Acknowledgement 3 First and foremost, Lexpregs my’ sincere gratitadé:t0 the "Alinighty’, forigiven me'the opportunity and strength senior a ro ae this Book ‘ile jet fesouréel aii indebted to the Thskur Publication Prt. Ltd. and their Entire Editorial Team and Ms: _aept Singh ® qld (Associste Bait), for their effores ity hve put infor making this book’ a teality"an! helping in || the neat execution of the text : 3 : — ara ‘ - Drs Atul Kapdi f Tova grea many thanks to gest many People, wb hlped and suppored me doting the writing of this book, especially, Principal, Coordinator and Students of Najjeevan Institute of Management, Nash 1 woud tke to thank Thakur Publication Pvt. Lid tank my Family Members, who always supported and tenoouraged me inspite of al thet from them.nents in Services. Need to Study Service Marketing: Evolution of Services as Extended Matketing Mix Ble Indian, Asian ge Global Perspectives. wutors, Service Sector beyond 2020. Evidence in Services Marketing: “Servicescape and Servuction System, Importance of Process in 1& Vertically; Variety in Service Process, Vale {Yall-2: Role of Process, People & Physical Process - Service system - Service System, ‘ceo; Service Blueprint; Mapping the Process-"Horizontally sidition it Proces’. 1 Key. toa service Marketing: PaspleDim in Services Marketing; Service Ene in Service Situations; Service Profit Chain; Service ‘Culture Evidence to the Service Understanding, Managing the Ph ical Beople; Céntect & Low-Contact Services; Emotion: ence- Contribution of Physical E itn Sexvice Marketing. saan E aiiaging Consumer Behaviour & Service Quali sumer and Organisational Behaviour in Services — Ttesodlag Our Customers & Collaborators in “Secvices; Stages of Service Consumption Secvice" Quality-"Levels'& Dimensions; Service ‘Quality Models: - ServQual, GAP. Msiel. dnd Critical Incident Model. Managing Demand and Capacity - Capacity Constraints, it Demand Servite “Irapact of Service Failures, Ne SL yemrsapeavi to she New Paradigm and Perspectives: Customer as the Centre of Attention; Services as Key Differentiators; New Service Opportunities: Emergence of Work from Home, Automation & New Technologies in Services; Service Marketing Opportunities in India. = of Service Marketing: Marketing in Tourism, Retail, Hospitality, Airlines, Telecom, IT & ITES, 08 intértainment, Logistics, Health Care Sector, Event Mana; ices ané Banks 1 Sector, Non-Profit Organisations. onUnit 1: ServicéMarketing-Ah Insight into Emerging Sector _ Of Economy Seren n Meaning and Definition of Services n Nature’ Services Chameteristics n Distinctive = Charmcteriticg «af 11 Service: (Osher Characteristics of Services 13 Key Cisgsification of Services 3 Semice Continuum 4 Significance of Services 16 Difference between Goods and 17 Sercen ‘Service Marketing Mix 18 Introduction 8 ‘Traditional Element of Service 18 Mixit P's of Marketing Extendes! Masketime Mix for Services 18, Ekement: of Extended Marketing Mix 19 Need for Execnded Marketing Mix 20 ‘Blement mn Services Services Marketing, 20 Introduction. 2 Need to Stuty Services Marketing 2 Fectoss Influencing Services 22 Armportance of Secviges Marketing 28 ‘Services Marketing Challenges 2B Eyolation of Services as Value 26 ‘Consribstors: L& “Service Sector Beyond 2020 25 141. Tatroduction 3 142 ‘Indian Perspective 26 143 ‘Asign Perspective a Lae, Global Perspective = Unit 2: Role of Process, People & Physical Evidence in Services Marketing a. Service Process Fol 21.1, Introduction 3 212 “Types of Service Process u 213 Steps for Managing Servic 35 Processes 2h Service Design 37 L141, Service Design Standards; 38 ‘Standardisation Zid2. "Herd Measures 38 2143.‘ Soff Measures 38 L144: ~ Elements of Service Design o 38 2145. Tools for Designing Service 39 Processes 2 Contents 2a, asa, 2452. Ds, 246.1 2162. 2163. 247, 2534. 234 255. 2554 2552 256. 26. 264 262 2.6.3. 2.6.5. Mapping the Procece Mapping Proceee Vertically Mapping Process Revstonnally “Understanding Seivice Protest ‘Variety in Process Valve Addition in Proweee Trek Atlecstion Immortance of Process in Service Services System Inwrodvction Componente of Strvicts System Prom-Office Interface Rack Office Interface Opersiyone Syetem Service Delivery Systent Servce Marketing Syetems Servoction Sytem Service Bineprint Introduction Components of Service Blueprint Process of Service Blueprint Significance of Service Blueprint Servicescapes Intredoction ‘Types of Servicescapes Role of Serviceseapes Experience Servicescape Elements: Servicescape Framework Architectural Elements. Behaviours in the Servicescape Internal. Responses, =... the Servicescape Virtual Servicescape. People: ‘The Key to a Service © Marketing Introduction People Dimension in Service Marketing Importance of People Service Encounters People as Part of Service People as Representatives of the Firm People as Marketers High-Contact and Tow-Contact Services Service Profit Chain [Links in Service Profit Chain Importance of Service Profit Chain motions 18 Service Situations Service Culture Ieteoduction Elements of Service Culture Corating & Culture of Service Importance of Service Culture ‘The Services Masketing Triangle Variants of Service Marketing ay 2 a a2 a a 4 SSSSRART274 274. 275. 28. forcrnat Marketing Eaternal Marketing Interactive Marketing Service Physteat Evidence Introduction Contribution of Physical Evidence to the Service Understanding: Importance of Physical Evidence in Services Elements of Physical Evidence Methods of Providing Physical Evidence ‘Managing the Physical Evidence in Service Marketing Exercise 15 16 Te 7 Unit 3: Managing Consumer Behaviour and Service Quality Consumer Behaviour in Services Introduction ‘SC's of Service Marketing Company : Understanding Customers Competitors Collaborators in Services Climate ‘Search, “Experience and Credence’ Attributes (Elements of Service Quality) Narure of Consumer Behaviour in Servicer * Factors, Influencing Services Consumer Behaviour Stages of Service Consumption: Customer Decision Making Process Pre-Purchase Stage Problem Recognition Search for Information Pre-Expericace Evaluation ‘Moment of Truth: Service Encounter Stage Evaluation of Services: Post-purchase tage Post-Experience Evaluation Customer Delight ‘Consumer Satisfaction Post-Purchase Disscaance Service Quality Tntroshiction to Seevice Quality Significance of Quality in Services Categories of Secvice Quality Perspectives of Quality Levels of Quality Improving Service Quatity Measurement of Service Service Quality Mode =) CS? 80 is. ative a ootts z) “33: 333. 3334. 3532. 33332 334 334 3342, 33.43. 3344, 3345. Iss. 335. 3352. wa Bate 342. 34.2. 3422. 3423. F424 Targeting and Pos' 41 1 Gap 1. Customer Expect 1 Generatiog Critica inciting 1. Demand Variations Serviee aires Reasons of Service Faihre Types of Service Fadore Dmpact of Sernce Fuikrss °° . 12g Behaviour ‘Nature of Complaining Behavior Complaint Resoistion 5 Guidelines for Compact Reson Service Recovery Services in Modern 7a ‘Strategies for Services Markesoe443, 44a, 44.5. 446, Introduction Services Market Segmentation Requirements for Effective ‘Segmentation Bases for Segmentation of Services Process of Service "Market ‘Segmentation ‘Target Market Bes of Targeting the Identified Segments Selecting Target Markets: “Approaches to Target Marketing Positioning of Services 4 Steps in Developing Positioning Differentiation of Services Techniques «> for Service Differentiation » i Factors Involved: in» Service Differentiation Managing Relationships in Services ‘Managing External Relationships Managing Internal Relationships Customer Relationship Management: (CRM) Architectural Elements of CRM. Role of CRM Process of CRM Advantages of CRM Disadvantages of CRM Ways of Maintaining Relations with Customers Importance of Managing Customer Relationships Services Marketing Triangle Introduction Variants of Triangle Internal Marketing Strategies for Internal Marketing Relevance of Intemal Marketing in Service Business External Marketing Strategies for External Marketing Essentials of External Marketing ' Interactive Marketing ‘Activities of Interactive Marketing Quality Generating Resources in Interactive Marketin Relationship Marketing Tntroduction Evolution of Relationship Marketing Relationship Development Strategies Relationship Challenges Importance of Marketing Service Marketing Relationship _ Current Customer Retention 135 135 136 136, 137 138 139 140 141 142 142. 143, 143 143, 144 144 145 14s 146 146 147 147 148. 149 149 149 150 151 152 “133 45.1 452. 453. 454. 455, 46. Building Customer. Relationship | 153 ‘Through Retention Strategies‘ Lavels of Retention Strategies 155 Relationship Value of Customers 156 Characteristics of Customer Value © «157 Classification of Customer. Value 157 Measurement of Customet Valle. 1158 Customer Lifetime Value (CLV) 158 Small and Medium Enterprises. 160 (SME) Meating and) Definition (of Small 160 ‘Scale Enterprises 8°75 49 Charactenstcs of SME 161 Scope of SME "S018? 362 Rationale of SME i “162 Service Marketing, Strategies for’ 163 Small and Medium» Enterprises: °°? Importance and Challenges Exercise we 165 Unit 5: Marketing of Services saz. 5A22, 55. 5.5.1. 5.5.2. S521. 55.2.2. 5.6. 56.1. 5.6.2. 5.6.2.1. 5.6.2.2, $1. New Paradigm and of Service Marketing |. New Paradigm and Perspective (167 igms in Services Marketing . j,\ (167 a Process . 167 Doing Right the First Time 5 168 Speedy Response .¢. 168 Customer as the Centre of Attention «5169 Services as Key Differentintors. .j :170 New Service Opportunities; am Introduction am " Emergence of Work from Home m ‘Automation and New Technologies 172 Service Marketing Opportunities in 173 India *F ~ Applications of Service Marketing: 175 Tourism Services 115 Introduction 175 Marketing in Tourism Services 176 Market Segmentation of Tourism 176 Services Marketing Mix of Tourism Services 177 Retail Services 180 Introduction 180 Marketing in Retail Services 181 Market Segmentation in Retail 181 Services Marketing Mix of Retail Services 183 Hospitality Services 184 Introduction 184 Marketing in Hospitality Services 184 Market Segmentation of Hospitality 185 Services Marketing Mix of Hospitality 187 Services Telecom Services 1885.1. °°. “introduction: 1188 372, Masking in Telecom Servis 188 SI Market Segmentation of Telecom 188 angsty” i # Foeeing Mix of Telecom Industry | 159 ‘sielines Industry “190 + “tauceduction: © 2° 390 ‘Maiketing in Airline Service 191 ition of Airline 19% casket Sezment ‘Services > Makeling Mixiof Airline Service s822h0" go. ° IT@ETES 59), Inteodctiod Son! °° Marketingin P&TTES ~ se. Market Segmentation of TE ITES Zo22e Marketing Mix of 17 & ITES Bio, eSports and Entertainment Services 10.1; Introduction S10a c High Tangible elements sroods) ‘Automobil a Oesre or angsty 1 dere ortagtny Dog food Necktie a High Sait Figure 1.1: Goot-Service Continaum All the three positions involved in goods-services continuum, ate described below: i 1) Standatone Service Products: These arc the’ services tlt the consumer buys because they’ 6ffet’ some expertise, Here the expertise is referred as the standalone service (like psychoanalysis) offered by such Services. Such people-based services are on the intangible end of the service continuum. The need of such services is increasing day by day as people are having lesser time to perform their daily tasks. There is also the emergence of self-improvement services like, spoken language classes or personality grooming classes, Ii large cities even services like professional do, walkers ‘are bécoming very popular, Individualé also ‘engage someone to help them with their legal matters; their tax filings and even to repair theit’ car, lecttonie gadgets, ete. £ ‘The. manufacturing firms (which earlier were engaged in offering products with only supplementary services) are now developing and redesigning their core potential to offer standalone services. As per theit expertise they are offering new standalone services to the public, For example, IBM was initially knowg as a manufacturer of computer and hardware equipment. Now they have four business verticals vic. strategic outsourcing, business consulting, integrated technology. services ‘and maintenance as standalone services. 2) Service Products Bundled with Tangible Products: In this category, both goods and services combitie to form a complete product. For example;'restaurants, and hotels are placed in middle of the continuum, as they use goods (e.g., expensive crockery) nil services (e.g, skilled manpower). ( Other fecility-driven services such as museums, miiltiplexes, z00s, amusement parks, eté., involve following three factors: i 7 polite }) “Operational Factors: Effective utlsitioa of different technologies should be practised so that customers, ‘Teel delighted while using services. A proper set of instructions and indications mus be provided to guide ‘customers about using the service. This may help the company to reduce their waiting time,jices are commonly purchased services, ‘peational Factors: These serv! ay par crvices, .8., ATM, iy ocational Mays an irapotat ee ashes Srvices are provided at partic re) retain i Cavironmental Factors: These are storefrdht services where cosoers vg eye”, EHS impor ticular: place shouldbe attractive ‘Place fy * environment of that particu TOU to appt Pdnformation E: ane, ‘banks must provide an elegant-and sophisticated appearance, advance motloped coun services, etc, (0 their customers. Sg ~ tig, of communict et lefinitions of di ; 5) Goods Dominated Products: These types of produts ‘cb tangible in nstute and at ng, ecrs at | supporting services. For exam ple, one month warranty of foll-ree services are mash | seereiny to increase the Value ofthe product. The strategy Of associating the suppeing y ta \sophiatcation ‘main product is called ‘embodying’. 4 s]sommunicato bodying is used by IT industry, where companies use this strategy to enter ny Pdi ee ocsied with low-cost products having inappropriate user-puidance. "* Steal face a dra 6. Differ 1.1.5. — Significance of Services wit cisalotofdi The significance of services can be understood with the hélp of following points: dus signfican nifleance of Services nating and ca j ¥ aple, food, bc igble exper fan Trend in the Disposable ‘ | aentag > Updo in he Dis Taecuing Speciation fines, ans vee aad fines, rela ‘Changed Lifestyle Timproved Literacy Rate oe r ase Rate Point of Differ fessionalism in Education _Restahahl 1 Profe uli Edy Information Explosion. : ! : Tnspartl Sophiatication i Market 1) Upward Trend in the Disposable Incomie: Since. fast, ten years, the Indian customers a eh Taeonslt upWifd trend in the disposable income. The: tratisforiniation of economy is resulted due to drelogne (> €ofporate sectors. If there are many job opportunities.for an individual, it will offer higher ch earning fo masses and as the earnings will increase,,it.will result in more consumption, Ths, cet disposable income is resulted due to the positive,developments in the development secs. Tei prompt increase in the demand when someone has an inerement in his income irrespective of he ily 2) Inéreasing Specialisation: The current era is of specialisation where perfection reccives the arprogt focus, The increased specialisation results in higher sophistication in the process of eoit-F apie ‘transformation. There is an increased level of technological advancements in the industrial economies a is obviously resulted due to higher necd of specialisation. For hi ig the cost-effectiveness, most of Tirmectnte! organisations are bound to improve on specialisation, ‘The organisations are approaching sect almost every activity. In the management of an organisation, the roles of experts and professionals ile ‘management consultants, legal advisers, financial experts, technocrats are highly significant. Davey” 3) Changed Lifestyle: There will be a noticeable chine in the lifestyle due to the development ef om « ‘culture and development of potent service sector. Thé fashion will be soon converted into an indus the impact of internet on various aspects of life. As the health consciousness will be promoted, tee yy Services like hair dressing, beauty parlours, jogging and gym cettires would be facing 2 good gr" 4) Improved. Literacy Rate: The literacy tate especially in the backwatd arens of India is ae ma _ Significantly due: to education ‘mission adopted by government of India. This makes the consboe * “aware, knowledgeable and sensitive about the services which they are consuming, ‘5),, Professionalism in Education: HI the is 4 ole fesslonalism in Education: All the organisations, whether they produce, product® wl svete bighed priori we advetopmiett of Magn tesa Hower © Wilb the foot oF atthe corpora id this 18 nt accomplished ‘withouti ice Marketing-An Insight into Emerging Sector of Economy (Unit 1) a orientation in the organisation. Most of the population will peruse the professional education‘ : Fa 2 D Pe ional education due to the Information Explosi Josion: Lot of attempts ed ira ] ttempts are made towards creating an informati . developed counties, The information explosion is resulted 1g an information super-highway by the mmunications. This is the mai ! by a lot of innovations and im vay OY of communiations, Thi the isin reson bshind conversion f late ine ‘global village, The new f 's are written in every dimension of village. The new sommunieat ) of the business fae 7 ood aon Almost all the sectors of the economy are influenced peer troeteron aie in satelite istication in Market: The sophii ir nication explosion atte " sophistication in the markets i : “omnintmnication services wI " sis created b ; SSeS es Taree eae ty eae ; : ing co the one ; tions, vill face a drastic change. ig (0 the products and services which are demanded by the customers 6. eee between Goods and Services cis alot of difference between goods and services and it i us silent fees Goods refer to tangible items svhich ean be tucked and emonstateds they ae ating and can be traded or exchanged. Thus, goods are material, can be taken away and can be stored, for | books, fursiture, household appliances, industrial objects, et. Conversely, services refer to hotel and hospitality, legal and medical advice, banking and insurance, health ete. It is important to note here that these services cannot te stored uired to offer such services. These services render feeling:of ple, gible experiences such as, itness, transport and communication, here and additional personnel ere req ness, relaxation, fulfilment, aid, etc. oint of Difference | Goods Products ‘Services Perishability “Fhe goods can be stored for along time and | It is not possible to store these services. They most of these are non-perishable. occur only when availed." Tnseparability “Rs the goods are firsily manufactared, then | Tt is difficult to separate these services from the Supplied, sold and used: their identity is | provider. A lot of variation can be seen in tse distinct from the producer. services in. terms of quality, delivery, time, 2 results, etc. Fhe inconsistency tn the quality of the | There is a Tot of varaton in the eerices, The Inconsistency rey of the manufacturer. It | variation in quality comes on the bast ofthe Boods comes cfanturer, who. can ensure | service provider, ime and place of deli. Consistency of the quality: for any sor of Givergence from the standard form, the manufacturer is to be blamed. 2 Tangibility rer hasng of goods is acquiring a matenal | Purchasing 2 service 7g acquiring an intangible ear aror example, buying a music system, | experience, For ‘example, beauty services by a ‘or a mobile phone. saloon. Reliable “The quality of goods is more important than Reliability and dependence dependence or reliability of the dealer. in services. re seas wo be spent only on manufaccuring | Servers 2° ‘ime-consuming activites, Time fa pero poate | Bownible to provide the services witiout The goods Once the goods are produced. it J poms’ aa ae inarketcd repeatedly without | Invesung SNe play significant roles Time-intensiveness ‘ordered phone, bould be as ou “Fhe time of delivery of the services should» rE rebaite or email, the delivery thoud Pio be | per the will of te customer, though the delivery ae cr pr the preference of the customen, | Fe TF, vary. The major difficlty standing 12 Pet On Paetfom a real store, the | front oF the marketing executives is to conviee On Dayne purchase the goods, and can) Ie Me etomers that the quality services WOM Sout win the dosed items. delivered within the specified ime es = i eis not possible 10 purchase the serve ae Pe cca ere nats inipulsive manner. Pro passing ont Hare lad a Fespecive, | analysis occurs before Porc ces. cess ol eo ycmample, house cleaning Servis prove of ninenier ne 72 Fe fo marketing of we serves OY ON 8 ++ | options fike, ‘delivery time as per your convenience’. Desires and Requirements18 MBA Third Semester (Services Marketing) SPPU 9) Agsociations The marketing of the goods is lew dependent on establishing the relationship ‘withthe customers. "The wading of services comes out of tabling relationship withthe cent To) Exchange Tt is potsible 0 exchange the purchased | Tis not possible wo exchange the services. goods 1), Elements ‘Markciing of goods need 4P's of marketing | Marketing a service require 3 more P's 10 he mix, those are: Product, Place, Price, and Promotion, Conventional "4 Ps": Physical evidence, People and Process i SERVICE MARKETING MIX 1.2.1. Introduction pega 4 Ve Development of a services marketing mix becomes very difficult due to the unique and distinct features of services. Tangibility of products enhances the ability of the customers to make a purchase decision regarding a product. This is due to the fact that the customers can actually feel, see, smell or even taste the products. « utydue! tothe: intangibility of services, it becomes the responsibility of the service marketers;to enable ccuslomers to picture the services in their minds. Application of the principles of service planning, .product, ‘price, place and promotion in the manner’that best fits the nature of the service provided, can-prove to be Thelpful. The main focus here is the satisfaction of customers, just like it is with products. Generally, marketing mix is a combined term for marketing components used by the organisations. s0 as to develop their overall marketing strategy. It is also called as 4 P's of marketing, i.e., product, price, place and [Bromotion. It is also called traditional marketing mix. But with the advancement of the service sector, the ‘Concept oF services marketing mix has emerged including.7 P’s of marketing, i... additional 3 P's (people, ‘process and physical evidence). Thus, marketing mix for services can be said to an extension of that for the ‘goods, as it includes some more factors. : ‘According to Borden, “The Marketing mix refers to the appointment of efforts, the combination, the designing, nd the integration of the elements of marketing into a program or mix which, on the basis of an appraisal of the “Blarket forces will best achieve an enterprise at a given time” ‘According to Stanton, “Marketing mix is the term used to describe the combination of the four inputs which ‘constitute the core of a company's marketing system, i, the product, the price structure, the promotional activities and the distribution system”. s Marketing of the services is that part of the marketing, where organisations are interested in establishing an ‘enduring relationship with the service customers. As the selling of services is much different from the selling of {G00ds; its marketing is not an easy job, Therefore, to support marketing of services, a distinet‘and effective marketing mix is required. Here, alongwith using 4 P's of marketing, 3 extra marketing components, ie. ppedple,' process and physical evidence, are used. These added elements are called “expanded” and/or “uginentéd marketing mix”. Tien: en . " 1.2.2... Traditional Elements, of Service Mix/4 P’s of Marketing aed In oder to Satisfy, the needs and requirements’of the target customers as well as to Fulfl the objectives of the ‘Organisations, ‘a defined set of marketing compornts’is used, which is called ‘traditional marketing mix (4 P's)’. The elements of traditional marketing mix are: 1). Product, 2). Pricing; 12.3. Extended Marketing Mix for Services. ‘Tehas been found by the scholars that a different approach is needed for the marketing of the services. Tt has ‘been suggested that 4 P's of the traditional marketing need to be extended for the marketing of the services. With the advancement of the services, the additional marketing components (ie.,.3 P8)-are Jncluded in the ‘marketing. This is called extended/expanded/augmented marketing mix. nt 3),,Place/Distibutionvoture OF marketing the approach was made stronger by including 3 more P's, ie., Jationship between different elements of marketing mix is paren mented HRUREUN HA er HHE Re GUD en the idea of 88 have given the pone a execution i BNET sical evidences The se, Process seputed in table 11. ‘Table 11: Augmented Marketing Mix for Services " Tae Prost Physleal Evidence er ing Flow of Activities Facility Dest; roplayees internal Market 18) + Standardised = Aesthetics, : e + Resesting + Customised & «Functionality: ” 7 + Traising “Namber of Steps ‘© “Ambient conditi Pea + Simple + Equipment sy ee © Cofplex © Signage ue + Employde dreds ‘Comomers (External Marketing) Level of customer involvement ‘Other Tangibles| Binsin + Reports «© Triting © Business cards ‘ Communicating ‘© Statements . + Cau ad Vales + Guarantees! Employee Research : ‘oooth, anys of the added 3P's of the marketing mix is often carried out separately; yet, they are smoasted elemens in the process of marketing management. As per the requirement of the marketing plan, the can ls be combined with the other elements ofthe marketing mix, like communication and dstibiion. 1231. Elements of Extended Marketing Mix ‘The extended P's of service marketing are as follows: 1) People: Inthe field of service masketing mix, ‘people” are referred to as both the service personnel as well asthe customers, because in some cases not only the service personnel but the customers are also essential for dlivering the service successfully. For example, in the field of education, students (customers) should also cooperate with the teachers (service personnel) in order to make it successful. Similarly, in many other service fields the cooperation of customer is very important for availing the services. Services are mainly based on people, as employees and customers share a direct relationship with each other. In service orpssisstioas, employees play a vital role in carrying out marketing activities. According'to the theory of intemal marketing, the employer must use marketing research, market segmentation, and old-style rurketing activities, such as, advertising, sales promotion, etc., in order to attract service personnel and make them perform in desired manner. te] 2) Process: Process refers to the manner in which the activities are originally performed and the steps that are undertaken to perform such activities. For last few years the study of ‘processes” is being given the due consideretion, especially in the field of computer programming, manufacturing, engineering, etc. ‘Process’ tas set up some innovative improvements, such as, ‘lean production’ arid ‘just-in-time’ in the field of ‘Production and manufacturing. In the present times, the importance of process is getting recognition even in the service industries and also becoming one of the core competencies of the service industri 3) Physical Evidence: Physical evidence of a service can be seen'in various aspects of the service, such as, physical features of the place where the service is to be delivered, usefulness, design, and environment of the locaton, te. In other words, everything that an organisation physically demonstrates to the customer is referred to as the physical evidence. Physical evidence consists of physical atmosphere, interiors, and ‘exterior of the outlet and all the tangible items (eg., furniture, machinery, equipment, stationery, Signboards, vehicles, centficates, communication equipment, service personnel, receipts, etc.) Customers readily anticipate the quality of service on the basis of tangible ‘signs which are provided by the physical ‘evidence. The tangible envizonment not only supports the service provider but also the service consumer in the process of service delivery. Since services are intangible in nature, so before paying for them, the Customers usually assess the tangible signs, physical evidence, etc., for appraising the service and for Anticipating the level of satisfaction that they may derive during and after consuming the service.MBA Thitd Semester (Services Mathie aeing An 1.2.3.2.’ | Need for Extended Marketing Mix Elements in Se 2. Nee vices ers to appeal ( Marketi nix is'not derived from any philosophy, but itis developed to assist the marketing manage ea pon viding ike task of decision-making in several small decisions, The general 4Ps (product phee lara fe | : Promotion) involved in marketing mix ate determined as per the needs of the manut rer ‘Theestaurant ma ‘Were fot sufficient for taking the decisions related to the services, Se Th tet. ‘Some problems that rhinimised the effectiveness of 4Ps are as follows: vith the ma 1) The main reason behind the failure of 4Ps in ease of services is that none of them gave iesighy £ Pith intangible elements of services. The product element of marketing min is suitable for ie tea OM™ le nature, but is not appropriate in case of services. Tn the same way, the place element f tad gece, marketing mix might not be suitable for service industries. ae thing 7 2 Physical goods are generally produced away from the consumer, 50 there is no direct conte; Producer in the promotion activities of goods. This is why the promotion element of standard 4s following k ‘execute the promotion of services because in service industries promotion occurs at the oj, Itisamana ‘“consuniption of service and is done by the producer himself. Promotion of service is directly depeng, Itis an orga the delivery of service, e.g., hairdresser, bank, ete. Tis a social 3) Price component of 4Ps ignores the reality that most of the services are created and proves 8220*t goverment, non-profit organisations, etc., without charging any price from the customer. 32. | Ne Service miirketers believe that the traditional marketing mix is not sufficient for marketing of service teed 0f Jeads to several efforts for redefining the mix by adding some more elements in it. ve Booms and Bitner added some useful clements in traditional marketing mix to make it more approp ‘m2 service sector. It must be noticed that this theory is not an outcome of any experiment, but it comes fo study of several decisions taken by service personnel in order to satisfy the requirements of customer} Optimum the importance of additional components, i.e., ‘people’ and ‘process’ have also been acknowledged, eel use/misus Physical evidence, the 7" P, had also been introduced by Booms and Bitner. Recently, professor Lovélo St*Vice 5 ‘added ‘productivity and quality’ as 8" P. Improvement in the productivity of fundamental services comrollin tganisation is very essential for effective cost mangement. But, simultaneously quality of the service "SS f the customers should also be maintained in order to distinguish the service from the services ob Opening viders. Long term durability of the services depends upon the customer's perception about the qu ; ri t f\ process d i service, It i8 also found in research that an effective production process helps an organisation in deli of servic ij better quality and standard services to their customers. 3 the gainf i i Raising @ 1 SERVICES MARKE aie i ote et q ee pestis iy : society i i 1 Introduction. designe Service is provided by seller to buyer in exchange of money (economic activity) but it does not provid the deve Ownership of the, services provided to the buyer, only. values are exchanged. This is the feat yy vi distinguishes services from physical goods. at : Making According to, Philip Kotler, “A service's an act or performance that one party can offer to another Wving ‘estenlallyindingible and does not result inthe ownership of anything. Its production may or may not bet ipeually sneangiol e L *) Eeo-Fr a piiseal proitiet”, ‘ rs realised : Pere tua isi “‘Aveordltig to Zéiehanal and Bitner, “Services are deeds, processes and petformances”. aa rege \ Thowg étvices marketing is marketing 'based’oh relationship and vahie, It may be used to market a Service ge tec ‘product also, Marketing a service-base business is different from marketing a goods-base business. Se ig is & form of marketing that focuses on selling services. They can be tricky to sell, and the mars ‘approach for them is much different than the approach for products. Some companies offer both product serviges atid must use a mixture of styles; e.g., a store that sells computers also tends to aleo’bielp people ‘coinputers and’provide computer repair. Such a store must market both its products and tlie? i i |"Sever Matai Teja me owrng Hermon Fromm 1) ” [otters so appeal se rents, Wher mente tive ates, the nen et Abe eines to byw pro ier wo pe preps tn de enone: wth» petienter eam, when Mh mec Iaeation Por html, & rcirmane offen « serene crows fe th ematen, Ith ofie i ip topo fran Hr mhy see ey rove rome ft ser ene ote en Hs prefers ther reetmirate we Sie Pai bs meets Gees ‘with the meatoing of peewee Hotline Ewen HeonteeIfke what fe Retny Pema, ah he — Teor © eames itr ings. 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Provionsty. they served ihe local contimenity Moreover, there was sc ated er employ onirteting experts it these firms at competition was sot mmc. ‘operation size weat leita and they served only focal sommanity 2D. Restrictions by Rewulatory Radler: The working of wversl vervice providers were limited by the regatitory todics. At present, ccsrictions are impieed hy the regulatory Sodies for curbing the quantity mod thet kine of advertising. especially in arena GF medion? me legal profestions, Rules and regulations sis curb (Ow trade activities of the chantable services wil the gublic sectors, 3) Expansion of Service Sector: The expansion of she service sector lke banking, hospitality, sortams, cf. hat led to povel ideas of marketing Novel reeboologies and thoughts are provoked with the advmcement of the service sector Marketing 18 responuble for advancement an achievernent of sereice aectors in severe Feapects, The service eector 1 designed fatty 12 per the aceds of the constimers; itis catering to the acts} ‘peas of the market and net tothe perseived iteas about the saaie. 4) Features of Services: Depening spon the features of the services mich et intangible, undividable, heterogencous and perishable, the masteting strategies tave to be devised. Based on these: variations, tbe aworted market untepics bave to be placned by Mighlighting those features which ate considered. be significant by the consumers. 4 5) Cuntomer-Employre Interaction: { the marketing of services, it is much lenportent to;establich: good Frlatccahlp with the cuttomers, Heace. sodt skills and Business, etiquettes, play. role narketing of the services. A. few move related concepts. which, have, come out are relationship. ‘tamteting and internal marketing. These ideas are. widely accepted in tho aod re alto eaed beyond marketing of the secvicen, oF 6) Service Quality: The quality of the services and the programmes for teadering quality wervices alto play 3 srecial role in services macketing, The markoting of the tervices Aas inid emphasis of improving the quatiry of the services based on beter understanding: about what is considered to De “yhallty services’ by tbe scutorsers. . 7) Particular Service Sectors: Recently, a tow particular tervices have attracted she interests of marketers, apecifically the professional services and nonprofit ofgumaauons. Moral valuex ast geumerpien are ‘sontidered vital in thew sectors, Even Wome publ tector also Tiave such wbligatsome Trent sernice weczoes have Nlowristed by stopeng the market strategies devised by (he experts 8) Brand of the Seevice Provider: Sometimes, what the customers ars actually looking for it the “brand” Bese? organisation 9 comidered anporunt for the customers ad Drand Seipk at creating Drand loyalty. 3) Accesibitity of Place and Tone: The ineraction with the customer plays 4 vital cole in marketing of the services, f (2 tds moval uy oF the Yereice provider Wo pravide the given KAVivES Ip the CMeRNET a8 per River desire toabsiey 20 do a0 may Kea to lowing the teuat of the caters RO: mighE resort ID Somme,Service Matkétng-An Insight into Emerging Sector of Beonomy (Unit 1) B 10) Customer Participation: This factor should be given due importance by all the firms while matketing the services. Only by involving the customer with the ‘service organisation, he/she can develop a sense of belongings. However, the amount ofthe participation by the customer can vary depending upon his/her past ‘eipetiences and personal choices. Hence, while marketing the services, this factor should be given due importance. 1.3.4..... Importance of Services Marketing =. ‘With the emergence of education, healthcare and software consultancy services, the service sector has achieved 1 significant position in the economy of the country. Therefore, itis crucial for businesses to have a department for the marketing of services. It is not easy for the organisations to market services, Service marketers must be ‘expert at attracting potential service customers towards the, service organisation by utilising all the 7 P's of the service marketing mix, Followitig points highlight the importarice of service marketing: “+ ' 1)" Helps in Bullding Relationships: Service marketing results in building long-term relationships with the target customers. As there is no tangible product with service matketers to offer, they rely on undefstaniding the needs and demands of the customers and fulfilling them through concerned service offerings in the most effective way. In this way, a trust and loyalty is developed within the customers for the service organisation, ‘which results in long-term relationships with them. These relationships help in generating repeat purchases 4s well as word of mouth promotion, 2) Assists in Affecting Customers’ Perception: A iumber of interaction points are designed for the target Customers while offering the services, The overall buyiig process of the customer is influenced By the cumulative effect of these interaction points, i.e, people involved in delivering the services, the process:and ‘methodologies used by such people and the surrounding physical evidence. These interaction points help in affecting the perception of the target customers. 3) Involves Customers’ Feedbacks: The marketing approach of services is quite different from that‘of the tangible products, as consumer plays a significant role in the marketing process. Here, the custémers’ Feedbacks are invited and studied so as to improve the efficiency of the service marketing. In this way, sirong relation is developed with the customers and they become loyal to the service organisation: 4) Helps in Differentiating the Service Organisatioh: Sérvice organisations offering similar serviceb/products to the market are efficiently differentiated with the help of service marketing approach. Service matketing helps in highlighting the quality features of the services offered by the organisation so as to make the service organisation preferred over the competitors. For example, itis the service marketing ‘because of which people differentiate between the Domino's and Pizza Hut as both deliver same product. Sf Offers Higher Cistomer Retention: In today's world of cut throat competition, the marketers are t0 fish "out the limited customers. In such a scenario it becomes more important to retain the customers, insteat! of attracting the new ones. In service marketing, the custoniers’ neéds and feedbacks are analysed s0 as {0 deliver the desired services. Therefore, customers are satisfied by offering the customised services and it results in higher customer retention: ‘ ait 13.5. » Services Marketing Challenges Marketing of services has certain inherent difficulti¢s. ‘These are as follows: Services Marketing Challenges Marketing Intangibles Tiniaalalng Quality Developing Trust |_[ Extra competition ‘Creating aNeed Instead of Features ‘Momeitiim between Passion Marketing and SalesMBA Third Semester (Services Mag, irketh Servi intangible i . Wt be seen, or fel. ting Intangibles:, Services are intangible in nature, They cann jae in a state of uncertainty when they buy a service product because they are not aseele service that they will get. It is very difficult forthe buyer to have a concept and asses the serving “offered by the service providers. It becomes veZ) difficult for the service provider to control the qua, the services and the strategics for its pricing and promotion. Both bayer and the seller experience difficulties due to intangible nature of the services. The matketngh, «different from that ofa product as the marketer has to describe an intangible product and the buyer uses five senses to evaluate the service, Therefore, the matketers find it challenging to visualise the benef, services tothe buyers. Buyers also face difficulty in determining the value for price aspect of the serves, 2) Maintaining Quality: Its also very difficult to assure the quality for a service as it is often produced, ‘consumed atthe same time. I, therefore, very difficult to measure the service quality unlike a produ the case of a product, the manufacturer is able to test the products in simulated conditions before releasing: the market, There is a stage of quality check where the product is scanned for any quality issue. Therefore, necessary improvements can be installed before the actual launch, However, in case of services, itis» challenging to maintain the quality ofthe service as itis produced right in front of the customer. Developing Trust: Developing trust is also a challenge for the service marketers. The customers only} services from a particular service organisation, if they have trust in it. No matter which services are oft by the service organisation, customers select it only in case of having faith in it challenging task to gain the tnist of the customers. For example, a person selects an insurance poli if the insurance agent appears trustworthy or the instrance company has a clean image, no matter} tractive the claims are, Therefor, it becomes very difficult for the agent to gain the trust of that perce 4) Extra Competition: Another challenge for service marketers is that service organisations often haw compete with their own prospects apart from other organisations. For example, fora service organise Which offers accounting services to different small businesses, a prospect doing his accounting on his isa competitor. : 5)” Emphasising Service Instead of Features: Most of the service marketers foctis on: ‘elaborating thie feex of the services apart from describing the actual servict: It is a challenging task to describe the selviée Cjfeced to the customers. For example, in order to market the insurance produit, the agents often p claborating the benefits attached to i like frst accident forgiveness, multi-car discount, ete. Howevest red to assure the prospect about the timely assistance and proper execution of the policy provisions fi challenging job, © Creating a Necd: Another crucial challenge associated with the services marketing is that a need ist Sie for the services. Sometimes, i becomes essential forthe service marketers to generate a ned fa Terese hey offer as generally people do not undetstand their need, For example, generally peoye ‘understand the need for personality development. Therefore, the service murkelee hee ty onc ¢ ‘ealise the importance of personality inthe current era, It is not an easy tsk for the server ken 7) Passion: Another challenge associated with 3) ‘Therefore, it j a ‘sential for the service providers to maintain an adequate Of commitment and passion among staff members for providing quality services. Momentum between Marketing and Sales: 8) and sales of the service organisation is a very here, in case of services mark 13.6. Evolution of Services as Value Cx 5. ‘ontributors Tae get century, the crea concept of value generation hes ten dbfned by the wel-known eet ‘Adam Smith, He represented the concept of valuc generation in his theory as: Production —» Tangible Output —+ Value generation Service Marketing Therefore, he manufacturing ‘consumption J dismissed by ‘generation are When no tang generation, Hi another famou Even til the ¢ society and ec value generatic At present, se economic dev several service onis essential Media service keeping tillio development. ‘more consumy ‘Undoubtedly, Rather than « standards, ‘The number consume mor ‘watch TV onl goods, there s There is a si productivity ‘agriculture. W agriculture se different spor ‘The very con capita service Countries and % ‘This kind of services secto the country, 141. In ‘The COVID- chain of serv inputs for ou two-thirds of of the employ 40%. In addi MSMEs ope: chains of ser‘Service Marketing-An Insight ito Emerging Sector of Economy (Unit 1) a Therefore, be implied that the tangible outputs that are used by the customers are produced by ,the manufacturing process of goods. And when the obvious or latent needs of the consumers are satisfied, consumption leads to the generation of value. The role of services in the generation of values is, however, dismissed by Adam Smith. He strongly claims that services do not lead to value generation as the services generation are unproductive. When no tangible product ownership is transferred, then it is quite difficult to explain the concept of value generation. However, in the late nineteenth century, this concept of the role of services was corrected by ‘another famous economist Alfred Marshall. Even till the twentieth century, the confusions related to the role of services sector in the well-being of the society and economic development continued. Customers, today, know that both goods and services lead to value generation as both of them satisfy the various needs of the customers. At present, services sector is considered as one of the important part in both well-being’ of the society and economic development. Today, services consumption is considered necessary. For example, consumption of several services such as civic seryices, education, entertainment, tourism, communication and transport and so ‘on is essential for the economy. f Media services and event management including global cultural and sporting produce immense profits by keeping billions of people spellbound and significantly contribute to the hosting states and country’s economic development. Consumer concentration is therefore, shifted to greater consumption of services from more and more consumption of tangible goods like clothes, bigger houses or food. ‘ Undoubtedly, consumers seek services more than goods once their basic or fundamental needs are satisfied. Rather than consumption of only products, people relate higher service consumption to increase in living standards, ‘The number of goods that can be consumed by an individual scems to have a physical limit. One cannot consume more than a specific amount of food in a day no matter how much money he has. One will be able to watch TV only one at a time even if there is one TV in each of the rooms and even in the car. In consumption of roods, there seems to be an upper limit while, in services consumption, there is no such limit. ‘There is a significant reduction in the working hours of both employers and employees globally due to productivity gains. Even the workload has been considerably reduced in technology backward areas like ‘agriculture, With the arrival of tractor and electric and diesel pumps there has been a significant growth in the agriculture sector. This has resulted in more free time, a significant portion of which is used to undertake different sports and leisure pursuits. ‘The very concept of development, therefore, has undergone a transition. Today, societies which have higher per capita services consumption than the goods are considered as the more advanced ‘and’ developed societies. ‘Countries and societies no more consider statistics like steel or per capita food grain as their growth indices, ‘This kind of pattern can be witnessed even in India. In the last few decades, with the increasing importance of services sector in the growth of national economy and employment generation, there are tremendous changes in the country. SERVICE SECTOR BEYOND 20: 1.4.1, Introduction ‘The COVID-19 outbreak has greatly affected the services sectors on a global level. The disruptions in supply chain of services have largely affected the economy and trade of a country as it plays major rote in providing inputs for other activities of ecouomy involving goods trade and supply chain facilities. Today, more than two-thirds of foreign direct investments and economic outputs are generated by the services facilitating most of the employment opportunities across the country. The contribution of services in the world trade is around 40%. In addition, as services account for the majority of women’s jobs worldwide and a substantial share of MSMEs operations. Social and economic inclusiveness is also impacted by the disturbance in the supply chains of services. ies 0 SIR Thick Sees (Series Masketng) SPPU trae i thore. emphasis wailability of online ‘services in sectors such as healthcare, fi more emphasis on the availability Buc ¢ telecommuni eee retail, and audio-visual services. All this accelerates companies to make their ‘efforts to expand (heir online services and develop new customer habits that are expected to'lead to a sighificant "and longterm change towards online services. Itcan be expected thatthe trade end supply of services from one “Ration to the other can be increased due to the expanded availability of services through digital networks in future. Both intensification and expansion of developments over the medium term, leading to @ transition in the nature of eross-border rade in services over the past decade and significant decreases in trade in services is likely to be indicated by the 2020 trade statistics. In relative terms, trade in services has moved to compute and information facilites, telecommunications, professional services, financial services, and audio-visual facilities from the “traditional” categories of travel and transport services. In general, the significance of the services has been highlighted by this crisis that facilitates the online supply for éxample, computer services and telecommunications alongwith the comprehensive infrestructural role of the transport, logistic services, financial, and distribution services in supporting the economic and trade-related development. By enabling Telework and Tele-education, the online supply capacities in dealing with the crisis have been increased. Simultaneously, the increased digital gaps and related policy issues related to the online supply services are now being promoted by the pandemic. The key to recovery from the slowdown in economy ‘will be the ercation of favourable situations to services trade under various supply modes. 1.4.2. Indian Perspective Services sector greatly contributes to the GDP and trade of India, as well as attracts substantial foreign investment and generate large employment opportunities. A large variety of services like business services, comriunity, social and personal services, trade, financing, education, hotels and restaurants, storage and communications, real estate, services related to construction are a part of services sector in India. As all the activities were almost standstill due to COVID-19 second quarter of the year 2020, a major contraction was experienced by the Indian service industry resulting in strengthening the fear of large recession and a huge loss of employment. As the businesses of the clients remained closed and footfall remains extremely ‘below the normal levels, both domestic and global demand of services continuously fell in May. As per the sub- indexes measuring domestic and global demand, the demand of services remained at zero. Although slightly improved from April demand is still low which lead the companies to reduce their employees. As services sector contributes almost 60% to the India’s GDP, it is thus important for India's development and ‘growth. Economists had predicted that third-largest economy of Asia (India) could face either a zero growth or recession in this quarter if the lockdown was extended. As the shops across the nations were closed and people ‘were restricted to leave their house, as has been seen elsewhere in the world, has drastically affected the service ‘economy, Many economists say that the worst is yet to come. The government is now firmly under pressure to resolve the economic problems caused because of lockdown, 7 ‘The US $180 billion IT sector faced challenges in retaining the business when country witnesses COVID-19 and steps like lockdowns were considered. After more than one month, company managers felt that it has been a blessing in disguise and lead to maximum employees work from home after the COVID-19, Not only the IT sector which is gaining benefits from this COVID-19 scenario, but also there are many sectors ‘who, features this scenario to cost and productivity reaps out work from home (WFH). Few employees: have. been set to: work in offices in future in many services sector companies.such as banks. In order to stop the spread of the coronavirus across the country, India was put under a lockdown of 21 days from March 25, which Was extended till May 3, ic., 19 more days. However, there are many areas of industrial sector and services Sector are still subject to lockdown restrictions that are being phased out. There are many employees who have to.cover long distances to workplaces in cities overwhelmed with heavy traffics and air pollution problems. ' In May 2020, Nikkei India Services Purchasing Manager's Index (PMI) was 14.6 showing reduction as the ‘business was hampered by the shutdown caused by COVID-19. AE Sasa 1)/"Impact on'IT Services: Tech giants of India have tended to cope better with the eris{# than they!would ._ have antidipated. Though, as compared with Europe or US, the underlying network of towns and cities of Jhdia’ are not developed, however, it is remarkable that how quickly and well service’ providers based it ‘India’ shied ‘to work-from-home delivery models Without any substantial disturbance to theit°¢li bated'in ient-baseService Matksting-An fight ato Emes 2) 3) 4 ing Sector of Beonomy (Unit 1) a globally. Because of COVID-19, there have Been no reported cases to outsourced services: going into fuilur, Fresh contracts for new services ate negotiated and concluded by the Indian services companies despite the continued limitations enforced in response to the pandemic. {tis not right to state tat there were no major consequences. Some ofthe examples are: : 2) Service providers may face problems as they are not able to comply with thei customer's (often very Seed I ind Physical protection policies, which can include, eg, suc limits on access to designated service delivery sites, and no right to capture or replicate customer specific information or content, 1) If service locations are situated in 2 Special Economic Zone (SEZ), which allows tex brecks for ofthore job assets situated within it, but forbids the relocation of SEZ devices then itis quite dificult to change the service locations of dedicated desktops or laptops, ‘i The ability to provide remote support and replacement of defective kit can be limited even if the employee can take IT equipment home, iv) With benchmarks of change and/ or develoy Project have been affected substantially, tapact on Financial Services: There is very eruciil ‘role played by Fintech when promoting digital banking was the main focus of RBI and it acts asthe backbone forthe banking industiss, nevder seetty ihe Fintech sector (o allow players to provide help to the banking sector in the present scenario, one ensures are required for support. pment failing to yet unknown extent, the timescales of ‘Suggestions 4) A renewed thrust is needed to promote the’ digital banking and payments because virus can also be spread by using cash, Subsidies for payments through digital for transaction below €2,000 mist be reinstated by the government, {i} The immediate implementation of E-KYC based on Adhaar authentication is required forthe regulated entities of RBI say, Fintechs. This will provide support to the business and their financial inclusions continuously. RBI, in its master circular, should highlight the need of CKYC registry, Also, the video. KYC usage simplification is needed, iii) The banks are listed as the important services that will continue actions. Fintech and other allied banking service providers that operate with partners of the banks are required to be provided similar considerations. 4y) For ensuring the sustainability of the business particularly when work from home is used, there must be some sort of ease in data privacy norms depending on self-dectaration. v) When it comes to the insurance sector, itis important to digitalise the complete process of issuance and servicing of policies along with overcoming the KYC gaps. Private Security Services: The personal security market is likely to reach INR 99,000 crore by 2020 and anticipated to reach INR 1.5 lac crore by 2022 which was estimated at INR 57,000 erore in 2016. In India, Private security is among the largest industry anticipated to have 8,5 employees (approx.) across the country with having thousands of establishments. ‘There is an important role in managing the establishments with significant contols and limited movements and temperature check is played by the Private Security Industry during the time when India has been sneaked by an infectious pandemic, Governments are required to make certain important measures for Providing this essential support continuously. Sui all FS noo eeiaui services have been advised to closed their offices and reduce their workforce under 50% by the Municipal Commissioner of Greater Mumbai in its latest communication. If Private Security Agen: Problematic situations. Therefore listing the Private Security Services under required services by ‘communicating with all local civic bodies and State Government is the immediate priority. Impact on Education: All schools and eduestional institutes are close as advised by all State Governments because of the spread of COVID-19 and this closure will be extended if the vius is not controlled, Even exams are also postponed in various regions. However, this drastically impacts the children's education: In such a situation, schools may turn to online classes increasingly. 3| | 28; aaa MBA Tint Seester (i ay eSuiggestions: : SARA sen ~Trvorder fo meet the work from home and online classesleaming quirements, poticy of exry th, heeded, banbig, oi 5) Tourism, Hospitality & Medical Value Travel Services: Since January to Feb rey “is dropped by-67% and outbound tourism is mx Pecause of the cancellation of travel plan on a large seate by mm Known as the MICE segment, i" ‘out of all the hospitality sector ‘ ‘C) are some of the inte qT coronavirus across the world my. ho The situation will be worsening in the upcoming months as expected by the tourism indus te » because during the March and April months, generally, for both domestic and inte: tou Bumbers of Indian travellers are in peak, Nearly 90% booking, however, for flights and hotels jg, *© Singered, And also the huge number of travellers wore cancelled thels cee bookings for destinations. Singapore, Thailand and Malaysia. Because of the limitations imposed on international tourists, the it Aurel and aviation sector of India together lost 28,500 crore fg PFOX.) as anticipated by the Ink, Association of Tour Operators (LATO). It is also predicted they (ce Would have a detrimental effeay Employment in the sector. I has also affected the Medical Value Travel beer F Suggestions q ') “The elimination of fines on any forthcoming licences and the extension of permits for the stew. § hospitality and travel industry. Moreover, in addition {0 several taxes such as property taxes, a her ; bat license is also paid by the hotels. And without any furiheg Payment, atleast by one year, the pe | of validity of these licenses and taxes can be extended : i) AI statutory dues such as Advance tnxes excise fees, GST, travel. and aviation industry, license JO ot Set er wales and power charges should be deferred for a year Hii) 10% of SEIS scrips for duty credit fort ' Wel, Tourism and Hospitality industry should be restored: a ‘anime airs to skill of train 40 mill Private sector in skill developme : 2022 in order to adi adding to the service sector portfolio will be caused by the Make in Int aeessam while attempting to strengthen the manufactuting sector. In thie sense, a key enabler for both sent Sector and manufacturing sector of India is the Start ‘up India initiative which offers support to the startups. Both domestic and international factors play a role in the development of the service Sector, Between 2015 ar sag indian facility management industy is projected to expand wi 19s! CAGR, exceeding the USS # billion mark backed by the booming, hospitality, real estate and retail sectors, ‘The healthcare industry 5 India is anticipated to re: growth, USS 14.3 billion by 32 billion by 2023, while by 2025; the digital economy ¢ h US$ 1 villion, The I i y the end of 2023. reduced and a common national market is created by implementin the Goods and Services Taxed (GST). Costs ji Production credit, rest 14.3. Asian Perspective ee i is fying. This is a Heled situation th The rate of growth of the Covid-19 virus across the globe is terrifying. ‘This is an unpaca ie von calls for sieaourae that are extraordinary. This crisis has a huge impact on the nasteen ae ne Sectors‘ds well'as impacts the employment and world ‘economy. The-inequality gaps may a Nn of the’impact of crisis over the poor individuals and households who already below poverty’ people in poverty, f cee!a Service Markeing-An Insight into Emerging Sector of Economy (Unit 1) » In Asian-Pacific regions, because of the concentration of economic activities, urbanisation, demographics and problem in achieving Self-Development Goals (SDGs), the impact of coronavirus is tremendous. This crisis has revealed how deeply the Asia-Pocific region is integrated in the world's economic and social structure involving. ‘more than two-thirds of global population. Asia-Pacific region is one of the most populated cities of the world most of the world's manufacturing operations, the availability and use of oil, and 46 million refugees. Tt also highlights the importance of taking quick actions, implementing stable strategies and creativity on the part of ‘Asian nations has effectively dealt with this unexpected pandemic. ‘There is a reduction in overall demands, with specific impacts on retail, services, tourism, civil aviation and hospitality because of the early measures such as lockdowns, quarantines, and travel restrictions in order to control the spread of novel coronavirus. Further, there is an economic and financial uncertainty and stability because of the decline in global demand for goods, especially for oil. Though there are several estimates over the impact of coronavirus pandemic, they show that the impact will be worst without exceptions but the extent to which situation will worsen remains unknown. Services export services, especially travel involving food- servicing services, foreign accommodation services and tourism-related services, would have one of the most. immediate and significant impacts. The long-term influence completely depends on how long the intemational restrictions will remain. ‘There was an immediate impact, resulting in increased unemployiment and layoffs, over the traditional services sectors like retail, tourism, civil aviation and some emiployec-intensive and supply chain-based production. ‘Though, the detailed data on employment effect of coronavirus is not known yet, but this effect will be significant because almost 80% of the region's informal sector and SMEs, which offers most of the employment the region, is comprised by the services and labour-intensive production, There are already sudden decreases revenues of the different sectors; however, the economic slowdown of coronavirus has only started. The small and medium enterprises, particularly the informal sectors, are not nble to accept the cost of these blows and have become weakened. However, the demand for online services, ike education, online shopping, as well as medical services is increased because of this pandemic, Once the spread of coronavirus is controlled, there will be the need of the policies to facilitate labour adaptation and reduce market friction to these employment opportunites Look Ahead, Anticipate and Adjust There will be several variations on the economic impact of duration and cruelty of coronavirus. Businesses will ddo well, though, if they put a “look ahead, anticipate and adjust” strategy in motion, Supply chain diversification and leveraging new opportunities arising from changes in demands of customer should be explored by the companies over the short-term. To ensure the greater flexibility diversification of Product and services portfolio is important in the long-run. It will be strategically necessary to improve brand equity and shifting sales channels online’externally while embracing workplace-supporing technology and organisational stability would enable firms to hit the ground running after the crisis of COVID-19. 1.4.4. Global Perspective ‘The impact of coronavirus on Global services sectors are as follows: 1) Tourism and Travel-Related Service: Since the country's borders are sealed and tourists are restricted from travelling abroad due to the coronavirus crisis, the travel and tourism services sector, such as tour ‘operators, hotels, restaurants, and travel agencies, across the world, are greatly affected. The tour and travel sector is also a big recipient of international trade. Moreover, the restrictions on domestic tourism activities, which are substantial to supplies through commercial presence, such as domestic travel limitations and need of “work-frpm-home would continue to impact the sector further. ‘The services sectors highlight its importance in the economy of many nations as decline in this sector results in broad economic consequences. The impact of direct, indiect and mediated tourism have added USS 8.9 trillion, ie, 10.3% to global GDP and 330 million jobs in 2019, according to the WTC. Tourism accounts for both the largest share of total exports and significant share of GDP for some economies, pasticularly for smaller ones. For example, it is 67% for Seychelles, 62% for St Kitts and Nevis and 48% for Vanuatu. In 2018, the 25% of global commercial services, and 32% of services exports for developing nations and 50% for least developed nations are represented by travel, according to the statistics of Balance of Payment (BOP).z [MBA Third Semester (Services Marketing) SPPU 5] the Crisis nis f ae 4 seen ag mcm fo nel etter’ reiation calling for strong and urgent help is released by UNWTO on April 1; 2020. 6 PFS segs undertaken scale Frnents have included social, economic and financial suppor systems forstaffin the industry, ‘programmes to foster their up-skilling ‘and reskilling, tax deferrals and various other “© forms of tourism operator's financial support, etrbution Services: The function of distribution has also taken a hot because of the COVID pandemic. 2, ad Toneuental Shops have been closed to ensure social distancing. In many counties, cosa! distancing ecasures are used results in closing of non-essential services (excluding pharmacies and groceties) in order sat the spread of coronavirus which results in heavy impact on the distribution sores The supply Guan through commercial presence which is important for tis sector is also substantially impacted by the pandemiis, For example, retul trade of China is reduced by 20.5%, compared with previous year, according Pare data published by National Bureau of Statistics (NBS) at the peak of the criss in January! February seg he ates inthe physical stores, in China, cid not recover the sales before tho crisis ag consumers emain eautious even though the restrictions are eased and sales of physical stoves a increased from mid- Tanah ‘However, ther nations are also expected (0 have similar trends with differences on level of waar inve impact the type of social distancing policies adopted by these countries, | FOF example, as saree toned daring lockdown in April there is 18% rection in the total retail sales in United Kinglom: Many ttaler and distribution agents have als filed for closed sores and Dankpicy 19 Mtb aaaasoeee Iie sil early to give a verdict on this but i is fel thet the hit tothe retaildistribution, in terms Of jobs, trade will be huge in Africa, “The pandemic will ndoobtedty intensify the growing shift towards the selling of consumer products across intemet platforms as shoppers arc developing new preferences and retailers are speeding up efforis Mt intend their online operations. including more conventional brick-and-mortar suppliers. However, several froblems ike inventory shortages and issues in supply chain, which results in delayed, deliveries, and Uisturbing global e-commerce, are faced by the online retailers. As a result of various measures (o lockdown toms and afferent levels of e-commerce growth, the effect on the distribution market, including its online ‘component, can vary across economies. 3) Telecommunications, ICT and Audio-Visual Services: The need for Information and Communication ‘Technology (ICT) facilites and associated services has been increased ax more people are now engaging in oth remote schooling and work, and more are relying highly on the internet for entertainment and social interaction, Countries which are heavily affected by the pandeinic, their voice and video traffic are almost dovbled and more than 50% growth in online messaging services as reported by Facebook. For example, Facebook reported 70% growth in overall usage and the time spend on group calls was increases up to 1000%, however, the revenue of global advertising has been decreased yet. Spain's Telefonica has seen # growth of 40% in terms of IP traffic and 50% in terms of mobile usage. Also, a growth of 828% and 215% respectively in the users of Zoom and Skype as reported by Thailand. In China, in the first quarter of 2020, Tencent saw expanded usage of its social networks, sports, fintech and business services, with ads up in some areas, but also warned of slower growth in advertisements to come, Moreover, In South Africa, 40% increase in data traffic is recorded by the Vodacom group. If global use grows significantly and promotes sharper awareness of the valtie of access to information and same of the trade consequences for the ICT sector could be significant. Data limits ‘are reduced and eapacitigs can be improved by the operators at no extra cost and wireless spectrum to operators for further increment in capacity is offered by many governments in response to the coronavirus ‘A large number of SG spectrum auctions, however, have been delayed. It can cause further constraints on mobility, revenue eared from roaming for operators will get impacted (analysts estimate close to USDS25 billion over the next 9 months). Even the dispatches of mobile handsets have been impacted. Compared to last year, 40 milion lesser smartphones were shipped this year. In expectation of the, economie downturn triggered by the pandemic, a South African provider, MTN Group, that provides: telecommunications services across Africa, has announced that itis introducing cost-cutting through its operations ). Zelihaml and Bitner . ©) Christopher Lovelock. 4) , Borden osSariibe Misketng-Aa lsight inte Emeraiay Sede of Boonsiny (Urit2) 8 10)" ___refers tothe manner in which the ctvies are originally performed and the steps that are undertaken to ‘perform Buch activities. +) Process by Prodoct 5 People 4) Physical evidetice 11) permits the eustomer to review his decision regarding the company for one more tim, a) - Process: bys Prodoct ©) People»... 8), Physical evidence |. Which ofthe fllowing isnot the extended Ps of marketing mix? <8)... People ») Promotion ©) Process.» 4) Physical evidence, |B) These types of services ty fo shape aittudes oF behaviour. In onder to achieve this, these services h oriented to people's minds, this is referred to as 2) Possession processing 1) People processing ‘ ©) Mental-stimalus processing Information processing vf 14) Which ofthe following products is an example of intangible dominant? 8) Ovtback steakhouse ) Carrental agency ©) Math saocing ‘A magazine subscription * 5) Which of te following is uatrve? : scekergy cera 2) A msjorcharacteristic of services is that they eannot be seen before they aie bought. a ei 2), Services end physial products are a opposite ends of the tangible intangible contidum °° ©) Physical products and services are bundles of benefits: “ ©) Something is defined as either 2 physical product or itis a service, de De ge ad Qa oo Ne aa do 30) 2 ia 12d Be ie 15) 4 5.2. Very Short Answer Type Questions ) Define services. ’ d d ) a ‘What is meant by services marketing? ‘Write shor note on goods-service continuum. ‘State services marketing mix. ‘Explain the intangible characteristics of services marketing. (Classify the services on the basis of service providers. 5.3. Short Answer Type Questions ) » » » ) ‘State the characterisucs of services. Give significance of services. Explain the need of extended marketing mix elements in services. Discuss evolution of services as value contributors. ‘What is the need to study services marketing? Explain. L5.4. Long Answer Type Questions » > » \ » How services are classified? Give difference between goods and services. . , Discuss the traditional and extended marketing mix elements. i What are the factors influencing services marketing? Also discuss the challenges and importance of services marketing. , Biber nnn, sian an loa prspectves of service sector beyond 2020.4 [MBA Thitd Semester (Services Marketing) SEPU dd G 205 analy sa th oH Role of Process, People & Physical Evidence in # 7 ite Services Marketing 2. yA ce oh ated 21.15. Introduction. ct : i : Prochet'is an essential component of marketing mix of services and is also an important element of the value ‘chains the other elements of value chain are, production, inarketing, after-sales service, etc, ‘Process’ contributes ‘as'4 significant part of marketing, objectives,.then also less attention has been paid to it, The processes, which add some.yalue to the services without incurriag-much cost, benefit the organisation as well as.the customers. Performing transactions, delivering information, and offering a service in most suitable way to the customers as well as to the company, js, known, as, the. process, Several. disciplines such as decision theory, operations ‘malagemént‘Cormputer programming, ctc., define the'term éss’ in a different way by using different words tht’ the basie concept behind it remains the: “All the disciplines believe that a process should comprise of logical sub-processes that can be used for making the process more efficient, es “Tilease of manufacturing industry, it is not necessary for the marketers to Keep informed about how the physical ‘gods are being manufactured; rather the individuals who own the manufacturing unit are required to know this, (On the other hand, in case of service industry, the marketer is expected to Keep well-informed about all the services and the process of manufacturing and delivering these services to the end customers. This is because the customers here are directly involved in the manner in which a service product is created and they may have some specific requirements regarding the services. Marketers also need to be involved in the design or the redesign of a service process as the same can influence the consumers. ‘The custonier views every service as an experience. For example, visiting a doctor or lodging a complaint at a call centre. On the other hand, organisations view services as a process which needs to be designed so that the required experience is delivered to the customer. The process is thus the backbone of the service. It is nothing but a method or sequence of activities which service organisations need to undertake and also co-ordinate in ‘order fo create value proposition for the customers. In today’s customer-oriented business environment, all areas of manufacturing, engineering. and computer programming focus towards understanding the process through which a task is undertaken and the various steps involved in achieving the bottom-line results. This has given birth fo various revolutionary concepts like “Just in Time’, ‘flexible manufacturing’, ‘lean production’ ‘efficient customer response system’, etc. The ‘companies have recently started giving so much importance to the process of delivering services and are using it as a strategic tool in gaining a competitive edge, . 2.1.2.. ‘Types of Service Process ‘The different types of service process are as follows: ® ° tae 1) People Processing Services: As the namo suggests, people processing services are directly targeted at the individuals, Here, the customers need to physically enter the service environment to avail the service that he vedesites..An example of this is the Airlines, where the service is ereated a delivered through 8 combination: oF people or technology (or both). Itis also possible that the service provider may reach the customer'along ‘with the required tools for delivering services. The idea'is to create a new set of values for the customers in the service industry, For example, banking services which are offered by personally visitng atthe office or residence of the customer and completing the transactions and other services desired by the customers.