Designing and Managing Service:

 A service is any act or performance that one party can offer

to another that is essentially intangible and does not result in
the ownership of anything.
 Its production may or may not be tied to a physical product.
 Nature of the service sector: Service industries are quite
varied.
 The government sector
 Private nonprofit sector
 Business sector and
 Manufacturing sector.
 Factors influencing for the growth of service sector

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Nature of the service sector:

 Categories of Service Mix: Five categories of an offering’s

service mix can be distinguished.
 Pure tangible good
 Tangible good with accompanying services
 Hybrid
 Major service with accompanying minor goods and services
 Pure service.
 Characteristics of Services and Their Marketing
Implications:

 Services have four major characteristics that greatly affect

the design of marketing programs. They are intangibility,
inseparability, variability, and perishability.
 Differences in goods Vs services marketing

Goods Services Resulting Implications

Tangible Intangible Services cannot be inventoried
Services cannot be patented
Services cannot be readily displayed or communicated.
Pricing is difficult

Standardized Heterogeneous Service delivery and customer satisfaction depend on

(variable) employee actions.
Service quality depends on many uncontrollable factors.

Production separate Simultaneous Customers participate in and affect the transaction.

from consumption production and Customers affect each other.
consumption Employees affect the service outcome.
(inseparable) Decentralization may be essential.
Mass production is difficult
Nonperishable Perishable It is difficult to synchronize supply and demand with
services.
Services cannot be returned or resold
Marketing mix strategies: 7Ps

 Product/Service
 Price
 Place
 Promotion
 People
 Process and
 Physical Evidence
Three Types of Marketing in Service Industries:

 Internal Marketing
 External Marketing
 Interactive Marketing
MANAGING PRODUCT SUPPORT SERVICES:

 Although service industries are an important part of the

economy, a growing number of product-based industries are
also offering a service bundle.
 Presale Service
 Post sale Service
 Service remains a critical component for product marketers
in today’s dynamic, interconnected global marketplace.