SERVICE MARKETING MIX

Chapter 4 Module 2

Service Marketing Mix

Service Product

Service Product Mix

1.

2.
3.

4.

It means a set of services offered for sale by a company. It can be assessed in terms of Width – Number of different service line company offers Length – Total number of service items in the mix Depth – Number of variants offered in each service line Consistency – How closely service lines are related in consumer perception and distribution channels

Service Product Mix

Basic Service Package

A.

B.
C.

The service package is the product dimension of services. It includes all decisions involving the essential concept of service, the range of service provided and the quality and levels of service. Christian Gronroos makes a distinction between 3 groups of services: Core Facilitating (enabling) Supporting (enhancing)

Service Offer

It spells out in more details those services to be provided, how and to whom. It includes all those elements that make up the total service package including the tangible and in tangible part of it.

Service Delivery Systems

It is a carefully designed blueprint that describes how the service is rendered to the customers. It describes how the service is provided to the customer. It represents the interaction between service provider, customer & service facility.

Service Product Levels
1.

Generic / Core Service Level Actual Service Level

2.

3.

Expected Service Level
Augmented Service Level Potential Service Level

4.

5.

Service Levels

Diagrammatic presentation
Potential Augmented Expected

Actual
Core

Flower of Service

Flower of Service
Facilitating / Enabling
 

Enhancing / Supporting
 


Information Order taking Billing Payment


Consultation Hospitality Safekeeping Exceptions

Facilitating services
Example of Information elements  Directions to service site  Schedule / service hours  Prices  Reminders / Warnings  Conditions of sale/ services  Notifications of change  Summaries of account activity  Documentation  Confirmations of reservations Example of Order taking Elements

   

Membership in clubs or programs Subscription services Reservations and check in Professional Appointments Email / Web order placements Fast order execution

Facilitating services
Example of Billing elements

Example of Payment elements

Periodic statements of account activity Invoices for individual transactions Verbal statements of accounts due Self Billing

Exact change in machine Credit/ debit card payment ETF Automated systems

Enhancing Services
Example of Consultation
 

Example of Hospitality
 


 

Advice Auditing Personal counseling Tutoring / training Management or technical counseling

Greeting Food and Beverages Toilets & Washrooms Waiting rooms – lounges, magazines, newspapers

Enhancing Services
Example of Safe keeping
     

Example of Exception
  

Child / pet care Parking (valet) Cloak rooms Security Pick up and drop Cleaning / Refueling Repairs / Renovation / Upgrade

  

Medical / Disability needs Religious observances Handling complaints / compliments / suggestions Resolving difficulties Refunds / compensation Assisting customers for any need

Flower of Service

New Service Development - Need


 

Current Service has reached saturation stage To utilize spare and unused capacity Opportunity in the form of unmet needs To retain customers

Major Service Innovations

1. 2.

3.
4. 5.

6.
7.

As per Christopher Lovelock there are 7 categories of service innovations: Major Service innovations Major Process innovations Product Line extensions Process Line extensions Supplementary Service innovations Service improvements Style Changes

Difficulties in New Service Development


  

Rapid Changes in Technology Lot of R & D expenditure Improper Designing of service processes Competitors fight back harder than expected Risk of Confusing customers with too many services

Stages in New Service Development
1.

2.
3. 4. 5. 6. 7. 8.

Idea Generation Screening of Ideas Concept Development and evaluation Business Analysis Service Prototype Development Market Testing Commercialisation Review / Post introduction evaluation

BCG – Ansoff Corporate Strategy
Offerings Markets

Current Customers Existing Services Share Building or
Market Penetration New Service Service Development

New Customers Market Development

Diversification

BCG – Ansoff Corporate Strategy

Share Building / Market Penetration (Current Customer – Existing Services) Market Development (New Customer – Existing Services) Service Development (Current Customer – New Services) Diversification (New Customer – New Services)

Ansoff Growth Matrix

Service Blue printing

It is a picture or a map that portrays the service system It displays service delivery, points of contact, role of customers & employees, visible elements of service, etc
Process

Service Blueprinting

Point of Contact
Evidence

Service Blueprinting

Service Porduct Life Cycle


 

Introduction Growth Maturity Decline

2 P’s - Price

Service Pricing is Different - Why
1.

2.
3. 4. 5. 6. 7.

Price Quality relations Price value relations Price varies with demand Intangibility Lack of Stock Service customisation Non-Monetary Price

Types of Non-Monetary Price


 

Time Cost Search Cost Psychological Cost Convenience Cost

Pricing Objectives


   

Survival Revenue and Profit objective Patronage and user based Market Share & Sales Growth Competitive Effect Image Differentiation

Pricing Objectives


  

Market Skimming Early Cash Recovery Preventing New Entry Customer Satisfaction Social Responsibility

Factors affecting Pricing
Internal
 

External
    


Costs Objectives of Firm Image of Firm Promotional Activities Service Life Cycle

Competition Demand Consumers Government Control Economic Conditions Channel Intermediaries