UNIT-1

1. Concept of service marketing

Service marketing is marketing based on relationship and value. It may be used to

market a service or a product. With the increasing prominence of services in the global
economy, service marketing has become a subject that needs to be studied separately.
Marketing services is different from marketing goods because of the unique
characteristics of services namely, intangibility, heterogeneity, perishability and
inseparability.

In most countries, services add more economic value than agriculture, raw materials
and manufacturing combined. In developed economies, employment is dominated by
service jobs and most new job growth comes from services.

Features of Services:

1. Intangibility:

A physical product is visible and concrete. Services are intangible. The service cannot
be touched or viewed, so it is difficult for clients to tell in advance what they will be get-
ting. For example, banks promote the sale of credit cards by emphasizing the
conveniences and advantages derived from possessing a credit card.

2. Inseparability:

Personal services cannot be separated from the individual. Services are created and
consumed simultaneously. The service is being produced at the same time that the
client is receiving it; for example, during an online search or a legal consultation.
Dentist, musicians, dancers, etc. create and offer services at the same time.

3. Heterogeneity (or variability)

Services involve people, and people are all different. There is a strong possibility that
the same enquiry would be answered slightly differently by different
people (or even by the same person at different times). It is important to minimize the
differences in performance (through training, standard setting and quality assurance).
The quality of services offered by firms can never be standardized.

4. Perishability:

Services have a high degree of perishability. Unused capacity cannot be stored for
future use. If services are not used today, it is lost forever. For example, spare seats in
an aeroplane cannot be transferred to the next flight. Similarly, empty rooms in five-star
hotels and credits not utilized are examples of services leading to economic losses. As
services are activities performed for simultaneous consumption, they perish unless
consumed.

5. Changing demand:

The demand for services has wide fluctuations and may be seasonal. Demand for
tourism is seasonal, other services such as demand for public transport, cricket field
and golf courses have fluctuations in demand.

6. Pricing of services:

Quality of services cannot be standardized. The pricing of services are usually

determined on the basis of demand and competition. For example, room rents in tourist
spots fluctuate as per demand and season and many of the service providers give off-
season discounts.

7. Direct channel:

Problems in Marketing Services:

1. A service cannot be demonstrated.

2. Sale, production and consumption of services takes place simultaneously.

3. A service cannot be stored. It cannot be produced in anticipation of demand

4. Services cannot be protected through patents.

5. Services cannot be separated from the service provider.

6. Services are not standardized and are inconsistent.

7. Service providers appointing franchisees may face problems of quality of services

Classifications of Services

1. Classification of service based on Tangible Action

2.Classification of services based on Intangibility

A more general classification of services based on the type of function that is provided
through them can be as follows:

• Business services.
• Communication services.
 • Construction and related engineering services.
• Distribution services.
• Educational services.
• Environmental services.
• Financial services.
• Health-related and social services.
• Tourism and travel-related services.
• Recreational, cultural, and sporting services.
• Transport services.
• Other services not included elsewhere.

The 7Ps of Service Marketing mix:

Product

The product is produced and consumed simultaneously. It is at once perishable and

diverse. It can, therefore, be customized on the spot. This also makes the point of sale
for the service very important. You want every customer to get the same quality of
experience. That means you will have to standardize the model of delivery somehow.

Pricing

You cannot measure a service in terms of the materials that go into it. You also cannot
measure the tangible cost of production of a service. That makes it hard to put a price
tag on a service. You can consider things like overheads and labor, but other things like
ambiance and the brand also come into play which cannot be easily measured.
Place

The service is simultaneously produced and consumed in the same place. You cannot
own that service and walk away with it short of walking away with the service provider.
That means the place where the service is provided is very important. It should be easy
to access and desirable. A fast food restaurant will be located on a busy street so
customers can walk in. A fine dining restaurant will be somewhere a little quieter so that
it gives an aura of privacy and exclusivity.

Promotion

Promotion here plays the same role as it would in the marketing of a physical product.
You can replicate a service more easily than a physical product. In order to prevent its
interchangeability with the services of competitors, you need to create a brand image
that is desirable and popular in the market. Differentiation is the key here.

People

When you deliver a service, the person delivering that service is independent to the
service itself. If a rude waiter serves you food in an upscale restaurant, then you will still
walk away an unhappy customer. This is why businesses work so hard to have the right
people serving their customers and go through great pains to train them appropriately.

Process

With the provision of services, there is a fine balance between standardization and
customization. That is why the process matters so much. It needs to be clear enough
that the service provider can easily follow it. They should be able to follow it like a recipe
so that they can provide the same standard of service to every customer that comes
along. There should also be areas within this process where the preferences of the
customer are accommodated so that every customer still experiences some
uniqueness.

Physical Evidence

Here the place where the service is delivered becomes important. How attractive and
comfortable the location can make or break a business in the services industry. When
the environment is calm and comforting, then the customer will feel secure and will want
to come back another day, maybe even bringing another customer along.
2.Service Leadership

Service leadership in service marketing emphasizes the pivotal role of leadership in

delivering exceptional service experiences to customers. Here's how it intersects with
service marketing:

1. Customer-Centric Approach: Service leadership in service marketing revolves around

placing the customer at the center of all strategies and decisions. Leaders cultivate a
customer-centric culture within the organization, where understanding and fulfilling
customer needs and expectations is paramount.

2. Vision and Strategy: Service leaders set a clear vision and strategy for delivering
superior service experiences. They align the organization's goals with customer
satisfaction objectives and develop marketing strategies that emphasize service quality,
reliability, and responsiveness.

3. Employee Engagement and Empowerment: Service leadership involves empowering

employees to deliver outstanding service. Leaders invest in employee training,
development, and empowerment initiatives to ensure that frontline staff have the skills,
resources, and autonomy to address customer needs effectively.

4. Service Innovation: Service leaders foster a culture of innovation within the

organization to continuously improve service offerings and differentiate themselves in
the market. They encourage experimentation, creativity, and collaboration to develop
innovative service solutions that meet evolving customer demands.

5. Brand Building and Reputation Management: Service leaders recognize the

importance of building a strong brand reputation based on exceptional service delivery.
They ensure that marketing efforts communicate the organization's commitment to
service excellence and actively manage the brand's reputation through consistent, high-
quality service experiences.

6. Relationship Building: Service leadership involves building long-term relationships

with customers based on trust, loyalty, and mutual value creation. Leaders emphasize
the importance of personalized interactions, active listening, and responsiveness to
customer feedback in nurturing these relationships.

7. Quality Assurance and Continuous Improvement: Service leaders establish rigorous

quality assurance processes to monitor and maintain service standards. They leverage
customer feedback, performance metrics, and benchmarking to identify areas for
improvement and drive continuous enhancement of service delivery processes.

8. Ethical and Responsible Business Practices: Service leaders uphold ethical and
responsible business practices in their marketing efforts. They prioritize transparency,
integrity, and fairness in all customer interactions and ensure compliance with relevant
regulations and industry standards.

9. Adaptability and Resilience: Service leaders demonstrate adaptability and resilience

in the face of challenges and disruptions. They proactively anticipate market changes,
emerging trends, and customer preferences, and adjust their marketing strategies and
service offerings accordingly to stay relevant and competitive.

10. Measurement and Evaluation: Service leaders utilize key performance indicators
(KPIs) and performance metrics to assess the effectiveness of their service marketing
efforts. They regularly evaluate customer satisfaction, loyalty, retention rates, and other
relevant metrics to gauge the impact of their leadership on service performance.

By embodying service leadership principles, organizations can create sustainable

competitive advantages in the marketplace by delivering superior service experiences
that delight customers and drive business growth.
3.Marketing challenges of services:
There are some inherent challenges in marketing a service business, but they can be
overcome. When marketing services, you apply the same marketing mix principles used
for products: place, price, promotion and product -- which is your service. Added to this
mix are emphases on people, process and physical evidence.
Intangible

One of the most obvious challenges in marketing services is that you are selling
something intangible. People can touch and see a product and are exchanging money
for something they need and can take home to use. Conversely, people only see the
results of a service, which may not always be immediate. It requires faith on the
customers’ part that they will get the desired results for their money. For example, if you
own a cleaning service, you have to convince your customers to trust you that their
homes will be cleaned to their satisfaction.

Demonstrating Empathy

Convince your customers in your marketing efforts that you understand their problems
and are offering a solution. Do this using people, processes and physical evidence. For
example, if you and your employees have families and work full time, this identifies with
working families who have no time for housecleaning. Before-and-after pictures in your
marketing materials, such as your website, brochures and advertising, are all physical
evidence. Finally, you may need to interact personally with customers multiple times as
part of the marketing process to establish a relationship and convince them you
understand their needs.

Competitive Pricing

How you price your services is an important marketing element. You need to be
competitive, so research several competitors’ prices to gauge what your prospective
customers expect to pay. Then assess your costs -- your overhead such as rent,
insurance, salaries and supplies -- to determine if you can meet your costs and make a
profit with that pricing. Consider bundling extra features with your services to
differentiate your company and garner a higher price. For example, you can offer to wax
floors as part of your service, or do laundry as part of a bonus package.

People

As a services company, marketing your people, including you, is paramount. A service

is consumed when it’s purchased or produced -- just the results or effects linger, and
sometimes temporarily. For example, your customer’s home will get dirty again, so the
result of your cleaning delivery is temporary. The client may or may not call you again
based on the overall experience. How your people performed that service will impact
repeat business.
4. Consumer behaviour in services

Consumer behavior in services refers to the study of how individuals, groups, or

organizations make decisions and behave when seeking, purchasing, using, or
evaluating services. Understanding consumer behavior in services is crucial for service
providers to effectively market their offerings, deliver exceptional experiences, and build
lasting relationships with customers. Here are some key aspects:

1. Intangibility: Services are intangible, meaning they cannot be seen, touched, or felt
before purchase. This characteristic affects consumer behavior as customers often rely
on cues such as brand reputation, word-of-mouth, or service quality signals to evaluate
and choose services.

2. Inseparability: Services are often produced and consumed simultaneously, which can
influence consumer behavior. Consumers may consider factors such as the
professionalism of service providers, the quality of interactions, and the overall service
experience when making purchasing decisions.

3. Variability: Services can exhibit variability in quality due to factors such as human
involvement, customer preferences, and environmental conditions. Understanding how
consumers perceive and respond to variability in service delivery is essential for service
providers to meet customer expectations and maintain satisfaction.

4. Perishability: Services are perishable and cannot be stored for future use, which can
impact consumer behavior, particularly in terms of demand fluctuations and pricing
strategies. Consumers may respond to dynamic pricing, promotions, or time-based
incentives offered by service providers.

5. Search, Experience, and Credence Attributes: Consumers evaluate services based

on different types of attributes:

- Search attributes: Tangible characteristics of a service that can be assessed before

purchase (e.g., price, features).

- Experience attributes: Qualities of a service that can only be assessed during or after
consumption (e.g., service quality, ambiance).
- Credence attributes: Characteristics of a service that are difficult for consumers to
assess even after consumption (e.g., expertise of a financial advisor).

6. Customer Expectations and Perceptions: Consumer behavior in services is

influenced by customer expectations and perceptions. Service providers must manage
customer expectations through effective communication, branding, and service delivery
to ensure positive consumer experiences.

7. Service Encounter: The service encounter refers to the moment of interaction

between the service provider and the customer. Consumer behavior during service
encounters is shaped by factors such as interpersonal communication, service delivery
processes, and perceived value.

8. Service Quality and Satisfaction: Consumer behavior is influenced by perceptions of

service quality and satisfaction. Consumers assess service quality based on factors
such as reliability, responsiveness, assurance, empathy, and tangibles. Meeting or
exceeding customer expectations can lead to higher satisfaction and repeat business.

9. Word-of-Mouth and Social Influence: Consumer behavior in services is often

influenced by word-of-mouth recommendations, online reviews, and social influence.
Positive or negative experiences shared by others can impact consumer perceptions,
trust, and decision-making.

10. Post-Purchase Behavior: After consuming a service, consumers may engage in

post-purchase behaviors such as advocacy, loyalty, or complaint handling.
Understanding how consumers evaluate their service experiences and what factors
influence their likelihood to repurchase or recommend a service is essential for service
providers.

By studying consumer behavior in services, organizations can gain insights into the
factors that drive customer decision-making, satisfaction, and loyalty, enabling them to
design and deliver services that meet or exceed customer expectations.
5. Applications in areas of telecom

Telecommunication services encompass a wide range of applications that cater to

various needs and demands of consumers and businesses alike. Here are some key
applications of telecom services across different areas:

1. Voice Communication: Traditional telephony services remain a fundamental

application of telecom services, allowing individuals and businesses to communicate via
voice calls over landline or mobile networks.

2. Data Transmission: Telecom services facilitate the transmission of digital data over
networks, enabling internet access, email communication, file sharing, and multimedia
streaming.

3. Mobile Services: Mobile telecom services include voice calls, text messaging (SMS),
multimedia messaging (MMS), and mobile internet access. Mobile telecom providers
also offer value-added services such as mobile banking, mobile payments, and location-
based services.

4. Internet Access: Telecom services provide broadband internet access to homes,

businesses, and public spaces through various technologies such as DSL, cable, fiber-
optic, and wireless (e.g., Wi-Fi, 4G/5G).

5. Video Conferencing and Collaboration: Telecom services enable real-time video

conferencing and collaboration among individuals and teams, facilitating remote work,
virtual meetings, and online collaboration tools.

6. Cloud Services: Telecom providers offer cloud-based services such as cloud storage,
software-as-a-service (SaaS), platform-as-a-service (PaaS), and infrastructure-as-a-
service (IaaS) over their networks.
7. Internet of Things (IoT): Telecom services support IoT applications by providing
connectivity for a wide range of devices and sensors, enabling applications such as
smart homes, smart cities, industrial automation, and remote monitoring.

8. Unified Communications: Telecom services integrate various communication

channels (e.g., voice, video, messaging) into a unified platform, allowing seamless
communication and collaboration across multiple devices and channels.

9. Telemedicine and Telehealth: Telecom services facilitate remote healthcare delivery

through telemedicine and telehealth applications, enabling patients to consult with
healthcare providers, receive medical diagnoses, and access healthcare services
remotely.

10. Digital Entertainment: Telecom services deliver digital entertainment content such
as streaming video, music, gaming, and e-books over networks to consumers' devices,
including smartphones, tablets, smart TVs, and computers.

11. E-commerce and Mobile Payments: Telecom services support e-commerce

transactions and mobile payment solutions, enabling consumers to make purchases,
transfer money, and conduct financial transactions securely over mobile networks.

12. Location-Based Services: Telecom services leverage location-based technologies

(e.g., GPS, Wi-Fi, cellular networks) to provide location-based services such as
navigation, local search, geotagging, and location-based advertising.

13. Cybersecurity and Network Security: Telecom services include cybersecurity

solutions to protect networks, devices, and data from cyber threats such as malware,
phishing, hacking, and data breaches.

These applications demonstrate the diverse and essential role of telecom services in
enabling communication, connectivity, and digital transformation across various
industries and sectors.
6. Role in health care service

In the healthcare sector, services play a crucial role in delivering quality patient care,
improving health outcomes, and enhancing overall healthcare experiences. Here are
some applications of services in various areas of healthcare:

1. Clinical Services: Clinical services encompass a wide range of medical services

provided directly to patients by healthcare professionals. Examples include:

- Primary Care: Services provided by general practitioners or family physicians for

routine check-ups, preventive care, and treatment of common illnesses.

- Specialty Care: Services provided by specialists such as cardiologists, oncologists, or

neurologists for specific medical conditions requiring specialized expertise.

- Diagnostic Services: Services such as laboratory testing, imaging (e.g., X-rays, MRIs),
and diagnostic procedures (e.g., biopsies) to assess and diagnose medical conditions.

- Surgical Services: Services involving surgical procedures performed by surgeons and

operating room staff to treat injuries, diseases, or conditions requiring surgical
intervention.

2. Telemedicine and Telehealth Services: Telemedicine and telehealth services utilize

technology to deliver healthcare services remotely, allowing patients to access medical
care and consultations without the need for in-person visits. This includes:

- Teleconsultations: Remote consultations with healthcare providers via video

conferencing or phone calls for diagnosis, treatment planning, and follow-up care.

- Remote Monitoring: Monitoring of patients' vital signs, symptoms, or health status

remotely using wearable devices, sensors, or mobile apps to track chronic conditions or
post-operative recovery.

- Telepsychiatry: Remote mental health services, including therapy sessions,

counseling, and psychiatric consultations delivered through telecommunication
technologies.

3. Home Healthcare Services: Home healthcare services bring medical care and
support services to patients in their homes, particularly for individuals with chronic
illnesses, disabilities, or mobility limitations. These services include:
- Home Nursing Care: Skilled nursing services provided at home, including wound care,
medication management, and post-operative care.

- Home Health Aides: Assistance with activities of daily living (ADLs) such as bathing,
dressing, meal preparation, and medication reminders.

- Physical Therapy and Rehabilitation: In-home rehabilitation services to help patients

recover from injuries, surgeries, or disabilities and regain mobility and function.

4. Health Education and Wellness Programs: Services aimed at promoting health

education, disease prevention, and wellness among individuals and communities. This
includes:

- Health Promotion Workshops: Educational workshops, seminars, or classes on topics

such as nutrition, exercise, stress management, and chronic disease management.

- Preventive Screenings and Vaccination Clinics: Services offering screenings for

various health conditions (e.g., cancer screenings, blood pressure checks) and
vaccination programs to prevent infectious diseases.

- Employee Wellness Programs: Workplace-based wellness initiatives designed to

promote employee health and well-being through fitness activities, health screenings,
and health coaching.

5. Healthcare Administration and Support Services: Administrative and support services

that facilitate the efficient operation of healthcare organizations and improve patient
experiences. This includes:

- Appointment Scheduling and Patient Navigation: Services to assist patients with

scheduling appointments, navigating healthcare systems, and coordinating care across
multiple providers.

- Health Information Management: Services for maintaining, organizing, and securing

patient health records, including electronic health records (EHRs) and medical coding
and billing services.

- Patient Support Services: Services such as patient advocacy, financial counseling,

and social work assistance to help patients access healthcare resources and overcome
barriers to care.
These applications demonstrate the diverse ways in which services contribute to
delivering comprehensive, patient-centered healthcare experiences and improving
health outcomes across various settings and populations.

7. Role of service banking and insurance sector

The role of the banking and insurance sectors in the broader economy is multifaceted
and crucial for financial stability, economic development, and risk management. Here
are some key roles they play:

### Banking Sector:

1. Financial Intermediation: Banks serve as intermediaries between savers and

borrowers, channeling funds from depositors to borrowers through loans and other
credit facilities. This process facilitates the efficient allocation of capital in the economy.

2. Payment Services: Banks provide payment services that enable individuals and
businesses to transfer funds domestically and internationally. These services include
wire transfers, electronic funds transfers (EFT), automated clearing house (ACH)
payments, and credit/debit card transactions.

3. Credit Provision: Banks extend credit to individuals and businesses, supporting

consumption, investment, and economic growth. They offer various types of loans,
including mortgages, personal loans, business loans, and lines of credit.

4. Deposit Services: Banks offer deposit products such as savings accounts, checking
accounts, certificates of deposit (CDs), and money market accounts. Deposits provide a
safe place for individuals and businesses to store their money and earn interest.

5. Risk Management: Banks assess and manage various types of risks, including credit
risk, market risk, liquidity risk, and operational risk. Effective risk management practices
help ensure the stability and soundness of banks' operations.
6. Wealth Management: Many banks offer wealth management services to high-net-
worth individuals, providing financial planning, investment management, and estate
planning services.

7. Corporate Finance Services: Banks assist corporations with various financial

services, including underwriting securities offerings, advising on mergers and
acquisitions, arranging syndicated loans, and providing treasury management services.

### Insurance Sector:

1. Risk Transfer and Protection: Insurance companies provide individuals and

businesses with financial protection against various risks, including property damage,
liability, illness, disability, and premature death. Insurance policies transfer the risk of
potential losses from policyholders to insurers in exchange for premium payments.

2. Financial Security: Insurance products offer individuals and families financial security
by providing compensation in the event of unforeseen events such as accidents, natural
disasters, illnesses, or death. This helps mitigate financial hardship and maintain
stability during difficult times.

3. Long-Term Savings and Investment: Some insurance products, such as life

insurance and annuities, serve as long-term savings and investment vehicles. They
offer individuals a way to accumulate wealth, generate retirement income, and protect
against longevity risk.

4. Risk Pooling and Spreading: Insurance companies pool premiums from policyholders
to create a fund that can be used to compensate those who experience covered losses.
This spreading of risk helps reduce the financial impact of individual losses and
provides greater stability to insured individuals and businesses.
5. Promotion of Economic Growth: Insurance coverage encourages entrepreneurship,
investment, and economic growth by providing businesses with protection against risks,
thereby facilitating investment and innovation.

6. Regulatory Compliance: Insurance companies operate under regulatory frameworks

designed to ensure solvency, consumer protection, and the stability of the insurance
market. Compliance with regulations helps maintain trust in the industry and protects
policyholders' interests.

Both sectors play vital roles in supporting economic activities, managing risks, and
promoting financial well-being for individuals and businesses. Their functions are
interrelated, with banks often collaborating with insurance companies to offer bundled
financial products and services that meet customers' diverse needs.
 Unit -2
1. GAP model and SERVQUAL scale for the measurement of service
quality

SERVQUAL Model: 5 Gaps

In order to provide services, companies must be aware of what their clients expect from
them. Therefore, the SERVQUAL model identifies five gaps that can occur between the
client's expectations and the services provided by the organization. These include:
Gap 1. Knowledge gap
A gap in the service arises if the organization is not aware of what customer wants. If
the organization fails to understand customers' expectations, it will prevent them from
serving customers better.
Gap 2. Standards gap
The organization has already formulated its ideas about what kind of services the
customer wants. These ideas do not match up with what customers really want. There
is, therefore, a high chance that the organization will translate them incorrectly into
a quality policy and set of rules.
Gap 3. Delivery gap
Let's assume that the organization has clearly understood what the customer wants (no
knowledge gap) and has appropriately formulated the customer's needs into their
policies and work processes (no standard gap). Still, there is a possibility that the
organization might fail to deliver the service in the planned way. This will be the delivery
gap.
Gap 4. Communications gap
To avoid creating false expectations or misleading promises, organizations should
ensure that their external communications accurately reflect what they can deliver.
Over-promise and under-delivery could raise customer expectations high, and the
organization fails to deliver at that standard. This will be the communication gap.
To reduce the risk of communication gaps, organizations should ensure that they
communicate clearly about their products or services.
Gap 5. Satisfaction gap
Customers are unhappy because they expect a certain level of service but get
something different. Eventually, customers will be dissatisfied with the product or
service they receive.
2. Service quality dimensions
Service quality dimensions refer to the various aspects or characteristics of a service
that customers use to evaluate its overall quality and their satisfaction with it. These
dimensions provide a framework for assessing and improving service delivery. While
different models may categorize service quality dimensions differently, one of the most
widely recognized frameworks is the SERVQUAL model, which identifies five key
dimensions of service quality:

1. Reliability: Reliability refers to the ability of the service provider to perform the
promised service accurately and dependably. It involves delivering the service
consistently and on time, maintaining service quality standards, and keeping promises
made to customers. Reliability also encompasses factors such as service uptime, error
rates, and the ability to fulfill commitments.

2. Responsiveness: Responsiveness relates to the willingness and readiness of the

service provider to help customers promptly and effectively. It involves being attentive to
customer needs, providing timely assistance, and resolving issues or inquiries in a
timely manner. Responsiveness also includes aspects such as accessibility, waiting
times, and the ability to handle customer requests efficiently.

3. Assurance: Assurance refers to the competence, credibility, and trustworthiness of

the service provider and its employees. It involves instilling confidence in customers
through professionalism, expertise, and reliability. Assurance encompasses factors
such as the qualifications and training of service personnel, the clarity of
communication, and the ability to inspire trust and confidence in the service provider's
capabilities.

4. Empathy: Empathy involves understanding and caring for customers' individual

needs, concerns, and preferences. It entails demonstrating empathy, attentiveness, and
personalized attention to each customer's unique situation. Empathy encompasses
factors such as listening to customer feedback, showing understanding and
compassion, and adapting the service delivery to meet individual customer
requirements.

5. Tangibles: Tangibles refer to the physical evidence and tangible aspects of the
service environment that customers can see, touch, or experience. It involves the
appearance of facilities, equipment, and materials, as well as the visual and sensory
elements of the service delivery process. Tangibles encompass factors such as
cleanliness, aesthetics, comfort, and the availability of modern equipment and
technology.

These five dimensions collectively represent the key components of service quality and
are used by organizations to measure, manage, and improve the quality of their
services. By focusing on these dimensions, service providers can identify areas for
improvement, enhance customer satisfaction, and differentiate themselves from
competitors in the marketplace.

3. Customer expectations of service

❖ Service expectation

Expectations are formed during the research and decision – making process, and
they are heavily shaped by information search and evaluation of attributes. If you have
no relevant prior experience, you may base your pre-purchase expectation on word-of-
mouth commends, news stories, or the firm’s on marketing efforts. Expectations change
over time, too, and are influenced by supplier controlled factors- such as advertising,
pricing, new technologies, and service innovation-as well as social trends, advocacy by
consumer organizations, and increased access to information through the media and
the internet (Christopher .Lovelock)

Expectations are reference points against which service delivery is compared .The
level of expectation varies from the types of reference points customers hold. Customer
service is all about expectations. Service is thus praised or criticized because of
expectations. (Valarie A. Zeithaml)

Possible Levels of Customer Expectation

(http://image.slidesharecdn.com/hotelrestrurantlodge)

How Do Consumers Develop Expectations

Consumers have different types of expectations from a service. The knowledge of

customer expectations helps marketers design comprehensive service packages
capable of delivering satisfaction. Companies should meet all customer expectations to
survive in the competitive environment. (K.Rama Mohana Rao).

Types of Expectations
 1. Desired Service– The type of service which customers hope to receive is termed
as desired service. It’s a ‘wished for’ level- a combination of what customers believe can
and should be delivered in the context of their personal needs.

2. Adequate Service– the minimum level of service a customer will accept without
being dissatisfied.
The difference between desired and adequate service level expectation is known as
the zone of tolerance. (Christopher Lovelock)

Factors that Influence Customer Expectations of Service

As expectations play such a critical role in customer evaluation of services, marketers
need to understand the factors that shape them.

A) Sources of Desired Service Expectations

1. Personal Needs: Personal Needs are those states or conditions essential to the
physical or psychological well-being of the customer and are pivotal factors that shape
what customers desire in the service. Personal needs can fall into many categories,
including physical, psychological, social and functional. A customer with high social and
dependency needs may have relatively high expectations for hotel’s ancillary services,
hoping, for example, that hotel has a bar with live music and dancing. (Valarie A
Zeithaml)

2. Personal Service Philosophy: A consumer’s expectations are also affected by

his personal philosophy concerning delivery of services. Some consumers, by nature,
have high standards concerning the quality of service delivery and very little tolerance
for deviation.(David L. Kurtz) Other consumers have lower standards and tend to be
more tolerant of service deviation. If you have ever been employed as a waitperson in a
restaurant, you are likely to have standards for restaurant service that have been
shaped by your training and experience in that role. You might, for example, believe that
waiter should not keep customers waiting longer than fifteen minutes to take their
orders.(Valarie A Zeithmal). Individuals develop their service philosophy through a
combination of two inputs: Hereditary and past experience. (David L. Kurtz)

3. Derived Service Expectations: This influence occurs when a customer

expectations are driven by other persons or a group of people. A niece from a big family
who is planning a 90th birthday party for a favorite aunt is representing a entire family in
selecting a restaurant for a successful celebration. Her needs are driven in part by
expectations derived from the other family members. (Valarie A Zeithaml)

B) Sources of Adequate Service Expectations

A different set of determinants affects adequate service, the level of service the
customer finds acceptable. In general, these influences are short term and tend to
fluctuate more than factors that influence desired service. The three factors which
influence adequate service are:

1. Perceived Service Alternatives: These alternatives are other providers from

whom the customers can obtain the service. If the customers believe they have multiple
service providers to choose from, or if they can provide the service for themselves, their
levels of adequate service are higher than those of customers who believe it is not
possible to get better service elsewhere. The customer’s perception that service
alternatives exist raises the level of adequate service. (Valarie A Zeithaml)

2. Situational Factors: Customer expectations of service are affected by such

situational factors as reason for the purchase, the consumer’s mood, the weather, time
constraints and whether the service is an emergency. These factors are temporary
changes in the normal state of things which impact what consumers expect from a
service.(David L. Kurtz) One type of the situational factor is uncontrollable situational
factors, which include service performance conditions that customer view as beyond the
control of the service provider. For example, catastrophes that affect a large number of
people at one time may lower service expectations from insurance customers in other
geographic locations because they recognize that insurers are inundated with demand
for the services. Other type of situational factor is a personal situational factor which
consists of short term individual factors that make a customer aware of need for service.
(Valarie A Zeithaml)

3. Predicted Service: It is the level of service that customers believe that they are
likely to get. If customers predict good service, their level of adequate service are likely
to be higher than if they predict poor service. It is typically an estimate or the calculation
of the service that a customer will receive in an individual transaction rather than in the
overall relationship with service provider. (Valarie A Zeithaml)

C) Sources of Both Desired and Predicted Service Expectations

When consumers are interested in purchasing services, they are likely to seek or take
in information from several different sources. For example, they may call a store, ask a
friend or track newspaper advertisement to find the needed service at a lowest price.
There are four factors that influence both desired and predicted service expectations
which are as follows:

1. Explicit Service Promises: These are personal and non-personal statements

about the service made by the organization to customers. Statements are personal
when they are communicated by firm’s sales people; they are non-personal when they
come from company’s web pages, brochures and other written publications. All the type
of explicit service promises have direct effect on desired service expectations.

2. Implicit Service Promises: These are service related cues that lead to inferences
about what the service should and will be. These quality cues are dominated by price
and tangibles associated with the service. In general, the higher the price and the more
impressive the tangibles, the more the customer will expect from the service. (Valarie A
Zeithaml)

3. Word- of- Mouth Communication: It is the strongest source of information used

by consumers in forming expectations. The consumers will often seek the opinion of
others before purchasing a service. For the service with which consumer have little
knowledge or experience, this communication can be used to establish the desired and
ideal levels of service. (David L. Kurtz).

4. Past Experience: The most important factor affecting consumer expectation of a

service is consumers past experience. It includes with particular service vendors,
experience with other vendor within the same industry, and experience with related
service. For example, you probably compare each stay in a particular hotel with all
previous stays in that hotel. But past experience with the focal hotel is likely to be very
limited view of your past experience. You may also compare each stay with your
experiences in other hotels and hotel chains.

4. Measuring customer satisfaction

Measuring customer satisfaction is crucial for businesses to understand how well they
are meeting customer expectations and to identify areas for improvement. Several
methods and metrics can be used to measure customer satisfaction:

1. Surveys: Surveys are a common method for collecting feedback from customers.
They can be conducted through various channels such as email, online forms, phone
calls, or in-person interviews. Surveys can include both quantitative rating scales (e.g.,
Likert scale) and qualitative open-ended questions to gather detailed insights.

2. Net Promoter Score (NPS): NPS is a widely used metric that measures the likelihood
of customers to recommend a company's product or service to others. It is based on a
single question: "On a scale of 0 to 10, how likely are you to recommend
[company/product/service] to a friend or colleague?" Customers are categorized into
promoters (score 9-10), passives (score 7-8), and detractors (score 0-6). The NPS is
calculated by subtracting the percentage of detractors from the percentage of
promoters.

3. Customer Satisfaction Score (CSAT): CSAT measures the overall satisfaction of

customers with a specific interaction, transaction, or experience. It is typically based on
a simple question: "How satisfied are you with [product/service]?" Customers rate their
satisfaction on a scale (e.g., 1 to 5 or 1 to 10), and the average score is calculated to
determine overall satisfaction.
4. Customer Feedback and Reviews: Monitoring customer feedback and reviews on
various platforms such as social media, review websites, and customer forums can
provide valuable insights into customer satisfaction levels and areas for improvement.
Analyzing both positive and negative feedback can help identify trends and patterns.

5. Customer Complaints and Resolution Time: Tracking customer complaints and their
resolution time can indicate areas of dissatisfaction and the effectiveness of the
company's complaint handling processes. Lower resolution times and fewer unresolved
complaints generally indicate higher levels of customer satisfaction.

6. Customer Retention and Loyalty: Monitoring customer retention rates and measuring
customer loyalty through metrics such as repeat purchases, subscription renewals, and
customer lifetime value can provide insights into overall satisfaction levels and the
likelihood of customers to continue doing business with the company.

7. Benchmarking: Comparing customer satisfaction metrics against industry

benchmarks or competitors' performance can provide context and help identify areas
where the company lags or excels in customer satisfaction.

8. Employee Feedback: Employees who interact with customers directly can provide
valuable insights into customer satisfaction levels through their observations and
interactions. Collecting feedback from frontline employees can complement customer
feedback and help identify areas for improvement in service delivery.

By using a combination of these methods and metrics, businesses can gain a

comprehensive understanding of customer satisfaction levels, identify areas for
improvement, and implement strategies to enhance the overall customer experience.
Regular monitoring and analysis of customer satisfaction data are essential for
maintaining high levels of customer satisfaction and loyalty.

5. Service encounters

Service encounters refer to the interactions between service providers and customers
during the delivery of a service. These encounters are critical moments that shape
customers' perceptions of the service and significantly impact their overall satisfaction
and loyalty. Here's a breakdown of key aspects related to service encounters:
 ❖ Types of Service Encounters

A service encounter occurs every time a customer interacts with the service
organization. There are three general types of service encounters – remote
encounters, phone encounters, and face-to-face encounters. A customer may
experience any of these types of service encounters, or a combination of all three in
his/her relations with a service firm.

1. Remote Encounter: Encounter can occur without any direct human contact is called as
Remote Encounters. Such as, when a customer interacts with a bank through the ATM
system, or with a mail-order service through automated dial-in ordering. Remote
encounters also occur when the firm sends its billing statements or communicates
others types of information to customers by mail. Although there is no direct human
contact in these remote encounters, each represents an opportunity for a firm to
reinforce or establish perceptions in the customer. In remote encounter the tangible
evidence of the service and the quality of the technical process and system become the
primary bases for judging quality. Services are being delivered through technology,
particularly with the advent of Internet applications. Retail purchases, airline ticketing,
repair and maintenance troubleshooting, and package and shipment tracking are just a
few examples of services available via the Internet. All of these types of service
encounters can be considered remote encounters.
2. Phone Encounters:- In many organizations, the most frequent type of encounter
between a customer and the firm occurs over the telephone is called as phone
encounter. Almost all firms (whether goods manufacturers or service businesses) rely
on phone encounters in the form of customer-service, general inquiry, or order-taking
functions. The judgment of quality in phone encounters is different from remote
encounters because there is greater potential variability in the interaction. Tone of voice,
employee knowledge, and effectiveness/efficiency in handling customer issues become
important criteria for judging quality in these encounters.
3. Face-to-Face Encounters: A third type of encounter is the one that occurs between an
employee and a customer in direct contact is called as Face-to-Face Encounter. In a
hotel, face—to—face encounters occurs between customers and maintenance
personnel, receptionist, bellboy, food and beverage servers and others. Determining
and understanding service equality issues in face—to—face context is the most
complex of all. Both verbal and non-verbal behaviors are important determinants of
quality, as are tangible cues such as employee dress and other symbols of service
(equipment’s, informational brochures, physical settings). In face—to—face encounters
the customer also play an important role in creating quality service for herself through
his/her own behavior during the interaction. For example, at Disney theme parks, face-
to-face encounters occur between customer and ticket-takers, maintenance personnel,
actors in Disney character costumes, ride personnel, food and beverage servers, and
others. For a company such as, IBM, in a business-to-business setting direct
encounters occur between the business customers and salespeople, delivery
personnel, maintenance representatives, and professional consultants.
5. Service failure and recovery
Service failure and recovery refer to the processes by which service providers respond
to instances where service delivery does not meet customer expectations or falls short
of service standards. Effective handling of service failures and recovery is critical for
maintaining customer satisfaction, loyalty, and trust. Here's an overview of service
failure and recovery:

### Service Failure:

1. Definition: Service failure occurs when a service does not meet the expectations or
requirements of the customer. It can manifest in various forms, including delays, errors,
quality issues, misunderstandings, or unmet needs.

2. Causes: Service failures can result from factors such as human error, operational
issues, system failures, miscommunication, inadequate training, or external factors
beyond the service provider's control.

3. Impact: Service failures can have negative consequences for both customers and
service providers. They can lead to customer dissatisfaction, frustration, loss of trust,
reputational damage, negative word-of-mouth, and potential customer defection.

4. Detection: Service providers must actively monitor and identify instances of service
failure through various channels, including customer feedback, complaints, quality
assurance processes, service performance metrics, and employee observations.

### Service Recovery:

1. Definition: Service recovery refers to the actions taken by service providers to

address and resolve service failures effectively, restore customer satisfaction, and
rebuild trust.

2. Objectives: The primary objectives of service recovery are to acknowledge the failure,
apologize to the customer, resolve the issue promptly, compensate the customer if
necessary, and prevent similar failures from recurring in the future.
3. Principles of Effective Service Recovery:
- Timeliness: Service recovery should be initiated promptly, ideally as soon as the
service failure is detected or reported.
- Empathy: Service providers should demonstrate empathy and understanding towards
the customer's concerns, acknowledging the impact of the failure on their experience.
- Ownership: Service providers should take ownership of the problem, accept
responsibility for the failure, and demonstrate a commitment to resolving the issue
satisfactorily.
- Transparency: Service providers should communicate openly and transparently with
customers about the nature of the failure, the steps being taken to address it, and any
compensation or remedies being offered.
- Fairness: Service providers should strive to offer fair and appropriate compensation or
remedies to affected customers, taking into account the severity and impact of the
failure.
- Learning and Improvement: Service providers should use service failures as
opportunities for learning and improvement, identifying root causes, implementing
corrective actions, and enhancing service delivery processes to prevent similar failures
in the future.

4. Types of Service Recovery Actions:

- Apology: Offering a sincere apology to the customer for the inconvenience or
disappointment caused by the service failure.
- Correction: Taking immediate action to correct the problem and restore the service to
the expected level of quality.
- Compensation: Providing compensation or restitution to the customer as a gesture of
goodwill for the inconvenience or dissatisfaction experienced.
- Follow-Up: Following up with the customer after the resolution to ensure their
satisfaction, address any remaining concerns, and thank them for their patience and
understanding.
### Importance of Effective Service Recovery:

1. Preserving Customer Relationships: Effective service recovery helps preserve

customer relationships by demonstrating responsiveness, care, and commitment to
customer satisfaction.

2. Rebuilding Trust: Service recovery actions can help rebuild trust and confidence in
the service provider's ability to deliver quality service, even after a failure has occurred.

3. Minimizing Negative Impact: Prompt and effective service recovery can minimize the
negative impact of service failures on customer satisfaction, loyalty, and word-of-mouth.

4. Turning Negatives into Positives: Well-handled service recoveries have the potential
to turn dissatisfied customers into loyal advocates who appreciate the company's efforts
to address their concerns.

5. Continuous Improvement: Service failures provide valuable opportunities for learning

and continuous improvement, helping service providers identify and address underlying
issues to prevent similar failures in the future.

In summary, service failure and recovery are inevitable aspects of service delivery, but
how service providers respond to these challenges can significantly influence customer
perceptions and outcomes. By embracing principles of effective service recovery and
taking proactive steps to address service failures, companies can enhance customer
satisfaction, loyalty, and long-term success.

6.Service Guarantee
ervice guarantees are a powerful marketing tool that can help service providers to build
trust and enhance customer loyalty. By offering a service guarantee, service providers
demonstrate their confidence in the quality of their services, which can help to reduce
customers’ perceived risk and encourage them to try the service.
What is a Service Guarantee?
A service guarantee is a promise made by a service provider to deliver a certain level of
service quality to customers. If the provider fails to meet the promised level of quality,
the customer is entitled to some form of compensation, such as a refund or a discount.
 A service guarantee typically includes specific conditions, such as the time frame within
which the service will be provided, the scope of the service, and the types of
compensation that will be offered if the service falls short of the promised level of
quality.
Benefits of Service Guarantees
Service guarantees can offer several benefits to service providers, including:
• Increased customer trust and loyalty: Service guarantees demonstrate a service
provider’s commitment to quality and customer satisfaction, which can help to build trust
and enhance customer loyalty.
• Reduced customer perceived risk: By offering a service guarantee, service providers
can reduce customers’ perceived risk and encourage them to try the service.
• Improved service quality: Service guarantees can provide a strong incentive for
service providers to improve their service quality and customer satisfaction levels.
• Competitive advantage: Service guarantees can be a powerful differentiator for
service providers, helping them to stand out from competitors and attract new
customers.
Designing Effective Service Guarantees
To be effective, service guarantees must be well-designed and carefully implemented.
Here are some key factors to consider when designing a service guarantee:
• Relevance: The service guarantee should be relevant to the customer’s needs and
expectations.
• Clarity: The service guarantee should be clear and easy to understand, with specific
conditions and compensation.
• Feasibility: The service guarantee should be feasible for the service provider to deliver,
with realistic conditions and compensation.
• Communication: The service guarantee should be effectively communicated to
customers, through multiple channels such as website, brochures, or posters.
• Measurement: The service guarantee should be measurable, so that the service
provider can monitor its effectiveness and continuously improve.
 UNIT-3
1. Challenges of service design and development

Service design and development present several challenges, primarily due to the
intangible nature of services, the complexity of service delivery processes, and the need
to meet diverse customer expectations. Here are some key challenges:

1. Intangibility: Unlike physical products, services are intangible, making them more
challenging to conceptualize, communicate, and evaluate. Designing tangible elements
such as branding, communication materials, and service environments that effectively
convey the value proposition of the service can be complex.

2. Customer Heterogeneity: Customers have diverse needs, preferences, and

expectations when it comes to services. Designing services that cater to a broad range
of customer segments while maintaining coherence and consistency can be
challenging. Personalization and customization are often required to meet individual
customer needs effectively.

3. Complexity of Service Delivery: Services often involve multiple touchpoints,

interactions, and stakeholders throughout the service delivery process. Coordinating
these elements to ensure seamless integration and consistency across channels and
touchpoints can be challenging, particularly in omnichannel environments.

4. Managing Customer Expectations: Meeting and managing customer expectations is

crucial for service success. However, customer expectations can be influenced by
various factors such as previous experiences, word-of-mouth, marketing
communications, and industry standards. Aligning service design and delivery with
customer expectations while avoiding overpromising can be a delicate balance.

5. Service Quality and Consistency: Maintaining service quality and consistency across
different locations, channels, and customer interactions can be challenging, especially
for service businesses with multiple branches or franchises. Standardizing service
processes, training employees, and implementing quality control measures are
essential to ensure consistent service delivery.
6. Innovation and Differentiation: Achieving differentiation and staying ahead of
competitors in the service industry requires continuous innovation and creativity.
Developing innovative service concepts, features, and experiences that resonate with
customers and address unmet needs can be challenging, particularly in saturated or
highly competitive markets.

7. Technology Integration: With the increasing role of technology in service delivery,

integrating technology solutions such as digital platforms, automation, artificial
intelligence, and data analytics into service design and development processes can be
challenging. Ensuring seamless integration, user-friendliness, and data security are
critical considerations.

8. Regulatory and Compliance Requirements: Service businesses are often subject to

regulatory requirements, industry standards, and compliance obligations that govern
service delivery, data privacy, consumer protection, and other aspects. Ensuring
compliance with relevant regulations while maintaining operational efficiency and
customer satisfaction can be challenging.

9. Risk Management: Services inherently involve various risks, including operational,

financial, legal, reputational, and cybersecurity risks. Identifying, assessing, and
managing these risks throughout the service design and development lifecycle is
essential to mitigate potential negative impacts on customers and the business.

10. Measurement and Evaluation: Measuring the effectiveness, performance, and

impact of service design and development initiatives can be challenging due to the
intangible nature of services and the complexity of customer interactions. Developing
appropriate metrics, gathering meaningful data, and interpreting results accurately are
essential for continuous improvement.

Addressing these challenges requires a holistic approach to service design and

development that encompasses customer-centricity, innovation, collaboration, and
continuous learning. By understanding and proactively addressing these challenges,
service businesses can create and deliver compelling service experiences that meet
customer needs, drive satisfaction, and foster long-term success.
2.Types of Service

Types of Services

Business Services
The services used by business organizations to conduct activities are known as
business services. The business services assist the business but do not deliver a
tangible commodity. For example, transportation services do not give a tangible result,
but transport goods, inventory, raw materials, etc., from one place to another. The
major business services are insurance, banking, warehousing, transportation and
communication services.
Social Services
The services provided by an individual or a group of individuals voluntarily for the
accomplishment of some social goals are known as social services. The social goals
include improving the standard of living for the weaker section of society, providing
educational and health facilities to poor children and people, or providing hygienic
conditions in slum areas. The social service providers usually voluntarily provide the
services along with some considerations to cover their costs. Therefore, these service
providers do not have a profit earning motive. For example, educational facilities or
services provided by NGOs to poor children.
Personal Services
The services that give different customers’ a different experience are known as
personal services. These types of services are inconsistent in nature and differ based
on the service provider, customers’ demands, preferences, etc. For example,
restaurants, hotels, tourism, etc.
Types of Business Services
Banking
Commercial banks play an essential role in an economy by providing their customers
with institutional credit. These commercial banks transact the banking business, i.e.,
they accept money with the motive of lending and investing the deposited money by
the public, repay them on demand, or provide them withdrawing facilities through
cheques, drafts, orders, etc. The banks also earn some profit by lending money to the
companies. In simple terms, banking services provide finance to businesses in any
form, for different purposes, such as purchasing raw materials, building, machines,
and their daily routine activities. Besides, the banks also provide the companies with
locker, draft, debit card and credit card facilities.
Insurance
Insurance services involve facilitating the companies with insurance for their business.
In simple terms, insurance companies sign an agreement with companies, charge a
premium fee, and then transfer their risk to themselves. The signed insurance
agreement contains a promise by the insurance company to pay the mentioned
insured company a fixed amount either on the maturity of the fixed period or in case of
an accident or mishap to the business. Different kinds of insurance are life insurance,
marine insurance, fire insurance, health insurance, etc.
Transportation
Transportation refers to the transfer of people, goods, raw materials, etc., from one
place to another. Companies mainly use transport services to transfer finished goods,
raw materials, inventory, human resources, etc., from one place to another.
Transportation plays a crucial role in the development of an organization as these are
the only services that transport raw materials, essential products, and human
resources from one place to another. Different modes of transportation supporting
these services are rail, air, sea, road and waterways.
Warehousing
Warehousing means storing goods, materials, etc., in a scientific and systematic
manner. Usually, there is a time gap between the production and utilization of the
goods; therefore, an organization needs to preserve the goods until they are utilized.
Warehousing solves this problem of the companies by providing storage facilities to
the companies. Today’s warehousing services provide the right quantity at the right
time and place, in the right physical form, and at the right cost. Typically, warehousing
services are used by importers, wholesalers, exporters, manufacturers, customs,
transport businesses, etc.
Communication
Communication is the process of creating a common understanding amongst people
by exchange of messages through different sources. For the success of a business, it
needs to establish a good relationship or link with the outside world, including
customers, creditors, suppliers, competitors, etc., as it cannot run in isolation.
Therefore, it is essential for companies to use fast, accurate and efficient
communication services. Communication services can be used for placing an order,
filing a complaint, providing suggestions, expressing ideas, sharing information, etc.
The main communication services used by companies are telecom and postal.
3. Stages in new service development

The development of a new service typically involves several stages, from idea
generation to commercialization and launch. While the specific stages may vary
depending on the industry, market dynamics, and organizational processes, the
following are commonly recognized stages in new service development:

1. Idea Generation: The first stage involves generating ideas for new services based on
market research, customer feedback, industry trends, technological advancements, or
internal innovation initiatives. Ideas can come from various sources, including
employees, customers, competitors, and market insights.

2. Idea Screening and Concept Development: In this stage, potential service ideas are
evaluated and screened based on criteria such as market potential, feasibility,
alignment with organizational goals, and strategic fit. Concept development involves
refining selected ideas into viable service concepts, outlining key features, benefits,
target customer segments, and value proposition.

3. Market Research and Analysis: Conducting market research to assess the demand,
competition, and feasibility of the proposed service concept. This involves analyzing
customer needs, preferences, and behaviors, identifying market trends, conducting
competitive analysis, and evaluating regulatory and legal considerations.

4. Business Analysis and Planning: Evaluating the financial viability and business case
for the new service. This includes estimating the potential revenue, costs, profitability,
and return on investment (ROI) associated with the service, as well as developing a
detailed business plan outlining the strategic objectives, marketing strategy, pricing
strategy, and resource requirements.

5. Prototype or Pilot Testing: Developing a prototype or conducting a pilot test of the

new service to gather feedback, validate assumptions, and identify potential issues or
areas for improvement. This may involve testing the service with a small group of
customers or in a limited geographical area before full-scale implementation.
6. Service Design and Development: Designing and developing the new service based
on the feedback and insights gathered during the testing phase. This includes defining
service processes, designing service delivery systems, developing service features and
functionalities, and creating service documentation and training materials.

7. Implementation and Rollout: Implementing the new service across relevant channels,
locations, or customer segments. This may involve training employees, updating
systems and infrastructure, developing marketing and promotional materials, and
preparing for the launch of the service to the target market.

8. Monitoring and Evaluation: Continuously monitoring and evaluating the performance

of the new service after launch. This involves tracking key performance indicators
(KPIs), gathering customer feedback, assessing customer satisfaction, and making
adjustments or refinements to the service based on insights and learnings.

9. Scaling and Expansion: Scaling up the new service and expanding its reach to
additional markets, customer segments, or geographical areas. This may involve
refining the service offering, optimizing operational processes, investing in marketing
and sales efforts, and exploring partnership opportunities to accelerate growth.

10. Continuous Improvement: Iteratively improving the new service based on ongoing
feedback, market trends, and changes in customer needs or preferences. This involves
fostering a culture of innovation, learning from successes and failures, and adapting the
service to evolving market conditions to ensure its long-term success and
competitiveness.

By following these stages in new service development, organizations can systematically

bring innovative services to market, address customer needs, and drive business
growth and competitiveness in the dynamic marketplace.

4. Concept of service blueprinting

A service blueprint is a visual representation that outlines the process of delivering a

service, detailing each step involved from both the customer's and provider's
perspectives. It helps in understanding the interactions, touchpoints, and dependencies
within a service ecosystem. Here's a breakdown of the typical components of a service
blueprint:

1. Customer Actions/Steps: This section outlines the actions that customers take when
interacting with the service. It includes steps such as researching, purchasing, and
receiving support.

2. Frontstage Interaction: These are the customer-facing touchpoints where interactions

occur, such as a website, app interface, or physical store.

3. Backstage Interaction: These are the behind-the-scenes activities that support the
frontstage interactions. It includes processes, systems, and personnel involved in
delivering the service.

4. Support Processes: This section details the processes and activities that support the
delivery of the service. It could include IT systems, logistics, customer service protocols,
etc.

5. Physical Evidence: This includes tangible elements that customers encounter during
the service delivery, such as brochures, signage, or product packaging.

6. Customer Experience: This aspect highlights the emotional or psychological

experiences that customers may have at various touchpoints throughout the service
journey.

7. Service Providers/Staff: This section outlines the roles and responsibilities of the staff
involved in delivering the service, including frontline employees, managers, and support
staff.
8. Customer Touchpoints: These are the specific points of contact or interaction
between the customer and the service provider. It could be a call center, a checkout
counter, or an online chat support feature.

9. Service Blueprint Layers: Service blueprints can have multiple layers to represent
different levels of detail. For example, a high-level blueprint may provide an overview of
the entire service process, while a detailed blueprint may zoom in on specific
interactions or touchpoints.

Overall, a service blueprint provides a comprehensive view of the service delivery

process, helping organizations identify areas for improvement, optimize processes, and
enhance the overall customer experience.

Elements of a service blueprint

Service blueprints typically contain five categories that illustrate the main components of
the service being mapped out.

1. Physical evidence

What customers (and employees) come in contact with. Though first in line, it’s usually
the last element added.

Example: This category includes locations, like a physical store or the company
website, but also any signage, receipts, notification or confirmation emails, etc.

2. Customer actions

What customers do during the service experience.

Example: Customers might visit the website, talk to an employee (in person or online),
make a purchase, place an order, accept an order, or receive something.

3. Frontstage or visible employee actions

What customers see and who they interact with. For tech-heavy businesses, add in or
replace this category with the technology that interacts with the customer.
Example: Employees might greet a customer visiting a physical location, respond to
questions through chat, send emails, take an order, or provide status information.

4. Backstage or invisible contact employee actions

All other employee actions, preparations, or responsibilities customers don’t see but that
make the service possible.

Example: Employees might write content for the website/email/etc., provide approval,
complete a review process, make preparations, package an order, etc.

5. Support processes

Internal/additional activities that support the employees providing the service.

Example: Third-party vendors who deliver supplies, a carrier service, equipment or

software used, delivery or payment systems, etc.

Lines

Service blueprints also include lines to separate each category, clarifying how
components in a service process interact with each other. This allows employees and
managers to better understand their role and, most importantly, possible sources of
customer dissatisfaction within a service experience.

Optional categories

If you need more detail, you could also add a timeline to show how long each step
takes, some kind of success metric to measure goals, or the customer’s emotions
throughout the process.

Fundamentally, service blueprints center on the customer. They allow for a clear vision
of the service design, which in turn helps organizations refine their processes and
deliver pleasing, memorable customer experiences.

Benefits of using service blueprints

Because services aren’t tangible, it can be difficult to convince decision-makers and

executives that changes need to be made. It can be even more difficult to talk about
specific changes without first having a full picture of the process. Visualizing each step
and each interaction in the process takes away that vagueness and highlights areas for
improvement.
 Service blueprints empower organizations to optimize their service processes.
Additional benefits include:

• Scalability and flexibility: Service blueprints accommodate as much or as little detail

as needed. They can show high-level overviews or intricate steps.

• Cross-functionality and knowledge transferability: Employees and managers in long-

standing or complex processes can easily lose sight of the bigger picture or how each
action affects other departments, fellow employees, or even the customer. Service
blueprints clarify interactions and reduce siloes.

• Competition: Service blueprints allow you to compare what you want your service to
look like with what it looks like now, or you can compare your company’s services
with a competitor’s.

• Failure analysis: Once you can see who is (or should be) doing what, it’s much easier
to diagnose what’s going wrong.

Service blueprints create a visible structure for implementing and achieving operational
goals. Their cross-functionality likewise fosters better communication between
customers, employees, and management, which increases the chances that companies
will understand their customers and respond to their needs while keeping their service
processes free from unnecessary complications and redundancies.

How to create a service blueprint

You can build a service blueprint diagram at any point in your service design.

1. Come up with a customer scenario

Whether you are creating a new process or mapping out an existing one, start with the
customer service scenario you want to explore. It may be beneficial, at this point, to
include real customers in the conversation to ensure that your scenario is as true to
customers’ real (or desired) experiences as possible.

2. Map out the customer experience

Whatever scenario you decide on, plot out the actions the customer will take in
chronological order.

3. Built out from the customer’s actions

Once you have the full customer service experience laid out, add the other categories––
frontstage and backstage actions, support processes, physical evidence, time, etc. to
 the customer actions. What do employees do during each action the customer takes?
What support processes come into play?

3. Clarify lanes of responsibility and action

Use the different lines of separation to keep each category in its own clearly marked
lane and to illustrate the ways different actors interact during the service process:

• Line of interaction: Where the customer interacts with the service and employees.

• Line of visibility: Where the employee or organizational processes become invisible to

the customer.

• Line of internal action: Where partners or employees who don’t have contact with the
customer step in to support the service.

4. Clarify cross-functional relationships

After mapping out each category, add another level of detail to your service blueprint by
including arrows. While you will already have laid out the steps in chronological order
within each lane, you can also show the relationships and dependencies that run across
different categories through arrows. If a shape has a single arrow, the exchange occurs
in the direction indicated. A double arrow shows that some agreement must be reached
or that the two shapes depend on each other in some way.

Together, these elements will help you see and find solutions to service processes and
customer experience issues.

Service blueprint templates and examples

Whether you're ready and just need a few shapes to make your own service blueprint or
you want to look at some more examples, we've got a variety of options for you. See the
templates below and discover how service blueprints can help you across different
industries and accommodate different levels of detail.
Service Blueprint (Click on image to modify online)
Finance Industry Service Blueprint Example (Click on image to modify online)

Food Industry Service Blueprint Example (Click on image to modify online)Service

Blueprint Current and Future State (Click on image to modify online)

How to use Lucidchart to build your service blueprint

Lucidchart is a diagramming solution that helps managers, stakeholders, and

employees visualize their processes to see and build their future, faster. Explore
Lucidchart’s template library to get inspired and see what’s possible with our service
blueprint examples.

Think of our pre-made templates as easy service blueprint creators where the standard
layout, including the lines of separations and the different categories, are all ready to go.
All you have to do is fill in the blanks and add connecting arrows.

To customize or build your own, use our shape libraries to quickly drag and drop shapes
onto the canvas and rearrange them with the click of a button. Add color or images,
import data to your service blueprint diagram, and add conditional formatting to show
status updates, flag certain information, or track metrics.
Since your documents are securely stored in the cloud, Lucidchart makes it easy to
share and collaborate with relevant stakeholders on your service blueprint. Optimize
your service process and simplify your service design with Lucidchart.

4. customer defined service standards

Customer Defined Service Standards

21 Mar 2019

5.Customer Service Standards

Customer service standards are a set of policies and expectations that have been
created and adopted by a company. The standards cover all the points of contact the
business may have with the customer. In a sense, they are the expectations or rules for
conduct in any customer transaction and how you want customers to feel about their
experience with your company. After all, customers buy based on emotions rather than
logic or reason. Exceptional customer care inspires future purchasing behavior more
than data and facts.

Customer Service and the Buyer’s Journey

The buyer’s journey is a conceptual framework for thinking about your customer’s full
range of experiences or contacts with your company. While the precise contours and
points of contact will vary depending on the company and what it does or sells,
generally it will consist of at least these three stages:

(i) Awareness: The customer becomes aware of a problem or a need, and has the
desire to solve it or fill it.

(ii) Consideration: The customer thinks about possible solutions and options available
for solving that problem or filling that need.

(iii) Decision: The customer makes a purchasing decision and buys one of the
products or solutions he has considered in stage two.

Customer service should ideally cover each of these stages, as well as the post-
purchase phase. In one sense, marketing is the art of helping customers move more
rapidly and easily from one stage to the next.

Customer service serves as a support for people at every stage along the way, and
beyond. Far from simply helping people who have already purchased to use the product
more effectively, customer service is there to support both prospective and existing
customers as they consider, evaluate, purchase and use a company’s products and
services.
It may mean offering additional information about the need or perceived problem in the
awareness stage, or stage one. In stage two, it could mean providing more detailed
information about the lifespan of the product or service cycle and how it can help
resolve the problem. Finally, in stage three, the decision-making phase, it usually
revolves around assistance with the transaction itself or some aspect such as shipping
and returns.

By crafting customer service standards to govern interactions with consumers at every

possible point along the buyer’s journey, a company expertly crafts the specific
experience it wants its customers to enjoy. Maintaining this sense of proactive design
helps a business turn prospects and leads into loyal customers and brand
ambassadors.

Importance of Service Standards

Taking the time and effort to formalize customer service standards is an important
exercise for companies to undertake. The process of developing those standards and
guidelines helps the company solidify its thinking about how it relates to its market and
further enhance its brand.
Adopting formal customer service standards and communicating those standards to all
employees who have any contact with customers is essential for the company’s
workers, especially those filling roles that are explicitly devoted to the customer and
technical service functions.

Additionally, adopting formal customer service standards helps the company in scripting
the buyer’s journey. Furthermore, standardized customer service helps the company by
ensuring the maximum positive response from the maximum number of customers.

A positive, enjoyable customer experience during a person’s first transaction with a

company will often bring that customer back for future purchases. For most companies,
from an economic standpoint, it makes much more sense to retain an existing customer
than to acquire a new one. It could be up to 25 times more costly to gain a new
customer than to keep an existing one.

6. Services cape
Servicescape: Meaning, Examples, Elements, Approach, and Roles

June 13, 2023 | By Hitesh Bhasin | Filed Under: Marketing

Servicescape is defined as the physical environment where a service can take place. It
helps to analyze and identify the impact of a good environment on the service-based
industry.

Servicescape deals in the settings where a service is consumed or delivered and the
place where both the company and customer interactions with each other. It has a
powerful impact on the assessment, perception, and response of the customer.

Meaning of servicescape

Servicescape is a model that puts its onus on explaining the behavior of customers and
clients within the service environment. It is a popular concept from Booms and Bitner
that categorically states that ambiance has a direct impact on the customers.

When a consumer visits a place for a particular service or product, it is the surroundings
that encourage or discourages him from following a set course of action.

It is the first aspect of service perceived by the client or customer and the impression
that forms pave the way for further services.
The founders of Servicescape have explained the concept as a necessity if you are
interested in improving your relationship with customers to felicitate better sales figures
and larger revenues.

Aspects of servicescape

It is the role of a service provider to create an environment that will appeal to its
customer and ease any discomfort. The important aspects of servicescape are-

1. Spatial layout and functionality

Spatial layout is about the way you arrange the furnishings, equipment and machinery,
their shape and size and of course, the spatial relationship which exists amongst them.
Functionality is about the ability of those items to accomplish customer satisfaction.

The aspect of spatial layout and functionality is much needed in self-service settings
where the customers themselves handle the services.

Also Read Brand Dilution: Definition, Causes and Examples

You will generally not find employees or workers helping you to deal with them. Some
important examples are the ATM, self-service restaurants, internet shopping, etc.

2. Signs, symbols, and artifacts

The sign is one of the most explicit signals that can communicate directly with a
customer in a physical environment. These are prominently displayed on both exterior
and interior of a place and generally act as communicators.

The signs can be used as labels like the name of a department and company, for a
directional purpose like entrance and as rules for specific behavior like no smoking.
Symbols and artifacts are also effective in giving the implicit cue to the reader.

Some important examples are artwork, floor coverings, photographs on the wall, and
display of prominent artifacts that have symbolic meaning and manage to connect and
communicate with its reader.
3. Ambient conditions

The background conditions of an environment like color, noise, music, sound, lighting,
etc. are included in ambient conditions. These are important factors as they affect one
or other of our five senses and can change the mindset and perception of a person.

In some cases, we hear a soothing background score to relieve stress. The effect of the
strong scent, for instance of coffee or cookies, act as great tempting force and can
easily draw people in. Remember, the ambient condition has proved itself as an
influential aspect of servicescape.

Examples of servicescape

Impressions matter a great deal, and it is the ambiance that proves a deciding factor for
most customers. Do you want to conduct any type of service at a place where you are
not comfortable in the settings?

Sometimes the product value of two companies is the same, but what separates from
others is its physical environment. A person will feel comfortable in one place and not so
in another.

This can be a deal-breaker for him. For example, if you have the option of having dinner
in a plain room with only basic amenities and the other place with the soothing
ambiance, you will always choose the latter instead of the former.

Roles of servicescape

The servicescape can play various roles like-

1. Facilitator

Servicescape acts as a facilitator to help people in their surroundings.

A well-designed place creates a pleasurable ambiance that relates to peace and

harmony, whereas an inefficient design can cause frustration and pessimistic attitude in
the minds of both employees and customers.

2. Socialiser

The servicescape design acts as a perfect socializer between both customers and
employees.
It also helps to depict the expected behavior and roles like an employee can understand
his position in a team through his cubicle placement, the quality of office furnishings and
office assignments.

The design also suggests to customers where they are not allowed and where they are
encouraged and welcomed through servicescape.

3. Package

The servicescape helps to convey the internal image through its outward appearance.

Product packages are one of its primary examples where you can easily know about the
wrapped product by viewing and reading the matter. It acts as a visual metaphor for
building a specific image.

4. Differentiator

Servicescape acts as a differentiator by separating designs of a company from its

competitor. It helps to reposition a company and attract new segments.

Types of servicescape environment

The two types of service environment identified on servicescape are –

1. Lean servicescape

Designing this type of environment is straightforward and includes fewer interactions,

elements, and spaces between employees and customers.

Some important examples are fast-food outlets, vending machine, and kiosks.

2. Elaborate servicescape

Designing this type of servicescape requires teams that are skilled in their work and are
fully aware of the corporate vision and desired outcome. The elaborate servicescape
includes multiple spaces, elements, and interactions between employees and
customers.

Some important examples include restaurants, gym, swimming pool, bars, ocean liners,
and international hotels.
Functions of servicescape

The functions of servicescape are as follows-

1. Image, differentiation, and positioning

Servicescape is an integral part of value proposition and service experience as it can

attract attention very easily.

It delivers leisure as well as a contact service, for instance, in shopping malls, the staff
and the environment jointly makes an effort to please its customers.

Also Read What is Product Research?

2. Facilitating service encounter and increasing productivity

designing plays an important part in servicescape if you want to facilitate service

encounter and maximize productivity.

Several shopping malls have included small playhouse type of enclosures within its
innovative design so that mothers can avail the services, keep their child over there,
and peacefully continue with their shopping.

Approach of servicescape

The approach adopted by servicescape includes-

1. Direct observation

Trained observers are hired to observe and make a detailed note of the behavior and
reactions of both the employees and customers. Depth interviews and direct
observation has helped to explore the reactions and interactions of participants.

The findings have proved useful in comparing and redesigning the servicescape for
better results.

2. Environment surveys

An environment survey asks both the employees and customers to put across their
preferences and needs by answering predetermined queries in a particular format. It
measures perceptions of three different factors like social condition, design, and
ambiance.

The most important advantage of this survey is the interpretation and administration of
the derived result to create better servicescape.

3. Photographic blueprint

The visual and photographic blueprint can help to know the point of view of a customer.
It acts as a tool to assess the service process.
 UNIT-4

1.Delivering Services: Role of Employees and Customers in Service Delivery

You will recall that, services are produced by employees and consumed by customers
simultaneously. Hence, customers must know the role that they would be expected to
play at a particular service facility. They must be educated and trained, if necessary, to
play appropriate roles at the service outlet, so that they can get the benefit of the
service. Most customers learn their roles while growing up in life. However, they may
not know the best role that they can play at a new service facility.

Take the case of customers waiting to receive medicines at a hospital pharmacy.

Ordinarily, customers would submit their request for medicines and wait anxiously at the
deliver counter for their medicines. In case there are many people waiting for their
medicines, each person has to stand for a long time to receive their medicines. Few
chairs might be placed near the counter for the patients to wait, but they might not
consider being seated, rather they would stand anxiously around the counter to check
that their request receives due priority, other people do not get their medicines out of
turn, and the pharmacy employees do not delay delivering their medicines out of plain
laziness. This situation used to take place at a hospital pharmacy and is commonly
encountered in most hospital pharmacies.
Role of customers in service delivery

Service delivery for customers can be seen in a factory. The place the service is
produced and is consumed interacting with the employees and other customers. E.g in
a classroom or in a training situation, students (customers) are sitting in the factory
interacting with the instructor and other students as they consume the educational
services.

Since these customers are present during the service production, customers can
contribute to or detract from the successful delivery of the service and to their own
satisfaction.

Importance of customers in service delivery

Customer participation at some level is inevitable in service delivery. Services are

actions or performances, typically produced and consumed simultaneously. In many
situations employees, customers and even others in the service environment interact to
produce the ultimate service outcome. As the customers receiving the service
participates in the service delivery process. He or she can contribute to the gap through
appropriate or inappropriate, effective or ineffective, productive or unproductive
behaviors.

Customers who are unprepared in terms of what they want to order can soak up the
customer service representative’s time as they seek advice. Similarly, shoppers who are
not prepared with their credit cards can “put the representative on hold”. While they
search for their credit cards or go to another room or even out of their cars to get them.
Meanwhile, other customers and calls are left unattended, causing longer wait times
and potential dissatisfaction.
Customer’s Roles

(i) Customers as a productive process

Service customers are referred to as “partial employees” of the organization. They are
human resources who contribute to the organization’s productive capacity. In other
words, if customers contribute effort, time or other resources to the service production
process, they should be considered as part of the organization.

(ii) Customers as quality contributors to service delivery and satisfaction

Another role customers play in service delivery is that of the contributor to their own
satisfaction and the ultimate quality of the services they receive. Customers may care
little that they have increased the productivity of the organization through their
participation. But they likely care a great deal about whether their needs are fulfilled.
Effective customer participation can increase the likelihood of service delivery that their
needs are met and that benefits the customer seeks are attained. Services such as
health care, education, personal fitness, and weight loss, where the service outcome is
highly dependent on the customers participation. In such services unless the customers
perform their roles effectively, the desired service outcomes cannot be achieved.

(iii) Customers as competitors

A final role played by service customers is that of a potential competitor. If self-service

customers can be viewed as resources of the firm, or as “partial employees,” self-
service customers in some cases. They can partially perform the service or the entire
service for themselves and may not need the provider at all.

Customers thus in that sense are competitors of the companies that supply the service.
Whether to produce a service for themselves (internal exchange). E.g. child care, home
maintenance i.e. have someone else provide home services for them (external
exchange) is a common dilemma for consumers.

Similar internal versus external exchange decisions are made by organizations. Firms
frequently choose to outsource service activities such as payroll, data processing,
research, accounting, maintenance, and facilities management. They find that it is
advantageous to focus on their core businesses and leave these essential support
services to others with greater expertise. Alternatively, a firm may decide to stop
purchasing services externally and bring the service production process in-house.
2.DELIVERING SERVICE THROUGH INTERMEDIARIES ANJD ELECTRONIC
CHANNEL

3.Integrated Marketing Communications

It is essential for organizations to promote their brands well among the end-users not
only to outshine competitors but also survive in the long run. Brand promotion increases
awareness of products and services and eventually increases their sales, yielding high
profits and revenue for the organization.

To understand integrated marketing communication, let us first understand what does

brand communication mean?

Brand communication is an initiative taken by organizations to make their products and

services popular among the end-users. Brand communication goes a long way in
promoting products and services among target consumers. The process involves
identifying individuals who are best suited to the purchase of products or services (also
called target consumers) and promoting the brand among them through any one of the
following means:

▪ Advertising
▪ Sales Promotion
▪ Public Relation
▪ Direct Marketing
▪ Personal Selling
▪ Social media, and so on
Integrated Marketing Communication - Let us now understand what does integrated
marketing communication mean?

Integrated marketing communication refers to integrating all the methods of brand

promotion to promote a particular product or service among target customers. In
integrated marketing communication, all aspects of marketing communication work
together for increased sales and maximum cost effectiveness.

Let us go through various components of Integrated Marketing Communication:

1. The Foundation - As the name suggests, foundation stage involves detailed

analysis of both the product as well as target market. It is essential for marketers
to understand the brand, its offerings and end-users. You need to know the
needs, attitudes and expectations of the target customers. Keep a close watch
on competitor’s activities.
2. The Corporate Culture - The features of products and services ought to be in line
with the work culture of the organization. Every organization has a vision and it’s
important for the marketers to keep in mind the same before designing products
and services. Let us understand it with the help of an example.

Organization A‘s vision is to promote green and clean world. Naturally its
products need to be eco friendly and biodegradable, in lines with the vision of the
organization.

3. Brand Focus - Brand Focus represents the corporate identity of the brand.
1.4. Consumer Experience - Marketers need to focus on consumer experience
which refers to what the customers feel about the product. A consumer is likely to
pick up a product which has good packaging and looks attractive. Products need
to meet and exceed customer expectations.

5. Communication Tools - Communication tools include various modes of promoting

a particular brand such as advertising, direct selling, promoting through social
media such as facebook, twitter, orkut and so on.
6. Promotional Tools - Brands are promoted through various promotional tools such
as trade promotions, personal selling and so on. Organizations need to
strengthen their relationship with customers and external clients.
7. Integration Tools - Organizations need to keep a regular track on customer
feedbacks and reviews. You need to have specific software like customer
relationship management (CRM) which helps in measuring the effectiveness of
various integrated marketing communications tools.
Integrated marketing communication enables all aspects of marketing mix to work
together in harmony to promote a particular product or service effectively among end-
users.

4. Pricing of services

Pricing of services can vary widely depending on factors such as the type of service, the
industry, the target market, and the value proposition offered. Here are some common
pricing strategies for services:

1. Hourly or Time-Based Pricing: This model charges customers based on the time
spent delivering the service. It's common in industries like consulting, legal services,
and freelancing.

2. Fixed Pricing: In this model, the service provider sets a fixed price for a specific
service or package of services. This is often used for standardized services where the
scope of work is well-defined.

3. Value-Based Pricing: This strategy involves pricing the service based on the
perceived value it delivers to the customer. Providers may charge higher prices for
services that offer unique benefits or solve critical problems for customers.

4. Tiered Pricing: Providers offer different service packages at various price points,
allowing customers to choose the level of service that best fits their needs and budget.
This is common in industries like software as a service (SaaS) and subscription-based
services.

5. Freemium Model: This approach offers a basic version of the service for free, with the
option to upgrade to a premium version with additional features or functionality for a fee.
It's often used in software and online services.
6. Pay-Per-Use: Customers are charged based on their usage of the service, such as
the number of transactions processed, data storage used, or resources consumed. This
model is prevalent in industries like cloud computing and utilities.

7. Subscription Pricing: Customers pay a recurring fee to access the service for a
specified period, typically monthly or annually. This model provides predictable revenue
for service providers and is common in industries like streaming media, gym
memberships, and software subscriptions.

8. Bundled Pricing: Multiple services or products are bundled together and offered at a
discounted price compared to purchasing each item separately. This can incentivize
customers to purchase more and increase their overall value.

When determining pricing for services, it's essential to consider factors such as the cost
of delivering the service, competitive pricing, customer perceptions of value, and pricing
elasticity. Experimentation and market research can help service providers find the
pricing strategy that maximizes revenue while meeting customer needs and
expectations.

5.Self service technologies

Self-Service Technologies (SSTs) are technological interfaces allowing customers to

produce services independent of involvement of direct service employee.[1] Self-Service
technologies are replacing many face-to-face service interactions with the intention to
make service transactions more accurate, convenient and faster.

Examples of SSTs

Automatic Teller machines (ATMs), Self pumping at gas stations, Self-ticket purchasing
on the Internet and Self-check-out at hotels and libraries are typical examples of self
service technologies.[2] As users of self service technologies continue to become more
accepting, additional solutions for making service transactions more convenient and
faster will be developed. One example of that is self serve alcohol and beverage
dispense which is now becoming more accepted in on-premise alcohol consumption
concepts like taprooms, breweries, entertainment venues, hospitality and urban living
locations.
Self-service technologies (SST) allow customers to get a service without interaction with
service providers. It is a big part of our lives, regardless you are 6 or 60 years old. Some
of these technologies are already well established in the market, while others still fight
against resistance.

The truth is that self-service technologies bring many benefits to both customers and
businesses. The customer gets what they want faster and easier; business sells more,
reduces costs and improves customer satisfaction, creating a loyalty bond between
them.

Even if you don’t love SSTs like I do, you can not deny its presence. And if you are a
business owner, you should definitely consider having this technology, if possible, to
increase your revenue and make your clients happier.

Here are my top 10 self-service technologies that I just love to use and that I think might
help you and me on a daily basis.

1. Airport self-service

They are part of the journey already: self-service kiosks in airports. Especially loved by
travelers with little luggage (which is often my case), they are real time-savers for
check-in and baggage drops.

Airport self-service kiosks speed up formalities and take away a lot of the stress
involved in the airport environment. With a plane to catch, we don’t want the possibility
of missing our flights. We just want to get to our gate fast.

So buckle up and have a nice flight!

2. ATMs

ATMs (Automated Teller Machines) were the first self-service machine introduced to the
public. To be exact, the first ATM was introduced into the UK in 1967. They are the best
example of a self-service technology that is well established in societies all around the
world.

ATMs have made our life much easier. They can be placed in a musical festival or in
any street. Nowadays, we take them for granted, hardly considering a time when they
didn’t exist. But it took them some time to get our trust.

Yes, we all love a cash machine (when our bank account is not in the red)!
3. Hotel automated service

Slowly but surely, the hotel industry is adopting self-service technology. Many hotels
have check-in and check-out kiosks to make guests‘ arrivals more pleasant and less
turbulent. More convenient, digital self-service can not be neglected in the modern
world.

But kiosks can be quiet expensive and they are not the only way to speed up the hotel
check-in process. Another way that self-service is being incorporated in hospitality is
through automated customer service (chatbots) on hotels’ websites. Take a look at how
Asksuite’s chatbot can help hotels avoid long queues ate their front desks:

Not to mention that pre-stay is a crucial part of guest experience and can benefit a lot
from self-service. Less stress for hotel staff otherwise overloaded with questions and
more convenience for the tired guest who has just arrived.

Just get your key room and enjoy your stay!

4. Self-ordering technology in restaurants

Self-ordering technology in restaurants is a growing trend. This kind of technology

increases operational efficiency as well as improves customer service by taking off the
pressure of standing in a queue.

McDonald’s is one of the big names that already adopted self-service technology. Their
kiosks have been in test since 2003 in the United States and as of 2020, they will be
implemented at all U.S. locations.

So from now on, you may take your own order and add yourself that extra-fries!

5. Self-service gas station

Self-service gas stations are a controversial topic. A self-service gas station is the one
where customers fill up their vehicles themselves. Most countries operate self-service
gas stations, but not all. In the US, for example, not all states allow it either. However, in
Europe, most people prefer self-serve gas stations to full-service gas stations.

There are many economical and social aspects of this subject. I prefer to take Andrew
Clark’s funny (and superficial) analysis of this feud: full-service gas stations are for lazy
people; self-service for desperate people who are looking for an excuse to get out of
their cars!

Full service or self-service: which one are you?

6. Self-service parking

Self-service kiosks make life easier in many scenarios, including airport parking. They
allow drivers to check-in and out through a fully automated system, helping late
passengers to catch their flights.

Specifically to air passengers, the quicker the process to get to the gate is, the better
their experience becomes. Making it simple to park the car, passengers feel less
stressed and their journey is off to good a start!

No more traffic on the parking plot!

7. Post office technologies

Many Posts all over the world are investing in self-service technologies in order to close
the gap between digital and physical. Canada Post and Singapore Post are some
examples of it.
I’m not sure if letter mail and post stamps will disappear forever (I do love the nostalgic
feeling that they bring), but it is undeniable that service experience is changing in the
post office world. It is great not to have to stay in line just to send a normal package or
to be able to track a product that you bought on e-commerce.

Mr.Postman, you don’t need to check if there is a letter for me anymore!

8. Supermarket kiosk

Supermarkets have also started to introduce technology for customers to scan and pay
their shopping. Self-service checkouts are more efficient and clients like it! Besides,
they have language options which are great for foreign customers.

Furthermore, those kiosks save time for both customer and employees. Employees can
focus on other important tasks, like stocking shelves, and customers skip chatting with
strangers while shopping.

Read the code bars, pay and prepare your dinner!

9. Museum and art gallery kiosks

I love museums and art gallery kiosks! They are a simple and fast way to engage clients
and make clients experience richer. They can be used in ticketing, wayfinding,
interactive exhibits, and guided tour.

Furthermore, the kiosks should be placed in the right spot, to get maximum traffic flow
and to be an integrated part of the exhibition. If people don’t understand its purpose, it
will be a waste of money.

If you need more information, please press the button!

10. Ticketing kiosks

Another self-service technology that I love is the movie theater kiosks. Theater kiosks
can encourage loyalty programs, collect customer data and make theaters more
profitable.

Ticketing kiosks are especially great for people that are always late, like me! In a matter
of a few minutes, you can select the movie, the showtime, the seat and pay for your
ticket. There is no more need to arrive early to guarantee the perfect spot to watch the
movie.

Skip line and grab your popcorn!