Teju kumar d.s1st sem mba

A service is any act of performance that one party can offer another that is essentially intangible and does not result in the ownership of anything; its production may or may not be tied to a physical product

Service

“ A service is an act of performance that one party can offer to another that is essentially intangible and does not result in the ownership of anything. Its production may or may not be tied to a physical product.”

- Philip Kotler

Services are intangible we cannot touch them as they are not physical objects.

A consumer feels that he has the right and opportunity to see, touch, hear, smell or taste the goods before they buy them but his is not applicable to services.

The services are not known to the customer before they take them.

1. INTANGIBILITYNature and characteristics

Mobile network providers like Vodafone , Airtel , Reliance , etc.

INTANGIBILITY EXAMPLE

Service cannot be stored

Value of service exists at the point when it is required.

Services perish as soon as they are used.

Services last for a specific time and cannot be stored like a product for later use.

2. PERISHABILITY

For example government bus

Services cannot be separated from the service provider.

Thus, the service provider would become a part of a service.

Production and consumption of services go hand in hand.

3. INSEPARABILITY

Taxi operator drives taxi, and the passenger uses it.

The presence of taxi driver is essential to provide the service.

INSEPARABILITY EXAMPLE

The quality of services cannot be standardized.

Systems and procedures are put into place to make sure the service provided is consistent.

The service firms should make an effort to deliver high and consistent quality by selecting good and qualified personnel for rendering the service.

4. HETEROGENEITY

Live concerts like singing , dancing and comedy shows , movies , etc.

HETEROGENEITY EXAMPLE

In the sale of goods, after the completion of process, the goods are transferred in the name of the buyer and he becomes the owner of the goods.

But in the case of services, the users have only an access to services.

They cannot own the service.

5. OWNERSHIP

Membership of a gym and swimming pool OWNERSHIP EXAMPLE

A service sector requires another tool for measurement.

We can measure it in terms of service level.

It is very difficult to rate or quantify services.

6. QUALITY MEASUREMENT

We can quantify the food served in a hotel but the way waiter serves the customer or the behavior of the staff, timely delivery , hygiene etc. cannot be ignored while rating the total process.

Thus the firm sells good atmosphere, convenience of customers, consistent quality of services, etc.

QUALITY MEASUREMENT EXAMPLE

The services are fluctuating in nature.

The demand of services can be abnormal, sudden seasonal, situational & dependent.

Therefore, while identifying the salient features of services one cannot ignore the nature of demand.

7. NATURE OF DEMAND

Physical Evidence and Presentation

Place People Equipment Communication material Symbols Price

Service Blueprints

By market Segment

Business Consumed

End consumer

Coaching , Taxi, Car wash, Life insurance

Management Consulting, Machinery Repair,Accounting Services, Legal services

Classifications of Services1. By Market Segment

By degree of Tangibility

Highly Intangible

Highly Tangible

Car rental, Vending Machines

Psychotherapy, consultancy , legal services.

2. By degree of Tangibility

Services Linked to Tangible goods

Domestic appliances repair, Car services

By skills of the service Providers

Non-professional

Professional

Medical services, Legal services, Accountancy , Tutoring

Babysitting, Caretaking, Casual Labour , Uniformed security, Taxi.

3. By Skills of Services Providers

By Business Orientation

Commercial

Non-profit organization

Scouts Association, Charities public sector Leisure facilities

Banks, Airlines, Tour Operators, Hotel and Catering services

4. By Business Orientation

By degree of Regulation

Non-regulated

Highly Regulated

Mass transit, Hospitals, Insurance, Utilities

Computer time, leisure lawn care, House painting

5. By degree of Regulation

Limited Regulated

Catering, Fast food

By Type of End Users

Industrial service

Consumer service

Beauty care, Hair cutting

Machine installation, plant maintenances

6. By Type of End Users

Business to Business

Market research, Advertising

Changing Lifestyle

Upward Trend in Disposable Income

Professionalism in EducationSophistication in Market

Increasing Government Activities

Information Explosion

Increasing Literacy Rate

Increasing Specialization

Importance of services

Importance of services

Upward trend in the disposable income: in past 10years the income of Indian consumer is found to be moving upward.

Increase in specialization: People want more perfection to be reworded suitably

Change in life cycle: Development of corporate culture emergence of well established services there is a drastic change in life cycle

Importance of service

Increasing literacy rate: due to education mission of government of India literacy rate in India

Professionalism in Education: The professional excellence would get a new priority and the masses would tempted to professional education

Information Explosion : invention and innovations in the field of communication have been found explosion in information

Sophistication in Market : It is natural that one finds sophisticated in market were customers expectations would find highIncreasing Government Activities: Expanding government activities give mainly to that participation of state in almost all sectors would make ways for the development in service sector

Thank you