Services Marketing

C ha pte 3
r P : S e rvice
in ositioning
C ompe titive
s M a rke
ts

Slide © 2010 by Lovelock & Wirtz Services Marketing 7/e Chapter 3 – Page 1
 O ve rvie w of C ha pte
r3 Services Marketing
 F ocus S tra te gie s for S e
rvice s
 M a rke t S e gme nta
tion
 S e rvice Attribute s a nd Le ve
ls
 P ositioning D istinguishe s a Bra from its C ompe
nd titors
 D e ve loping a n E ffe ctive P ositioning S tra
te gy
 U sing P ositioning M a ps to Ana lyz e C ompe S tra te
titive gy
 C ha nging C ompe titive P
ositioning

Slide © 2010 by Lovelock & Wirtz Services Marketing 7/e Chapter 3 – Page 2
 Services Marketing

F ocuse S tra te gie for

d S es rvice
s

Slide © 2010 by Lovelock & Wirtz Services Marketing 7/e Chapter 3 – Page 3
 S ta nding Apa from the
rt
C ompe tition Services Marketing

“A business must set itself apart from its

competition. To be successful it must identify and
promote itself as the best provider of attributes that
are important to target customers.”

G e orge S . D a
y

Slide © 2010 by Lovelock & Wirtz Services Marketing 7/e Chapter 3 – Page 4
 Ba sic F S tra te gie for
ocus s
S e rvice s Services Marketing

Slide © 2010 by Lovelock & Wirtz Services Marketing 7/e Chapter 3 – Page 5
 C onside ra tions for
using
F ocuse d S tra te gie s Services Marketing

F ully focuse d: Limite d ra of se rvice s to na rrow a

nge nd
spe cific ma rke t
 O pportunitie  R
s D e ve loping re cogniz isks
 M a rke t is too sma ll to
ed ge ne ra te ne e de d
e
dexpe
finertise in ama
niche weyll- volume

d prote D e ma nd ma y be
provide ction displa ce d by ge ne
a ga
compe titors
would- be ric compe tition from
inst a lte rna tive products
 Allows firms to cha 
rge pre mium price s P urcha se rs in chose
n se gme nt ma y be
susce ptible to e
conomic downturn

Slide © 2010 by Lovelock & Wirtz Services Marketing 7/e Chapter 3 – Page 6
 C onside ra tions for
using
F ocuse d S tra te gie s Services Marketing

 M a rke t focuse
d N a rrow ma rke t se gme nt wide ra nge of se rvice
 with s
N e e d to ma ke sure firms ha ve ope ra tiona l ca pa bility
to do
a nd de live r e a ch of the diffe re nt se rvice s se le cte d
 N e e d to unde rsta nd custome r purcha sing pra a nd
ctice s
pre fe re nce s
 S e rvice focuse
d N a rrow ra nge of se rvice s to fa irly broa d ma rke t
 As ne w se gme nts a re a dde d, firm ne e ds to de
ve lop knowle dge a nd skills in se rving e a ch se
gme nt

Slide © 2010 by Lovelock & Wirtz Services Marketing 7/e Chapter 3 – Page 7
 C onside ra tions U
for sing
F ocus S tra te gie Services Marketing
s
 U nfocuse
d Broa d ma rke ts with wide
ra nge of se rvice s
 M a ny se rvice provide rs
fa ll into this ca te

gory
D a nge
r –a ll
betra
coming
de a nd
“ja
ma ckste r as
of none
of
”

Slide © 2010 by Lovelock & Wirtz Services Marketing 7/e Chapter 3 – Page 8
 Services Marketing

M a rke S e gme nta

t tion

Slide © 2010 by Lovelock & Wirtz Services Marketing 7/e Chapter 3 – Page 9
 M a rke t S e gme nta
tion Services Marketing

 F irms va ry wide ly in the a bilitie s to se rve diffe re

ir nt
type s of custome rs
 A ma rke t se gme nt is compose d of a group of buye
rs
sha ring common cha ra cte ristics, ne e ds, purcha
sing be ha vior, a nd consumption pa tte rns
 T a rge t se gme nts should be se le cte d with re fe re to
nce
 F irm’s a bility to ma tch or e xce e d compe ting offe
rings
dire cte d a t the sa me se gme nt

N ot just profit pote ntia l

Slide © 2010 by Lovelock & Wirtz Services Marketing 7/e Chapter 3 – Page 10
 Services Marketing

Se Attribute a
rvice s nd
Le ve ls

Slide © 2010 by Lovelock & Wirtz Services Marketing 7/e Chapter 3 – Page 11
 D e ve loping R ight S e
rvice
C once pt for S pe cific S e gme
a nt Services Marketing

 U se re se a to ide ntify a nd prioritiz e which a ttribute s a

rch of
give n se a re importa nt to spe cific ma rke t se gme
 rvice
I ndividua ls ma nts
y se t diffe re nt prioritie s a to:
ccording
 P urpose of using the se rvice
 W ho ma ke s de cision
 T iming of use
 W he the r se rvice is use d a or with a group
lone

C omposition of tha t group

Slide © 2010 by Lovelock & Wirtz Services Marketing 7/e Chapter 3 – Page 12
 I mporta nt D e te rmina
vs. nt
Attribute s Services Marketing

 C onsume rs usua lly choose be twe e n a lte rna tive se

rvice
offe rings ba se d on pe rce ive d diffe re nce s be twe e n
 the m
Attribute s tha t distinguish compe ting se rvice s from
one
a nothe r a re not ne ce ssa rily the most importa nt one
 s
D e te rmina nt a ttribute s de te rmine buye rs’ choice s be
twe e n
compe

ting a lte rna tive s
se rvice cha ra cte ristics tha t a re importa nt to purcha se
 rs
custome rs se e significa nt diffe re nce s be twe e n compe
ting a lte rna tive s on the se a ttribute s

Slide © 2010 by Lovelock & Wirtz Services Marketing 7/e Chapter 3 – Page 13
 E sta blishing S e Le ve
rvice ls Services Marketing

 M a ke de cisions on se le ve ls – le ve l of pe rforma nce

rvice
firm pla ns to offe r on e a a ttribute
 ch a re e a sie r to unde rsta nd – e . g. , ve
spe
E a sily
e d, qua
physica
ntifiel ddime
a nsionshicle

ttribute s
Q ua lita tive a ttribute s subje ct to individua l inte rpre ta tion –
e . g. , physica l comfort, noise le ve ls

 C a ofte n se gme nt custome rs a ccording to willingne ss

n detooff price ve rsus se rvice le ve
tra
l: P rice - inse nsitive custome rs willing to pa y re la tive ly high price
for
high le ve ls of se rvice

P rice - se nsitive custome rs look for ine xpe nsive se rvice
with re la tive ly low pe rforma nce
Slide © 2010 by Lovelock & Wirtz Services Marketing 7/e Chapter 3 – Page 14
 Services Marketing

P D istinguishe a
ositioning
Bra from s
its C ompe
nd titors

Slide © 2010 by Lovelock & Wirtz Services Marketing 7/e Chapter 3 – Page 15
 F our P rinciple of P
s ositioning
S tra te gy Services Marketing

 M ust e sta position for firm or product in minds of

blish
custome rs
 P osition should be distinctive , providing one simple
,
consiste nt me ssa ge
 P osition must se t firm/ product a pa rt from compe
titors
 A compa ny ca nnot be a ll things to a ll pe ople –
must
focus its e fforts

Slide © 2010 by Lovelock & Wirtz Services Marketing 7/e Chapter 3 – Page 16
 P rinciple of P
s ositioning Services Marketing

Slide © 2010 by Lovelock & Wirtz Services Marketing 7/e Chapter 3 – Page 17
 Services Marketing

D e ve a E ffe
loping
P n S ctive
tra te
ositioning gy

Slide © 2010 by Lovelock & Wirtz Services Marketing 7/e Chapter 3 – Page 18
 D e ve loping a n E ffe
ctive
P ositioning S tra te gy Services Marketing

 P ositioning links ma rke t a na lysis a nd compe

titive
a na lysis to inte rna l corpora te a na lysis
 M a rke t Ana
lysis
 F ocus ove ra ll le ve l a nd tre nd of de ma nd a nd ge ogra
on phic
loca of de ma nd

tions
siz e a nd pote ntia l of diffe re nt ma rke t se gme
 U nde into
rsta nts
nd custome r ne e ds a pre fe re nce a nd how the
Look
nd s y
pe rce ive the compe tition

Slide © 2010 by Lovelock & Wirtz Services Marketing 7/e Chapter 3 – Page 19
 D e ve loping a n E ffe
ctive
P ositioning S tra te gy Services Marketing

 I nte rna l C orpora te Ana

lysis
 I de ntify orga niz a tion’s re limita tions, goa a nd
source s, ls,
va lue s
 S e le ct limite d numbe r of ta rge t se gme nts to se
rve
 C ompe titor Ana
lysis
 U nde rsta nd compe titors’ stre ngths a nd we a kne sse
 s
Anticipa te re sponse s to pote ntia l positioning stra te
gie s

Slide © 2010 by Lovelock & Wirtz Services Marketing 7/e Chapter 3 – Page 20
 M a rke I nte rna l, a C ompe
t,
Ana lysend titive
Services Marketing
s

Slide © 2010 by Lovelock & Wirtz Services Marketing 7/e Chapter 3 – Page 21
 Anticipa ting C ompe
titive
R e sponse Services Marketing

 C ompe titors might pursue sa me ma rke t

position
 I nde pe nde ntly do sa me positioning a na lysis a nd a rrive a t
simila r
conclusions

T hre a te ne d by ne w stra te gy, ta ke ste ps to re position own se

rvice
N e w e ntra nt pla ys “follow the le a de r”
 C onduct inte rna corpora te a na lysis for cha lle nge rs a
l nd
ana lyz e e ffe cts of a lte rna tive move s
I mpa ct of
possible
price cut on de ma nd, ma rke t sha re , a nd profits
 R e sponse s of diffe re nt se gme nts to cha nge s in se rvice a
ttribute s

Slide © 2010 by Lovelock & Wirtz Services Marketing 7/e Chapter 3 – Page 22
 S umma
ry Services Marketing

 F ocus S tra te gie

s:
 F ully focuse d
 S e rvice focuse
 d

 M a rke tfocuse
d
U nfocuse d
 M a rke t S e gme nta – buye rs sha re
tion
cha ra cte ristics, ne e ds, common purcha sing be ha
vior &
consumption pa tte rns
 S e rvice a ttribute s– de te rmina nt a ttribute s a re the
ofte n
one s most importa nt to
Slide © 2010 by Lovelock & Wirtz
custome rs
Services Marketing 7/e Chapter 3 – Page 32
 S umma
ry Services Marketing

 P ositioning links:
 M a rke t Ana lysis
 I nte rna l Ana lysis
 C ompe titive Ana
lysis
 P ositioning ma ps a use ful for compe titive
re plotting
stra
 te gy:
I de ntify pote ntia l compe titive re
 sponse s
H e lp e xe cutive s to visua liz e stra te
gy

Slide © 2010 by Lovelock & Wirtz Services Marketing 7/e Chapter 3 – Page 33