Service

Product
Comprises all of the elements of the
service performance, both physical
and intangible, that create value for
customers.
Designing the Service Concept

Core Product
It is the central component that
supplies the principal, problem-
solving benefits customer seek.

Philippine Airlines
EDSA Shangri-la
 Supplementary
Services
These are services that augments
and accompanies the core product.

Philippine Airlines
Philippine Airlines
EDSA Shangri-la
Delivery
Process
These are processes used to
deliver both the core product and
each of the supplementary services.
Sequence that deals on when will the
customers use each of the core and
supplementary services and the
approximate length of time required
in each instance.
Documenting the
Delivery Sequence
Parking Get car
Check in Check out
Internet Internet
Use
Room USE GUESTROOM OVERNIGHT
internet

Porter
Pay TV
Meal
Room service
 Flower of Service
Information

Payment Consultation

Billing Core Order-Taking

Exceptions Hospitality

Safekeeping
KEY: Eight clusters of
Enhancing elements
Facilitating elements
supplementary services that
are displayed as petals
surrounding the center of a
flower (core).
Facilitating
Supplementary required for either service delivery or aid in

Services the use of the core products.

Information Customers need relevant information.
Once customers are ready to buy, a
key supplementary element comes
into play-- accepting applications,
orders and reservations.
Order
Taking
 Billing
It can be verbal statements to a
machine-displayed price, and from
handwritten invoices.
 A variety of payment options
exist, but all customers
expect ease and
convenience.
Payment
Enhancing
Supplementary
Services
adds extra value for customers.
Consultation
Hospitality
Safekeeping
Exceptions
1. Special Requests
2. Problem Solving
3. Handling of complaints
/suggestions/complements
4. Restitution
 Managerial implications
q Most supplementary services
do (or should) represent
responses to customer needs.
q Any badly handled element
may negatively affect
customers' perception of
service quality.
q Not every core product is
surrounded by supplementary
elements from all eight petals
of the Flower of Service.
q A company's market positioning
strategy helps to determine which
supplementary services should be
included.
q The flower of service serves as a
checklist in the search for new ways to
augment existing core products and to
design new offerings.
q All of the elements in each petal
should receive the care and attention
needed to meet defined service
standards.
Branding Service Products
and Experiences
Branding
Strategies
for Services
Branded
House
Applies its brand name to
multiple offerings in often
unrelated fields.
The corporate of the master
brand is the frame of reference
but the product itself alos has Sub Brands
a distinctive name.
 The product brand dominates but the
corporate name is still featured.

Endorsed
Brands
Home to numerous brands,
each independent of one
another, and each with its
own audience, marketing,
look and feel.
House of
Brands
New Service Development
Hierarchy of
New Service
Categories

-represent the simplest

type of innovation
-typically involving no
changes in either process or
performance

Style Changes
 Service Improvements
most common type of
innovation
Involves modest changes in
the performance of current
products, including
improvements to either the
core product or to existing
supplementary services
Supplementary Service
Innovations
This takes form in the addition of new
facilitating or enhancing service
elements to an existing core service
or of significantly improving an
existing supplementary service.
Process Line
Extension
These are less innovative than
process innovations but often
represent distinctive new ways
of delivering existing products,
either with the intent of offering
more convenience and a
different experience for existing
customers or attracting new
customers who find traditional
approach unappealing.
 Product Line
Extensions
These are additions to a
company’s current product
lines. These new services may
be targeted at existing
customers to serve a broader
array of needs or designed to
attract new customers with
different needs or both.
Major Process
Innovation
Consist of using new processes to
deliver existing core products in new
ways with additional benefits.
Major Service
Innovations
These are new core products
for markets that have not been
previously defined. They
usually include both new
service characteristics and
radical new processes.
REENGINEERING SERVICE
PROCESSES
Reengineering involves analyzing
and redesigning processes to
achieve faster and better
performance. Examination of
processes may also lead to
alternative delivery methods
 Examination of processes may also lead to
creation of alternative delivery methods that
are radically different as to constitute entirely
new service concepts.
 PHYSICAL GOODS AS A SOURCE
OF NEW SERVICE IDEAS

Any new physical product

has the potential to create a
need for related possession-
processing services.