1.

0 introduction

The active marketing of something that is impalpable and which is typically bought at the
point of delivery. Services marketing covers a broad range of sections and activities:
customer services, entertainment services, medical services professional services, sports
services, maintenance services etc. Services marketing academics are separated on how
truly services marketing is differentiated from the marketing of touchable goods.

Services marketing has now become a major practice in the comprehensive marketing
range of techniques and has different practices from product marketing. The services
marketing has been widened by the desires of public services, franchises and non-profit
services, which are booming worldwide.,

The key appearances of the services marketing that separate it from manufactured goods
are that a service is a benefit that one party brings to another that is neither separable
nor touchable, neither standardized nor storable. The principal characteristics of services
marketing are known as IHIP: intangibility, heterogeneity, inseparability, and perishability.

2.0 Literature Review

2.1 Significance of Service Marketing

If innovative marketing principles are trailed in services marketing, the socio-economic

transformation will happen at a much faster rate where it will lead to an all round
progression of the economy. The importance of the service economy may be discussed
under the following headings:

2.1.1 Generating employment Opportunities - Service sector is broadly differentiated with

many components in which systematic development of the service sector is instrumental
to the development of the economy which would create enormous employment
opportunities.

2.1.2 Optimum Utilization of Resources - The human resources availability favors the
growth of the service sector and it offers excellent export opportunities too. Services
marketing supports conserve the valuable resources for future generations.
2.1.3 Capital Formation - As the Services will grow more rapidly in the near future,
investments made in the service sector, will contribute to the nation-building process.
Performance of profitable services can captivate higher investments, thereby quickening
the rate of capital formation.

2.1.4 Improving the Standard of Living - This would be decided on the basis of standard
and the quality of products ingest or services availed in the day-to-day living. The
development of services industry is sure to endorse the standard of living of the people.

2.2 Distinctive characteristics of Service

A most important contribution to the services discussion was a classification containing

of four features which is referred to as ‘IHIP’ characteristics.

2.2.1 Intangible - Intangible things include non physical objects and only exist in
connection to other things. Harker (1995, p.10) humorously, though helpfully designated
services as ‘something that you cannot drop on your foot’, which vividly proves the
intangible characteristics of services.

2.2.2 Heterogeneous - A common service differs according to the situation, requirements

and nature of each customer. It may be diverse according to different quality standards
related with different costs; services can be varied across regions or cultural background.

2.2.3 Inseparable - Services may be said to be inseparably linked with customers in

relation of production and consumption and so it is said that service is inseparable. A
service provider may not offer their services until the customer engaged.

2.2.4 Perishable - Using technical criteria to define services, Smith (1776) positions a
service will ‘expire in the very instant of its performance, and rarely leave any hint or value
behind them for which an equal amount of services could afterwards be obtained’. Here
Smith exhibits one of the important characteristics of services, which is perishability. It
may be told that services are not a stock of fixed assets and it is not possible to store
services in inventories (Hill 1999, p.425; Gadrey 2000. P.367).

2.3 Measuring and Managing service quality

Service quality is a main issue facing many service operations managers. For a touchable
product, customers can envision its physical characteristics before purchase (Zeithaml
1981). For example, even though they perform alike ‘transport’ function one can easily
validate why a Rolls Royce is costlier than the Tata Nano car from their appealing
characteristics (Bowen and Ford 2002, P. 450). However, it is moderately more
problematic to compare the banking service provided by two similar Sri Lankan based
high street banks such as HNB plc and Commercial Bank plc objectively. We may, for
example, be highly influenced by our own or our friends experience. Chase and Dasu
(2001) conclude that eventually a customer’s opinion will be a determining factor on the
efficiency of a service organization. Therefore, managers of service operations would
practically have a methodology to assess customer satisfaction and loyalty individually
(Heskett et al. 1994, P. 166; Bowen and Shoemaker 1998, P 14; Paulin et al. 2000).
Lundberg noted that regularly, the quality and value for a service can depend wholly on
the customer’s validation at that instance (Lundberg 1991, P.66). One frequently cited
method that has been established to measure the individual quality of a service is named
SERVQUAL which is constructed on the gaps between expectation and the perception of
the service delivered (Parasuraman et al. 1988, P.15). SERVQUAL allows service and
retailing companies to appraise consumer perceptions of service quality and supports to
identify areas requiring managerial action (Parasuraman et al. 1988 p.32).

2.4 Technology in Service Marketing

Technology is regulating the practice of services marketing which is empowering both

customers and employees to receive and offer customized services.

2.4.1 New ways to deliver service - Technology has instigated new ways of bringing
service since face of customer service has changed with the influx of technology.
Ex- Introduction of automated voice response system- Ford Motor company’s technology
enables customers to set their own service appointments and observe the status of their
vehicles via online.
 2.4.2 Easy accessibility of service - Internet based businesses find that internet makes
offer of new services possible. Ex- bill payment service guarantees convenience to the
customers while utilizing services.

2.4.3 Close link with customers - This provides the customer with better service by
simplifying an integrated customer relationship. ex- Financial entities provide
online financial services to clients without human intervention.

2.4.4 Global reach of service - The internet is one big service which has no boundaries.
Information, customer service and transactions available across countries. The service
provider can reach any client who has access to the internet.

2.4.5 Close link with customers - This provides the customer with better service by
simplifying an integrated customer relationship. ex- Financial entities provide
online financial services to clients without human intervention.

2.4.6 Higher level of service - Self-service technologies has enabled customers to serve
themselves which has saved time of communication and companies to serve their clients
well according to their needs.

2.4.7 Cost rationalization - Customer expectations are high at a reasonable cost for which
the replacement of technology helps companies to lessen the employee cost.
Reference

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Academic Publishers

Smith A (1776) The Wealth of Nations. Chichester: Wiley

Hill P (1999) Tangibles, intangibles and services: a new taxonomy for the classification of
output Canadian Journal of Economics-Revue Canadienne D Economique, 32(2): 426–
446

Gadrey J (2000) The characterization of goods and services: An alternative approach.

Review of Income and Wealth, 46 (3): 369–387

Zeithaml VA (1981) How consumer evaluation processes differ between goods and
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Bowen J, Ford RC (2002) Managing service organizations: does having a ‘thing’ make a
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Chase RB, Dasu S (2001) Want to perfect your company’s services? Use behavioral
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Heskett JL et al (1994) Putting the service-profit chain to work Harvard Business Review,
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Bowen J, Shoemaker, S (1998) Loyalty: a strategic commitment. Cornell Hotel and

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Paulin M, Ferguson RJ, Payaud M (2000) Business effectiveness and professional

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