DEVELOPING SERVICE PRODUCTS :

CORE AND SUPPLEMENTARY

ELEMENTS

GROUP 3
Deven pai 1221512
Gulshan bhandari 1221513
Jayant jayasenan 1221514
Jyotishman kaushik 1221515
Lentson amos 1221516
 A Case study : STARBUCKS
• A Globally dominant specialty-coffee brand
• Success contributed to three core components
a) Highest quality coffee in the world
b) Customer Service
c) Ambiance
• Core Product : Coffee
• Supplementary Services : Wireless Broadband,
Access to Apple iTunes music store, Movie DvD’s ,
Books, etc ………..
 Service Product
• A service product comprises all of the
elements of the service performance, both
physical and intangible, that create value for
customers
• The value proposition must address and
integrate three components
i) Core Product
ii) Supplementary Services
iii) Delivery process
Core Product
A Core Product is the central component that supplies the
principal, problem solving benefits customers seek

Supplementary Services
These services augment the core product, facilitating its
use and enhancing its value and appeal to the customer’s
overall experience

Delivery Processes
Concerns the processes used to deliver both, the core
product and each of the supplementary services
 SERVICE OFFERING FOR AN OVERNIGHT HOTEL STAY

Reservation

Parking
Use Phone

Nature
Scheduling Of
Process
Check in /
Room Service Core Check out
Service Customer
Level Role

Pay TV Porter

Meal
FACILITATING SUPPLEMENTARY
SERVICES
 FLOWER OF SERVICE
CORE PRODUCTS

FACILITATING ENHANCING
SUPPLEMENTARY SUPPLEMENTARY
SERVICES SERVICES

The supplementary services are classified into one of the eight clusters

The eight clusters are shown as petals surrounding the core of a flower
which is said to be flower of service

The petals are arranged in the clockwise, in the manner they are said to be
experienced however the encounter may not follow the same order
CONTD...

FACILITATING ENHANCING
SERVICES SERVICES
• Information • consultation
• Order-taking • Hospitality
• Billing • Safekeeping
• Payment • Exceptions
 INFORMATION
• To obtain value from any good service, customers need
relevant information
• Customers nowadays are information hungry
• Customers also require documentation of what has already
taken place such as confirmation of receipts, tickets or
monthly summary of account activity(eg: SIB)
• Information must be provided in both timely and accurate
manner(eg: redbus)
• Traditional ways include using front-line employees, printed
notices, brochures etc
• Nowadays it is provided through videos, websites etc
• Certain business provide opportunities to track their
services(eg: EMS speed post)
 ORDER-TAKING
• It is the first step when the customer is ready to buy
• It includes applications, order entry, reservations or
check-ins(eg: admission process in college, a restaurant
table)
• Accuracy in order-taking is highly essential
• It can be done through sales personnel, phone, email
or online
• It should be polite, fast and easily understandable
• It should ensure minimum physical and mental
work(eg: m-tickets)
 BILLING
• Common to all services (unless the service is free)
• Inaccurate or incomplete bills disappoint customers
• Procedures vary from verbal statements to machine –
displayed price(eg: kirana, hotels)
• Simple approach is self-billing(eg: small hotels)
• Customers expect bills to be clear and informative
• Customers hate waiting for bills
• Recent trends include express check-outs in hotels and
rentals
• Previewing bills on TV monitors
 PAYMENT
• Bills requires the customer to pay (which is especially
slow)
• Certain services automatically deduct charges
(eg: ATM)
• Methods range from self-service payment to credit
cards, pre-paid and electronic payment
• Some service business have instituted control
systems(eg: ticket checks)
• However the control process must ensure politeness
with firmness
• Say THANK YOU
VOILA
Enhancing supplementary services
1.Consultation

• Response to
customers’ questions.
• Advice to customers.
• Tutoring or training in
product use.
• Technical consulting.
2. Hospitality

• Greetings.
• Food and beverages.
• Waiting facilities and
amenities – waiting
rooms, newspapers,
magazines etc.
• Transport.
• Security
3. Safekeeping.

• Caring of customers’
possessions.
• Parking of vehicles.
• Baggage handling.
• Packaging of goods.
• Transportation and delivery.
• Installation of purchased
goods.
• Inspection and diagnosis.
• Repair and renovation.
4. Exceptions.

• Special requests.
• Handling
suggestions/complaints/
compliments
• Problem solving
• Restitution.
 Managerial implications
• The flower of service provide many options for
enhancing the core product.
• The elements are categorized as facilitating and
enhancing.
• Any badly handled element may negatively affect
customers’ perception of service quality.
• The nature of the product helps to determine
which supplementary services must be offered
and which might be used to enhance the value of
the core product.
 Branding Strategies for Services
• Brand House
Using a single brand to cover all products
Eg: Virgin group

• Sub Brands
Corporate and the master brand is the primary frame of
reference but the product itself also has a distinctive name
Eg: Singapore Airlines Raffles class-Companys business class
Singapore airlines Suits-Its beyond first class services
Branding Service Products and Experience
Product Differentiation
Product Implies a defined consistent bundle
of output as well as the ability to differentiate
one bundle of output from another
•Tangible- Eg: Product menu of fast food
restaurant
•Intangible- Eg: Service Offered by Insurance
company, Courses of Universities
• Endorsed Brand
The product brand dominates but corporate name is
still featured
Eg: Hotel Industry in USA

• House of brands
In these each of the brand is actively promoted
under their own name
Eg: Yum brands Inc- A&W,KFC,Pizza hut, taco bell and
long horns silver
 Tiering Service products with
Branding
Offering several price based classes of service
concept, each is based on packaging a distinctive
level of service performance across many attributes
Eg: Hotels, airlines ,Cable Television, credit cards

BRITISH AIRWAYS SUB BRANDS

Four inter continental offerings
• Deluxe service
• Club world
• World traveller plus
• World traveller
SUN MICRO SYSTEM HARDWARE AND SOFTWARE SUPPPORT

• Platinum: Mission: Critical services with onsite services

24/7
• Gold : Business critical support with onsite services
from Monday to Friday
• Silver: basic support with onsite services from Monday
to Friday
• Bronze: Self support with phone services 8am to 5 p.m
 NEW SERVICE DEVELOPMENT

1. Style Changes

2. Service Improvements

3. Supplementary Service Innovations

4. Process Line Extensions

5. Product Line Extensions

6. Major Process Innovations

7. Major Service Innovations

 REENGINEERING SERVICE PROCESSES
 Reengineering involves analyzing and redesigning processes to
achieve faster and better performance.
 Identification of each distinct step.
 Measuring how long each step takes.
 Finding ways to speed up the process.
 Eliminating a futile step.
 Running tasks in parallel.
 Eliminating certain existing supplementary services.
 Adding new valuable services.
 Rethinking points of service.
PHYSICAL GOODS AS A SOURCE OF NEW SERVICE IDEAS
 Each and every new physical product has the potential to
create a need for related possession processing services.
 Caterpillar example
 Cat Financial
 Cat Insurance
 Cat Rental Stores
 Cat Logistics
 Equipment Training Solutions Group
 Maintenance and Support
 Remanufacturing
 USING RESEARCH TO DESIGN NEW SERVICES
 The need for research arises for figuring out which features and
what price will create the best value for target customers.
 Marriott Courtyard example
 External Factors
 Room Features
 Food Related Services
 Lounge Facilities
 Basic Services
 Value Added Services
 Leisure Facilities
 Security
 ACHIEVING SUCCESS IN NEW SERVICE DEVELOPMENT

1. Market Synergy

2. Organizational Factors

3. Market Research Factors

4. Internal Marketing

5. Product Synergy

6. Human Resource Strategies

7. People Processing Services

THANK YOU !