Service Mrt Ppt

8/4/2019 Service Mrt Ppt

1/34

Introduction to

Services Marketing


2/34

There are no such thing as service

industries. There are only industrieswhose service components are greater or

less than those of other industries.Everybody is in service.

Theodore Levitt-


3/34

It is the part of the product or the full productfor which the customer is willing to see valueand pay for it.

The services sector has been growing at arate 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


4/34

What is a Service

A Service is a type of a product.

a deed performed by one party for

another Discussions about the marketing of

goods apply to services as well.

Services have special characteristics that

make them different than products.


5/34

Importance of services

In all parts of the world, the service sector ison an all time boom.

It has a contribution of 54% in Indias GDP,

and this is excepted to grow in the future. All businesses today offer services bundled

with the marketing of goods to derive acompetitive edge in the market over similar

and competing products.


6/34

Phenomenal Growth attributes to

Rapid increase in per capita income

Double income families

Increase in leisure

Changed life style

Increased Life expectancy

Increased complexity in life Specialization in Profession & Business


7/34

Important features

Lack of Physical output or construction.

Benefit to the receiver from the service ratherthan the product offered.

The intangible nature of services.

The possible combination of services with theproduction of goods.

Marketing of an idea or a concept.


8/34

Contribution of Services to GDP

-- Generally contribution of Service to Gross Domestic Product of a

nation increases as its economy develops

Country Service contributesChina 40.0% of GDP

Brazil 54.0India 60.7

Canada 68.5Japan 73.1

U.K. 73.4U.S. 78.6


9/34

Tangible

touch

see taste

smell

Intangible

cant see

cant touch cant smell

cant taste

Tangible / Intangible Attributes


10/34

Goods and Services: Scale ofElemental Dominance


11/34

The goods and service continuum

Tangible Goods : Do not offer any amount ofservices. Toothpaste, salt, soaps etc are examples.Customers purchase these products on the merit ofthe advantages of the tangible parts.

Tangible goods with some services : In some cases,customers require some knowledge aboutinstallation, training about the use of products, aftersales service. The spread of the word of mouth

depend upon these attributes. Examples areconsumer durables, computers, cars etc.


12/34

Goods and services in near equal measures :People have different reasons for choosing abar or a restaurant. For some, the equality of

food and cocktails is the key, for some othersthe ambiance is the key. Here, to satisfy acustomer, a hotel should provide excellent

food (tangible ) and service ( atmosphere,hospitality ).


13/34

Service accompanied by minor goods:

Some industries provide services (airlines )accompanied by some amount of products

(food, soft drinks etc )

ISPs provide the service of internet. In

association they also give CD of games,

utilities etc.


14/34

Pure services, not accompanied by goods :Some companies deliver a pure service likeconsultation, gym etc. Here, there is no other

consideration by buyers but the purchasedepends purely on the service quality.


15/34

Service ClassificationsService

Equipment-based People-based

Automated

Monitored by

relatively

unskilled

operators

Operated by

skilled

operators

Skilled

laborUnskilled

laborProfessionals

Vending

machines

Automated

car washes

ATM

Motion

picture

theaters

Dry cleaning

Taxis

Electric

utilities

Airlines

Computer

network

installation

Lawn care

Security

guards

Janitorial

services

Appliance

repair

Plumbing

Catering

Lawyers

Managing

consultants

Accountants


16/34

Special Characteristics of Services

Intangibility

Inventory(Perishability)

InseparableSimultaneousProduction

andConsumption

Inconsistency

(Heterogeneous)


17/34

Difference between physical goods and

services

Physical goods Services

tangible intangible

homogeneous heterogeneous

Production 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-sellerinteraction

Customers do not participate in theproduction process

Customers participate in production

Can be kept in stock Cannot be kept in stock

Transfer of ownership No transfer of ownership


18/34

INTANGIBILITY

Pure services cannot be assessed by sight,feel, smell, taste etc.

Emphasis on processes rather than

outcomes

Can only assess a service after it has beenconsumed

Services purchases may be perceived asmore risky than goods


19/34

Implications of Intangibility

Services cannot be inventoried

Services cannot be patented

Services cannot be readily displayed orcommunicated

Pricing is difficult


20/34

VARIABILITY ( Inconsistent )

Each producer-consumer encounter may beunique

May be little opportunity for quality control to

maintain consistency

It is often easy to adapt services to thespecific needs of individual consumers


21/34

Implications of Heterogeneity

Service delivery and customer satisfactiondepend on employee actions

Service quality depends on many

uncontrollable factors

There is no sure knowledge that the servicedelivered matches what was planned and

promoted


22/34

INSEPARABILITY

Production of a service cannot be separatedfrom its consumption

Consumers are co-producers of a service

Makes quality control more difficult

Has implications for accessibility to services


23/34

Implications of Simultaneous Production and

Consumption

Customers participate in and affect thetransaction

Employees affect the service outcome

Decentralization may be essential

Mass production is difficult


24/34

PERISHABILITY

Services cannot be stored

If capacity is not used, the opportunity to sellit is lost forever

Supply and demand must be carefullymatched

Mismatch between supply and demand can

impact directly on consumers


25/34

Implications of Perishability

It is difficult to synchronize supply anddemand with services

Services cannot be returned or resold


26/34

Service Marketing Triangle

-- Service marketing is all about promisespromises made

and promises kept to satisfaction of customers.

-- So framework of service may be split into three arms viz.

* making the promise

* enabling the promise &

* delivering the promise

Internal Marketing

(enabling the promise)

External Marketing

( making the promise)

Interactive Marketing

(delivering the promise)

Management

CustomersContact employee


27/34

External Marketing of Services

Comprises of activities through which company makes

promises to customers about service likeAdvertising, Sales

Promotion, Pricing, Availability etc.

In addition, promises are made by

Contact employees during interactions

Proper design and dcor of service area (ambience) Development of service process ( blueprint)

Effective external marketing involves consistent and

realistic promises which the company can keep.

And not overpromises that raise customers expectationthereby leads to dissatisfaction and poor customer

relationship.


28/34

Internal Marketing

Company has to develop a service blueprint depicting step

by step progress of service process.

Company should impart on- and off-the-job training to

contact employees who will actually deliver the service.

Company should equip contact employees with suitabletools, requisite knowledge and skills so as to provide

service satisfactorily.

Company should ensure proper motivation and control of

contact employees so that they remain in ship-shape toprovide satisfactory service.


29/34

Interactive Marketing

It is unique of Service Marketing that the customer interacts with

contact employee (i.e. service provider) in delivering the promisedservice, unlike products where customers only consume or use the

product without interacting during its manufacture.

Hence it is essential that contact employee is equipped with skills,

knowledge, tools and motivated to do his best in service delivery.

For same reasons Ambience i.e. arena where service is delivered

should be congenial for both players.

Technology is fast emerging as the fourth apex of Service Triangle

for customer satisfaction, giving it the shape of a Pyramid.


30/34

Strategy for Customer Satisfaction through Quality

Service Delivery

Key aspect of this strategy is that the contact employeesshould be willing and also able to deliver quality service.

So successful service-providing companies endeavor to build

teams of customer-oriented, service-minded contactemployees in Internal Marketing process through :

* hiring right persons

* developing them to deliver quality service

* provide them with needed tangibles including motivation &

* retaining best people.


31/34

Extended Marketing Mix

Marketing mix are elements that marketer uses tosatisfy or communicate with customers.

Traditionally, marketing mix composes of 4 Ps viz.

Product, Price, Place(distribution) and Promotion.

These elements are interrelated and collectivelyhelp in delivering satisfaction to customers inselected segments at profit to organization.

Services are intangible, quite often, customers usethe ambience i.e. building, lawns or accompanyingtangibles - equipments in operation theatre ofhospital to gauge the level of service experience.


32/34

Extended Marketing Mix

Realizing importance of these additional variables inservice marketing , marketers have taken threeadditionalelements as Service Marketing Mixelements viz.:

People Human actors who play role in service delivery

to influence customers service experience andperception like employees, customers etc.

Physical EvidenceEnvironmentwhere service isdelivered or service-provider and customer interact, theambience, facility design, equipments, employee -dress,

logo, business card and other tangibles. Process Actual procedures, mechanism, flow of

activities and equipments by which service is delivered.


33/34

Major Challenges in Service Marketing

1. Delivery of service consistently at same level of quality

-- Becauseservices produced by providers are not consistent

-- And services cannot be mass-produced

-- So delivery of high quality service becomes costlier.

2. Wide fluctuation in demand of service--Demand for hotel accommodation, tables at restaurant, public

transport etc vary greatly with time.

3. Designing of new services is a challenge to marketers

--Identifying precisely what is wanted by customers iscomplex so requires intensive market research.


34/34

4. Role of Service-providers

-- Most of services are producedand deliveredwhen in closeproximity of

customerso right selection, training and motivation of service-providers

is essential.

5. Wider Competition

-- Todays employee / franchisee may become tomorrows competitor. --

Attrition rate is high in service industry particularly among skilled

service-providers.

Service Mrt Ppt

Documents

Transcript of Service Mrt Ppt