What is a Service? Services are acts, efforts, or performances exchanged from producer to user without ownership rights Consumer services Business services

Business Services

Characteristics of Services Intangibility Perishability Variability Inseparability

Perishability If unused, the opportunity to sell a service perishes. Ex: If an airplane takes off with an empty seat, the airline has lost the chance to sell that seat for that flight.

Intangibility You cannot hold a service in your hands, as you can with a regular product. But you should have some evidence that the service was performed.

Variability No two service encounters are alike. Ex: You can go to the same hairdresser and ask for the same hairstyle on two occasions. One time the hairstyle is great, the next time it is not.

Inseparability The service and the provider of the service are the same person or firm. You cannot get the service without direct contact with the provider. Ex: You cannot get a hairstyle without direct contact with the hairdresser.

Perishability

Tangible Benefits MasterCard emphasizes the tangible benefits

Classification of Services

Goods/Services Continuum

The Goods/ Services Continuum Good-Dominated Products - tangible products supported by supporting services automobiles, home appliances, electronics Equipment or Facility-Based Services - heavy reliance on both equipment and personnel hospitals, tanning salons, health clubs People-Based Services decorators, realtors Video: Starbucks and its focus on service

Core and Augmented Services Core service is a benefit that a customer gets from the service Augmented services are additional offerings that differentiate the firm Example: Airline transportation Core: travel Augmented services: frequent flier miles, sky caps, in-flight entertainment services, and Internet access

Core versus Augmented Components Augmented services often attract customers

Services on the Internet Banking/ brokerages Software Music Travel “Free” services Blogs Photo sharing Social networking Dating Career development Distance learning Medical care TV and movies Email Advice and opinions

The Service Encounter Social Contact Economic Production

Exceeding Expectations

Servicescapes Elaborate servicescapes underscore claims of luxury

Dimensions of Service Quality Search qualities - characteristics of a product that the consumer can examine prior to purchase Experience qualities - characteristics that customers can determine during or after consumption Credence qualities - attributes we find difficult to evaluate even after we’ve experienced them

Service Experience Blueprint

Measuring Service Quality Gap Analysis - measurement tool that gauges the difference between a customer’s expectation of service quality and what actually occurred Critical Incident Technique - company collects and closely analyzes very specific customer complaints to identify critical incidents

Service Failure and Recovery When services do fail, recover fast! Apologize Resolve the problem Do not further inconvenience the customer Analyze what happened to eliminate future failures

Strategies for Services Targeting: Defining the Service Customer or Audience Positioning: Defining the unique aspects of the Service to Customers

The Future of Services Changing demographics Globalization Technological advances Shift to flow of information

Services that were once unimaginable will be part of our future

Strategies for Marketing People_1 Pure selling approach - an agent presents a client’s qualifications to potential “buyers” until he finds one who is willing to act as an intermediary Product improvement approach - the agent works with the client to modify certain characteristics that will increase market value; person’s image changes to conform to what is currently in demand

The Stages of Madonna

Strategies for Marketing People_2 Market fulfillment approach - agent scans the market to identify unmet needs. Then agent finds a person that meets qualifications and develops product “Manufactured stars” N-Sync, The Spice Girls, New Kids on the Block

Marketing People People may serve many roles as celebrities

Marketing Places Place marketing strategies treat a city, state, country, or other locale as a brand and attempt to position this location so that consumers choose to visit Example: The New York Miracle

Marketing Places

Marketing Ideas Idea marketing is about gaining market share for a concept, philosophy, belief, or issue Examples: Sexual responsibility Drinking responsibly Nissan’s Food from the Hood Newman’s Own