Services Marketing

Click to edit Master subtitle style

8/5/12

Characteristics of services
Intangibility Inseparability Perishability Variability

8/5/12

Physical goods tangible homogeneous

Difference between physical goods and services

Services intangible heterogeneous

Production and distribution are separated Production, distribution and consumption from consumption are simultaneous processes A thing Core value processed in factory Customers do not participate in the production process Can be kept in stock Transfer of ownership An activity or process Core value produced in the buyer-seller interaction Customers participate in production Cannot be kept in stock No transfer of ownership

Services could meet

Personal needs haircuts, tution, massage

parlours

Business needs courier services, office

cleaning services, delivering fresh flowers

8/5/12

Marketing Implications of Eight differences between Services Marketing and Goods

Difference:-Most service products cant be

inventoried

Implications:-

Customers may be turned away or have to wait.

Marketing Related tasks:-

1)Smooth demand through dynamic 8/5/12 pricing and reservations.

Difference:-Intangible elements usually

dominate

Value creation.

Implications:-

Its harder to evaluate services and distinguish from competitors as the customers cant taste, smell or touch.
Marketing Related tasks:-

1)Make services tangible through emphasis on physical clues. 2)Employ vivid images in advertising, branding.
8/5/12

Services are often difficult to visualize and

understand.

Implications:-

Customers perceive greater risks and uncertainty.

Market-Related Tasks:-

1)Educate customers to make good choices, explain what to look for.

8/5/12

Customers may be involved in co-production. Implications:-

Customers interact with providers equipment , facilities , and system.

Market-Related Tasks:-

1)Develop user friendly equipments and systems. 2)Train customers to perform effectively.
8/5/12

People may be the part of the service

experience.

Implications:-

Appearance , attitude and behavior of service personnel and other customers can shape the experience and affect satisfaction.
Market-Related Tasks:-

1)Recruit,Train and Reward the employee.

8/5/12

2)Target the right customers at the right

Operational inputs and outputs tend to vary

more widely.

Implications:-

Its harder to maintain consistency , reliability and service quality

Market-Related Tasks:-

1)Set quality standards based on customer expectations , redesign product elements for simplicity.
8/5/12

Time factor often assumes great importance. Implications:-

Customers see time as a scarce resource and dislike wasting time waiting.
Market-Related Tasks:-

1)Find ways to compete on speed of delivery. 2)Minimize burden of waiting.

8/5/12

Distribution may take place through

nonphysical channels.

Implications:-

Information based services can be delivered through electronic channels such as the Internet or voice telecommunication
Market-Related Tasks:-

1)Seek to create user-friendly , secure web -sites and free access by telephone.
8/5/12

Goods-Services Goods and Services are intermingled in Continuum The goods and services different proportions.
continuum enables marketers to see the relative goods/services composition of total products.

8/5/12

Tangible goods:-FMCG. Services with Tangible goods:-FMCD. Goods and services in equal proportion:-

Hospitality industry.
Services accompanied by minor goods:-

Airlines
Pure services:-Consultancy services.
8/5/12

Services Marketing Environment

Political Economic Environment Socio-Cultural environment Technological Environment Competitive Environment

8/5/12

Political firms are being subject to Economic Many service Government Regulations in Environment andaddition to the usual taxes , legislation restrictions on
promotion and price discrimination. types of competition.
Regulations reduces the marketers of options Regulation generally influence the range and

and introduces certain rigidities into the marketing process.

8/5/12

Political-Economic New rules to protect Customers , Employees Environment and the Environment.
Privatization

8/5/12

Industrial policy:-

The Industrial policy of the government covers all those principles, policies, rules, regulations and procedures, which direct and control the industrial enterprises of the country and shape the pattern of industrial development. It defines the scope and role of private and public sector.

8/5/12

Fiscal policy: It includes government policy in

respect of taxation and debt.

Monetary policy: It includes all those activities

and interventions that aim at smooth supply of credit to the business and a boost to trade and industry.
Foreign investment policy: This policy aims at

regulating the inflow of foreign investment in various sectors for speeding up industrial development and take advantage of the modern technology. 8/5/12

ExportImport policy (Exim policy) :

It aims at increasing exports and bridge the gap between expert and import. Through this policy, the government announces various duties/levies. The focus now-a-days lies on removing barriers and controls and lowering the custom duties.

8/5/12

Social Groups:- Consumers ,Investors ,Local

Socio-Cultural Community , Employees. Cultural factors:- Beliefs , Customs , Habits of Environment:individuals, Lifestyles.

8/5/12

Technological Environment:Innovative Techniques of Production.

Automation Provides a competitive edge. Increased Productivity , Enlargement of the

catchment areas of service.

8/5/12

Competitive Environment Direct Competitive Rivalry.

Threats From Alternatives Threats from new Entrants. Bargaining powers of Buyers and Suppliers.

8/5/12