Sales and Marketing

Session 2

Service Characteristics of Hospitality

and Tourism Marketing
 Recap of previous class
• Marketing Mix – 4 P’s
• Tourism Marketing – Hospitality + Travel Industries
• Marketing Process – Creates Value for Customer & Capture
value from customers in return.
• Marketing Concepts – Needs, wants & Demands, Market
offerings, Customer Value & Satisfaction, Exchanges &
Relationships, Markets
• Marketing Management Orientation – Production, Selling,
Product & Marketing based
• Customer Valu building tools.
 Service Characteristics of Hospitality
and Tourism Marketing

Learning Objectives

1. Describe a service culture.

2. Identify four service characteristics that affect the marketing
of a hospitality or travel product.
3. Explain seven marketing strategies for service businesses
 Different Service Cultures
• Service culture
• Japanese Service Culture
• Disney world Service culture
• Starbucks Service Culture
 Ritz Carlton Hotels
• A great Service Company- 91 hotels in 30
countries.
• “Put people first” – Customer/Employee-
centered motto “We are Ladies and
Gentlemen Serving Ladies and Gentlemen”.
 Core of Ritz Carlton Culture
The 3 steps of Service
1. A warm & sincere greeting. Use the guest
name.
2. Anticipation and fullfillment of each guests
needs
3. Fond Farewell. Give a warm good-bye. Use
the guests name.
 Hospitality Services

Hospitality
Industry Services Customers

Profit Satisfaction

Services are Intangible activities that provides satisfactions of wants

Characteristics of Service Marketing

Characteristics
of Services
 Characteristics of Service Marketing
- Intangibility
• Cannot be seen, tasted, felt, heard or smelled
before purchasing it.
• Can be Experienced only
• We take away only memories, not physical
product.
• Service Marketers- provide tangible evidences
such as promotional materials with photos,
websites, videos
 Characteristics of Service Marketing
- Inseparability
• Simultaneity of production & consumption
• Products – Produced, stored, sold and
consumed later.
• Hospitality services- Sold, produced &
consumed at the same time. So, service
provider & consumer must be present when
transaction occurs.
• Services are generated & consumed at the
same time. Eg: Barber shop
 Characteristics of Service Marketing
- Variability
• Products can be mass produced & homogeneous.
• Services are highly variable. Each service is unique & cannot
be exactly repeated.
• Eg: Burgers produced in McDonalds of the same flavour may
be identical, but the service standard of the same counter
staff may not be the same for 2 consecutive customers,
depending on his emotions.
• Variability / Lack of consistency – may cause customer
disappointment in Hospitality industry.
Steps to Reduce Variability
Invest in good hiring
& training
procedures

Standardize Monitor
The service- Customer
performance Satisfaction
process
 Characteristics of Service Marketing
- Perishability

• Services cannot be stored, returned, resold –

once rendered to a customer.
• Say, a 100 room hotel with 60% occupancy,
cannot sell the unused rooms the next day as
140 rooms. – Perishable
• Also, a customer dissatisfied with the services
of his barber, cannot return his haircut. Can
only decide not to return to the shop in
future.
 The Service Profit Chain
Satisfied and
Internal service productive Greater service
quality service value
employees

Healthy service Take care of

Satisfied and those who
profits and
loyal customers take care of
growth customers
 3 Types of Service Marketing
External
Marketing

Internal Service Interactive

Marketing Marketing Marketing

Everyone including customer

Customer judges service quality not
contact employees are trained
only on the technical quality (food
& motivated to work as a team
quality) but also the functional
and provide
quality(the service provided in the
Customer satisfaction.
restaurant).
 Marketing Strategies for service businesses

Service Service Service Customer

Differentiation Quality Productivity Complaints

Employees Capacity
Perceived
As Part Of and
Risk
The Product Demand
Capacity Management
Involve the Customer in the Service Delivery System

Cross-Train Employees

Use Part-Time Employees

Rent or Share Extra Facilities and Equipment

Schedule Downtime During Periods of Low Demand

Change the Service Delivery System

Demand Management
Use Price to Create or Reduce Demand

Use Reservations

Overbook

Revenue Management

Use Queuing

Shift Demand

Create Promotional Events

 Key Terms
Interactive marketing Marketing by a
service firm that recognizes perceived
service quality depends heavily on the
quality of the buyer–seller interaction.
Internal marketing Marketing by a
service firm to train effectively and
motivate its customer-contact employees
and all the supporting service people to
work as a team to provide customer
satisfaction.
Organization image The way a person
or group views an organization.
Physical evidence Tangible clues such as
promotional material, employees of the
firm, and the physical environment of the
firm. Physical evidence is used by a service
firm to make its product more tangible to
customers.
Revenue management A pricing
method using price as a means of matching
demand with capacity.
Service culture definition to look like
this. Definition to look like this.
 Key Terms (cont.)
Service inseparability A major
characteristic of services; they are
produced and consumed at the
same time and cannot be
separated from their providers,
whether the providers are people
or machines.
Service intangibility A major
characteristic of services; they cannot be
seen, tasted, felt, heard, or smelled before
they are bought.
Service-profit chain A model that
shows the relationships between employee
satisfaction, customer satisfaction,
customer retention, value creation, and
profitability.
Service variability A major
characteristic of services; their quality may
vary greatly, depending on who provides
them and when, where, and how they are
provided.

Service perishability A major

characteristic of services; they cannot be
stored for later use.