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Introduction to Service Marketing
It is an act or performance that one party offers to another, that is essentially intangible and does not result into ownership of anything. It includes activities, benefits or satisfaction which are offered for sale and are provided with the sale of goods.
Service quality measurement:
Technical quality: The efficiency with which service is offered. Functional quality: The way in which the service is delivered.
Service Marketing Triangle
Characteristics of Services
1. Intangibility Marketing implication:
Can not be stored to meet demand fluctuations Services can not be patented legally Can not be easily communicated so quality assessment is difficult Pricing is also difficult to determine
2. Inseparability Marketing implication: Mass production is difficult Customer satisfaction is highly dependent upon the real time experience 3. Heterogeneity Marketing implication: It is highly variable depending upon the provider, time and the place Depends a lot upon the willingness of SP to satisfy customers needs
4. Perishability and fluctuating demand
Marketing implication: Inability to store Demand forecasting and planning for capacity utilization are very crucial Strong recovery strategies are required as services can not be resold
Difference between physical goods and services
Physical goods tangible homogeneous Production and distribution are separated from consumption A thing Core value processed in factory Customers do not participate in the production process Can be kept in stock Transfer of ownership Services intangible heterogeneous Production, distribution and consumption are simultaneous processes An activity or process Core value produced in the buyer-seller interaction Customers participate in production Cannot be kept in stock No transfer of ownership
Lovelock s classification of services
1. Nature of services Act: Intangibility and the service recipients are considered It considers how customers presence is required during service delivery Try to standardize the service so as to provide some consistency in service delivery
2. Relationship with customer
Healthy relations provide SPs with complete knowledge about their customers Personal information assess can help them to plan customized marketing efforts If the customers are anonymous, there will be lack of information and hence market opportunities will also be restricted
3. Customization and judgement in service delivery
Customization may help but SPs have to balance the cost of custom made service with the std service 4. Nature of demand and supply for services: It emphasizes on establishing demand patterns over time and to understand their existence. This pattern can be used to make things more favorable for the SPs
5. Method of service delivery
It deals with the availability of service outlets and the nature of interaction between the customers and the SPs Distribution related decisions to be taken considering customer convenience
Equipment based and labour based classification