Chapter 4
Developing Service Concepts: Core and Supplementary Elements
GENERAL CONTENT
Multiple Choice Questions
1 the sequence of encounters that a customer has with a service
organization can provide valuable insights into the nature of existing service.
a. Flowcharting
b. Establishing
c. Comparing
d. Deriving
e. Shifting
(a; Easy; p. 68)
a facilitate use of the core product and add value and differentiation to
the customer’s overall experience.
Fixed services
‘Value-added provisions
‘Marketing theories
Supplementary services
Service providers
(d; Moderate; p. 69)
paose
a supply the central, problem-solving benefit that customers seek.
Core products
Supplementary services
Delivery processes
Sustaining processes
. Conditional services
(a; Easy; p. 70)
poop
4. augment the core product, both facilitating its use and enhancing its
‘value and appeal.
Core products
Supplementary services
Delivery processes
Sustaining processes
Conditional services
(b; Moderate; p. 70)
aooe
75. A company’s helps to determine which supplementary services should
be included.
a. location
b. delivery system
c._ key service representative
service atmosphere
fe. market positioning strategy
(e; Easy; p. 78)
6. The order-taking process should be and
50 that customers do not waste time and endure unnecessary mental
sical efor.
short; curt; abrupt
simple; slow; effortful
short; sweet; ineffective
powerful; simple; abrupt
polite; fast; accurate
(e Easy; p. 78)
to an gee
Ps represent a special type of order taking that entitles customers to a
specific unit of service
Suggestions
Reservations
Trackers
Repossessions
Contacts
(b; Moderate: 80)
pangs
8 Atit’s simplest, consists of immediate advice from a knowledgeable
service person in response to the request: “What do you suggest?”
a. billing
D. payment
consultation
@. hospitality
e. selling
(c; Easy; p. 81)
9. Which of the following is NOT considered an example of a hospitality element?
Greeting
Toilets and washrooms
Advice
Food and beverages
Transport
(cj Moderate: p. 82)
Jeaoge
1810. Which of the following is NOT one of the eight basic steps to developing and
delivering a branded customer experience?
a. Target profitable customers, employing behavior segmentation rather than
demographics
. Achieve a superior understanding of what your targeted customers value.
c. Design facilities that delight your customers and reduce complaints.
4. Give employees the skills, tools, and supporting processes needed to deliver the
defined customer experience.
e. Make everyone a brand manager.
(c Moderate; p. 89)
‘True/False
LL, Service marketers need to create a coherent offering in which each element is
compatible with the others and all are mutually reinforcing.
(True; Easy; p. 68)
12, The search for competitive advantage rarely centers on supplementary services.
(False; Moderate; p. 69)
13. The greater the proportions of tangible service elements, the more necessary it is to
provide tangible clues about the features and quality of the service.
(False; Moderate; p. 70)
14, All service elements must be delivered in a prescribed sequence.
(False; Moderate; p. 72)
15, Consumption of the core product is sandwiched between use of supplementary
services that are needed earlier or later in the delivery sequence.
(True; Easy; p. 72)
16. Core products are surrounded by supplementary elements from each of the eight
clusters of supplementary services.
(False; Easy; p.
17. To obtain full value from any good or service, customers need relevant information.
(Tine; Moderate; p. 78)
18. Hospitality represents a more subtle approach to consultation because it involves
helping customers better understand their situations.
(False; Easy; p. 82)
19, “Exceptions” involve supplementary services that fall outside the routine of normal
service delivery.
(Tine; Moderate; p. 84)
1920. Information processing services tend to be the most demanding in terms of,
supplementary elements.
(False; Moderate; p. 85)
Short Answer
21. What three components must the value proposition address and integrate?
Cote products, supplementary services, and delivery processes.
(Moderate; p. 70)
22. What four things must the design of the service offerings address?
‘How the different service components are delivered to the customer, the nature of the
customer’s role in those processes, how long delivery lasts, and the prescribed level
and style of service to be offered.
(Moderate; p. 71)
23, List three examples of order-taking elements in order entry.
(On-site orcer fulfillment.
‘Mail/telephone order placement.
E-mail/Web site order placement.
(Moderate; p. 79)
24, Give two examples of billing elements.
Periodic statements of account activity.
Invoices for individual transactions.
(Verbal statements of amount due.)
(Machine display of amount due.)
(Self-billing computed by the customer.)
(Moderate; p. 80)
25. Give an example of a consultation element.
Advice—personal counseling, tutoring/training in product use, or management or
technical consulting.
(Easy; p. 82)
20Essay
26. Describe the four types of “exceptions” listed in the chapter.
Special requests are one type of exception. These involve a departure from normal
operating activities and are common in travel and hospitality industiies. Problem-
solving refers to an exception where normal service fails to run smoothly as a result
of accidents, delays, etc. Handling of complaints/complements/suggestions help
service providers react quickly to failures and duive off of complements. Restitution
is the final type of exception listed. This involves repaying customers for severe
performance failures.
(Challenging; p. 84)
27. Discuss the three factors that discriminate between successful and unsuccessful new
financial services.
‘The three factors that lead to success in new financial services are market synergy,
organizational factors, and market research factors. Market synergy refers to the
ability of new offerings to fit well with the existing image of a firm, to meet
customer needs, and to receive strong support from a firm and its branches.
Organizational factors include strong interfunctional cooperation and coordination
and a clear direction for the development team. Finally, market research is conducted
early in the development process with a clear idea of the type of information needed.
(Challenging; p. 95)
APPLICATION CONTENT
Multiple Choice Questions
28, systems, based on telephone or Web site reservations, provide
enormous cast savings for airlines because there are no
a. Ticketless; gross revenue charges
b. Partial; gross revenue charges
c. Ticketless; travel agent commissions
a
e
|. Partial; travel agent commissions
Ticketle:
(c Easy; p. 80)
net revenue charges
a29, came up with the novel idea of an arrivals lounge for its terminals to
‘serve passengers amiving early in the moming after a long overnight flight from the
Americas, Asia, Africa, and Australia.
a. Singapore Airlines
b. British Airways
c. Delta Airlines
@. Continental Airlines
e. Trans World Airlines
(b; Moderate; p. 83)
30, Which of the following is an example of a special request in advance of service
delivery?
a. Dietary requirements
b. Complaints
c. Warranties
d. Refunds
e. Suggestions
(a; Easy; p. 84)
31, Singapore Airlines Raffles Class is an example of a(n) .
a. branded house
b.endorsed brand
c.house of brands
disub-brand,
e.clear strategy
(4; Challenging; p. 87)
32. Which of the following is NOT one of British Airways seven distinct air travel
products?
a. Deluxe service (First Class)
b.Club World (Business Class)
c.Club Britain (Business Class)
d.Club Europe (Business Class)
e.Euro-Traveler (Economy Class)
(G Moderate; p. 88)
‘TrueFalse
33, Firms actually benefit from late payments, because they reduce the amount of
accounts payable,
(False; Moderate; p. 81)
34, Singapore Airlines is well recognized for both their superior meals and attentive
cabin crew.
(True; Moderate; p. 83)
2235. Quick service restaurants are sometimes described as “quasi-manufacturing”
operations because they produce physical output combined with value-added service.
(ime; Moderate; p. 86)
36. Westin hotels are wholly owned subsidiaries of Marriott Group that are usually not
identified as part of Marriott to protect Westin’s exclusive image.
(False; Moderate; p. 87)
37. The term “branded house” is used to describe firms like Virgin Group, that uses
distinct individual brand names to cover a range of diverse service offerings in
unrelated fields.
(False; Moderate; p. 88)
Short Answer
38, Draw the flowchart that might be involved in staying at a motel.
Park Car -> Check in > Spend Night > Breakfast > Check Out
‘A A
Housekeeping Breakfast
Gleans Room’ Prepared
(Moderate, p. 74)
39. What ate the two roles of supplementary services?
Facilitating or enhancing.
(Moderate; p. 77)
40. Give two examples of facilitating services.
Information, order-taking (billing, payment).
(Moderate; p. 77)
41. Give two examples of enhancing services.
Consuhation, hospitality (safekeeping, exceptions).
(Moderate; p. 77)
42. Why do firms benefit from prompt payments?
Itreduces the amount of accounts receivable that is counted as a liability.
(Moderate; p. 81)
23Essay
43, Explain how the core product, supplementary services, and delivery processes are
integrated in the context of an overnight hotel stay.
‘The core product refers to the overnight rental of a bedroom. Its components are
service level (e.g. luxury versus economy), scheduling (how long the room is
available), nature of the process (in this case people processing), and the customer’s
role in consumption of the room. Supplementary services include things like
parking, room service, reservations, and a breakfast buffet. Delivery of both the core
and the supplementary services is provided electronically, via hotel employee, or by
the customer. Phone use and pay TV are automatically billed to the room. Room
service and check-in are provided by a hotel employee. Most breakfast buffets are
self-service, requiring the customer to take action.
(Moderate; p. 71)
44, Discuss how multi-brand strategies can succeed and what the strategies should be
>ased on in the hotel industry.
Many hotel chains offer groups of sub-brands or endorsed brands. For example,
Hilton Hotels Corporation has seven sub-brands, while Marriott International has
twelve. To succeed, each sub-brand must offer a distinct value to customers. For
example, catering to the ultra wealth at one end of the spectrum with one brand and
also serving the economy class with another brand, Accomodations, amenities, and
service must be consistent with the level of customer sought. Target considerations
include, short-term versus extended stay, business versus pleasure, and ability to pay
matched with customer needs and desires.
(Challenging; p. 87)
43, Explain where Sun Microsystems falls on the spectrum of branding alternatives and
discuss what their strategy involves.
Sun Microsystems utilizes a sub-branded strategy. The company offers a
comprehensive hardware and software support program with four different levels of
support, These range from bronze to platinum. Different levels of support give
customers the flexibility to tradeoff price for increased service. For example, 24/7
service is costly, but potentially necessary for some high-powered business
customers.
(Challenging; p. 87)
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