Services Marketing Mix: The 7 P’s of Marketing

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This model, proposed by Booms and Bitner in 1981

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 Product
The product in service marketing mix is intangible in
nature and can not be measured. Tourism industry or
the education industry can be an excellent example.

The service product thus has to be designed with

care. Generally service blue printing is done to define
the service product. For example – a restaurant blue
print will be prepared before establishing a restaurant
business. This service blue print defines exactly how
the product (in this case the restaurant) is going to
be.
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 Place
Place in case of services determine where is
the service Product going to be located.

Due to the inseparability of services, they are

produced and consumed at the same place.

This inseparability of services makes it impossible for

service providers to produce the service at a place
where the costs are low and sell it at a place where
there is a high demand for it.

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 Example:-

• The best place to open up a petrol pump is on the

highway or in the city.
A place where there is minimum traffic is a wrong
location to start a petrol pump.

• Similarly a software company will be better placed in

a business hub with a lot of companies nearby rather
than being placed in a town or rural area.

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 Promotion
Promotion have become a critical factor in the service
marketing mix. Services are easy to be duplicated and
hence it is generally the brand which sets a service apart
from its counterpart.
Why is that? It is because competition in this service
sector is generally high and promotions is necessary to
survive.
Promotion refers to your advertising, marketing, and
sales techniques. This could mean traditional advertising,
via TV, radio, billboards, etc., or more modern methods,
like ads within web content, ads on a podcast, email
marketing or push notifications.
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Word of mouth is also a type of promotion. Word of
mouth is an informal communication about the
benefits of the service by satisfied customers and
ordinary individuals.

Example: There are few service providers who

promoted its brands in particular feild (HABIB ,
Zomato , Swiggy , Oyo etc).

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 Pricing
Pricing in case of services is rather more difficult than
in case of products. The fixed cost is high and the
variable costs are low for a service, when compared
to a product.

Example: The marginal cost involved in serving a

customer in restaurants is negligible.

Therefore, a major part of the price paid by the

customers is directed towards covering the fixed
costs of the service provider.
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Contd…
Price of the same service can be changed depending
on the demand for the service.

Example: The owner of a discotheque can increase or

decrease the price of entry depending on the
demand.

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 People
People define a service.
If you have an IT company, your software engineers define you.
If you have a restaurant, your chef and service staff defines you.
In case of service marketing, people can make or break an
organization.

Thus many companies nowadays are involved into specially

getting their staff trained in interpersonal skills and customer
service with a focus towards customer satisfaction. In fact many
companies have to undergo accreditation to show that their
staff is better than the rest.

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 Example:- When a person behaves badly at a
restaurant, the total experience of others gets
negatively affected.

Many services involve consumers as co-producers in

designing the service offering.

Example:- In a salon, the service provider involves

the customer also in the service and asks him various
questions to ascertain his desires so that they can
give the customers satisfaction.

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 Process
Service process is the way in which a service is delivered
to the end customer.
A service encounter is the actual time period during
which an interaction takes place between the service
provider and the customer.
These particular interactions are named critical incidents
and are directly responsible for customer satisfaction or
dissatisfaction.
These feelings of satisfaction or dissatisfaction may result
either from their interaction with the service personnel or
from the interaction with the equipment or production
processes.
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 Example:- Movie theatres have introduced ticket
kiosks to offer convenience to customers and also
reduce the human element in the service delivery
process.

Example:- A restaurant offering self-service can save

on labour costs and can pass on the savings to the
customers in the form of lower prices.

Example:- Introduction of ATM on Banking Sector.

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 Physical Evidence

As said before, services are intangible in nature. However, to

create a better customer experience tangible elements are
also delivered with the service. Take an example of a
restaurant which has only chairs and tables and good food, or
a restaurant which has ambient lighting, nice music along
with good seating arrangement and this also serves good
food. Which one will you prefer? The one with the nice
ambience. That’s physical evidence.

Several times, physical evidence is used as a differentiator in

service marketing. Imagine a private hospital and a
government hospital. A private hospital will have plush offices
and well dressed staff. Same cannot be said for a government
hospital. Thus physical evidence acts as a differentiator.
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