Chapter

14
Designing and
Managing Services

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 Categories of
Service Mix
• A pure tangible good
• A tangible good with
accompanying services
• A hybrid
• A major service with
accompanying minor
goods/services
• A pure service

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Characteristics
of Services

Intangibility

Inseparability

Variability

Perishability

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 Intangibility
• Services cannot be seen, tasted, felt, heard, or
smelled
Physical evidence and presentation tools:
 Place
 People
 Equipment
 Communication material
 Symbols
 Price
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 Inseparability
• Services are typically produced and consumed
simultaneously

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 Variability
• The quality of
services depends on
who provides them,
when and where,
and to whom
– As such, services
are highly variable

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 Perishability
• Services cannot be stored
• Strategies to match demand & supply

On demand side On supply side

•Differential pricing
•Nonpeak demand
•Complementary services
•Reservation services
•Part-time employees
•Peak-time efficiency routines
•Increased consumer
participation
•Shared services
•Facilities for future expansion

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 Achieving Excellence
In Services Marketing
• Marketing excellence

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Best Practices of Top Service
Companies
Top-
Strategic
management
concept
commitment

Satisfying High
customer standards
complaints

Monitoring
Profit tiers
systems

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