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Transcript of aaac3Marketing of services
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Name of Institution
Amity Business
School
Marketing of Services
Sonali P. Banerjee
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Name of Institution
Amity Business
School
Please write one sentence of your own on
Customer Service.
(5 Mins)
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Amity Business
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Write Minimum 5 Excuses you hear
customers service representative give for
offering poor or bad customer service.
(5 Mins)
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Amity Business
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Common Excuses I dont have enough time.
I dont get paid to be nice. I am measuredby my productivity and accuracy
How can we do good job if the computer is
always down
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Name of Institution
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Every customer is totally crazy today.
I cant deal with people who do not showme respect.
How can we do a good job if the otherdepartments do not provide the back upwe need?
I am having a bad day. People are basically stupid.
I am always too busy
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Name of Institution
Amity Business
School
A customer simply wants..
You to Greet HIM Value HIM
. Help HIM
. Listen to HIM Invite HIM Back
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The service sector
The services sector has been growing at a
rate of 8% per annum in recent years More than half of our GDP is accounted
for from the services sector
This sector dominates with the best jobs,best talent and best incomes
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Service Sector
Definition
An industry comprised of companies thatprimarily earn revenue throughproviding intangible products and services.Service industry companies are involved
in retail, transport, distribution, food services, aswell as other service-dominated businesses.Also called service sector, tertiary sector ofindustry.
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The Nature of Services
regardless of the product, there is a services
component to the offerings of all firms in some cases, a service is the principal purpose of
the transaction, as in the rental of a car, a haircut, or
legal services -- we refer to this as the core servicecore service
in others, service is performed in support of the saleof a tangible product -- these are referred to as
supplementary servicessupplementary services
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What is services?
It is the part of the product or the full
product for which the customer is willing to
see value and pay for it.
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Difference between physical goods andservices
Physical goods Services
tangible intangible
homogeneous heterogeneousProduction and distribution are
separated from consumption
Production, distribution and
consumption are simultaneous
processes
A thing An activity or process
Core value processed in factory Core value produced in the buyer-seller interaction
Customers do not participate in the
production process
Customers participate in production
Can be kept in stock Cannot be kept in stock
Transfer of ownership No transfer of ownership
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Strategic ProductImplications
the core service can be enhanced through
the addition of supplementary services,thereby creating added value
the life cycle of services has to bemanaged
the branding of a service can be difficult asthe customer often has nothing tangible toshow
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Continued
Quality is hard to define, measure, control,
and communicate Quality is defined by the consumer
Its important to measure customer
satisfaction with an organizations servicequality.
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Pricing Services
The characteristics of perishability, inability
to store, and fluctuating demand for
services create pricing challenges.
Pricing Strategies include:
Discount strategies: Cheaper by the week.
A variable pricing strategy: Kids eat free,movies cheaper on Tuesdays.
Price competition
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Distribution of Services
because most services are tied directly to a specific
service provider, most have been distributed directly
to customers
with advancing technology, many firms are now
delivering services through machines
channels of distribution are necessarily short; some
firms use one agent intermediary, such as
insurance, real estate, and travel agents
some firms use franchisesfranchises to distribute services
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Promotion of Services customer contact personnel represent the main
channel of customer communication
service providers must ensure that each serviceserviceencounterencounteris a positive one if customers are todevelop a positive image
many professional service firms are now
permitted to advertise other elements of the promotional mix are used,
including publicity and community affairs
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The three additional Ps of Service
Marketing
People Physical evidence
Process
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When customers visit a service
establishmentTheir satisfaction will be influenced by
Encounters with service personnel
Appearance and features of service
facilities exterior and interior
Interactions with self service equipment
Characteristics and behaviour of other
customers
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Four Rs of Service Marketing
Retention
Referrals
Relationships
Recovery
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The Changing Environment
for Services The boom in the service economy, reduced regulation
has created an increase in competition. Major focus on increased productivity, efficiency
Work on people aspects of business:
Education, training programs
Change technology: Computer-based technologies used.
Restructure jobs.
Bottom line: People are key to success!
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Other Considerations in
Marketing Services Impact of Technology:Impact of Technology:
Remember, not everyone likes impersonaltechnology
Performance Measurement:Performance Measurement:
Customer perceptions are essential.
Prospects for Growth:Prospects for Growth: It is very likely that services will continue to take
an increasing share of the consumer pocket.
The use of marketing programs in all services isexpected to increase considerably.
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In services, the last
experience remains uppermost
in your mind. Therefore, it is not
enough to be good, you have to
be consistently good
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Characteristics of services
Intangibility
Inseparability
Perishability
Variability
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Differentiation in services
Offering
Faster and better delivery
Image
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Determinants of service quality Reliability delivering on promises
Responsiveness willing to help
Assurance inspiring trust and confidence
Empathy individualising customers
Tangibles- physical representation
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Customer Service Expectations
Desired Service the wished for service
Adequate Service the service that wouldbe acceptable
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Zone ofTolerance
Difference between the desired serviceand the adequate service
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Recovery
Dont
Ignore customer
Blame customer Leave customer to fend for himself
Downgrade
Act as if nothing is wrong pass the buck
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Dos
Acknowledge problem
Explain causes Apologies
Compensate/upgrade
Lay out options Take responsibility
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Adaptability
Dont
Promise and fail to keep them Show unwillingness to try
Embarrass the customer
Laugh at the customer Avoid responsibility
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Dos
Recognise the seriousness
Acknowledge Anticipate
Accommodate
Adjust Explain rules/policies
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Spontaneity
Donts
Exhibit impatience
Yell/laugh/swear
Steal from customers
Discriminate
Ignore
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Dos
Take time
Be attentive Anticipate needs
Listen
Provide information Show empathy
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CopingDont
Take customers dissatisfaction personally
Let customers dissatisfaction affect others
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Types of complainers
Passives
Voicers
Irates
Activists
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Passive complainers : they will complain
to everyone but the actual business. Since
the business is left unaware of their error
they cannot correct it and the only thing a
passive complainer succeeds in doing is
depriving the company of potential
business.
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Voicers : These customers actively
complain to the service provider but they
are less likely to spread negetive word of
mouth to switch or to go to the third parties
with their complaints. These customers
are the Service providers best friend.
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Irates : These consumers are more likely
to engage in negetive word of mouth to
friends and relatives and to switch
providers than are others. They are
unlikely to complain to 3rd party. Though
they are angry with the service provider,
but still believe that complaining wouldhave some social benefits. They usually
switch the provider.
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Activists : These consumers complain in
an above average way in all dimensions.
They will complain to the provider. They
will tell others and they are more likely to
complain to the third parties
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Customer complaints
It pays to resolve customer complaints
On an average only 5 % dissatisfiedcustomers complain. Others simply goover to the competitor
A satisfied consumer speaks to an
average of 3 people on his her experience
A dissatisfied consumer gripes to on anaverage 11 persons about his/her
unpleasant experience
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Causes behind service switching
Pricing
High PricePrice Increase
Unfair Pricing
Deceptive Pricing
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Inconvenience
Location
Wait forAppointmentWait for Service
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Core Service Failure
Service Mistakes
Billing errors
Service Encounter Failure
Uncaring
Impolite
Unresponsive
unacknowledgeable
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Response to Service Failure
Negative Response
No ResponseReluctant Response
CompetitionFound Better Service
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Involuntary Switching
Customer Moved
Provider Closed