Seven characteristics of services

here are several characteristics which differentiate a service from a product. These are Perishability, Heterogeneity, Intangibility and ownership. Here we discuss further 7 characteristics which are critical and help you understand a service product better. 1) Services are sold exclusively on the basis of benefits they offer – Why is it that Accenture has such a high brand equity? This is because of one single thing which they have commanded over time – Trust. Thus this is one benefit to the service of Accenture which other companies can hardly give. Therefore, word of mouth publicity and a good reputation are some benefits which are critical to make a service brand over time. The first restaurant you try, is one recommended by your friend. 2) Services cannot be made available in advance – If you were running a restaurant, can you make all the dishes one day in advance and then serve the customer when he comes? No you cant. All you can do is make the ingredients. Even fast food restaurants take care that the food is replenished every single day. The simple reason behind this is that services cannot be stored. They cannot be given in advance. They can be given only when a purchase of the services has been made. 3) Time utility is critical – If you were a doctor, and you gave half an hour to each patient, talking idle talks just to make him comfortable, you will probably lose the 10 customers sitting in your lobby. In services, you charge by the amount of time a person consumes. Thus the way you utilise your time is critical to the profitability of your business. A restaurant which does not have any customers today, will have lost a lot of money in keeping the restaurant open, in labour charges etc. 4) Services cannot be transferred – Outsourcing is the best example of non transference of services. If you wanted to outsource your calls, can you bring the call centre to your country? You cant. Because again the costing will go high. That is why call centres are in cheaper countries. You cannot separate the process from the source. You will have to keep the call centre services in one place and provide these services in another. 5) Services perish – The point is similar to perishability of services marketing. The concept is simple – if you do not watch the movie now, you wont get a refund of the ticket. If you do not board your plane or your train, you cannot ask back for the charges of the ticket. A service once order, perishes, if it is left unused. 6) A service once consumed cannot be returned – You pay a doctor for consultation and medicines. But your illness does not get cured or he is unable to

A hint here for a marketer / entrepreneur. fresh food and vegetable products? . you can return the dish if you dont like it. Even in a restaurant. we are going to examine the 5 major characteristics of services which are. Can you ask your money back? You cannot. This is human factor and the owner can hardly do anything. He gave you the service which you asked for. as services are intangible. He has a heavy workload on weekends as a result of which the quality of service is low. Why? Services are highly perishable compared to physical products. But how could.find the source. the services of say. They are a product. The bottomline – you cannot return a service once it has been consumed. Go through each of these characteristics and find out where you can bring about an improvement in your organization. say. In restaurants. Medicines are not a service. I am sure even if you are meeting your customers satisfaction goals. this is one of the most difficult to appreciate. Overall these seven characteristics define a service. 7) Controlling the quality of services is difficult – My local auto service centre has one rule for loyal customers – Do not give your bikes on weekends. there is scope for exceeding customer expectations by analysing these seven characteristics of services. for example. The reason is quite simple. He might not ask for money anymore or you can return the medicines and receive the money for the medicines. the quality of food served or the service given will vary during peak hours. 5 Major Characteristics of Services Posted by Olufisayo in Marketing On June 20. and ask for another same one. Today. Furthermore. we discussed about “How you can Successfully Market your Services“. Thus controlling the quality of services over time is very difficult as long as the human element is involved. o o o o o Perishability Intangibility Variability Inseparably Non-ownership Perishability Perhaps of all the suggested special characteristics of service products. 2011 In our last post. it is not possible to measure the quality of service given. an airline be considered to be more perishable than. But you cannot walk out of the restaurant without paying for the services.

an insurance policy. The intangible nature of most services gives rise to special problems both for suppliers and consumers. and so on. it is often very difficult for both supplier and consumer to ensure a consistent “product” or quality of service. word of mouth. will not vary. Rather the customer pays only to secure access to or use of the service. The provision of services. packaging. unlike a physical product. however. if an airline does not sell all the seats on a particular flight. bank services. the hairdresser needs to be physically present for this service to be consumed. credit cards. even in a life-time of purchases. Variability In the production and marketing of physical products.The reason is that unlike most physical products. or even the location and decor of the insurance office. . Because of this. with many services. we are purchasing nothing else but the skills of the suppliers. Again the hotel room is a good example. Intangibility Physical products in the store are widely displayed for customers to see. we must “consume” this service at the point of provision. For instance. has immediately and irreversibly gone. see or smell the products before choosing. although the customer may be given a Cheque book. invariably includes a large measure of the “human element” Indeed. This has implications both for channels of distribution and scale of operations. For example. Similarly. the consumer does not secure ownership of the service. we cannot take a hotel room home for consumption. touch. feel. Inseparability A key distinguishing feature of service marketing is that the service provision and provider are inseparable from the service consumption and consumer. feature. weigh or sniff at before deciding whether or not to buy. Non-ownership The final distinguishing feature of a service is that. they serve only to allow the customer to make use of what he or she is actually buying. many services cannot be stored. with banking services. namely. companies have increasingly paid special attention to ensuring consistency in quality. Comparing this with the choice of the service of say. etc. You cannot touch. although clearly you can make some assessment based on past experience. then those seats or rather the sales revenue of filling of them would have carried. More often than not all customers can be sure that every bottle of Coke he/she buys. Similarly.

services are not countable.... on the Chicago Mercantile Exchange (CME). Not only the process is different but the style change you need to support this change. You cannot own a service. A service is offered by the utility element of companies.. make it possible to exchange pork bellies Futures.. but is "leveled. You can buy pork as a tangible product. are non-ephemeral... but service cannot be owned. the service is tailor-made.. Companies differentiate in offering products and services... A service is not countable. Good Luck. You buy it..services are ephimeral. cigarettes and cars.. Financial service companies however. can be owned. The ownership between products and services is different... Your bank services a depot fee for saving you a lot of work. . You can place a stock order which might result in a transaction later on... That are some of the main differences between products and services? And when are these relevant? Tangibility versus Intangibility Products are tangible. Where the product is much more standardized. can be bought . In the same way as you buy stamps. you ship it and sell it.. A stock could be called a financial product that you own.. A product is produced by a manufacturing process. In this last case. There is a limit in what a service can offer. A future is (not the most simple example of) a service with which you can hedge your risk..services e perishable." better than the best service is not possible... you subscribe to a service in the same way as you subscribe to your gas and electricity supplier.. You can count products in the same way as you can count your money (or have your bank service you this information). but the variations between similar products of different producers are less prominent than the variations between services. most of the people trading on the CME will never see or smell the pork bellies.. are countable. And this brings us to the essential of these differences.. changing from one (product approach) to the other (service offering) is very complex. because of the last mentioned differences.services can be felt. are non-perishable.Difference between product and service products products products products products products are tangible whereas services are intangible.

one lawyer is not interchangeable with another lawyer. I think. even though they may work for the same firm and have similar training.. A service relationship touches our essence and reveals the people involved: provider and customer. services tend to be perishable in the sense that they cannot be inventoried -. Consider the impact of this element on airline seat pricing -. services are personal. . like computer hardware. there are some substantial differences between products and services.From time to time I hear the question raised about whether something is a product or a service. but it is a service when it is only on some ISP or ASP system. phones. services do not even exist before we buy them. Products possess physical characteristics we can evaluate before we buy. For example. such as infrastructure . Products are made. services are experienced. A service is something that improves the quality of life. This is very different from the world of products. Products are used. This comes about. accessed by the people using that service. Products are impersonal. which definitely affect how you think about managing both the customer interaction and the marketing generally.. For example. A product is something we can reach out and touch. where we fully expect two boxes of laundry detergent to be virtually indistinguishable. electricity. For example. because marketers and brand managers in service businesses often refer to products as a matter of convenience. As an IT professional.it's a huge driver in that industry! Service quality is notoriously difficult to control. physically wrap our arms around. a mortgage product or a vacation product.what you don't sell today cannot be sold tomorrow. services are delivered. I feel that software is a product when it is delivered to the client's computers to use by their discretion. However.