7 Promoting Services

AND EDUCATING
CUSTOMERS
WIRTZ LOVELOCK
 Learning Objectives
7.1 Know the 5 Ws of the Integrated Service
Communications Model; i.e., Who, What, How, Where,
and When.
7.2 Be familiar with the three broad target audiences
(i.e., “Who”) for any service communications program.
7.3 Understand the most common strategic and tactical
service communications objectives (“What”).
7.4 Be familiar with the Services Marketing
Communications Funnel and the key objectives in that
funnel.

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 Learning Objectives
7.5 Know a few important roles that service marketing
communications can assume.
7.6 Understand the challenges of service
communications and know how they can be overcome
(“How”).
7.7 Be familiar with the Services Marketing
Communications Mix (“Where”).
7.8 Know the role of the internet, mobile phones, apps,
QR codes, and other electronic media in service
marketing communications.

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 Learning Objectives
7.9 Understand the role, benefits, and costs of using
intermediaries in distributing services.
7.10 Know the communications mix elements available
via service delivery channels.
7.11 Know the communications mix elements that
originate from outside the firm.
7.12 Understand when communications should take
place (“When”), how budgets for service
communications programs may be set, and how these
programs may be evaluated.

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 Learning Objectives
7.13 Appreciate ethical and consumer-privacy-related
issues in service marketing communications.
7.14 Understand the role of corporate design in
communications.
7.15 Know the importance of Integrated Marketing
Communications to deliver a strong brand identity.

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 5 Ws of the Integrated Service
Communications Model
PROMOTING SERVICES AND EDUCATING
CUSTOMERS

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 Strategic and tactical service
communications objectives
• Strategic objectives:
PROMOTING SERVICES AND EDUCATING

o Building a service brand and positioning it

and its service products against
competition
CUSTOMERS

o Persuading target customers that their

service product offers a better solution for
customer needs
o Attracting new users and maintaining
contact with existing customers

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 The challenges of service
communications
Overcoming Problems of Intangibility
PROMOTING SERVICES AND EDUCATING

• May be difficult to communicate service benefits to

customers, especially when intangible
• Intangibility creates problems:
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o Non-searchability: Cannot be fully searched or inspected before

purchase
o Abstractness: No one-to-one correspondence with physical
objects
o Mental impalpability: Customers find it hard to grasp benefits of
complex, multidimensional new offerings

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 The Services Marketing Communications Mix
PROMOTING SERVICES AND EDUCATING
CUSTOMERS

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 Traditional Marketing Channels
Advertising
PROMOTING SERVICES AND EDUCATING

• Build awareness, inform, persuade, and remind

• Challenge: How stand out from the crowd?
• Effectiveness remains
CUSTOMERS

controversial
• Research suggests that
less than half of all ads
generate a positive
return on their invest-
ment

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 Traditional Marketing Channels
Direct Marketing
PROMOTING SERVICES AND EDUCATING

• Mailings, recorded telephone

messages, faxes, e-mail
• Potential to send personalized
CUSTOMERS

messages to highly targeted

microsegments
o Need detailed database of information
about customers and prospects
• Advance in on-demand technologies empower
consumers to decide how and when they prefer to be
reached, and by whom
o e.g., email spam filters, pop-up blockers, podcasting
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 Traditional Marketing Channels
Sales Promotion
PROMOTING SERVICES AND EDUCATING

• Defined as “Communication that

comes with an incentive”
• Should be specific to a time period,
price, or customer group
• Motivates customers to use a
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specific service sooner, in greater

volume with each purchase, or
more frequently
• Interesting sales promotions can generate attention and put firm in
favorable light (especially if interesting results publicized)
o SAS International Hotels: If a hotel had vacant rooms, guests over 65 years
old could get a discount equivalent to their years. When a guest announced
his age as 102 and asked to be paid 2% of the room rate in return for
staying the night, he received it— and got a game of tennis with the general
manager!
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 Traditional Marketing Channels
Personal Selling
PROMOTING SERVICES AND EDUCATING

• Interpersonal encounters educate customers and

promote preferences for particular brand or product

• Common in b2b and infrequently purchased services
• Many b2b firms have dedicated salesforce to do personal
CUSTOMERS

selling
o Customer assigned to a designated account manager
• For services that are bought less often, firm’s
representative acts as consultant to help buyers
to make selection
• Face-to-face selling of new products is expensive—
telemarketing is lower cost alternative

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 Traditional Marketing Channels
Public Relations
PROMOTING SERVICES AND EDUCATING

• PR/Publicity involves efforts to stimulate positive interest in an

organization and its products through third parties
o e.g., press conferences, news releases, sponsorships
• Corporate PR specialists teach senior managers how to present
CUSTOMERS

themselves well at public events, especially when faced with hostile

questioning
• Unusual activities can present an opportunity to promote company’s
expertise
o e.g., FedEx – safely transported two giant pandas
from Chengdu, China, to the National Zoo in
Washington, D.C. in a FedEx aircraft renamed
FedEx PandaOne

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 Online/Digital Communication
Tools
Company’s Website
PROMOTING SERVICES AND EDUCATING

• The web is used for a variety of communication tasks

o Creating consumer awareness and interest
o Providing information and consultation
o Allowing two-way communication with customers through email
CUSTOMERS

and chat rooms

o Encouraging product trial
o Allowing customers to place orders
o Measuring effectiveness of
advertising or promotional
campaigns
• Innovative companies look for ways to improve the
appeal and usefulness of their sites
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 Online/Digital Communication
Tools
Online Advertising
PROMOTING SERVICES AND EDUCATING

• Banner advertising
o Placing advertising banners
and buttons on portals such as
Yahoo, Netscape and other
CUSTOMERS

firms’ websites
o Draw online traffic to the
advertiser’s own site
o Web sites often include
advertisements of other
related, but non-competing
services.
o e.g., advertisements for financial
service providers on Yahoo’s stock
quotes page
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 Online/Digital Communication
Tools
Online Advertising
PROMOTING SERVICES AND EDUCATING

• Search engine advertising

o Reverse broadcast network: search engines let advertisers know
exactly what consumer wants through their keyword search
o Can target relevant messages directly to desired consumers
CUSTOMERS

o Several advertising options:

o Pay for targeted placement of ads to relevant keyword searches
o Sponsor a short text message with a click-through link
o Buy top rankings in the display of search results

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 Communications mix elements that
originate from outside the firm
Word of Mouth (WOM)
PROMOTING SERVICES AND EDUCATING

• Recommendations from other customers viewed as

more credible
• Strategies to stimulate positive WOM:
o Having satisfied customers providing comments
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o Using other purchasers and knowledgeable

individuals as reference
o Creating exciting promotions that
get people talking
o Offering promotions that
encourage customers to
persuade their friend to purchase
o Developing referral incentive schemes

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 Communications mix elements that
originate from outside the firm
Blogs, Twitter, and Other Social Media
PROMOTING SERVICES AND EDUCATING

• Blogs:
o Communications about customer experiences influence opinions
of brands and products
o Some firm have started to monitor blogs
CUSTOMERS

as form of market research and feedback

• Twitter/Instagram:
o Becoming increasingly popular;
fastest-growing social networking services
• Media Coverage:
o Compares, contrasts service offerings
from competing organizations
o Advice on “best buys”
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 Corporate design in
communications
Strategies for Corporate Design
PROMOTING SERVICES AND EDUCATING

• Many service firms employ a unified and distinctive visual

appearance for all tangible elements:
o e.g., Logos, uniforms, physical facilities
• Provide recognition and strengthen brand image:
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o e.g., BP’s bright green-and

yellow service stations
• Especially useful in competitive
markets to stand out from the
crowd and be instantly
recognizable in different
locations:
o e.g. Shell’s yellow scallop shell
on a red background
o McDonald’s “Golden Arches”
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 Integrated Marketing
Communications
• Different departments look after different aspects of the
PROMOTING SERVICES AND EDUCATING

firm’s market communications

• Service failures could result from lack of effective
coordination among these various departments
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• IMC ties together and reinforces all communications to

deliver a strong brand identity.
• Firms can give ownership of IMC to a single department
or by appointing a marketing communications director

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