SERVICES

MARKETING
SERVICE





AN ACT WHERE ONE PARTY OFFERS TO ANOTHER WHICH IS
INTANGIBLE AND DOESNT RESULT IN OWNERSHIP OF
ANYTHING




GOODS & SERVICES COMBINATION

1. ONLY TANGIBLE GOODS:- FACIAL SOAP, CHOCOLATE

2. ONLY PURE SERVICES:- VISIT TO GYMNASIUM

3. TANGIBLE GOODS WITH SERVICES:- CTV, WASHING M/C

4. GOODS & SERVICES ALMOST EQUAL:- WHEN SOMEBODY
VISITS A RESTAURANT,
GOODS FOOD, DRINKS
SERVICES FOOD DELIVERY,
AMBIENCE, MUSIC

5. SERVICES WITH MINOR GOODS:- IN AN AIRLINE TRAVEL,
SERVICE JOURNEY
GOODS TICKET, BOARDING PASS,
FOOD, DRINKS, COMPLIMENTARY IN-
FLIGHT MAGAZINE





DIFFERENCES BETWEEN
GOODS & SERVICES






GOODS SERVICES
1.
TANGIBLE INTANGIBLE
2.
PRODUCTION &
CONSUMPTION ARE
SEPERABLE
PRODUCTION &
CONSUMPTION ARE
INSEPERABLE
3.
NO VARIATION IN
SPECIFICATIONS OF
DIFFERENT GOODS
VARIATION IN
SPECIFICATIONS I.E.
DELIVERY OF DIFFERENT
SERVICES
4.
GOODS CAN HAVE MANY
OWNERS & THEY CAN BE
TRANSFERRED TO THIRD
PARTY
SERVICES CAN BE ENJOYED
ONLY ONCE BY CUSTOMER &
ONCE CONSUMED CANT BE
TRANSFERRED TO THIRD
PARTY
ROLE OF PEOPLE IN
SERVICES MARKETING


FRONTLINE EMPLOYEES ARE VERY IMPORTANT IN
SERVICES

IN A RESTAURANT IF AN ORDER IS DELAYED OR IF FOOD
IS NOT TASTY, WAITER IS IN TROUBLE

IF A FLIGHT IS DELAYED, AN OFFICER AT AIRPORT HAS TO
ANSWER

THAT IS WHY EMPLOYEE TRAINING IS VERY IMPORTANT

PROBLEM AREAS FOR
EMPLOYEES IN SERVICES

1. THE CORPORATION RULE STATES THAT IF NO PORTER IS
AVAILABLE IN STATE TRANSPORT BUSES, CONDUCTOR OF
BUS SHOULD HELP PASSENGERS TO LOAD AND UNLOAD
LUGGAGE

THIS IS SEEN DE-MEANING BY MANY CONDUCTORS, WHICH
CAN CREATE DISPUTE BETWEEN HIM AND PASSENGERS

2. ACCORDING TO HOTEL RULES, IF CUSTOMER STAYS NEXT
DAY BEYOND 12 NOON WHICH IS CHECKOUT TIME THEN HE
NEEDS TO BE CHARGED ACCORDINGLY

CUSTOMER MAY REQUEST EXTENSION TILL SAY 3 PM
WITHOUT ADDITIONAL PAYMENT THEN RECEPTIONIST MAY
BE IN QUANDRY
CUSTOMERS AS CONTRIBUTORS
TO SATISFACTION


NUMBER OF HOTELS USE BUFFET SYSTEM OVER A LA
CARTE

THIS IS NOT ONLY ECONOMICAL FOR HOTEL BUT
CUSTOMERS FEEL THAT THEY ARE IN CHARGE OF THEIR
OWN FOOD SELECTION


CUSTOMERS AS
PROMOTERS OF SERVICE


BUILDERS OF HOUSES NORMALLY GIVE NAMES &
ADDRESSES OF PREVIOUS PURCHASERS WHO WILL
SPREAD POSITIVE WORD OF MOUTH


CASE STUDY
ARAVIND HOSPITAL


BACKGROUND
ACCORDING TO 2012 ESTIMATES
THERE ARE ROUGHLY 3.9 CRORE
BLIND PEOPLE IN WORLD ( ROUGHLY
20 % IN INDIA i.e. 78 LAKHS ) AND
1/3
RD
OF THEM i.e. 1.3 CRORES ARE
UNNECESSARY BLIND i.e. CAN BE
TREATED .
STORY
DR. GOVINDAPPA VENKATASWAMY WANTED TO
BECOME GYNAECOLOGIST BUT HAD RHEUMATOID
ARTHRITIS AND BECAME OPTHALMOLOGIST .
WHEN DR. VENKATSWAMY RETIRED FROM
GOVERNMENT SERVICE AT AGE 58 , HE OPENED
11 BED HOSPITAL IN HIS HOUSE AT MADURAI IN
TAMILNADU .

DR. VENKATSWAMY ASKED IF COCA-COLA CAN
SELL BILLIONS OF SODAS AND MCDONALDS
SELLS BILLIONS OF BURGERS WHY CANT
ARAVIND DO MILLIONS OF SIGHT RESTORING
OPERATIONS .
MISSION



TO ERADICATE UNNECESSARY BLINDNESS .
BUSINESS MODEL
IT IS BASED ON FOLLOWING 3 THINGS :-

1. ECONOMIES OF SCALE .

2. CROSS SUBSIDIZATION .

3. VERTICAL INTEGRATION .
1. ECONOMIES OF SCALE
IN MICROECONOMICS , IT REFERS TO THE COST
ADVANTAGES A BUSINESS OBTAINS DUE TO
EXPANSION . ARAVIND TAKES ITS INSPIRATION
FROM STD BOOTH OWNERS AND XEROX MACHINE
OPERATORS . IN THESE BUSINESSES THE UNIT
PROFIT MARGIN IS LOW BUT THIS IS MADE UP
THROUGH ENORMOUS VOLUMES .

IN USA AVERAGE OPTHALMOLOGIST OPERATES
125 PATIENTS/YEAR AGAINST INDIAN SURGEON
OPERATING 250 400 PATIENTS /YEAR , BUT AT
ARAVIND A DOCTOR OPERATES ROUGHLY 2000
PATIENTS / YEAR .
2. CROSS SUBSIDIZATION
ARAVIND PROVIDES VERY LOW PRICED OR
FREE CARE TO 2/3
RD
OF ITS PATIENTS WITH
THE REVENUE DERIVED FROM 1/3
RD
OF
PATIENTS WHO ARE ABLE TO PAY
MODERATE PRICES .

A TYPICAL CATARACT OPERATION IN USA IS
ROUGHLY RS. 1 LAKH , RS. 58,800 IN
THAILAND AND RS. 2000 RS. 5000 IN INDIA .
AT ARAVIND IT COSTS ROUGHLY RS. 750
RS. 900 .
3. VERTICAL INTEGRATION
IT IS THROUGH

a. AUROLAB .

b. AMECS .

c. LAICO .
a. AUROLAB
ARAVIND OWNS AUROLAB WHICH MANUFACTURES
EYE RELATED THINGS . IT SUPPLIES INTRAOCULAR
LENSES , OPTHALMIC DROPS , SUTURES USED IN
SURGERIES TO ARAVIND .

AUROLAB PRODUCES 18 LAKH INTRAOCULAR
LENSES AT $2 PER LENSE , FRACTION OF A COST
COMPARED TO GLOBAL PRICE OF $80 . ARAVIND IS
LOWEST COST PRODUCER OF INTRAOCULAR
LENSES IN THE WORLD WHICH EXPORTS LENSES
TO 85 COUNTRIES , PROVIDING ANOTHER SOURCE
OF REVENUE FOR ARAVIND .
b. AMECS
(ARAVIND MANAGED EYE CARE
SERVICE)

IT MANAGES EYE HOSPITALS IN
OTHER PARTS OF INDIA . THEY HAVE
ASSOCIATIONS WITH 4 HOSPITALS IN
INDIA ( 2 IN UTTAR PRADESH , 1 IN
KOLKATA AND 1 IN GUJARAT ) .

c. LAICO(LIONS ARAVIND
INSTITUTE OF COMMUNITY
OPTHAMOLOGY)
ITS OBJECTIVE IS TO INCREASE PLANNING ,
EFFICIENCY OF EYE HOSPITALS ACROSS
THE GLOBE WITH FOCUS ON DEVELOPING
COUNTRIES .

IT HAS WORKED WITH 150 HOSPITALS
ACROSS INDIA , SOUTHEAST ASIA AND
AFRICA .

IT ALSO OFFERS LONG TERM COURSES IN
HOSPITAL MANAGEMENT .
OTHER FACTS ABOUT ARAVIND
1. PRESENTLY IT HAS HOSPITALS ACROSS 9 PLACES
IN INDIA .

2. FOR 2011-12 , ARAVIND TREATED 28 LAKH
PATIENTS AND 3.5 LAKH CATARACT SURGERIES
MAKING IT LARGEST AND MOST PRODUCTIVE EYE
CARE IN WORLD IN TERMS OF PATIENTS TREATED
AND SURGERIES PERFORMED ( IT CONDUCTED 7%
OF EYE SURGERIES PERFORMED ACROSS THE
GLOBE WHICH WERE THE HIGHEST IN THE WORLD).

3. EACH DOCTOR OPERATES WITH 4 NURSES , WHICH
IS COMPARATIVELY LARGE TEAM AND THAT IS WHY
DOCTORS PERFORM SO MANY SURGERIES .
OTHER FACTS ABOUT ARAVIND
4. ALL INDIA NURSES NEED TO BE GRADUATES AND
SHOULD PASS NURSING EXAMINATION .
AT ARAVIND STAFF IS RECRUITED FROM VILLAGES
AND SHOULD HAVE PASSED TENTH STANDARD .
THEY ARE TRAINED FOR 2 YEARS AND THEN PLACED
AS NURSES .

5. ARAVIND MAKES ROUGHLY 35% OPERATING PROFIT .

6. ARAVIND EYE CARE IS USED AS A CASE STUDY IN
HARVARD .
OTHER FACTS ABOUT ARAVIND
7. IT HAS GOT FOLLOWING AWARDS .
1. THE GATES AWARD FOR GLOBAL HEALTH
FOR 2008 AWARDED BY THE BILL AND
MELINDA GATES FOUNDATION .
2. THE CONRAD N. HILTON HUMANITARIAN
PRIZE FOR 2010 AWARDED BY CONRAD N.
HILTON FOUNDATION .
3. IN 2011 , INDIAS MOST INNOVATIVE
HOSPITAL AWARD AT INDIA HEALTHCARE
AWARDS AND BEST PRIVATE HOSPITAL
AWARD IN INDIA BY FICCI.
NEXT HORIZON THINKING
ARAVIND IS AIMING TO DO 1 MILLION ( 10 LAKH )
SURGERIES / YEAR BY 2015 .

INDIA HAS 5 CRORE DIABETICS ( 2012 ) OUT OF
WHICH 20% SUFFER FROM DIABETES RELATED
BLINDNESS . BY 2020 ARAVIND PLANS TO
ERADICATE DIABETIC RELATED BLINDNESS IN
INDIA .

AT ARAVIND EVERYTHING IS MEASURED NOT BY
HOW MUCH IS DONE BUT HOW MUCH REMAINS TO
BE DONE . ITS ASPIRATIONS HAS KEPT RISING ,
FROM ELIMINATING UNNECESSARY BLINDNESS IN
INDIA , TO ELIMINATING UNNECESSARY
BLINDNESS GLOBALLY .
POINTS TO PONDER
AT ARAVIND 2 PATIENTS ARE OPERATED
SIMULTANEOUSLY SO THERE CAN BE POST
OPERATIVE COMPLICATIONS. IN MANY USA
HOSPITALS IDEA OF HAVING 2 PATIENTS IN THE
SAME OPERATING AREA IS BANNED BECAUSE OF
FEAR OF INFECTION .

BASED ON THE RESEARCH BY ROYAL COLLEGE
OF OPTHALMOLOGISTS , LONDON , ARAVINDS
POST OPERATIVE COMPLICATIONS ARE LOWER
THAN UK HOSPITALS .RATE OF INFECTION AT
ARAVIND IS 4 PER 10,000 PATIENTS WHILE IN UK IT
IS 6 PER 10,000 !
CASE STUDY
MUMBAI DABBAWALAS - EPITOME OF
SERVICE EXCELLENCE
BACKGROUND

MANY INDIANS ARE AVERSE TO FAST
FOOD JOINTS AND LOVE HOME MADE
FOOD . ROUGHLY 5000 DABBAWALAS
PICK UP 2 LAKH HOT LUNCHES FROM
HOMES . THESE LUNCHES ARE
PREPARED BY STAY AT HOME
WOMEN .
STRENGTHS
1. WORKFORCE .

2. TEAM WORK .

3. SUPPLY CHAIN .
WORKFORCE
THE WORKFORCE IS NEARLY 100% ILLITERATE .
THE DABBAWALAS ARE BASICALLY A PART OF
LARGE COMMUNITY THAT IS DIRECT DESCENDANT
OF SHIVAJI MAHARAJAS WORKFORCE AND ARMY .
THEY ARE SIMPLE , HUMBLE AND CHEERFUL . THEY
ARE LIKE MILITARY PEOPLE CARRYING OUT THEIR
DUTIES WITH IMMENSE HARD WORK AND AGILITY .
THEY PERFORM LIKE RUTHLESS ARMY WITH A
MISSION TO ACHIEVE VICTORY BY RACING AGAINST
TIME . THEY BELIEVE THEY ARE ANNADAATAS
(PROVIDERS OF FOOD ) AND THIS PROFESSION HAS
GIVEN THOUSANDS OF IMPOVERISHED MEN SELF
ESTEEM .
WORKFORCE
EACH DABBAWALA HAS TO MAKE SMALL
FINANCIAL INVESTMENT (RS.15 PER MONTH)
IN THE ENTERPRISE FROM HIS SALARY OF
RS. 5,000 TO RS.6,000 WHICH GIVES HIM A
STAKE AND SENSE OF OWNERSHIP . MINIMUM
INVESTMENT IS ONE WHITE COTTON KURTA
PYJAMA , A GANDHI HAT , A WOODEN CRATE
AND 2 BICYCLES .

AGE OF DABBAWALAS RANGE FROM 18 TO 65.
NEW WORKERS ARE TYPICALLY RELATIVES
OR FRIENDS OF EXISTING MEMBERS.
TEAMWORK
THE CRUX OF SUCCESS IS TEAMWORK .
TIFFINS ARE COLLECTED FROM HOMES
BETWEEN 7AM AND 9AM AND TAKEN TO
NEAREST RAILWAY STATIONS . WORKERS
HAVE 40 SECONDS TO LOAD THE CRATES OF
DABBAS INTO A TRAIN AT MAJOR STATIONS
AND JUST 20 SECONDS AT INTERIM STOPS. AT
VARIOUS INTERMEDIARY STATIONS DABBAS
ARE HAULED INTO PLATFORMS AND SORTED
OUT FOR AREAWISE DISTRIBUTION .
TEAMWORK

A SINGLE TIFFIN COULD CHANGE HANDS 3 TO 4
TIMES IN A DAY . AFTER LUNCH HOUR , THE
PROCESS MOVES INTO REVERSE AND TIFFINS
RETURN HOME BY 6PM .

THE DABBAWALAS WITHIN A GROUP DONT
HAVE MONOPOLY OVER A PARTICULAR AREA .
THEY ARE ENCOURAGED TO SEEK NEW
CUSTOMERS , EVEN IN A BUILDING THAT IS
SERVED BY A COLLEAGUE . HOWEVER , ONCE
THE RELATIONSHIP IS ESTABLISHED , NO
OTHER DABBAWALA IS ALLOWED TO GO AFTER
THE SAME CUSTOMER AND STEAL HIM.
SUPPLY CHAIN
EACH DABBAWALA TRAVELS
35KM/DAY USING LOCAL
TRAIN , BICYCLES AND
PUSHCARTS .

SYSTEM FOLLOWS A SIMPLE
COLOUR CODING SYSTEM
PAINTED ON DABBA .
SUPPLY CHAIN
3
VLP
H
9
A
I
1
0

VLP ORIGIN RAILWAY STATION,
VILE PARLE .

H AREA COLLECTED FROM
WITHIN VILE PARLE i.e.
HANUMAN ROAD .

3 DESTINATION RAILWAY
STATION i.e. CHURCHGATE .

9 AREA TO BE DELIVERED IN
CHURCHGATE i.e. NARIMAN
POINT .

AI BUILDING WHERE DELIVERY
IS HAPPENING i.e. AIR INDIA
BUILDING .

10 FLOOR TO BE DELIVERED IN
AIR INDIA BUILDING ( IN TALL
BUILDINGS ALL DABBAS ARE
DELIVERED AT THE GROUND
FLOOR )

WEAKNESSES
1. LIMITED FUNDS FOR THE
ASSOCIATION .

2. HIGH DEPENDABILITY ON LOCAL
TRAINS .
1. LIMITED FUNDS FOR THE
ASSOCIATION
IF EVERY DABBAWALA GIVES RS.15 PER MONTH
AND ASSUMING THERE ARE 5000 OF THEM ,
TOTAL MONEY FOR ASSOCIATION WOULD BE
RS.9 LAKHS PER ANNUM . THIS MONEY IS USED
BY ASSOCIATION TO GIVE BENEFITS TO THE
DABBAWALAS LIKE MEDICAL AID AND OTHER
THINGS. THE ASSOCIATION ALSO HAS TO
MAINTAIN DHARMASHALAS AT PILGRIMAGE
PLACES . RS.9 LAKH IS INSUFFICIENT FOR THIS.
2. HIGH DEPENDABILITY ON
LOCAL TRAINS

THE CRUX OF SUCCESS OF DABBAWALAS IS
MUMBAI LOCAL TRAINS . DURING BANDH
OR RAILWAY STRIKE , DABBAWALAS CALL
OFF THEIR DUTIES .
OPPORTUNITIES
1. ADVERTISING .

2. CATERING .
1. ADVERTISING

DABBAWALAS HAVE BEEN APPROACHED BY VARIOUS
COMPANIES FOR ADVERTISING ON TIFFIN BOXES . THE
MOST SUCCESSFUL CAMPAIGN HAS BEEN CAMPAIGN 9
BAJ GAYE KYA ? OF KAUN BANEGA CROREPATI . IT
REMINDED PEOPLE TO WATCH THE PROGRAMME AT 9PM
EVERY NIGHT .
2. CATERING

DABBAWALAS CAN HAVE A CATERING
AT CENTRAL STATION i.e. DADAR AND
DELIVER TO VARIOUS OFFICES . THEY
CAN DELIVER FROM VARIETY OF
MENU .
THREAT
TICKET RESTAURANT VOUCHERS :-

MANY COMPANIES HAVE STARTED
OFFERING COUPONS TO THEIR
EMPLOYESS WHICH ARE CALLED
TICKET RESTAURANT VOUCHERS
EMPLOYEES CAN ENJOY FOOD AT
COMPANYS EXPENSE IN SHIV SAGAR ,
COPPER CHIMNEY , SMOKIN JOES etc .
ACCOLADES
IN 1998 , AMERICAN BUSINESS MAGAZINE
FORBES GAVE A SIX SIGMA PERFORMANCE
RATING FOR PRECISION OF DABBAWALAS .
THEY ACHIEVE ALMOST 100% ACCURACY ,
MAKING ONE MISTAKE IN 1.6 CRORE
TRANSACTIONS .

IN 2010 , HARVARD BUSINESS SCHOOL
INTRODUCED CASE STUDY TITLED THE
DABBAWALA SYSTEM : ON TIME DELIVERY ,
EVERY TIME AS PART OF ITS MBA
CURRICULUM .
ACCOLADES
RAGHUNATH MEDGE , MUMBAI
DABBAWALA ASSOCIATION
PRESIDENT SAYS PEOPLE STUDY
BUSINESS BOOKS AND THEN
PRACTICE . WE PRACTICED AND
ARE NOW STUDIED IN BUSINESS
BOOKS . THE WORLD IS FUNNY
PLACE .