Services Marketing

%e service sector
%e services sector as been growing at a
rate oI 8 per annum in recent years
More tan alI oI our GDP is accounted Ior
Irom te services sector
%is sector dominates wit te best jobs,
best talent and best incomes
%ere are no suc ting as
service industries.%ere are only
industries wose service
components are greater or less
tan tose oI oter industries.
Everybody is in service.
-%eodore Levitt-
at is services?
It is te part oI te product or te Iull
product Ior wic te customer is
willing to see value and pay Ior it.
at is a service?
It is intangible.
It does not result in ownersip.
It may or may not be attaced wit a
pysical product
DiIIerence between pysical
goods and services
Physical goods Services
tangible intangible
omogeneous eterogeneous
Production and distribution are
separated Irom consumption
Production, distribution and
consumption are simultaneous
processes
A ting An activity or process
Core value processed in Iactory Core value produced in te buyer-seller
interaction
Customers do not participate in te
production process
Customers participate in production
Can be kept in stock Cannot be kept in stock
%ransIer oI ownersip No transIer oI ownersip
Most products ave a service
component
%ey could be
Equipment based
People based varying skill levels
Services could meet
Personal needs aircuts, tution, massage
parlours
Business needs courier services, oIIice
cleaning services, delivering Ires Ilowers
Caracteristics oI services
Intangibility
Inseparability
Perisability
Variability
%e tree additional P`s oI
Service Marketing
People
Pysical evidence
Process
"ualities oI services
Searc qualities
Experience qualities
Credence qualities
DiIIerentiation in services
OIIering
Faster and better delivery
Image
Managing Service quality
Gap between management perceptions and
consumer expectations
Gap between management perceptions and
service quality speciIications
Gap between service quality speciIications and
service delivery
Gap between service delivery and external
communication
Gap between expected service and perceived
service
Determinants oI service quality
Reliability delivering on promises
Responsiveness willing to elp
Assurance inspiring trust and conIidence
Empaty individualising customers
%angibles- pysical representation
Moments oI trut
It is te customer service encounter
Every positive or negative experience oI
te consumer would ave Iall-out on te
overall service experience
In services, te last experience
remains uppermost in your mind.
%ereIore, it is not enoug to be
good, you ave to be consistently
good
Services Monitoring
Continuous auditing oI competitor service
levels versus own company
Importance - perIormance analysis
Importance PerIormance
Analysis
Concentrate
ere
Keep up te
good work
Low priority Possible overkill
I
M
P
O
R
%
A
C
E
P E R F O R M A N C E
Service quality is directly
proportional to employee
satisIaction
en customers visit a service
establisment
%eir satisIaction will be inIluenced by
Encounters wit service personnel
Appearance and Ieatures oI service
Iacilities exterior and interior
Interactions wit selI service equipment
Caracteristics and beaviour oI oter
customers
Customer Service Expectations
Desired Service te wised Ior` service
Adequate Service te service tat would
be acceptable
one oI %olerance
DiIIerence between te desired
service and te adequate service
Service Encounter %emes
Recovery
Adaptability
Spontaneity
Coping
Recovery
Don`t
Ignore customer
Blame customer
Leave customer to
Iend Ior imselI
Downgrade
Act as iI noting is
wrong
pass te buck`
Do
Acknowledge
problem
Explain causes
Apologise
Compensate/upgrade
Lay out options
%ake responsibility
Adaptability
Don`t
Promise and Iail to
keep tem
Sow unwillingness
to try
Embarrass te
customer
Laug at te customer
Avoid responsibility
Do
Recognise te
seriousness
Acknowledge
Anticipate
Accommodate
Adjust
Explain rules/policies
Spontaneity
Don`t
Exibit impatience
Yell/laug/swear
Steal Irom customers
Discriminate
Ignore
Do
%ake time
Be attentive
Anticipate needs
Listen
Provide inIormation
Sow empaty
Coping
Don`t
%ake customer`s
dissatisIaction
personally
Let customer`s
dissatisIaction aIIect
oters
Do
Listen
%ry to accommodate
Explain
Let go oI te
customer
%ypes oI complainers
Passives
Voicers
Irates
Activists
Customer complaints
It pays to resolve customer complaints
On an average only 5 dissatisIied customers
complain. Oters simply go over to te
competitor
A satisIied consumer speaks to an average oI 3
people on is er experience
A dissatisIied consumer gripes to on an average
11 persons about is/er unpleasant experience
Companies tat pay importance
to resolving customer complaints
Pay attention to quality and training oI manpower
recruited
Have clear bencmarks on service quality and
communicate to employees
%ake remedial steps to improve customer
satisIaction and prevent repeats oI customer
dissatisIaction
Have a data base on customer complaints tat is
periodically analysed and policies adjusted
SatisIied employees will produce
satisIied customers
Morale
Motivation
Mood
Managing Service Productivity
Giving quality service is an expensive business
Not every consumer is willing to pay extra Ior
service quality
Service providers would ave to Iind teir
optimum service quality/cost ratios
Can tecnology substitute part oI te labour
content?
Can customers substitute part oI te labour
content?
Making services obsolete by product innovations