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A type of economic activity that is intangible is not stored and does not result in ownership. A service is consumed at the point of sale. Services are one of the two key components of economics, the other being goods. Examples of services include the transfer of goods, such as the postal service delivering mail, and the use of expertise or experience, such as a person visiting a doctor. Service marketing
Services marketing is a sub field of marketing, which can be split into the two main areas of goods marketing (which includes the marketing of fast moving consumer goods (FMCG) and durables) and services marketing. Services marketing typically refers to both business to consumer (B2C) and business to business (B2B) services, and includes marketing of services like telecommunications services, financial services, all types of hospitality services, car rental services, air travel, health care services and professional services. The range of approaches and expressions of a marketing idea developed with the hope that it be effective in conveying the ideas to the diverse population of people who receive it. Services are economic activities offered by one party to another. Often time-based, performances bring about desired results to recipients, objects, or other assets for which purchasers have responsibility. In exchange for money, time, and effort, service customers expect value from access to goods, labor, professional skills, facilities, networks, and systems; but they do not normally take ownership of any of the physical elements involved. There has been a long academic debate on what makes services different from goods. The historical perspective in the late-eighteen and early-nineteenth centuries focused on creation and possession of wealth. Classical economists contended that goods were objects of value over which ownership rights could be established and exchanged. Ownership implied tangible possession of an object that had been acquired through purchase, barter or gift from the producer or previous owner and was legally identifiable as the property of the current owner. Adam Smith’s famous book, The Wealth of Nations, published in Great Britain in 1776, distinguished between the outputs of what he termed “productive” and “unproductive” labor. The former, he stated, produced goods that could be stored after production and subsequently exchanged for money or other items of value. But unproductive labor, however” honorable,...useful, or... necessary” created services that perished at the time of production and therefore didn’t contribute to wealth. Building on this theme, French economist Jean-Baptiste Say argued that production and consumption were inseparable in services, coining the term “immaterial products” to describe them.
Five Broad categories of service marketing
A recently proposed alternative view is that services involve a form of rental through which customers can obtain benefits. What customers value and are willing to pay for are desired experiences and solutions. The term, rent, can be used as a general term to describe payment made for use of something or access to skills and expertise, facilities or networks (usually for a defined period of time), instead of buying it outright (which is not even possible in many instances). There are five broad categories within the non-ownership framework
seat in an aircraft) 3. vehicle or other area which can be an end in its own right (e. boats.MAAP by Prof. surgery) 4. golf courses). with different fees for varying levels of access Product V/S service Products are the tangible entities which are offered in the market by Organization to fulfill the needs. Labor and expertise rental: People are hired to perform work that customers either choose not to do for themselves (e. tools and skills (e. utilities. Defined space and place rentals: These services obtain use of a defined portion of a larger space in a building. 2 . Rented goods services: These services enable customers to obtain the temporary right to use a physical good that they prefer not to own (e. costumes) 2. car repairs. Products are tangible products in the market which customers purchase from market to satisfy needs or wants.g. museums. Access to shared physical environments : These environments can be indoors or outdoors where customers rent the right to share the use of the environment (e. banking or insurance. gyms. storage container in a warehouse) or simply a means to an end (e. cleaning the house) or are unable to do due to the lack of expertise. Customers always view the product in the form of bundle means the set of benefits customers get after purchasing the product. information and etc. Services are intangible entities which are offered in the marketing by Organization with product or separately. table in a restaurant.g. Access to and usage of systems and networks : Customers rent the right to participate in a specified network such as telecommunications. 5.g.g. wants and demands of the customers. Manoj Yadav 9029388692 1. The product bundle include complementary elements like warranty.g. theme parks. The objective of service remain similar to product fulfilling wants or demands of customers.g.
perishable and variable. customer service. The first time a customer goes to a bank to deposit money into their account. develop your web site or provide them with a nice room in which to stay. In effect. How Does a Service Really Differ? Formal marketing texts tell us that services are intangible. as you cannot store the time to use it on another day. If you are a doctor and do not fill your appointment calendar on Monday. they are buying a promise. in the sale of a service. the producer and consumer often interact. you can do neither.MAAP by Prof. Variability Standardisation of service output is almost impossible. so buyers do not know exactly what they are buying from you. he may not smile as much. The teller may be a man. You can buy a can of tuna and take it home in a bag. Inseparability Services cannot be separated from their providers. education and banking are the most growing industries in services sector. there may be fewer. Goods are tangible. A service could be a promise to do someone’s tax return. then you have lost an opportunity for income. and many other. Your product offer has perished. A hairdresser is the person who cuts your hair and a teacher teaches your class. Manoj Yadav 9029388692 Kotler definition of Service is “ Any activity or benefit that one party can offer to another that is essentially intangible and does not result in the ownership of any thing” According to American survey products failure rate is higher than service failure rate that’s the reason we can see lots of services are being offered to customer in the market in 20th century. you cannot do this with a service. Perishability A service cannot be produced in advance and stored until you need to use or sell it. It is produced at the time of consumption. services without the service provider being involved. and the teller may or may not have taken lunch. Services cannot be examined prior to purchase. likewise if a room stands empty over the weekend. or more. Intangibility Services do not have physical dimensions or characteristics. However. employment practices. The exact type and level or service provided each time that the same service is supplied will differ. people waiting in the queue. you can see and touch them. 3 . In fact. Telecommunication. You can not have these. inseparable. Of what use is this information in a practical business sense? These attributes are key for the development of strategies and tactics for corporate positioning. not a woman. that you will perform a service as you have agreed. will be different from the second time they go. business processes and quality control. with services.
promotional activities. · Involves pricing strategy. and all communication with customers. · Performed to enable employees to perform the service effectively. Service Encounter) · This refers to the decisive moment of interaction between the front-office employees and customers. Internal Marketing : "Enabling the Promise" · Marketing to EMPLOYEES. and teamwork programs. INTERNAL MARKETING 3. · Performed to capture the attention of the market. i. Interactive Marketing : (Moment of Truth. EXTERNAL MARKETING 2. 2. Moment of Truth Focus on the interactions that are important to customers—and on the way frontline employees handle those interactions. would be wasted. · Involves training. because if the employee falters at this level. External Marketing : "Setting the Promise" · Marketing to END-USERS. INTERACTIVE MARKETING 1.MAAP by Prof. and arouse interest in the service. 4 . and keep up the promise made to the customer. delivery of service. 3.e. and all communication with employees. motivational. all prior efforts made towards establishing a relationship with the customer. · This step is of utmost importance. Manoj Yadav 9029388692 Service Marketing Triangle Service marketing involves 3 types of marketing: 1.
MAAP by Prof. Manoj Yadav 9029388692 Factor that influence Desired and Predicted service Cycle of Failure 5 .
In "A conceptual model of service quality and its implications for future research" (The Journal of Marketing. 6 .MAAP by Prof. A. Manoj Yadav 9029388692 Provide Gaps Model of Service Quality The gap model (also known as the "5 gaps model") of service quality is an important customer-satisfaction framework. 1985). VA Zeitham and LL Berry identify five major gaps that face organizations seeking to meet customer's expectations of the customer experience. Parasuraman.
Managers need to audit the customer experience that their organization currently delivers in order to make sure it lives up to the spec.MAAP by Prof. manage and minimize: • Gap 1 is the distance between what customers expect and what managers think they expect – Clearly survey research is a key way to narrow this gap. Gap 3 is from the experience specification to the delivery of the experience . Manoj Yadav 9029388692 The five gaps that organizations should measure.Managers need to make sure the organization is defining the level of service they believe is needed. • • 7 . Gap 2 is between management perception and the actual specification of the customer experience .
or discuss the best case rather than the likely case. Routine transactional surveys after delivering the customer experience are important for an organization to measure customer perceptions of service. their personal needs and their own past experiences. Manoj Yadav 9029388692 • Gap 4 is the gap between the delivery of the customer experience and what is communicated to customers .MAAP by Prof.All too often organizations exaggerate what will be provided to customers.Customers' expectations have been shaped by word of mouth. 8 . raising customer expectations and harming customer perceptions. Survey software can be key to assisting management with this crucial task. Finally. Gap 5 is the gap between a customer's perception of the experience and the customer's expectation of the service . • Each gap in the customer experience can be closed through diligent attention from management.