Grasping the Uniqueness of Services Marketing
Definition of Services A service is "a deed, a performance, an effort" (Rathmell 1966). Copyright © Houghton Mifflin Company. All rights reserved.
Characteristics of Services Intangibility - A service cannot be seen, touched, held, or put on a shelf. Simultaneity/Inseparability – For most services, the production and consumption of the service performance occur simultaneously. Heterogeneity – It is hard for a service organization to standardize the quality of its service performance. Perishability – Most services cannot be produced or stored before consumption. They exist only at the time of their production. Copyright © Houghton Mifflin Company. All rights reserved.
Marketing of Services Intangibility - The product is a process, a deed or a performance; therefore, For the customer: Perceived risk is higher; harder to evaluate before (even during or after the service). For the marketer: Harder to help customer visualize the product and differentiate from the competition. Copyright © Houghton Mifflin Company. All rights reserved.
Marketing of Services (cont’d) Simultaneity/Inseparability - The provider and the customer are part of the product; production and consumption are simultaneous and inseparable; therefore, For the customer: Some interaction with the service provider is necessary and sometimes product is shared with other customers. For the marketer: Customers are co-producers, and their interaction and roles have to be managed. Copyright © Houghton Mifflin Company. All rights reserved.
Marketing of Services (cont’d) Heterogeneity - The product varies across customer, provider, and for the same provider and customer from one consumption occasion to the next; therefore, For the customer: Consistency of product quality is always suspect, and service provider relationship is critical. For the marketer: Customization is an opportunity; and frontline operations and customer skills training is critical. Copyright © Houghton Mifflin Company. All rights reserved.
Marketing of Services (cont’d) Perishability - The product cannot be stored and can be produced only after customer initiates; therefore, For the customer: Product needs to be available and produced when necessary. For the marketer: Supply must match demand; otherwise (revenue) opportunity to produce is lost; the task is to manage rather than build demand. Copyright © Houghton Mifflin Company. All rights reserved.
Classifications Based on Services Fields Health Care Services Financial Services Professional Services Educational and Research Services Hospitality, Travel, and Tourism Services Sports, Arts, and Entertainment Services Source: Fisk & Tansuhaj (1985) Copyright © Houghton Mifflin Company. All rights reserved.
Classifications Based on Services Fields (cont’d) Telecommunication Services Channel, Physical Distribution, Rental and Leasing Services Personal and Repair and Maintenance Services Governmental, Quasi-Governmental, and Non-Profit Services Copyright © Houghton Mifflin Company. All rights reserved.
Classifications Based on Services Customers Consumer services – provided to customers who are purchasing for their own personal needs. Prominently visible in any community. Business to business services – provided to customers who are purchasing on behalf of their organizations. Rarely seen by the general public. Copyright © Houghton Mifflin Company. All rights reserved.
Lovelock's Classification Tangible acts on a person - Services such as health care, personal care, vacations, hotels, and airlines. Intangible acts on a person - Services such as education, entertainment shows, and legal services. Tangible acts on a thing - Services such as house cleaning, appliance repair, landscaping services, etc. Intangible acts on a thing - Services such as financial and insurance services and tax preparation. Copyright © Houghton Mifflin Company. All rights reserved.
Copyright © Houghton Mifflin Company. All rights reserved.
Copyright © Houghton Mifflin Company. All rights reserved.