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SERVICES MARKETING

Introduction

What is the role of service sector in Economy:


Every economy has three major sectors contributing the GDP 1. Agriculture is 17% of GDP and employs 60% 2. Industry (including Trade) is 29% of GDP and employs 12% 3. Services is 54% of GDP employing 28%

SERVICES sector plays an important role in todays economy.


Why do we need; Provider can give specialised service Can be outsourced

SERVICES MARKETING

Introduction

WHAT ARE SERVICES


1. Deeds

2. Processes

3. Performances

4. Are economic activities a. Without physical product output b. Are value added

SERVICES MARKETING

Introduction

Factors
In-tangible Heterogeneous (Goods are standardised)

Details
Can not be seen, felt, tasted or stocked No measure of quality Service dependent on employee and therefore consistency is lower

Simultaneous Production & Consumption The services are simultaneous production & consumption unlike in products where the production can be at different places while use at different places Mass production is not possible Perishability Services cant be stored, resold or returned Can not therefore keep an inventory for things to demand and then supply

SERVICES MARKETING

Marketing Mix

MARKETING MIX
Marketing mix is a set of controllable, tactical marketing tools a company employs to get the response from the market / customers. These tools are grouped as 4Ps, i.e. Product, Price, Place and Promotion.

The additional tools in the case of services marketing are;

People:- People play a very important role. The way they act, their reaction under given circumstances, the way they dress, their attitudes and behaviour with people, all play very important role Physical evidence:- The environment in which the service is delivered and where customers interact Process:- The actual procedures, mechanisms and flow of activities by which a service is delivered.

SERVICES MARKETING SOUTHWEST AIRLINES

Marketing Mix

Southwest Airlines, a Dallas based carrier, enjoys high respect, reliability, convenience, low cost, no frills and dependable airlines into the minds of US air-travelers. After Sept.1101, when many airlines were near bankruptcy, only Southwest Airlines was the only airlines making profits. The airlines has been enjoying top position consistently for 30 years and making profits. The major reasons being; Low cost structure and therefore low fares Number one in selling tickets over internet, thus not only being convenient to customers but also lower cost of operation Only one type of planes (Boeing 737s), which are fuel efficient with standardised maintenance and operational procedures (also low inventory of spares) No servicing of meals during in-flight Low turnover of man-power The present Chairman believes that employees are more important than customers (due to lower cost the customers priority is after employees). The airlines has best customer service record and has won industrys Triple Crown for best luggage handling, on-time performance and lowest customer complaint statistics for many years in a row. This has not been achieved by any other airlines so far.

SERVICES MARKETING SOUTHWEST AIRLINES

Marketing Mix

The Marketing Mix as required by a service industry are aligned around its market position and they strongly reinforce the value image of the airlines.

People:Both the customers as well as employees are used very effectively They are given authority to do and to make the flight enjoyable They are allowed to define fun and regular feedback from the customers is obtained to know their experiences of flying with them The customers also mix up with travelers and share jokes

Physical evidence:All tangibles associated show their uniqueness like the colour of aircrafts as orange and mustard brown The employees wear casual dress and even shorts in summer Re-usable plastic boarding passes are ample of examples to show low cost airlines image

SERVICES MARKETING SOUTHWEST AIRLINES


The no food during flight is another showing no frills LCA.

Marketing Mix

The environment in which the service is delivered and where customers interact

Process:The service that the airlines gives further re-enforces its position No assigned seat to the customer, people just line up to enter into the aircraft and taking seats The baggage is transferred to other connecting airlines thus cutting down the operations cost The process therefore becomes very efficient due to less number of people envolved in the entire operations

SERVICES MARKETING International Services Marketing

Marketing Mix

While starting or entering other countries or markets where the cultural differences persist The companies need to do following when entering such markets; The markets need to be studied carefully to know the type of services expected by the consumers The culture of the people and the type of competition needs to be studied As far as possible involve local people for dealing with the customers who understand the local markets, behaviour and customs of the market/country