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Components of Service Marketing

Service Marketing The Service Sector

Characteristics of Services

The Service Mix

Management of Services

Service Sector Employee Activities

Financial Services Banks, Building societies, accountants, stockbrokers,
insurance agents, actuaries.

Professional Services Estate agents, architects, designers, solicitors, lawyers,

consultants, surveyors, valuers, management, personnel.

Marketing Services - Advertising agencies, marketing research, public relations,

sales agents.

Catering Hotels, hospitality, restaurants, fast food and take-aways. Leisure and recreation sports clubs, theme parks, zoos and wildlife parks,
national parks and National Trust properties, tourism organisations, amusement centres, libraries, museums, the arts, cinemas, theatres, musical entertainment.

Other services painting and decorating, cleaning, repairs, health and social

services, education and training, travel and transport, postal services, police, public utilities, telecommunications, hairdressing.

Classification of Services
Type of market, such as consumer (legal advice and repairs) or industrial (consulting and installation services). Degree of labour intensiveness, whether labour based (education and hairdressing) or equipment based (telecommunications and public utilities). Level of customer contact, ranging from high (as in restaurants and air travel) to low (postal services and estate agents). Skill of the service provider, which could be mainly professional (lawyers and teachers) or non-professional (cleaners and public transport). Goal of the service provider, at one end of the scale profit based (banking and hotels) and at the other end non-profit orientated (police and some leisure / recreations services).

Rapid Increase in importance of all the Activities REASONS

General Economic prosperity and growth in various markets Lifestyle changes, e.g. Use of technology, women in the workforce, popularity of fitness and leisure, need for wider experiences and avoidance of specialist tasks such as cleaning, financial management and meal preparation Extended leisure time, leading to greater services opportunities and elimination of seasons Move to the private sector, for e.g. education, health and transport Demographic movements, such as a decrease in employment, early retirement and an increasingly older population Increase in ownership of goods, leading to increase in the repair services and maintenance sectors. Increase in consumer and business competition, leading to an increase in demand for personnel and consultancy services, leasing and caretaking, marketing and advertising, and so on Diversification into the services sector by retailers, for instance in the areas of optical, travel and tourism, and financial services Other factors, such as the increase in commercial and industrial services as a result of pressures for quality standards 4

Main Characteristics of Services

Characteristics Intangibility Distinguishing Features Cannot be tested, seen, heard, touched or smelled before purchase. Judgement therefore based on opinion, attitude, feeling, perception and experience , e.g. education provision Production and consumption are inseparable, creation / performance / consumption are often identical and distribution roles integrated. The product cannot usually exist without the customer, e.g. restaurant services Standardization of output is generally difficult, units differ in price, quality and conformity, and judgement is difficult in advance of purchase, e.g. tourism products. Services are perishable and cannot be stored, while short capacity is lost forever with fluctuations in demand, e.g. in transport and travel. Customers only have access to, or use of, a service, rather than ownership. There are thus no ownership transfers, patents or inventories and payment is for hire or temporary use, e.g. leisure facilities



Perishability Ownership

The Goods / Service Continuum

Dimensions of the Customer meal experience

Aspect Physiological Social Psychological Examples of Consumer satisfaction Correctly prepared steaks Comfortable seats Enjoyable company Helpful table service Secure, intimate environment Enhanced self - esteem Good Value Food Restaurant accessibility Examples of Consumer Dissatisfaction Overcooked food Static from nylon carpet Rowdy customers Waiter language difficulties Understanding French menu or wine list Smoky atmosphere Unacceptable credit card High priced entrees


Role of people in the service marketing mix

Contact Visibility Waitress Visible to client Service Engineer Telephone Operator Non visible to client Airline Accountant Computer operator Maintenance worker Cook in steak house Contact with client Non Contact with client

Marketing Solutions to Service Constraints

Service / Characteristics Intangibility Possible marketing solutions Increase tangibility and physical representation. Focus on benefits / reputations / brand names / personalities, to pinpoint the product. Use physical evidence where applicable. Develop internal / external research programme Emphasize service aspects. Re-organize work schedules. Train service providers. Careful personnel selection and training. Monitoring of standards / quality control. Prepacking of services. Emphasize tailor-made features and units. Better match between supply and demand. Short-term, tactical policies e.g. off-peak price reductions, promotional campaigns, etc. Stress Advantages of non-ownership, e.g. easier payment systems, less risk, spontaneity and surprise. 10





Service Marketing Strategies

Service Industry Outcome sought by buyer Technical possibilities Strategic possibilities

Higher education

Educational Tutoring Staff Development attainment Health Instruct patients to manage problems and prevent others

Higher entrance demands Pre-entry courses Market preventive medicine services, e.g. stress reduction/weight loss Market financial expertise by industrial spsecialisation




Money management courses Small Business management assistance

Plumbing repairs

Free flowing pipes

Provide consumers with instructions and supplies to prevent further blockages

Diversify, e.g. home waterpurification systems