services marketing jminit i(2)

8/8/2019 Services Marketing JMInit I(2)

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1. UNDERSTANDING SERVICES

A. Service Product Difference/ ServicePeculiarities

(i) 4 Is of Servicesa) Intangibility - intangibility spectrum

b) Inconsistency - heterogeneity

c) Inseparability - simultaneous production& consumption

d) Inventory - perish ability

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Characteristics of Services

Compared to Goods

Intangibility

Perishability

SimultaneousProduction

andConsumption

Heterogeneity

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Examples of Service Industries

Health Care

± hospital, medical practice, dentistry, eye care

Professional Services

± accounting, legal, architectural

Financial Services ± banking, investment advising, insurance

Hospitality

± restaurant, hotel/motel, bed & breakfast

± ski resort, rafting

Travel

± airline, travel agency, theme park

Others

± hair styling, pest control, plumbing, lawn maintenance, counseling

services, health club, interior designArvind Shukla



1. UNDERSTANDING SERVICES

Service industries & companies- whose core product isa service

e.g. lodging Taj Hotels, transportation- Indian Airlines

Service as products wide range of intangible productofferingse.g. IBM software consultancy, Accenture

Customer Service- in support of the cos core productcall centers

Derived Service service provided by the goodse.g. car provides transport service

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Implications of Intangibility

Services cannot be inventoried

Services cannot be readily displayed or

communicated

Services cannot be easily patented

Pricing is difficult

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Implications of Simultaneous

Production and Consumption

Customers participate in and affect thetransaction

Customers affect each other

Employees affect the service outcome

Decentralization may be essential

Mass production is difficult

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Implications of Heterogeneity

Service delivery and customer satisfaction

depend on employee and customer actions

Service quality depends on many

uncontrollable factors

There is no sure knowledge that the servicedelivered matches what was planned and

promoted

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1.UNDERSTANDING SERVICES (Contd.)

B. Services Marketing Triangle

a. Company

b. Providerc. Customer

Between a & b - Internal Marketing

Between b & c - Interactive Marketing

Between a & c - External Marketing

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SERVICES CLASSIFICATION

(1) People Processing ServicesThese services require the customers presence

while the service is being provided. Typically suchservices are directed or applied to people and sotheir presence is mandatory. To use, enjoy andbuy these services customers must be preparedto spend time co-operating with the serviceoperation. Typical examples are medical services,

passenger transport, hotels, fitness centres andbeauticians. It is the marketing of these servicesthat is very different to marketing physicalproducts.

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(2) Possession Processing

Such services are aimed at peoples

possessions, e.g. goods transportation,laundry and repair services. Clearly these

services do not require customer involvement

in the process and so from a marketing

perspective are less complex than peopleprocessing services.


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(3) Mental Stimulus / Information Based Services

Under this heading are a developing range of services aimed at peoples minds and assets, e.g.

entertainment, education. The internet has createdhuge global opportunities for mental stimulus andinformation processing services. e.g. consulting,education, entertainment, finance, travel facilitation,data processing and communication which can nowbe delivered electronically to global markets

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Consumer Evaluation

Processes for Services

Search Qualities

± attributes a consumer can determine prior to

purchase of a product

Experience Qualities

± attributes a consumer can determine after

purchase (or during consumption) of a product

Credence Qualities

± characteristics that may be impossible to evaluate

even after purchase and consumption




C. Search, Experience & Credence

Attributes of Services

Manufactured Goods High on Search Attributes

Services High on Experience & Credence

Attributes



Continuum of Evaluation for

Different Types of Products

Difficult to evaluateEasy to evaluate

High in search

qualitiesHigh in experience

qualities

High in credence

qualities

Most

Goods

Most

Services

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D. Services Marketing Mix

Product Price

Promotion Place

People Customers, Employees

Physical Evidence Facility Design, Equipments &

OthersProcesses Flow, Number of steps & Customer

involvement



SERVICES MARKETING MIX-THE THREE

NEW Ps(1) People

All the human actors, customers and staff who participate in theservuction system and influence each customers perception of and satisfaction with the service. Because of the inseparability

issue, front of house staff must interact continuously with theircustomers. To satisfy these customers staff must processappropriate technical and interpersonal skills. It is oftenchallenging to recruit staff with one of these sets of skills, and itmay often be a considerable challenge to find staff comfortableand competent in both areas. These staff are referred to as

boundary spanners, or part-time marketers, as they have bothoperations and marketing responsibilities. Apart from a rangeof human resource management issues, who manages thesestaff, operations, marketing or both?



SERVICES MARKETING MIX-THE THREE

NEW Ps

(2) Process

The steps, procedures, mechanisms, and all activities

by which the service is delivered. It is the heart of

the delivery and operating systems.

(3) Physical Evidence

Now referred to as the servicescape, its the

environment in which the service is performed,where all customers, staff and company interactivity

occurs.



3. UNDERSTANDING THE SERVICES

CUSTOMER (Contd.)

B. Customer Experience

Based on

the provider

the customer himself

the third party

the physical evidence



3. UNDERSTANDING THE SERVICES

CUSTOMER (Contd.)

C. Post experience evaluation

Important for predicting subsequent consumer behavior seldom used

Word of mouth becomes important-

Good experience creates good WOM

Dissatisfaction leads to poor WOM- Service recovery strategy neededAttribution of Dissatisfaction

Positive & Negative Biases



Goods versus Services

Source: A. Parasuraman, V.A. Zeithaml, and L. L. Berry, A Conceptual Model of Service Quality and Its Implications for Future Research, Journal of Marketing 49

(Fall 1985), pp. 4150.

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services marketing jminit i(2)

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