ASSIGNMENT 1

PARUL SETHI
241094

Que 1: An airline is concerned with whether its passengers are satisfied with how their
luggage is handled before, during and after a flight. With which element of the services
marketing mix is the airline concerned? Explain
Process: The Service Marketing Mix is made up of 7 Ps, Product, Price, Place, Promotion,
People, Process and Physical Evidence. Service Process is the way in which a service is
delivered to the end customer. Let take the example of two companies: McDonalds
and FedEx. Both the companies thrive on their quick service and the reason they can do that is
their confidence on their processes. On top of it, the demand of these services is such that
they have to deliver optimally without a loss in quality. Thus the process of a service
company in delivering i t s p r o d u c t i s o f u t m o s t i m p o r t a n c e .
Que 2: List the four characteristics of service and discuss how each would impact the
marketing of a chain of fitness centres that is being started by six former Olympic athletes.
Four characteristics of services area) Intangibility
b) Heterogeneity
c) Perishability
d) Inseparability/ Simultaneity of production and consumption.
Intangibility: Unlike a business with a tangible product, a fitness centre does not offer products,
rather the six Olympians provide service in the form of training. The customers might be vary to
utilize these services due to the belief that they might not have adequate information about the
service. Therefore, it becomes important for the chain of fitness centres to communicate to their
target audience about the authenticity of the fitness chain focussing around the fact that the chain
is being operated by Olympic athletes.
Inseparability: A service business has the service being produced and being consumed in the
same location. The customers who would use the service of the fitness centre would have certain
expectations from the centres, accentuated by the ambience of the centres and the equipment
being used. Therefore, it is important for the chain to keep a track of the satisfaction of the
customers and address the grievances of the customers, if any, at the earliest.
Perishability: Services have the characteristic of being perishable. This implies that any time
that the fitness centre is not providing services to its customers it is facing a loss in revenue.
Therefore a service business has to focus upon its processes and staff management. Anytime
when the customers are less the centre should employee less staff members (staff rationalization)
and streamline its processes.

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PARUL SETHI
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Variability: It is difficult for a service organization to produce same levels of services at all
times. Thus, arises a need to standardize procedures to produce consistent service delivery.
Que 3: How should you explain to a friend that there is more perceived risk with the
purchase of a wedding reception caterer for your wedding than for the diamond
engagement ring?
A diamond engagement ring is product for which the stakeholders are few and the risk can be
systematically hedged by knowing the choice of the person for whom it is being purchased. But
the caterer decision is a one where the general taste of all the invitees is to be considered along
with allied services like cutlery, stewards, cooks, chefs, waiters etc. The quality and freshness
of the food is of utmost importance. The food should not lack in quantity nor should be wasted
much. Also the choice of snacks to soups to croissants to main course should be a diligent
decision. It is much more than buying a ring.
Que 4: What is the difference between a product offering and a service such as Kayas
(both in beauty care domain), if loyal and first time customers are compared?
The products are tangible in case of Product Offering. Due to some recent ad campaigns or due
to dissatisfaction with their current product, some consumers would wish to experiment with new
products. They would however continue using the product until they have utilized the product
completely even if they do not realise the expected benefits from the product.
For loyal consumers, the product has consistently provided them with the expected benefits
driving up the satisfaction. They will continue using the products despite of the competitors
efforts due to the consistent Customer Delight.
In case of Service Offering for beauty care services the first timers are influenced by the peers,
friends, existing patrons or the experts promoting such saloons. They have high expectation from
the ambience of the beauty parlour. A first time customer uses the services of a parlour to gain a
sense of fulfilment from the services, i.e. they expect to observe some tangible difference from
using the services of the parlour.
The loyal customers on the other hand judge a beauty parlour for the empathy of its employees,
quality, consistency of the services, uniqueness of the service provided and the pricing
mechanism of the parlour (loyalty discounts, etc.). Additionally need identification and
fulfilment is also an important factor for the loyal customers.
Que 5: What aspects of the traditional Disney theme park formula, in terms of park design
and service design, might prove to be transferable to euro Disney, and which might prove
to be specific to the United States and/or Japan? In general what issues should a company
think through before extending a successful service concept across cultural boundaries?

ASSIGNMENT 1

PARUL SETHI
241094

Every society has their way of life: a complex matrix of manners, styles of dress, norms for
social behaviour, rituals, religions, values and language. In general, a company should focus
following aspects before extending a successful service concept.
i.

Traditions and rituals specific to various religions, so as not to religious sentiments.

ii.
The way people like to communicate with each other. For examples, personal
conversation before talking business is more in southern Europe than northern Europe.
iii.

Difference in eating habits. Examples: Norwegians eat burger with knife and fork.

iv.

Difference in greeting habits. Indians avoid giving gifts and change with their left hand.

v.

Variations in spending and consuming patterns.

vi.
It should also take care of whether the society in individualistic or collective, difference
in power distance, masculine or feminine, etc.
For a theme park, things such as park design, grooming standards for employees, and eating
habits, are to be considered before stating operations.
Specific (Non-transferable):
Eating habits should be non-transferable, as people would not like to adjust with their basic and
necessary requirement. Example:
a)
Not serving wine at Euro Disney is in consistent with US and Tokyo policies, but not
welcomed in France. When business is concerned, it should not be transferable, but consistencies
in policies and worldwide similar image, such restrictions are necessary.
b)
More focus on dining facilities and serving peak demands, rather than on fast food in offhours.
Grooming culture should be non-transferable. Example: Excessive Restrictions on grooming
requirements for employees was not welcomed in France. It should be more liberalized.
General (Transferable):
Cartoon characters should be same and transferable, because French people already have a liking
for those, but it is better if they are accommodated or slightly mixed with French culture.
Example: Cindrella lining in French Inn.
Park layout and design can also be transferable, but with little modifications. It would ensure
proper maintenance of integrity and also depicting the liking of American culture.

ASSIGNMENT 1

PARUL SETHI
241094

Que 6: Explain the three basic service encounters of Ron Kaufman?

Ron Kaufman has talked about three types of Service Encounters. The first Service Encounter
begins with the company asking the customer, What do you want? followed by the company
delivering the requisite product at the right time without any defects. The goal for the
organization in this encounter is to increase volumes and speed of productions, striving for
standardization and ultimately removing breakdowns. The people in such an organization have to
be trained for accuracy and a complete understanding of the processes of the organization. The
organization thus, strives for Customer Satisfaction in such a Service Encounter.
Service Encounter of the second kind begins with the company asking the customer, How do
you want it? such an encounter requires the company to be flexible, adaptive and responsive.
The company requires customizing its products and reengineering if the need arises, sometimes
looking for ways to overcome breakdown. The people in the organization must be committed to
their customers and for this they must be trained in listening skills and problem solving skills.
The organization thus, strives for Customer Delight in such a Service Encounter.
Finally comes the Service Encounter of third kind. The company here asks the customer, What
would you like to become? which requires building up of dialogue between customer and
company ultimately building trust. Such encounter requires the company to evolve to keep
delivering value to its customer and may even require the company to reinvent itself. Here the
focus is on the future and thus requires the company to anticipate breakdowns in the future.
Thus, this requires the employees to take ownership of the customers expectations and
problems, trying to solve them, and therefore they should be trained in creating partnership and
intrapreneurship. The organization thus, strives for Customer Loyalty in such a Service
Encounter.
While talking about the Service Encounter of the third kind it must also be remembered that all
each Service Encounter is based on the foundation of the Service Encounter of the previous kind.
Therefore, we can say that without Customer Satisfaction and Customer Delight we cannot
achieve Customer Loyalty.
Que 7: What have been Singapore Airlines main ingredients of success for decades?
Singapore Airlines main ingredient for success was their passion and dedication to excellence.
They recognized in order to be the best and remain the best, constant change and improvement
was absolutely vital. In a competitive environment they have managed to stay at the top, and
maintain their reputation. The SIA planned to reach their goals through a three pillar strategy,
which included: inflight service, the most modern fleet, and outstanding ground service. SIA was
also innovative in their approaches to change, and because of that they offered value to their
customers that kept them loyal to SIA for so many years. SIA was so successful because they
were able to maintain their competitive edge in a growing fast paced industry because they
implemented continuous development within the company. SIA wanted to be known as a high

ASSIGNMENT 1

PARUL SETHI
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quality flight service, and in order to ensure their customers were satisfied they recognized for
that to happen the individuals serving these customers needed to have a high level of job
satisfaction.
Que 8: Extensive study of the Word's best service companies reveals the four principles on
which the service business must get right? Explain
4 principles on which a business must get right are:
1. The Offering
A service business cant last long if the offering itself is fatally flawed. It must effectively meet
the needs and desires of an attractive group of customers. In thinking about the design of a
service, however, managers must undergo an important shift in perspective: Whereas product
designers focus on the characteristics buyers will value, service designers do better to focus on
the experiences customers want to have. Management team must be absolutely clear about which
attributes of service the business will compete on. Managers should discover the relative
importance customers place on attributes and then match the investment in excellence with those
priorities. At Wal-Mart, for example, ambience and sales help are least valued by its customers,
low prices and wide selection are most valued, and several other attributes rank at points in
between.
2. The Funding Mechanism
All managers, and even most customers, agree that there is no such thing as a free lunch.
Excellence comes at a cost, and the cost must ultimately be covered. With a tangible product, a
companys mechanism for funding superior performance is usually relatively simple: the price
tag. Only the customers who forfeit the extra cash can avail themselves of the premium offering.
In a service business, developing a way to fund excellence can be more complicated. Many
times, pricing is not transaction based but involves the bundling of various elements of value or
entails some kind of subscription, such as a monthly fee. In these cases, buyers can extract
uneven amounts of value for their money. Indeed, even non-buyers may derive value in certain
service environments. For example, a shopper might spend time learning from a knowledgeable
salesperson, only to leave the store empty-handed. There must be a funding mechanism in place
to allow the company to outshine competitors in the attributes it has chosen.
Funding mechanism take four basic forms:
a)

Charge the customer in a palatable way.

b)

Create a win-win between operational savings and value-added services.

c)

Spend now to save later.

d)

Have the customer do the work.

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PARUL SETHI
241094

3. The Employee Management System

Top management must give careful attention to recruiting and selection processes, training, job
design, performance management, and other components that make up the employee
management system. More to the point, the decisions made in these areas should reflect the
service attributes the company aims to be known for. To design a well-integrated employee
management system, start with two simple diagnostic questions. First: What makes our
employees reasonably able to achieve excellence? And then: What makes our employees
reasonably motivated to achieve excellence? Thoughtfully considered, the answers will translate
into company-specific policies and programs. Companies that neglect to connect the dots
between their employee management approaches and customers service preferences will find it
very hard to honour their service promises.
4. The Customer Management System
The customers themselves can be involved in operational processes, sometimes to a very large
extent, and their input influences their experiences (and often other customers too). For
example, an architectural firms client may explain the purpose of a new facility well or poorly,
and that will affect the efficiency of the design process and the quality of the end product. A
customer who dithers at a fast-food counter makes the service less fast for everyone behind him.
In a service business, employees and customers are both part of the value-creation process. A
main benefit is that customer labour can be far less expensive than employee labour. It can also
lead to better service experiences. When students participate more in a classroom environment,
for example, they learn more. But there are challenges, as well. Designing a system that
explicitly manages these challenges is essential to service success.
Que 9: Provide an example of a service industry where customers are involved in coproduction and explain the implications and marketing-related tasks that would be
associated with that service.
Co-production is rapidly becoming one of the most talked-about themes in public services and
public policy around the world. This article sets out what it is, why it matters and its implications
for public and social marketing. The movement to user and community co-production harks back
to one of the key characteristics of services in the public and private sectors: the
production and consumption of many services are inseparable. Quality in services often occurs
during service delivery, usually in the interaction between the customer and provider, rather than
just at the end of the process. This means that customers do not evaluate service quality based
solely on the outcomes (e.g. the success of a medical treatment in a hospital) - they also consider
the process of service delivery (e.g. how friendly and responsive were the hospital medical staff
and how comfortable was the ward).
Que 10: Explain how the core product, supplementary services, and delivery processes are
integrated in the context of an overnight hotel stay.

ASSIGNMENT 1

PARUL SETHI
241094

The integration of the core product, supplementary services, and delivery processes: The core
product is an overnight rental of a bedroom. The delivery processes surrounding this core
product are:
Nature of the processpeople processing in this instance
Customers rolewhat customers are expected to do for themselves; what the hotel will do for
them, such as making the bed, supplying bathroom towels, and cleaning the room
Schedulinghow long the room may be used before another payment becomes due
Service levelwhat level and style of service.
Surrounding the core product is a variety of supplementary services. These range from
reservations to meals and in-room service elements. Delivery processes must be specied for
each of these elements. The more expensive the hotel is, the higher the level of service is
required of each element. For example, very important guests might be received at the airport
and transported to the hotel in a limousine. Check-in arrangements can be done on the way to the
hotel. By the time the guests arrive at the hotel, they are ready to be escorted to their rooms,
where a butler is on hand to serve them. Specic design in terms of customer service processes is
called Service Blueprinting.
Que 11: Discuss the impacts of the competition globalization driver on people processing,
possession processing, and information-based service categories. Give at least one example
of a firm that falls into each category.
For people processing services, the need for simultaneous production and consumption limits
leverage of foreign-based competitive advantage in the front-stage of the service factory, but
advantage in management systems can be the basis for globalization. For example, McDonalds
restaurants must have a facility to serve customers to compete with restaurants in foreign
countries. For possession processing services, the lead role of technology creates the driver for
competitors with a technical edge. For example, Singapore Airlines services other carriers
aircraft abroad. Information-based competition is highly vulnerable to global dominance by
competitors with a monopoly or competitive advantage in information unless restricted
by governments. The BBC, Hollywood, and CNN are good examples of firms that fall in this
category.

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