Internal Assessment – 1st

Service Marketing
Servicescape Report
Uber

By: Sanchit Meena -

18010126061 (Div. “A”)
Aaryan Dhar -
180101260105 (Div. “B”)

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CONTENTS

INTRODUCTION..............................................................................................................................3

“BITNER”, CREATED THE “SERVICESCAPE FRAMEWORK”...........................................3

SERVICESCAPE OF UBER.............................................................................................................4
What role does technology play in the cab industry?..................................................................................................................5

ANALYSIS..........................................................................................................................................6
Comparative analysis................................................................................................................................................................... 6
Physical and electronic distribution............................................................................................................................................. 8
Service process.............................................................................................................................................................................. 9
Physical Evidence and Elements............................................................................................................................................... 10

RECOMMENDATIONS AND CONCLUSIONS.........................................................................12

BIBLIOGRAPHY.............................................................................................................................12

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INTRODUCTION

The word “servicescape” is derived from a marketing term as in the literature of marketing “physical
environment” is referred to as servicescape1. Bitner defined the very marketing term as it “refers to the
built environment (man-made, physical surrounding that opposed to the natural or social environment)
affecting consumers and employees in service organization”2 Thus, by this, we can say that
“servicescape” is an atmosphere that’s been specifically created to elicit emotional responses that
induces the impact customer purchasing decisions and that it can affect consumer experience as well
as generate a positive impression.
The impact of Servicescape has been studied extensively in a variety of settings, including the
industries hotels, food festivals, tourism, museums as well as theme parks. “Consumer satisfaction is a
metric that measures how well goods and services meet or exceed customer expectations” 3. It is
extremely critical for a company’s sustainability and profitability to maintain the levels of consumer
satisfaction. Thus, it can affect customer reactions, causing them to choose whether or not to continue
their relationship with a specific service provider. “Customers who are happy are more likely to be
loyal, make repeat purchases, and recommend the goods and services, according to previous studies.”4

“BITNER”, CREATED THE “SERVICESCAPE FRAMEWORK”

In 1992, this highlights the importance of the physical environment with respect to the service process
that takes place (as shown in Fig.1). The figure below shows the impact of servicescape on business
which is demonstrated by Bitner.
Figure 1 demonstrates that there are significant distinct types of responses to: “cognitive, emotional,
and physiological”. The individual reactions to the physical environment, which indeed contributes to
the “approach or avoidance behavior”, strongly influence the three responses. “Customers will
approach or avoid the service atmosphere based on their perceptions and reactions to the ambiance,
the structure, and symbols and artifacts.”5

1
Baker, J. (1987). The role of the environment in marketing services: The consumer perspective. The Services Challenge:
Integrating for Competitive Advantage, 79–84.
2
Bitner, M. J. (1992). Servicescapes: The Impact of Physical Surroundings on Customers and Employees. Journal of
Marketing,
3
Kotler, P., Keller, K. L., Ang, S. H., Tan, C. T., & Leong, S. M., (2018), Marketing management: An Asian perspective,
Pearson Education Limited, Harlow.
4
Bojanic, D. C., (1996), “Consumer perceptions of price, value and satisfaction in the hotel industry: An exploratory
study”, Journal of Hospitality and Leisure Marketing
5
Baker, S. M., Holland, J., & Kaufman- scarborough, C. (2007). How consumers with disabilities perceive “welcome” in
retail servicescapes : a critical incident study. Journal of Services Marketing
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SERVICESCAPE OF UBER

Uber is a billion-dollar corporation that provides transportation services to customers in over 400
cities worldwide. The services of Uber are built on a basis of advanced technology versatility and
demand. The main goal is to increase consumer transportation access which meets the demand
industrially as well as keeps the customers safe. And for this to be ensured the service quality must be
focused on to occupy market share.

In Uber, servicescape is done through aspects that are involving with customer experience to feel
welcomed again and to give a positive impression. This is done through three dimensions namely

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Physiological, Cognitive and Emotional, Cognitive.

1. Physiological Dimension: In this dimension, it demonstrates such as cars that appear to be

clean, well-kept, and a good physical appearance to impress the customers which provide for a
pleasant experience. A comfortable experience can also be evoked through a pleasant scent in
the cars.
2. Cognitive Dimension: This dimension demonstrates that the Uber car should always meet the
basic need of the customers to provide a convenient, safe and affordable ride. Even though
Uber hikes the price during busy hours, it still reduces as time. The company also ensures
safety as the cars are trackable in the Mobile App. It is extremely convenient as customers can
access transportation by just a tap away through the Mobile Application.
3. Emotional Dimension: In this dimension, it demonstrates that an experience could evoke
emotions that influence the mood and attitude of the customer. For this very dimension, Uber
efficiently trains drivers to be confident, polite, and decent to create a humble and well-being
atmosphere to influence the emotions of the customers. For this to run efficiently, the
customers of the service are allowed to rate the driver and the experience to supervise and have
insight on every ride that is taken into account. The customers can complain as well in case of
any grievance to give the help right away to change the mood or attitude of the customer.

What role does technology play in the cab industry?

Although the radio and mobile taxi segment constitute only 5 percent of the Indian Taxi Market, the
segment is witnessing significant growth with competition hitting up and new players and technology
making an entry now and then. “The radio taxi segment posted a 35 percent compounded annual
growth rate in the last five years. The segment has four or five big players (Meru, Ola, Easy Cabs, and
Book my Cab) and a similar number of medium players 6. The younger generation prefers radio taxis
and cashes transactions. Some companies like Ola and Meru have launched low-cost services. There
are companies like Taxi for Sure which has signed up normal taxis under its umbrella. Leading
companies don’t own taxis but provide software and trained driver-owners with KYC safeguards.
They ensure that the partner driver who is using the software should pass the stringent compliance
check of his personal and professional papers. Each ride is tracked and all the records are maintained
meticulously. Following are some of the advantages of technology in this industry:
1. Mobile App: The app shows and allots the available nearby cabs which are closest to the

6
Harshith Mallya, 2017. How tech, new business models could change cab industry, make short rides free?

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customer. Moreover, customer can also schedule their cabs for future bookings.
2. GPS: The in-built GPS feature allows the customer to track every movement of the cab and
helps in proper navigation.
3. Live Trafficking: Along with GPS, the app has the feature to track the live traffic on the route.
This helps the driver to change the route according to the traffic so that the customer reaches
the destination on time.

ANALYSIS

Comparative analysis

Customer Analysis Company Analysis Competitor Analysis

Market Attractiveness Organizational Resources, Strengths and Weaknesses

Limitations, Goals, and Values

Level of demand high and Resources Strengths

further increasing due to  Drivers  High Supply
exceeding customer  Technological Capital  Goodwill
expectations of service quality.  Corporate Staff  Efficiency
 Customers

Limitations Weaknesses
 Driver’s Availability  Inconsistent Service
 Driver Base Quality

 Payment Mechanism  Unreliable Service

 Technological Capital  Unreasonable and Non-

and Infrastructure Transparent charges

 User’s Internet  Limited Payment

Availability options

 User’s willingness to
provide personal details.
 Industry Regulation and
Legislation

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Goals and Values

 Innovation
 Excellent Customer
Service
 Affordable Rides
 Promote self-
employment within
drivers.

Customer Needs Strengths and Weaknesses Responses to potential

UberX: Need a convenient ride
that offers consistent high
service quality.
UberSELECT: Need a luxury
ride.
UberASSIST: Need a ride that
is equipped with disability
assistance.
Strengths
 Positioning as a simple
and seamless service.
 Positioning as a more
affordable brand.
 Strong brand identity.
 Positioning as a high-
quality service.
positioning strategies
 Competitors to position
themselves as a more
affordable option
 Position themselves as a
more credible and
lawful brand

Weaknesses
 Privacy concerns
 Safety Issues
 Unfair employee
remuneration

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Physical and electronic distribution

Uber is a transportation service that is spread across multiple locations and arrives at the customer's
requested location. The service is partially self-serving in the first step of distribution, with the
customer having no contact with the employees. However, during the ‘ride’ (service delivery) it
operates as an interpersonal service, whereby the customer and employee are present and active in the
servicescape.
To begin product, flow a consumer must download the Uber app onto their smartphone. All
supplementary services are also delivered through electronic channels, which include, gathering trip
information, order-taking, payment (connected to PayPal or a scanned credit card), billing, and
consultation if required. This delivery strategy is best utilized by individuals with higher confidence
and knowledge about service and the channel (Wirtz, Lovelock & Chew, 2012, p.128). By using this
channel Uber has restricted it to dauntless tech-savvy individuals and has outcast potential segments
who may not own a smartphone and/or are coy to technological change. It is delivered as an on-
demand service due to transportation needs, however, this is dependent on the supply of drivers in the
area if any at the time of the request.
By investing in new technologies to deliver the service to new segments, the company may strengthen
its delivery strategy. Uber could expand its service delivery to a web browser, allowing users to book
rides by logging into a website. This alternative to the App will entice customers who do not own a
smartphone to try out the service. It should be noted, however, that adding new channels would have
an impact on the customer's desired service experience and should only be used as a test to enable the
new segment to use the App.

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Service process

The process of Uber is designed to be simple with a smooth interface. The service is only available via
a smartphone. To book a ‘ride,' the customer must first download the app and register. With an
automated, consistent procedure, booking is easy. The app uses a GPS location tracker to link users
with vehicles. Different levels of vehicle luxury are also available, with correspondingly higher prices.
The only contact needed is when the driver picks up the rider during service delivery 7. Uber is a
cashless service that relies solely on electronic payments. Payments are immediately deducted and
disbursed between the driver and Uber when credit card information is connected to an Uber account.
To ensure passenger safety, the service delivery employees (drivers) are required to gain driver
authorization from the Department of Transport, in addition to obtaining a positive Police check. The
vehicle must be less than nine years old and in proper working condition. Uber’s criterion isn’t
rigorous, lowering barriers to entry for potential drivers. Thus, the effectiveness of the service delivery
is heavily reliant on the driver's capability and desire for service quality and could be affected if the
driver and company’s values do not align.
There are several key process steps that Uber has established to create and deliver its service process.
The major potential failure point of the service process is the customer's ride to the destination. Given
the customers are dealing directly with a front-line staff member whose behavior and appearance can
have a major effect on the service experience for the customer.
Another fail point could be the time customers have to wait from when they have requested the Uber
7
Samar Singla, How Uber Works: Insights into the Business & Revenue Model? Journal of Marketing

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till when it arrives. In regards to service standards and targets the Uber app gives approximations to
the minute of the estimated time of arrival of the Uber driver and how long it will take to get to the
customer's desired destination.

Physical Evidence and Elements

Servicescape has an influenced both: the time customers want to spend. In service as well as a strong
intention to return to the service provided for them.
“Customer satisfaction has been reported to be affected by the physical environment in which services
are rendered”8
The elements of servicescape are derived from a variety of sources and research work. “These
distinctions are still considered important and valid reflections of a physical service setting more than
two decades later.”9
Following are the elements:
1. Ambiance: “The character, decoration, and atmosphere (of the place) are enhanced by
lighting, temperature, noise, music, and smell, and are enhanced by the character, decoration,
and atmosphere (of the place)”10. This affects the perception and attitude of the customer as
they feel impressed as well as comfortable. As indeed happy customers are more likely to feel
emotions which are positive that leads to beneficial behaviors like promoting the company’s
services to others and repurchasing them in the future.
2. Cleanliness: “Cleanliness has two aspects: first, the state of being clean and clear of dirt, and
second, the ongoing cleaning process.”11 This element plays a huge role in customer
satisfaction. Thus, UBER must maintain cleanliness to satisfy the customers.
3. Interior Aesthetics: The aesthetics of the interior also plays a major role in attracting
customers. The seating comfort, banners, signs, and pictures could capture the eyes of
customers could influence the customer behavior positively.
4. Electronic equipment and displays: The customer perceptions on servicescape could have a
positive impact. Using technology is more convenient and it makes a customer feel safe as
well, Thus, having apps, and other displays could improve customer behavior massively.
8
Chen, C. M., Lee, H. T., Chen, S. H., & Huang, T. H., (2011), “Tourist behavioural intentions in relation to
service quality and customer satisfaction in Kinmen National Park, Taiwan”, International Journal of Tourism
Research
9
Mari, M., & Poggesi, S. (2013). Servicescape cues and customer behavior: a systematic literature review and
research agenda. The Service Industries Journal
10
Lam, L. W., Chan, K. W., Fong, D., & Lo, F., (2011), “Does the look matter? The impact of casino servicescape on
gaming customer satisfaction, intention to revisit, and desire to stay”, International Journal of Hospitality Management,
11
Wakefield, K. L., & Blodgett, J. G. (1996). The effect of the servicescape on customers ’ behavioral intentions in leisure
service settings. Journal of Services Marketing
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5. Employee service Quality: “Customer preferences and behavior intentions are influenced by
service quality, which is closely linked to the establishment's image.” 12 “service staff and their
performance influence consumer emotions and determine their perception of service quality” 13
This is essential to keep customers coming back to use the services, as it creates a positive
attitude towards the company.

Uber’s servicescape is predominantly based in the App where customers book their ride and, in the
vehicles, where customers are, during the service delivery. Primary data revealed that customers
consider the cleanliness of the vehicle as to the most important element of Uber’s physical evidence. It
is argued that a clean servicescape can positively influence customers’ satisfaction, customer trust, and
patronage. The firm controls the maintenance of its physical evidence effectively by its customer
feedback system.
Other contributing factors to customer satisfaction within this servicescape are the quality of the
vehicle, tangible offerings, and the physical appearance of the drivers. Firstly, the quality of the
vehicle enhances customer trust in using the service as it provides a positive impression of its
functionality. This is effectively managed by Uber as cars beyond nine years old are not accepted.
This policy also has a positive impact on drivers as they become more confident when their vehicles
are more reliable. Secondly, tangible offerings such as mints and bottled water heavily influence the
rating of the driver believe that tangible elements enhance the service experience and increase
customer satisfaction. Lastly, the physical appearance of a driver can offer a competitive advantage in
relation to the service encounter. 38 percent of respondents also revealed that having a well-groomed
driver was one of the most important elements that contributed to their overall experience. The firm
could improve its servicescape by ensuring all drivers conduct an extensive weekly clean of their
vehicles. Implementing this service standard will positively influence customer satisfaction and
patronage.

RECOMMENDATIONS AND CONCLUSIONS

Following are some of the recommendations that can improve Uber services:
1. The company can launch Launch UberSenior as a fourth service product offering to attract the
Senior segment of 50 to 70 yr old. UberSenior will be offered a discounted pricing strategy to
entice this segment to convert.
12
Jang, Y., Ro, H., & Kim, T. H., (2015), “Social servicescape: The impact of social factors on restaurant image and
behavioural intentions”, International Journal of Hospitality & Tourism Administration
13
Lin, J. S. C., & Lin, C. Y., (2011), “What makes service employees & customers smile: Antecedents consequences of the
employees’ affective delivery in the service encounter”
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2. To further drive conversions of this segment, it is recommended that Uber trials a referral
campaign, whereby the younger segment will be offered a discount or coupon for referring
their elderly family member/friend.
3. The company can strengthen its corporate design by introducing a standardized uniform for all
Uber drivers to wear. To keep costs to a minimum this could consist of a standard collared
shirt with the Uber logo and the employee’s choice of suitable pants and footwear. It will not
only help in driver identification but will also strengthen the brand identity.
4. To manage demand and increase distribution efficiency it is recommended there is further
utilization of Uber's sophisticated app technology. As mentioned earlier Uber collects useful
data when locating customers for collection, building this Uber can use location data to alert
drivers of high trafficked areas. This would reduce waiting time and provide convenience to
both customers and employees improving the overall interpersonal quality of the service.
Further manipulation of this data could allow Uber to send pop-up notifications to customers
in high trafficked areas to remind them of the Uber services availability possibly deterring
them from unconsciously seeking a taxi or similar service. Importantly, this provides Uber
with an opportunity to secure themselves positioning in consumer’s minds during their
decision-making process, notably allowing for recognition/selection during memory recall for
information search.

BIBLIOGRAPHY

Journals

1. The marketing journals

2. Sage journals: Marketing

3. Journal of the Academy of Marketing Science

Websites

1. www.uber.com
2. https://ivypanda.com/essays/servicescape-report/
3. https://www.slideshare.net/ShantunuKala/cab-industry-54101358

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