et o""ortun!t!es

Introuce ne "roucts

Rees!gn e2!st!ng "roucts

E!m!nate non-"er#orm!ng "roucts

Ma,e mar,et!ng m!2 ec!s!ons* res"on to com"et!t!on

8!str!+ut!on.serv!ce e!ver(

4r!c!ng

Commun!cat!on

DD8eveo"!ng a Mar,et 4os!t!on!ng Strateg( ?Ever(t)!ng t)at goes !nto creat!ng@

Ant!c!"at!ng Com"et!t!ve Res"onse

Com"et!tors m!g)t "ursue same mar,et "os!t!on

Get !ns!e com"et!tors )eas

Ana(/e "oss!+e e##ects o# aternat!ve com"et!t!ve moves

-!m"act o# "r!ce cut on eman* mar,et s)are* an "ro#!ts

-Res"onses o# !##erent segments to c)anges !n serv!ce attr!+utes

Us!ng "os!t!on!ng Ma"s to 4ot Com"et!t!ve Strateg(- use as a !agnost!c too* )e" (ou

ga!n avantage over com"et!tors* an see )ere (ou are0

Lecture ;



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C)a"ter : 4rouct Strateg(

$)at !s a "rouct'

A "rouct nee not +e a tang!+e goo

A "rouct !s an(t)!ng t)at t)e mar,eters mar,et0

-Cu+a

-%os"!ta Lotter!es

-4o!t!c!ans

-Serv!ces

8e#!n!ng "roucts an serv!ces

E2"er!ence: t("e o# "rouct t)at com+!nes a serv!ce or ")(s!ca "rouct !t) a

memora+e e2"er!ence

o 6!ggest !n#uence on "urc)ase o# "rouct

o 4urc)ase e2"er!ence

8escr!+e (our ast reta! "urc)ase e2"er!ence

Leves o# 4rouct

Core "rouct or +ene#!t

Actua "rouct

o 4ac,ag!ng* #eatures* es!gn*


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o 4arts* mater!as* ca"!ta !tems* su""!es

Consumer "roucts:

o Conven!ence* s)o""!ng* s"ec!at(* unsoug)t

Inustr!a.+us!ness "rouctso 4arts Mater!as

Ra an Manu#acture

o Ca"!ta Items

A! !n "rouct!on or o"erat!on

6u!!ngs* o##!ces* e


25/56

Name* term* s!gn* s(m+o or com+!nat!on t)at !ent!#!es t)e ma,er

or seer o# "rouct.serv!ce

o 4ac,ag!ng

o La+e!ngo 4rouct su""ort serv!ces

A!t!ona serv!ces t)at e!g)ts t)e customers an (!es "ro#!ts #or

com"an(

4rouct L!ne an M!2

6ran!ng Avantages

$)at are t)e avantages o# +ran!ng'o 5or consumer

o 5or mar,eter

Serv!ce C)aracter!st!cs 5!g0 0;

Intang!+!!t(

Inse"ara+!!t(

Var!a+!!t( 4er!s)a+!!t(

6ran!ng 8ec!s!ons

A +ran !s not a ogo

A +ran !s an !ea

o Not a ")(s!ca or v!sua t)!ng !t !s an !ea

o Set o# attr!+utes an emot!ons

o Ma( +e re"resente +( o+>ects* ogos* names

o Set o# assoc!at!ons t)at e2!st !n t)e m!n o# t)e consumer

6ran E


26/56

T)e !ea t)at a +ran )as numer!c oar vaue even t)oug) t)ere are no tang!+e

assets

C)a"ter J: 8eveo"!ng an Mar,et!ng Ne 4roucts

$)( eveo" ne "roucts'

5oo c)ang!ng mar,et!ng emans

Rema!n com"et!t!ve

Kee" u" !t) c)ang!ng tec)noog(

Re"ace (!ng "roucts

Re#res) an evove e2!st!ng "roucts

8!vers!#( "rouct o##er!ng to reuce r!s,

Ne 4rouct 8eveo"ment

Iea generat!on

Iea Screen!ng

4rouct conce"t

Mar,et!ng strateg(

6us!ness ana(s!s

4rouct eveo"ment

Test mar,et!ng

Commerc!a!/at!on

4rouct L!#e C(ce

A "roucts ! "ass t)roug) t)e 4LC

o %o ong !t ta,es +eteen stages

o %o ong !t rema!ns !n eac) stage

8eveo"ment- No customers* no "ro#!ts* )eav( s"en!ng

Introuct!on- Ear( ao"ter customers no "ro#!ts* )!g) aunc) costs



27/56

Grot)- Ear( ma>or!t( customers* ra"! saes grot) an revenues

Matur!t(-ate ma>or!t( customers* #at saes ec!n!ng "ro#!ts

8ec!ne- aggar customers* ec!n!ng saes* re"ace +( ne "roucts

Matur!t( Stage Strateg(

Mo!#( t)e mar,et

Mo!#( t)e "rouct

Mo!#( t)e mar,et!ng m!2

Lecture

4r!c!ng Cons!erat!ons an Strateg!es

$)at !s a "r!ce'

Sum o# a t)e vaues t)at consumers e2c)ange #or t)e +ene#!ts o# )av!ng or

us!ng t)e goo or serv!ce

4r!ce vs0 Cost

Mar,eters o not ma,e ec!s!ons a+out costs* t)e( ma,e ec!s!on a+out "r!ces

8(nam!c 4r!c!ng:

T)e "ract!ce o# c)arg!ng !##erent "r!ces e"en!ng on !n!v!ua customers an

s!tuat!ons

Internet an e+-"urc)as!ng "rov!es t)e tec)noog!ca ca"a+!!t(

S!tes !,e e6a( even a t)e a+!!t( to negot!ate "r!ce to (nam!c "r!c!ng

"ract!ces

5actors



28/56

$)atINTERNAL#actors !n#uence "r!c!ng'

-Mar,et!ng o+>ect!ves

-Mar,et!ng m!2 strateg!es

-Costs-Organ!/at!ona cons!erat!ons

EXTERNAL:

-Nature o# t)e mar,et an eman

-Com"et!t!on

-Ot)er env!ronmenta #actors ? econom(* reseers* government* soc!a concerns@

5!2e vs0 Var!a+e- &our Ca

4rouct "ac,ag!ng- *ariable

V4 o# Mar,et!ng=s saar(- 5!2e

Cost o# 9 mont) +!+oar cam"a!gn- 5!2e

Annua avert!s!ng +uget- 5!2e

Cost o# t)e "arts t)at go !nto manu#actur!ng t)e mar,eter=s "rouct- Var!a+e

4r!ce East!c!t(

A a( o# measur!ng )o sens!t!ve t)e mar,et !s to "r!ce c)anges

-Ineast!c: m!n!ma c)ange !n eman as "r!ce !ncreases

-East!c: s!gn!#!cant ro" !n eman as "r!ce !ncreases

Genera 4r!c!ng Strateg!es:

Cost-+ase a""roac)

-Cost-"us "r!c!ng

-6rea,-even ana(s!s

-Target "ro#!t "r!c!ng

Vaue-+ase a""roac)

-Consumer "erce"t!ons o# vaue

Com"et!t!on-+ase a""roac) ?most common a""roac)@



29/56

-$)at com"et!tors are c)arg!ng

4r!c!ng !n 8!##erent Mar,ets:Pure Competition:

Man( +u(ers an seers )ere eac) )as !tte e##ect on t)e go!ng mar,et "r!ce

Monopolistic Competition:

Man( +u(ers an seers )o trae over a range o# "r!ces

E20 A!r!nes

Oligopolistic Competition:

5e seers an sens!t!ve to eac) ot)er=s "r!c!ng.mar,et!ng strateg!es

Pure Monopoly:

Mar,et cons!sts o# a s!nge seer

E20 LC6O

4r!c!ng Ne 4roucts

Mar,et!ng s,!mm!ng "r!c!ng

-%!g) "r!ce to rea" ma2!mum "ro#!t #rom ear( ao"ter segments

-Strateg( must +e su""orte +( "rouct


30/56

O"t!ona 4rouct

-4r!c!ng o"t!ona or accessor( "roucts so !t) t)e ma!n "rouct ?eg0 Ice

ma,er !t) t)e re#r!gerator@

4rouct 6une 4r!c!ng-Com+!n!ng severa "roucts an o##er!ng t)e +une at a reuce "r!ce ?eg0

Com"uter !t) so#tare an Internet access0

Ca"t!ve-"rouct

-4r!c!ng "roucts t)at must +e use !t) t)e ma!n "rouct ?eg0

Re"acement cartr!ges #or G!ette ra/ors@

6(-"rouct "r!c!ng

-sett!ng a "r!ce #or +(-"roucts !n orer to ma,e t)e ma!n "rouct=s "r!ce more

com"et!t!ve ?eg0 Saust an +utterm!,@

8!scounts an Aoances

8!scounts:

-Cas)

-uant!t(

-Seasona

Aoances:

-Trae-In

-4romot!ona

Segmente 4r!c!ng

Se!ng a goo or serv!ce at to or more "r!ces* )ere t)e !##erence !n "r!ces !s

not +ase on !##erences !n costs

-Customer-segment

-4rouct-#orm

-Locat!on "r!c!ng

-T!me "r!c!ng



31/56

4s(c)oog!ca 4r!c!ng

Cons!ers t)e "s(c)oog( o# "r!ces an not s!m"( t)e econom!cs

Consumers usua( "erce!ve )!g)er-"r!ce "roucts as )eav!ng )!g)er-


32/56

4r!ce Cuts:

E2cess ca"a+!!t(

5a!ng mar,et s)are

8om!nate mar,et t)roug) oer costs4r!ce Increases:

Cost !n#at!on

Over-eman0 Cannot su""( a customers= nees

4r!ce Et)!cs

Com"et!tors:

-4r!ce-#!2!ng

-4reator( "r!c!ng

Manu#acturer an reta!er

-Reta! "r!ce an ma!ntenance

-8!scr!m!nator( "r!c!ng

Manu#acturer.reta!er an consumer

-8ece"t!ve "r!c!ng

4ann!ng an Creat!ng Serv!ces

A serv!ce "rouct com"r!ses a eements o# serv!ce "er#ormance* +ot) tang!+e

an !ntang!+e* t)at create vaue customers

T)e serv!ce conce"t !s re"resente +(:

-A core "rouct

-Accom"an!e +( su""ementar( serv!ces-#ac!!tate an en)ance use o# t)e

core "rouct an a vaue an !##erent!at!on

8es!gn!ng a Serv!ce Conce"t

Core "rouct

-Centra com"onent t)at su""!es t)e "r!nc!"a* "ro+em-sov!ng +ene#!ts

customers see,



33/56

Su""ementar( Serv!ces

-Augment t)e core "rouct* #ac!!tat!ng !ts use an en)anc!ng !ts vaue an

a""ea

8e!ver( 4rocesses-Use to e!ver +ot) t)e core "rouct an eac) o# t)e su""ementar(

serv!ces

Core an Su""ementar( Serv!ces at Lu2ur( %ote

Reservat!on

Vaet "ar,!ng

Rece"t!on

6aggage serv!ce

Coc,ta! +ar

Restaurant

Enterta!nment.s"orts.e2erc!se

Internet

$a,e-u" ca

Room Serv!ce

6us!ness Centre

Cas)!er

T)e 5oer o# Serv!ce

- Nee to ,no t)!s !,e !ts go!ng out o# st(e

%o to 8eterm!ne $)at Su""ementar( Serv!ces S)ou +e O##ere

Mar,et "os!t!on!ng strateg( eterm!nes )!c) su""ementar( serv!ces s)ou +e

!ncue

5!rms !t) !##erent eves o# serv!ce o#ten a e2tra su""ementar( serv!ces #or

eac) u"grae !n serv!ce eve



34/56

Manager!a Im"!cat!ons

To eveo" "rouct "o!c( an "r!c!ng strateg(* managers nee to eterm!ne:

$)!c) su""ementar( serv!ces s)ou +e o##ere as a stanar "ac,age or as

#ee +ase o"t!ons 5!rms t)at com"ete on a o-cost* no-#r!s +as!s nees #eer su""ementar(

eements t)an t)ose mar,et!ng e2"ens!ve* )!g)-vaue-ae serv!ces

Sett!ng 4r!ces an Im"ement!ng Revenue Management

%arer to cacuate #!nanc!a costs t)an a manu#acture goo

8!##!cut( !n e#!n!ng a un!t o# serv!ce

Serv!ces )ar to evauate

Customers ma( +e "re"are to "a( more #or #aster e!ver(

8e!ver( t)roug) ")(s!ca or eectron!c c)annes-ma( create !##erences !n

"erce!ve vaue

T)e 4r!c!ng Tr!"o

4r!c!ng Strateg(

Costs Com"et!t!on Vaue to Customer

Cost-+ase 4r!c!ng:

Tra!t!ona vs0 Act!v!t(-6ase Cost!ng

Tra!t!ona Cost!ng A""roac)

-La+or an !n#rastructure costs are cons!ere #!2e costs

Act!v!t(-+ase cost!ng ?A6C@



35/56

-Sets o# e!ver( act!v!t!es an reate goos

-5!rms can "!n"o!nt "ro#!ta+!!t( o# !##erent serv!ces* c)annes etc0

%o o (ou Reuce 4r!ce Com"et!t!on' Outsourc!ng

Non-"r!ce reate costs o# us!ng com"et!ng aternat!ves are )!g)

4ersona reat!ons)!"s mater

S!tc)!ng costs are )!g)

T!me an ocat!on s"ec!#!c!t(

Net Vaue: 4erce!ve +ene#!ts to customer ?Gross vaue- A 4erce!ve outa(s

?Mone(* T!me* Menta.4)(s!ca E##ort@

4r!c!ng Issues:

4utt!ng Strateg( !nto 4ract!ce

%o muc) to c)arge'

$)at +as!s #or "r!c!ng'

$)o s)ou coect "a(ment'

$)ere s)ou "a(ment +e mae'

$)en s)ou "a(ment +e mae'

%o s)ou "a(ment +e mae'

%o to commun!cate "r!ces'



36/56

Lecture

C)a"ters 11* 17* 1

Im"!cat!ons o# !ntang!+!!t( !n serv!ce "er#ormances

Customers are !nvove !n "rouct!on

Roe o# customer-contact "ersonne

8!##!cut( o# evauat!ng man( serv!ces

Nee to +r!ng su""( an eman !nto +aance

Overcom!ng 4ro+ems o# Intang!+!!t(

Ma( +e !##!cut to commun!cate serv!ce +ene#!ts to customers es"ec!a( )en

!ntang!+e

Intang!+!!t( creates "ro+ems

Genera!t( W !tems t)at com"r!se a cass o# o+>ects* "ersons* or events

Non-searc) a+!!t( W cannot +e searc)e or !ns"ecte !t) ")(s!ca o+>ects

A+stractness W no one-to-one corres"onence !t) ")(s!ca o+>ects

Menta !m"a"a+!!t( W Customers #!n !t )ar to gras" +ene#!ts o# com"e2*

mut!!mens!ona ne o##er!ngs

Avert!s!ng Strateg!es #or Overcom!ng Intang!+!!t( W !n te2t

Accenture 4romotes A+!!t( to Turn Innovat!ve !eas !nto resuts : a as use t)!s

8%L: "romot!ng t)e e##!c!enc( o# !ts !m"ort e2"ress serv!ce



37/56

5ac!!tate Customer Invovement

$)en customers are act!ve( !nvove !n serv!ce "rouct!on* t)e( nee tra!n!ng to

"er#orm

S)o serv!ce e!ver( !n act!on

Teev!s!on an v!eos engage v!eer

-ent!sts s)o!ng "at!ents v!eos o# surg!ca "roceures +e#ore surger(

Stream!ng v!eos on $e+ an "ocasts are ne c)annes to reac) act!ve

customers

Avert!s!ng an "u+!c!t( can ma,e customers aare o# c)anges !n serv!ce

#eatures an e!ver( s(stems !n +7+ an +7c conte2ts

Saes "romot!ons to )e" c)ange customer +e)av!our

- o##er !ncent!ves to ma,e necessar( c)anges

-4r!ce !scounts to encourage se#-serv!ce on an ongo!ng +as!s

%e" Customers to Evauate Serv!ce O##er!ngs

Customers ma( )ave !##!cut( !st!ngu!s)!ng one #!rm #rom anot)er

-"rov!e tang!+e cues reate to serv!ce "er#ormance

Some "er#ormance attr!+utes en t)emseves +etter to avert!s!ng t)an ot)ers

-A!r!nes- +oast a+out "unctua!t(

-8o not ta, overt( !n avert!s!ng a+out sa#et(* am!ss!on t)at t)!ngs m!g)t go

rong ma,e "ros"ect!ve traveers nervous



38/56

-Use !n!rect a""roac): "romote "!ot e2"ert!se* mec)an!c=s* ma!ntenance s,!s*

neness o# a!rcra#t

5!rm=s e2"ert!se !s )!en !n o-contact serv!ce

- nee to !ustrate e


39/56

T)roug) mar,et!ng C)annes W Tra!t!ona toos o# "ersona se!ng* account

management "rograms* trae s)os* avert!s!ng* !rect mar,et!ng* saes

"romot!on* "u+!c reat!ons

Message Transm!ss!on ?7@ W rea !n te2t

T)roug) messages or!g!nat!ng outs!e t)e Organ!/at!on W ver( !n#uent!a an "oer#u

- $or o# Mout) ?$OM@ W more cre!+e t)an #!rm=s messag!ng0 Customers re( on !t

)en ma,!ng )!g) r!s, ec!s!ons

-6ogs W on !ne >ournas )ere "eo"e can "ost t)e!r "o!nt o# v!e* +oggers can

+ecome e #actor atc) ogs* !n,s ena+e !n#ormat!on s)ar!ng

-E!tor!a Coverage We!tor!a coverage a+out a com"an( !n!t!ate +( +roacasters an

"u+!s)ers

Strateg!es #or Cor"orate 8es!gn

Man( serv!ce #!rms em"o( a un!#!e an !st!nct!ve v!sua a""earance #or a

tang!+e eements to re!n#orce t)e +ran

-#or e2am"e* ogos* un!#orms* ")(s!ca #ac!!t!es

4rov!e a recogn!/a+e t)eme !n,!ng a t)e #!rm=s o"erat!ons

Use o# traemar,e s(m+o as "r!mar( ogo* !t) name seconar(

-S)e=s (eo scao" s)e on a re +ac,groun

-Mac8ona=s Goen Arc)es

Mar,et!ng or 8!str!+ut!on C)anne

A set o# !ntere"enent organ!/at!ons !nvove !n t)e "rocess o# ma,!ng a "rouct or

serv!ce ava!a+e #or use or consum"t!on +( t)e consumer or +us!ness user0 ?seete2t@

$)oesaers.Reta!ers

$)oesaers

-Merc)ant )oesaers



40/56

-Agents an +ro,ers

-Manu#acturer=s saes +ranc)es an o##!ces

Reta!ers

-Amount o# serv!ce

-"rouct t!me

-reat!ve "r!ces

-reta! organ!/at!on

?unerstan t)e !##erence +eteen )oesaers an reta!ers@

$)at !s reta!!ng'

Reta!!ng !ncues a t)e act!v!t!es !nvove !n se!ng "roucts or serv!ces !rect( to

#!na consumers #or t)e!r "ersona* non-+us!ness use0

Amount o# Serv!ce ?NEE8 TO KNO$@

Se#-serv!ce reta!ers: Serv!ce customers )o are !!ng to "er#orm t)e!r on

ocate-com"are-seect "rocess to save mone(

L!m!te-serv!ce reta!ers: "rov!e more saes ass!stance +ecause t)e( carr( more

s)o""!ng goos a+out )!c) customers nee !n#ormat!on

5u-serv!ce reta!ers: usua( carr( more s"ec!at( goos #or )!c) customers !,e to

+e a!te on

Convent!ona vs0 Vert!ca

Convent!ona Mar,et!ng C)anne

manu#acturer

$)oesaer



41/56

Reta!er

Consumer

Vert!ca Mar,et!ng S(stemManu#acturer

$)oesaer

Reta!er

Consumer

Vert!ca mar,et!ng S(stem

A !str!+ut!on c)anne structure !n )!c) "roceures* )oesaers an reta!ers act as

a un!#!e s(stem

One c)anne mem+er ons t)e ot)er* )as contracts !t) t)em or )as so muc)

"oer t)at t)e( a coo"erate0

C)anne Con#!ct

8!sagreement +eteen mem+ers over goas

%or!/onta Con#!ct

-con#!ct +eteen #!rms on t)e same eve

Vert!ca con#!ct

-con#!ct +eteen #!rms on !##erent eves

8!s!nterme!at!on

-!s"acement o# a tra!t!ona mem+er #rom t)e mar,et!ng c)anne-se!ng !rect v!a t)e !nternet

5ranc)!se Organ!/at!on

Manu#acturer W s"onsore )oesaer #ranc)!se s(stem0



42/56

8!s!nterme!at!on

6("ass!ng !nterme!ar!es an go!ng !rect( to #!na +u(ers

Ra!ca( ne t("es o# c)anne !nterme!ar!es t)at com"ete !t) or !s"ace

tra!t!ona ones

Internet an e-commerce are t)e most common cause o# !s!nterme!at!on

Num+er o# Interme!ar!es

Intens!ve !str!+ut!on

-as man( !str!+utors as "oss!+e

E2cus!ve !str!+ut!on

-on( one !str!+utor !n a g!ven terr!tor(

Seect !str!+ut!on

-A seect #e !str!+utors !n a g!ven terr!tor(

Log!st!cs an Su""( C)a!n

4ann!ng* !m"ement!ng an contro!ng t)e ")(s!ca #o o# goos* serv!ces an

reate !n#ormat!on #rom "o!nts o# or!g!n to "o!nts o# consum"t!on to meet customer

re


43/56

a+!!t( to "rom"t !mme!ate cas to act!on0

Saes 4romot!on

Cou"ons* contests* "rem!ums* an !ncent!ves0 Use to attract attent!on0

4rov!e !ncent!ve #or tr!a or "urc)ase0

Generates resuts no versus ater0

E##ect!veness eas!er to trac, t)an avert!s!ng0

Ma( etract #rom +ran eect!ves

Consumer: !ncrease s)ort-term saes or )e" +u! ong-term mar,et s)are0

Trae: get reta!ers to:

-Carr( ne !tems an more !nventor(0

-avert!se "roucts0

-g!ve "roucts more s)e# s"ace0

-+u( a)ea0

4ersona Se!ng 4ersona* #e2!+e* to-a( commun!cat!on* "rov!es !rect #ee+ac,0

6u!s "re#erence* conv!ct!on* act!on0

Su!te to com"e2* )!g)er "r!ce "roucts0

6as!s #or +u!!ng a +u(er reat!ons)!"0

Reust >un, ma!Q

Mar,eters must ma,e a t)ousan ec!s!ons to e2ecute a 8M cam"a!gn

-$)o to sen !t to

-ata+ase



44/56

8!rect Ma! Mar,et!ng W T("e o# 8!rect Res"onse

Invoves sen!ng an o##er* announcement* rem!ner or ot)er !tem to a "erson at a

"art!cuar aress0 4erm!ts )!g) target-mar,et seect!v!t(0

4ersona an #e2!+e0

Eas( to measure resuts0

4u+!c Reat!ons

4u+!c reat!ons !nvoves +u!!ng goo reat!ons !t) t)e com"an(=s var!ous "u+!cs

+( o+ta!n!ng #avora+e "u+!c!t(* +u!!ng u" a goo cor"orate !mage an )an!ng

or )ea!ng o## un#avora+e rumors* stor!es an events0

Cannot +e "urc)ase - c)aeng!ngQ

8!rect( o""os!te to avert!s!ng W >ourna!sts cannot +e "a!0

Nes stor!es* #eatures* "ress con#erences* annua re"orts* cor"orate e+s!te0

Seen as more +e!eva+e t)an avert!s!ng messages0

More cost e##!c!ent0

Can +e !##!cut to contro0

Can +e "roact!ve an react!ve0

4u+!c Reat!ons Toos

Nes0

S"eec)es0

S"ec!a events0

6u// mar,et!ng0

Mo+!e mar,et!ng0

$r!tten mater!as0

Au!ov!sua mater!as0

Cor"orate !ent!t( mater!as0

4u+!c serv!ce act!v!t!es0

Com"an( e+s!te0



45/56

Lecture :

C)a"ters: 1J* 7* 79

5our Categor!es o# Serv!ces

8e!ver( o# a 4ossess!on-4rocess!ng Serv!ce ?5!g0 07a-@

4eo"e-4rocess!ng ?5!g0 07a@

Menta St!muus ?5!g0 07 c@

In#ormat!on 4rocess!ng ?5!g0 07 @

6ue 4r!nt!ngDeveloping a Blueprint:

Ient!#( ,e( act!v!t!es !n creat!ng an e!ver!ng serv!ce

8e#!ne +!g "!cture +e#ore r!!ng on to o+ta!n a )!g)er eve o# eta!

Advantages of Blue printing:

8!st!ngu!s) +eteen #rontstage an +ac,stage

Car!#( !nteract!ons +eteen customers an sta##* an su""ort +( +ac,stage

act!v!t!es an s(stems

Ient!#( "otent!a #a! "o!ntsX ta,e "reventat!ve measuresX "re"are cont!ngenc(

4!n"o!nt stages !n t)e "rocess )ere customer common( )ave to a!t

6ue"r!nt!ng T)e Restaurant E2"er!ence: A T)ree-Act 4er#ormance

Act 1:Introuctor( Scenes

Act 2:8e!ver( o# Core 4rouct



46/56

Coc,ta!s* seat!ng* orer #oo an !ne* !ne serv!ces

4otent!a #a! "o!nts: menu !n#ormat!on com"ete' Menu !nte!g!+e'

M!sta,es !n transm!tt!ng !n#ormat!on a common cause o#


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#s'cho!oica! Factors Re!ated to the use of SSTsAd"antaes:

Ti%e sa"ins +ost Sa"ins

F!e(i&i!it' +on"enience of !ocations Greater contro! o"er ser"ice de!i"er' ,ih percei"ed !e"e! of custo%i-ation

.isad"antaes: An(iet' and stress e(perienced &' custo%ers /ho are unco%forta&!e /it

h usin the% So%e see ser"ice encounters as socia! e(periences and prefer to dea! /ith

peop!e

Nature of Ser"ices Ser"ices cannot &e stoc0pi!ed This is pro&!e%atic for peop!e or ph'sica! possession ser"ices due to

/ide s/ins in de%and Goa! is to uti!i-e staff1 e*uip%ent1 and faci!ities as producti"it' as

possi&!e

Fro% E(cess .e%and to E(cess +apacit' E(cess .e%andToo %uch de%and re!ati"e to capacit' at a i"en ti%e

.e%and e(ceeds opti%u% capacit'

Upper !i%it to a fir%2s a&i!it' to %eet de%and at a i"en ti%e Opti%u% +apacit'#oint &e'ond /hich ser"ice *ua!it' dec!ines as %ore custo%ers areser"iced

E(cess +apacit'Too %uch capacit' re!ati"e to de%and at a i"en ti%e

Addressin the #ro&!e% of +hanin .e%andTwo Basic Approaches:

Ad3ust !e"e! of capacit'

Manae !e"e! of de%and

,o/ to .eter%ine .e%and #atterns Understand /h' custo%ers fro% specific %ar0et se%ents se!ect this

ser"ice Keep ood records of transactions to ana!'-e de%and patternsSophisticated soft/are can he!p to trac0 custo%er consu%ptionpatterns



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Record /eather conditions and other specia! factors that %iht inf!uencede%and

A!ternati"e .e%and4Manae%ent Strateies /ake no action

Let custo%ers sort it out #educe demand,iher prices+o%%unication pro%otin a!ternati"e ti%es

ncrease demandLo/er prices+o%%unication1 inc!udin pro%otiona! incenti"es5ar' product features to increase desira&i!it'More con"enient de!i"er' ti%es and p!aces

nventory demand by reservation system nventory demand by formali5ed queuing

Infor%ation Need for .e%and and +apacit' Manae%ent Strateies ,istorica! data on de%and !e"e! and co%position1 notin responses to

%ar0etin "aria&!es .e%and forecasts &' se%ent under specified conditions Se%ent4&'4se%ent data Fi(ed and "aria&!e cost data1 profita&i!it' of incre%ented sa!es Meaninfu! !ocation4&'4!ocation de%and "ariations +usto%er attitudes to/ard *ueuin:Linin up4/hen it is accepta&!e6 Pg* 677

+usto%er opinions of *ua!it' at different !e"e!s of capacit' uti!i-ation: e(7,ote!s8air tra"e!8retai! ser"ice

9hat is Ser"ice6.ifferent #erspecti"es of Ser"ice ua!it'Transcendent:

ua!it';E(ce!!ence Reconi-ed on throuh e(periences

Manufacturing-based: ua!it' is n confor%ance to the fir%2s de"e!oped specifications

User-based: ua!it' !ies in the e'es of the &eho!der

Value-based: ua!it' is a trade4off &et/een price and "a!ue

.i%ensions of Ser"ice ua!it'Tani&!es: Appearance of ph'sica! e!e%entsRe!ia&i!it': .ependa&!e and accurate perfor%ance



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Responsi"eness: #ro%ptness) he!pfu!nessAssurance: +o%petence1 courtes'1 credi&i!it'1 securit'E%path': Eas' access1 ood co%%unication1 understandin of custo%er

Se"en Ser"ice ua!it' GapsFi7

1. Knowledge ap:.ifference &et/een e(pectations and needs2. !tandards ap:Specif' S standards that ref!ect e(pectationsTrans!ation into desin8de!i"er' specs3. "eliver# ap:Ensure ser"ice perfor%ance %eets standardsE(ecution of desin8de!i"er' specs4. $nternal %ommunications ap: Ensure that co%%unications pro%ises

are rea!istic5. &erceptions ap: Educate custo%ers to see rea!it' of ser"ice *ua!it'

de!i"ered+usto%er perceptions of ser"ice e(ecution6. $nterpretation ap:#retest co%%unications to %a0e sure %essae is

c!ear and una%&iuous7. !ervice ap:+!ose aps > to ? to %eet custo%er e(pectations

consistent!'

Soft and ,ard Measures of Ser"ice ua!it' !oft measures-not easi!' o&ser"ed1 %ust &e co!!ected &' ta!0in to

custo%ers1 e%p!o'ees or others#ro"ide direction1 uidance and feed&ac0 to e%p!o'ees on /a's to

achie"e custo%er satisfaction+an &e *uantified &' %easurin custo%er perceptions and &e!iefse7 SER5UAL1 sur"e's1 and custo%er ad"isor' pane!s

'ard measures4 can &e counted1 ti%ed1 or %easured throuh auditsT'pica!!' operationa! processes or outco%esStandards often set /ith reference to percentae of occasions on/hich a particu!ar %easure is achie"ed7

+usto%er feed&ac0 +o!!ection Too!s Tota! %ar0et sur"e's Annua! sur"e's Transactiona! sur"e's Ser"ice feed&ac0 cards M'ster' shoppin Unso!icited custo%er feed&ac0 Focus roup discussions Ser"ice re"ie/s



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Ana!'sis1 Reportin and .isse%ination of +usto%er Feed&ac0 +hoosin the re!e"ant feed&ac0 too!s and co!!ectin custo%er feed&ac0 is

%eanin!ess If the infor%ation is not passed &ac0 to the re!e"ant partiesto ta0e action

Reportin s'ste% needs to de!i"er feed&ac0 to front!ine staff1 processo/ners1 &ranch8depart%ent %anaers and top %anae%ent

Three t'pes of perfor%ance reports:Month!' Ser"ice #erfor%ance Updateuarter!' Ser"ice #erfor%ance Re"ie/Annua! Ser"ice #erfor%ance Repot

Too!s to Ana!'-e and Address Ser"ice ua!it' #ro&!e%s Fish&one diara%+ause4and4effect diara% to identif' potentia! causes of pro&!e%s

#areto +hartSeparatin the tri"ia! fro% the i%portant7 Often1 a %a3orit' of pro&!e%s

is causes &' a %inorit' of causes @ie7 The B8D7>BCAna!'sis of +auses of F!iht .eparture .e!a's @Fi7 >D7>>C

Ser"ice Efficienc'1 #roducti"it' and Effecti"eness Efficienc': in"o!"es co%parison to a standard1 usua!!' ti%e4&ased @e7

ho/ !on e%p!o'ee ta0es to perfor% specific tas0C #roducti"it': in"o!"es financia! "a!ue of outputs to inputs Effecti"eness: deree to /hich fir% %eets oa!s

Generic #roducti"it' I%pro"e%ent StrateiesT#pical strategies to improve service productivit#:

+arefu! contro! of costs at e"er' step in process Efforts to reduce /astefu! use of %ateria!s or !a&or

Matchin producti"e capacit' to a"erae rather than pea0 de%and !e"e!s Rep!acin /or0ers &' auto%ated %achines or se!f4ser"ice techno!oies Teachin e%p!o'ees ho/ to /or0 %ore producti"e!' $roadenin "ariet' of tas0s that ser"ice /or0er can perfor% Insta!!in e(pert s'ste%s that s!o/ paraprofessiona!s to ta0e on /or0

pre"ious!' perfor%ed &' professiona!s /ho earn hiher sa!ariesAlthough improving productivit# can be approached incrementall#( ma)orgains often re*uire redesigning entire processes



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+usto%er4.ri"en 9a's to I%pro"e #roducti"it' Change timing of customer demand$' shiftin de%and a/a' fro% pea0s1 %anaers can %a0e &etter useof fir%2s producti"e assets and pro"ide &etter ser"ice

nvolve customers more in productionGet custo%ers to se!f4ser"eEncourae custo%ers to o&tain infor%ation and &u' fro% fir%2scorporate /e&sites

sk customers to use third parties.e!eate de!i"er' of supp!e%entar' ser"ice e!e%ents to inter%ediar'orani-ations

Evaluating Advertising

Ut!mate test !s )et)er saes )ave !ncrease0

Measure +e#ore an a#ter an a cam"a!gn to measure resuts0

On!ne avert!s!ng t)e eas!est to measure +ase on convers!on rates an t)e

a+!!t( to "rom"t !mme!ate cas to act!on0

Sales Promotion

Cou"ons* contests* "rem!ums* an !ncent!ves0

Use to attract attent!on0

4rov!e !ncent!ve #or tr!a or "urc)ase0

Generates resuts no versus ater0

E##ect!veness eas!er to trac, t)an avert!s!ng0

Ma( etract #rom +ran e


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4ersona* #e2!+e* to-a( commun!cat!on* "rov!es !rect #ee+ac,0

6u!s "re#erence* conv!ct!on* act!on0

Su!te to com"e2* )!g)er "r!ce "roucts0

6as!s #or +u!!ng a +u(er reat!ons)!"0 Reourna!sts cannot +e "a!0

Nes stor!es* #eatures* "ress con#erences* annua re"orts*cor"orate e+s!te0

Seen as more +e!eva+e t)an avert!s!ng messages0 More cost e##!c!ent0

Can +e !##!cut to contro0

Can +e "roact!ve an react!ve0

Public Relations Tools



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Nes0

S"eec)es0

S"ec!a events0

6u// mar,et!ng0 Mo+!e mar,et!ng0

$r!tten mater!as0

Au!ov!sua mater!as0

Cor"orate !ent!t(mater!as0

4u+!c serv!ce act!v!t!es0

Com"an( e+s!te0

Lecture J

C)a"ters: 71* 77

Serv!ce Sta##

Cruc!a( !m"ortant to t)e success o# a serv!ce #!rm

-Most v!s!+e

-Re"resents com"an( an e!vers +ran "rom!se

-Serv!ce sta##Y +ran

Instea o# a +ran manager- "eo"e manager

-Ga!n a com"et!t!ve avantage

-%e" ensure susta!na+!!t( !n t)e mar,et"ace

Understand that the wor+ of service staff can be demanding( challengingand difficult,

,iher perfor%in1 satisfied e%p!o'ees are 0e'

Front4!ine /or0 can &e de%andin @&oundar' spannersC Often ha"e conf!ictin ro!es E%otiona! !a&or

%onflict comes from sources: #erson8ro!e conf!icts

4$et/een 3o& re*uire%ents1 and o/n persona!it' Orani-ation8c!ient conf!icts



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4Fo!!o/ co%pan' ru!es or satisf' custo%er Inter4c!ient conf!icts

4+!ient to c!ient conf!ict EXAM#LES6

++LE OF FAILURE4 the search for producti"it'++LE OF ME.I+RIT4 no incenti"e to i%pro"e4e%p!o'ees unresponsi"e4increased pa' the !oner 'ou are there4ta0in initiati"e1 %a0in decisions1 pro"idin insiht is discouraed4hih 3o& securit'4e%phasis on ru!es4not satisfied /ith 3o&++LE OF SU++ESS4happ' e%p!o'ees1 /ho!e c'c!e is positi"e4&ier 3o& desins

4e%p!o'ees satisfied

9hat are the 0e' &arriers for fir%s see0in to &rea0 the c'c!e of fai!ure and%o"e in to the c'c!e of success6

Short sihted %anae%ent Lo/ %arins Forced efficienc' @9a!4MartC

The &est candidates O&ser"e &eha"ior

4Inter"ie/s1 e(ercises +onduct #ersona!it' tests

4.oes persona!it' %atch the 3o&6 Mu!tip!e1 structured inter"ie/s

4.ifferent inter"ie/ers Rea!istic 3o& pre"ie/

4E(pectations %uch %atch 3o& offerin

Other aspects of ,R Train ser"ice e%p!o'ees acti"e!' E%po/er the front !ine $ui!d hih perfor%ance ser"ice de!i"er' tea%s Moti"ate and eneri-e peop!e

The Ser"ice Ta!ent +'c!e for Ser"ice Fir%s in te(t>7 ,ire the riht peop!e


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+usto%er 5a!ue The !oner a custo%er sta's /ith a fir%1 the %ore profita&!e that

custo%er is to ser"e:4increased usae o"er ti%e

4reduced operatin costs4profits fro% referra!s and price pre%iu%

9h' is +usto%er Lo'a!t' I%portant to A Fir%2s #rofita&i!it'6+usto%ers &eco%e %ore profita&!e the !oner the' re%ain /ith a fir%:

Increase purchases and8or account &a!ances4+usto%ers8 fa%i!ies purchase in reater *uantities as the' ro/

Reduced operatin costs4,e/er de%ands fro% supp!iers and operatin %ista0es as custo%er&eco%es e(perienced

Referra!s to other custo%ers4#ositi"e /ord4of4%outh sa"es fir% fro% in"estin %one' in sa!es andad"ertisin

#rice pre%iu%s4!on4ter% custo%ers /i!!in to pa' reu!ar price4/i!!in to pa' hiher price durin pea0 periods

The .heel of /o#alt# 0ig 1123

Effecti"e Tierin of Ser"ice: The +usto%er #'ra%id

9hat /ou!d 'ou do64,o/ /ou!d OU create !o'a!t' in the ser"ice industr'6 Restaurants Air!ines $an0in +redit +ards E!ectrician

!trategies for "eveloping lo#alt# Bonds with %ustomers 44in te5t44

+o%%on O&3ecti"es of +RM S'ste%s

@Ser"ice #erspecti"esC .ata co!!ection .ata ana!'sis Sa!es force auto%ation Mar0etin auto%ation +a!! centre auto%ation



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+o%prehensi"e +RM Strate' in te(t

+o%%on Fai!ures in +RMI%p!e%entation @part > of

f10 mcs 1000 adlam notes

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