Unit 1 Marketing of services for basics.pdf

Basics of Services Marketing

1. Marketing of services
Unit.1 Introduction to service
Marketing-Understanding Service, The
Nature of Service Marketing,
Classification of Service.
1Made by:- Miss Kiran soni

2. Understanding Services
Factor Influencing the Growth of the Service
Sector.
Service Defined.
Tangibility Spectrum.
Characteristics of Services.
Generic Difference between Goods &
Services.
Classification of Services
Developing Frameworks for Analyzing
Services
Myths about Services.
2
Made by:- Miss Kiran
soni

3. Factor Influencing the Growth of the
Service Sector.
Demographic Changes.
Social Changes
Economics Changes.
Technological Changes.
Political & Legal Changes.
Policy Changes
3Made by:- Miss Kiran soni

4. Service Defined:-Services are those
Activities which satisfy wants.
Tangibility Spectrum:- The Major factor that
differentiates a service to its Product from its
Intangibility.
A pure Tangible Good:- wheat, sugar,
A tangible good with accompanying services:-
cars, computers ( after-sales services)
A major accompanying minor goods &
services:-(child-care centers provide food to the
babies under their care).
A pure service:-teaching
4Made by:- Miss Kiran soni

5. Characteristics of Services
Intangibility:- which can not be
touched.
Heterogeneity:- not in uniform.
Inseparability:- delivery & consumption
of a service are inseparable.
Perishability:-can not be inventoried or
stored.
5Made by:- Miss Kiran soni

6. Classification of Services
Classification based on Degree of Involvement of the
Customer:-
People Processing:- The customer is highly involved in the services
process & needs to be physically present in order to experience the
service. Ex. School or training centers.
Possession Processing:-the customer doesn't require to be present but
has to submit his property to the service provider. Ex car
Mental Stimulus Processing:-the attention of the customer must be
directed on the service in order to experience the service. Ex
advertising
Information Processing this type of service requires services personnel
to collect information, analyze it, interpret & appropriate advice to the
client.
Ex. market research
6Made by:- Miss Kiran soni

7. Classification based on the Service
Tangibility
Highly Tangible:- the customer obtains a tangible
Product in hand. As cell phone on rent.
Service Linked to tangible goods:- some
organization offer on warranty period to customer
who purchase products from them. As photocopying
machine.
Tangible goods linked to Services:- some service
offer a tangible product along with the service
requested by the customer. As Airlines services offer
food & magazines to passengers.
Highly intangible:- the services which do not
provide customers with any tangible product. As
massage parlor
7Made by:- Miss Kiran soni

8. Classification based on Skills &
Expertise Required
Professional Services:- the service
provider to be formally trained to deliver
the service. Ex Doctor, Pilot.
Non Professional services:- these
Service do not require the service
provider to undergo any training to
deliver the service.
8Made by:- Miss Kiran soni

9. Classification based on Business
Orientation of Service Provider
Not-for-profit organization:- the main
objectives of the service providers is to
serve society & not to make profits.
Ex. Government schools, Social service
organizations.
Commercial organization:- the main
objectives of the service provider is to
earn revenues & make profits. Ex
Airlines Insurance firms.
9Made by:- Miss Kiran soni

10. Classification based on Type of End-
User
Consumer services:- purchased by
individuals customer for their own
consumption. Ex Beauty Care, Hair Cutting.
Business to Business:- These service are
purchased by the organization. Ex Market
research, Advertising.
Industrial services:- Based on a contract
between organization & service providers. Ex
Machine installation, plant maintances.
10Made by:- Miss Kiran soni

11. The Nature of Service Marketing
Evolution of Service Firms.
A Different Approach for Marketing
Services.
The Service Marketing Triangle.
The Services Marketing Mix
Key Marketing Issues Before a Service
Organization.
New Avenues in Service Marketing.
11Made by:- Miss Kiran soni

12. Evolution of Service Firms
While Service firms in the earlier days gave very
little importance to :-
•Segmentation
•Customer satisfaction
•New Product Development
•Service Quality & some others.
 Today’s firms stress on these aspect to enhance
customer satisfaction.
Develop Business.
12Made by:- Miss Kiran soni

13. Further, Service firms did not pay due attention to service
quality Earlier.
However, today they emphasize on service quality by
assuring the customer of their commitment to address
Instances of less than perfect service quality.
The assurance of best quality service by firms is in the
form of guarantees or refund of money compensation in
the event that the customer is dissatisfied.
For ex Domino’s Pizza promises that it will offer its pizza
free if it is not delivered at the customers doorstep’s with
in 30 minutes of the order being placed.
13Made by:- Miss Kiran soni

14. A Different Approach for Marketing
Services
Narrow definition of marketing by service
providers.
Lack of Appreciation for marketing skills in
service organization.
Difference in organizational structure of
service firms.
 Problem in determining costs for pricing of
services.
Constraints & opportunities for not-for-profit
service organization.
14Made by:- Miss Kiran soni

15. 1.Narrow definition of marketing by
service providers
Earlier, service marketers had very narrow
definition for marketing & consider it function
that consisted only of advertising, sales
promotion & public relations. Very few
extended this definition to include sales &
market research as well.
Other marketing such as segmentation,
positioning, customer service, services
diffraction, new product development,
emphasize service quality etc. were not paid
adequate attention by service marketers.
15Made by:- Miss Kiran soni

16. 2.Lack of Appreciation for marketing
skills in service organization:-
There is less emphasize on sales training
& sales activities in service firms, unlike
in manufacturing companies.
3.Difference in organizational structure
of Service firms:- In such organization
structures, the top management frames
strategies, which are then implemented
by personnel at the lower levels.
16Made by:- Miss Kiran soni

17. 4.Problem in determining Costs for
prices.
The heterogeneous and intangible
nature of services makes it difficult to
deterring pricing of a service using the
cost-based strategy.
the usual pricing method
available to marketers do not suggest
any techniques to set for a price for the
skill, expertise & value that are involved
in service.
17Made by:- Miss Kiran soni

18. 5.Constraints & opportunities for not-
for-profit service organization
The major constraints faced by not-for-profit
service organization are funding & lack of
adequate & appropriate infrastructural
facilities. Constraints such as these make it
difficult for these organization to improve their
operation & functioning.
this is turn has an adverse impact on
the effectiveness of these organization to
deliver quality service.
18Made by:- Miss Kiran soni

19. Other Challenges
Being intangible in nature, service can
not be touched, smelt, seen or tested.
This make it difficult to market a service
due it difficulty in making the customers
conceptualize the service.
Another challenges that
arises due to heterogeneity of service is
the difficulty in standardizing the service
& ensuring quality control.
19Made by:- Miss Kiran soni

20. COMPANY
CUSTOMERFRONT-LINE
EMPLOYEES
The service marketing TrianglesThe service marketing Triangles
External marketingInternal marketing
Interactive Marketing
(i)
(ii)
(iii)
20Made by:- Miss Kiran soni

21. The service marketing triangle Consist of three
components of the service delivery process, namely the
company, the front-line employees & the customers. In
the service marketing triangles , the company, front lines
employees & the customer make up three corners of the
triangles.

(i) Company & customer External marketing)
The company communicates information about its
products & service to the external customers by means of
marketing communication mix comprising advertisement,
sales promotion, personal selling, direct marketing &
public relations.
21Made by:- Miss Kiran soni

22. (ii) Company – front line ( Internal marketing).
The interaction between the company & the front-lines
employees constitute internal marketing by means of
which the company enables its employees to deliver
quality service to customer.
The internal marketing process makes use of tools such as
newsletters, video shows etc.

(iii) Front-Lines Employees & Customer (Interactive
Marketing) this is the most important one that finally
determines customer retention by service firms by
interactive marketing
All three-internal, external & Interactive marketing-play an
important role in service marketing neglecting any of
these will result in the failure of a service organization in
achieving its marketing goals.
22Made by:- Miss Kiran soni

23. The Services Marketing Mix
The marketing mix for service is considered
to consists of 7P’s which are:-
Product
Price
place
promotion
People
Physical evidence
Process.
23Made by:- Miss Kiran soni

24. Key Marketing Issues Before a
Service Organization
Managing Differentiation among
services.
Managing Productivity.
Managing services quality.
24Made by:- Miss Kiran soni

25. Managing Differentiation among services
 The intangible nature of service marketing it difficult for
service providers to differentiate themselves from their
competitors on aspect other than plan.
the following tangible elements may be used to
differentiate service businesses.
iii.Service premises.
iv.Packaging
v.Service personnel.
vi.Tools & equipment used.
vii.Customers.
viii.Convenience.
ix.Name of the service establishment.
25Made by:- Miss Kiran soni

26. Managing Productivity
Managing productivity in service organization
is difficult task due to the multifunctional
nature of service jobs. For ex. In a fast food
outlet, the service personal perform various
task which include preparing the food
(production), delivering the food to the
customers (retail service), ensuring that the
customer have an enjoyable eating
experience (customer service), & accepting
payment & tendering the change (transaction
processing).
26Made by:- Miss Kiran soni

27. Managing services quality
The intangibility, heterogeneity, &
inseparability characteristics of service make
it difficult to control the service quality since
the service cannot be tested, measured &
verified accuracy before it delivering it to the
customer.
managing quality in service firms
require an understanding & identification of
the service characteristics that make it
difficult to control service quality.
27Made by:- Miss Kiran soni

28. New Avenues in Service Marketing
Service provider are looking for new
ways to attract new customers by
promising them a pleasant service
experience.
trade shows & trade fairs
serve as avenues for companies to
attract customers & generate new
leads.
28Made by:- Miss Kiran soni

29. THANKS
29Made by:- Miss Kiran soni