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Definitions on Service Marketing

AMA defines services as activities, benefits, or satisfaction which are offered for sale, or provided in connection with the sale of goods.

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Definitions on Service Marketing-continued

W.J.Regan in his article, The Service Revolution in Journal of Marketing services represent either intangibles yielding satisfactions directly ( transportation, housing), or intangible yielding satisfactions jointly when purchased either with commodities or other services (credit delivery).

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Modern services

Travel agency Real estates Advertising Public relations Market research Physical fitness, health clubs Car rentals Courier services Credit cards
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Examples of services

Banking, Transportation, Tourism, Hotel, Personal care, Education marketing, Hospital marketing,
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Examples of services

Courier services, Entertainment services, Electricity services, Telecommunication services, Automobile services Household services- baby sitters, maid servants,
security guards, attenders, gardeners, plumbers, computer service, secretaries
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Salient features of Marketing Services

1.

2.
3. 4. 5. 6. 7. 8.

Services are intangible Services are heterogeneous Services are inseparable Services are Perishable Services are susceptible to changing demand Services are subject to special pricing tactics Ownership cannot be transferred Simultaneity
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Goods and Services: A comparative analysis- continued

Products
1.Tangibility Versus Tangible

services
Intangibility:

Intangible 2.Transferability V/S Non transferability Goods can be It is not possible to transferred from one transfer goods from place to another one place to another place
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Goods and Services: A comparative analysis- continued Products Services 3. Existence: Durable Non existent in goods bought remain nature in existence 4. Heterogeneity Homogeneity Versus Cannot be Easy to measure the standardized. It is quality difficult to measure the quality of services Anand Modi

Goods and Services: A comparative analysis- continued

Products 5. Re-selling: Goods can be re-soldthere is legal right

6. Separable Vs Inseparability

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Services We dont bear the right of reselling. If we book a seat in aircraft, a room in a hotel, a ticket in a cinema hall Produced and consumed at the same time

7.Customer participation Vs Non participation :

In manufacturing a physical product, the customers do not participate in the production process. Consumes only after they are produced.

Buyers and sellers are to participate in production activity undertaken by the service-seller. Ex: student in a class ; barber- customer

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8.Stocking Vs Non- stocking

Products can be Services cannot be produced and stocked stored. Supply is till they are sold there only when there is demand.

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Goods and Services: A comparative analysis- continued


Products
9.Perishable or not

Services
Short lived. They cannot be produced ahead of time and stocked for peak loads of demand

10.Susceptible to changing demand

The market for services has wider fluctuations. Ex: transportationMorning and evening more load
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Goods and Services: A comparative analysis- continued


Products
11.Pricing tactics Standardized

Services
variable

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12.Tangibility Versus Intangibility

Products have a Services are definite consumed but not configuration and possessed. apparent characteristic features which can be easily seen, touched, smelt, heard or worn
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FACTORS INFLUENCING THE FASTER GROWTH OF SERVICE MARKETS


1)

2)
3) 4) 5)

6)
7) 8) 9)

More disposable income at customers command Increased scope for industrial specialization Growing fashion Professionalism in education Information explosion Sophistication in market Increasing Governmental activities Ever increasing complexity and sophistication in the jobs needed Change in the attitude of people towards life

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Significance of Services Marketing


Creation and expansion of job

opportunities Optimal utilization of resources without consuming natural resources Paving way for the formation of capital Increasing standard of living increasing awareness on how to spend, where, how, Environment friendly technology Anand Modi 16

Tourism marketing
In tourism our emphasis is on temporary

and short term movement of people We consider tourism marketing a process of creating a product or providing a service. It is a managerial process to promote the business of tourism.

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Users of tourism services

Actual users
Potential users Occasional users

Habitual users
Non users

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Salient features of Tourism marketing


Tourism product highly perishable
Tourism product is a service product Intangibility complicates marketing

Services are for pleasure


Users are supposed to visit the centre Adequate infrastructural facilities are

required Users are a heterogeneous people


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Package tour Tour operators Tourist guides Resort representatives Tourism department Festivals Goa festival Investment in shares of Resorts
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Service marketing mix

A service has its own peculiarities and hence there is need for additional Ps. Persons such as Judd, Magarth and Kotler thought of adding at least six more Ps

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Six more Ps of Service marketing

Positioning People Physical evidence Physical facilities Process management Power and public relations
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1. Positioning

Implanting in customers mind a clear cut meaning of what a product is. It refers to the picture which is being projected in the minds of the customers Concerned with identifying target market, development of uniqueness and communicating the same.

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2) People

It is the employees of the organization who represent the organization to the customers It is the employees to be trained to face the customers Employees are Internal customers

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people

Intimate and long term relationship Confidence in a particular doctor A well mannered waiter of a hotel develops his own clientele

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3. Physical evidence

Physical evidences are the tangible components such as buildings, furniture, stationery, letterheads, note pads, etc Physical evidences or tangible components are classified as under: i) Essential and (ii) Peripheral
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Physical evidence

i)

Essential or main services constitutes a dominant part of the service e.g., Impressive premises for a hotel college

ii) Peripheral evidences are minor or auxiliary associated with service. e.g., stationery, brochures, Pass Book, Cheque book, Bus ticket, Insurance policy document Physical evidences create impact on customers perceptions
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Physical evidence

A peripheral evidence can be possessed as a part of service bought. Ex: Service is affected by the setting that is visible to him

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4) Physical facilities

Accessibility or availability
Place - It deals with

- Location of services - Selection of intermediaries - cost effectiveness of distribution

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Location of services

Convenient banking hours


Personal visit to the customer (e.g.,

Pizza on phone, banking by home delivery

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Intermediaries : There is absence of

middlemen in the distribution of personal services like beauty parlour, hair dressing, repairs ,consultancy Indirect marketing is possible for banking, financial services, insurance, security services, travel and tourism through agents, franchising
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5. Process management

Assuring service availability and consistency Process refers to the way in which the
consumers receive delivery of service It consists of activities by which a service is produced and delivered to the ultimate consumer Service organisations have two dimensions, viz, 1.Front stage 2. back stage

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6. Power and public relations

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Service marketing model

Prof Christian Gronross says that the marketing activities of service organizations can be clubbed under three major heads as External Marketing ( traditional 4 Ps) Internal Marketing Interactive Marketing

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Service marketing model


- Prof Christian Gronross
COMPANY

Internal marketing
EMPLOYEES

External marketing
CUSTOMERS

INTERACTIVE MARKETING
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Service Marketing model

Services business is much more difficult

to manage with traditional marketing approaches using four Ps In product business, products are standardized and appear on the shelves waiting for the customers In service, customer reacts with a service provider whose service quality is less certain and more variable
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Service marketing model - Prof Christian Gronross


External Marketing Traditional 4Ps external as they are projected at target customers. These include Market planning- same almost Channels of Distribution-intangibility and inseparability. Channels are short & direct Advertising of services- WoM Personal selling personal relationship & Professional orientation and public image
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Internal Marketing
Almost every one should practice

marketing Cos manpower should be ready Internal employees should be trained and motivated for customer contact They should work as a TEAM Develop motivated and customer conscious employees
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Service Marketing model

Interactive Marketing In case of service marketing, service quality depends on both service provider and service delivery Customer judges service quality on the basis of technical norms such as (i) rate of success of surgeons and (ii) whether the surgeon showed concern and inspired the patient
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Service Marketing model - continued


Interactive marketing depends upon

buyer seller interaction


There is a need to increase competitive

differentiation, service quality and productivity

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Service Marketing model - continued


Competitive differentiation : Ex: Road

passenger service can introduce enroute movies, lunch, advance booking


Ex: Catering service _ Birthday cone

caps, free cake, balloon, etc

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Service Marketing model - continued


Service quality: consistently service

quality
Promise only what you can deliver and

deliver more than you promise


Render zero-defect service

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Future of Service marketing


Service has a bright future
Bound to take increasing share of Indian

consumer rupee Demand for services will go up as the businesses are becoming professionals Service providing machines vending machines

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