1. © South-Western Publishing SERVICES NEED MARKETING 11.1 11.1 What Are Services? 11.2 11.2 Classifying Types and Evaluating Quality 11.3 11.3 Developing a Service Marketing Mix

2. © South-Western Publishing WHAT ARE SERVICES? GOALS GOALS for Lesson 11.1 Explain the growing importance of services to the U.S. economy. Describe four important qualities of services that are not shared by products.

3. © South-Western Publishing Service Sector The service sector is the largest and fastest –growing employment area of our economy. In 2006, nearly 79 percent of all jobs in the United States were service jobs. Why?

4. © South-Western Publishing Growth and Importance of Service Industries Prosperity – an increase in the amount of discretionary income Automation – the increase of technology in the product producing industries Complexity – installation and repairs of high tech products

5. © South-Western Publishing Fastest-Growing Industries (2004 – 2014) Industry Annual Growth Rate Education and Health Services30.6% Professional and Business Services27.8% Leisure and Hospitality17.7% Information Services11.6% Financial Activities10.5% Trade, Transportation, Utilities10.3%

6. © South-Western Publishing Services Unique Qualities of Services Perishable Intangible Heterogeneous Inseparable

7. © South-Western Publishing Unique Qualities of Service Intangible – cannot be touched, seen, tasted, heard, or felt Inseparable – the service is produced and consumed at the same time Perishable – the service unused in one time period cannot be stored for use in the future Heterogeneous – difference between services (each baseball game is different)

8. © South-Western Publishing CLASSIFYING TYPES AND EVALUATING QUALITY GOALS GOALS for Lesson 11.2 Describe the various ways marketers categorize service businesses in order to develop effective marketing mixes. Identify the three types of service standards that are used to evaluate service quality.

9. © South-Western Publishing Service Organization Classifications On a piece of paper, identify six to eight businesses which you or your family recently purchased services.

10. © South-Western Publishing Service Organization Classifications Type of market – business or individual Goals of the organization – profit or not-for- profit Labor intensiveness – amount of physical labor compared to the amount of equipment used (car washes vs. teeth cleaning) focus on distribution and training

11. © South-Western Publishing Service Organization Classifications Customer contact – the amount of customer contact or interaction focus on promotion (personal selling) and customer satisfaction Level of skill – professional vs. nonprofessional

12. © South-Western Publishing Evaluating Service Quality The degree to which the service meets customers’ needs and expectations Competition Performance standards Customer satisfaction

13. © South-Western Publishing Evaluating Service Quality Competition Provide services that are at least equal in quality for the same price Services must be unique How do you set your business apart from the competition

14. © South-Western Publishing Evaluating Service Quality Performance Standard Should set their own service standards Standards should be communicated to customers through promotions “Eighty-five percent of our arrivals will be on time”

15. © South-Western Publishing Evaluating Service Quality Customer Satisfaction The use of assessment tools Key indicator is repeat business

16. © South-Western Publishing DEVELOPING A SERVICE MARKETING MIX GOALS GOALS for Lesson 11.3 Explain how businesses plan and promote services. Describe the importance of pricing and distribution of services.

17. © South-Western Publishing Service Planning Service planning – companies need to shape the attributes of the service to meet the needs and wants of the consumers. UPS – fast and reliable Banks – dependable, convenience, low rates Tangible elements of services – UPS, Banks, Dentists

18. © South-Western Publishing Promotion Promotion – services are hard to promote, services are not tangible. Endorsements Stress the tangible elements Word of mouth Personal selling The message must create a mental image

19. © South-Western Publishing Price and Distribution Price – with increased competition, pricing has become very important helps with positioning can be easily changed and justified bundling strategy Distribution Location Convenience