What are services?
Activities, performances or benefits that provide value or are offered for sale, but which involve neither an exchange of tangible goods, nor a transfer of title
What is service (the verb)?
The act of delivering a product (whether it is a good or services product)
What is a service-dominant logic?
The essence of their argument is that all products should be seen as a means to an end: that of providing value to the user/consumer
The propositions that modern economies are dominated by the services sector have been further extended to their logical conclusions
What are some service product classifications?
Consumer services
Business to business services
What are consumer services?
Are those services purchased by individual consumers or households for their own private consumption (to provide, for example, functional, sensory or psychological benefits)
How does the demand for services fluctuate?
During times of economic prosperity, servces are more in demand and during times of economic downturn, they are less in demand
What are business-to-business services?
Those services purchased by individuals and organisations for use in the production of other products or for use in their daily business operations
Business‐to‐business services are also often known as ‘professional services’
What differentiates services from goods?
Intangibility
Inseparability
Heterogeniety
Perishability
What is intangibility?
Because a pure service is an activity and not an object, it cannot be easily perceived by the five physical senses
How can an organisation make its offerings of services better despite intangibility?
Adding tangible components to their intangible service
Adding intangible service components to their tangible goods
What are some strategies thant an organisation can use to reduce the uncertainty felt by customers?
- Marketers can use tangible cues, such as logos, staff uniforms, architecture and décor
- Reduce the level of risk perceived by customers through such techniques as service guarantees, testimonials and positive word‐of‐mouth
What do service guarantees and testimonials do?
- A service guarantee offers the potential customer the knowledge that they can obtain some course of redress should the service not live up to expectations
- Testimonials provide potential customers with the confidence that other individuals or organisations have been happy with the service provided
What is inseparability?
For most services, it is impossible to separate the production of the service and the consumption of the service
As per this concept, it is very difficult to separate the services from the individual who provides it (dentist and the service) and sometimes it can be difficult to distinguish the customer from the services as well (gym where the individual must participate to get benefit sought)
What is heterogeniety?
- Variability in the service quality
- Services are provided by humans who, unlike machines, are subject to variations in mood, skill and willingness to provide service of an agreed quality
- For service marketers, the challenge is to provide a product with a reasonably consistent level of quality that matches customers’ expectations
What are key strategies for service marketers to reduce heterogeniety?
To develop service delivery systems
To manage the expectations of customers
To invest heavily in staff training
To select customers carefully
What does perishability refer to?
Refers to the inability to store services for use at a later date — they are ‘time bound’ (Doctors appointments)
What are some of the methods to address perishability?
Manage demand over time
Stimulate demand
Restrict demand
Increase or decrease supply capacity
What is the extended marketing mix for services?
People
Process
Physical Evidence
What does people mean?
- Includes staff, customers, other customers
- Most successful services marketing organisations will readily claim that their ‘people’ are their most valuable asset and the key to their success
- To ensure high standards of service delivery, service organisations need to carefully consider the selection, training, outfitting, motivating and rewarding of their staff so that they deliver services effectively, efficiently and to the standard expected by customers and the organisation
What is process?
Refers to all of the systems and procedures used to create, communicate, deliver and exchange a service offering
Ideally, the performance should exceed the customer’s expectation, although this becomes increasingly difficult over the long term of the relationship
What is physical evidence?
- Service marketers should therefore pay close attention to the physical environment in which the service is delivered and to all the other accompanying physical cues
- The physical environment includes architectural design, floor layout, furniture, décor, signage, shop or office fittings, colours, background music and even smell
What are some of the challenges of social marketing?
- Achieving a sustainable differential advantage in marketing services
- Managing profitable customer relationships
- Delivering consistently high levels of customer service
How can marketers manage differentiation in the services they provide?
In addition to the core and expected service, a range of supplementary services are often included, which add value from the customer’s perspective and which may serve to differentiate the service offering from that of competitors’ offerings
What are professional services?
Accountants, lawyers, architects and investment advisers, typically manage their customers closely as individuals and provide each with a service tailored to their unique circumstances and needs
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