CHANAKYA NATIONAL LAW UNIVERSITY

A PROJECT OF
MARKETING MANAGEMENT
ON
“A STUDY ON THE TANGIBLE GOODS THAT ARE PROVIDED
ALONG WITH THE BASIC SERVICES OF LODGING IN A HOTEL”

SUBMITTED TO: SUBMITTED BY:

Dr. Manoj Mishra Mayank Raj
(Faculty of Marketing Management) Roll No. - 1629
Semester – 2nd
B.BA LL.B
Session – 2016-2021

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 DECLARATION BY THE CANDIDATE

I hereby declare that the work reported in the BB.A. LL.B (Hons.) Project Report entitled “A
STUDY ON THE TANGIBLE GOODS THAT ARE PROVIDED ALONG WITH THE BASIC SERVICES OF

LODGING IN A HOTEL.” submitted at Chanakya National Law University, Patna is an

authentic record of my work carried out under the supervision of Dr. Manoj Mishra. I have
not submitted this work elsewhere for any other degree or diploma. I am fully responsible for
the contents of my Project Report.

(Signature of the Candidate)

MAYANK RAJ
Chanakya National Law University, Patna

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 ACKNOWLEDGEMENT

“ IF YOU WANT TO WALK FAST GO ALONE

IF YOU WANT TO WALK FAR GO TOGETHER”
A project is a joint endeavor which is to be accomplished with utmost compassion, diligence
and with support of all. Gratitude is a noble response of one’s soul to kindness or help
generously rendered by another and its acknowledgement is the duty and joyance. I am
overwhelmed in all humbleness and gratefulness to acknowledge from the bottom of my
heart to all those who have helped me to put these ideas, well above the level of simplicity
and into something concrete effectively and moreover on time.
This project would not have been completed without combined effort of my revered
Marketing Management teacher Dr. MANOJ MISHRA whose support and guidance was the
driving force to successfully complete this project. I express my heartfelt gratitude to him.
Thanks are also due to my parents, family, siblings, my dear friends and all those who helped
me in this project in any way. Last but not the least; I would like to express my sincere
gratitude to our Marketing Management teacher for providing us with such a golden
opportunity to showcase our talents. Also this project was instrumental in making me know
more about the various tangible goods provided along with the basic services in a hotel. This
project played an important role in making me understand more about the various tangble
goods provided along with the basic services in a hotel. It was truly an endeavour which
enabled me to embark on a journey which redefined my intelligentsia, induced my mind to
discover the intricacies involved in marketing of services.

Moreover, thanks to all those who helped me in any way be it words, presence,
Encouragement or blessings...

- Mayank Raj
- 2nd Semester
- B.BA LL.B

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 TABLE OF CONTENTS

Acknowledgement…………………………..…………………………………………………3

Table of Contents……………………………………………………………………………...4

Aims and Objectives…………………………………………………………………………..5

Research Methodology……………..…………………………………………………………5

1. Introduction………………………………………………………………………….6-7

2. Marketing of Services……………………………………………………………….8-9

3. Nature of Services………………………………………………………………...10-13

4. Services Provided by Hotels (Case Study)……………………………………….14-17

5. Findings and Suggestions………………………………………………………...18-20

6. Conclusion……………………………………………………………………………21

Bibliography………………………………………………………………………..……22

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 AIMS AND OBJECTIVES

The objective of this project is to bring to light, using research and reports, the various
tangible goods that are provided with the basic services of lodging in a hotel.

RESEARCH METHODOLOGY

The researcher has used both doctrinal method of research for the accomplishment of this
project.
The researcher has used various library sources including books, articles, reports, e-articles
and internet sources extensively.

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 INTRODUCTION
The world economy nowadays is increasingly characterized as a service economy. This is
primarily due to the increasing importance and share of the service sector in the economies of
most developed and developing countries. In fact, the growth of the service sector has long
been considered as indicative of a country’s economic progress. Economic history tells us
that all developing nations have invariably experienced a shift from agriculture to industry
and then to the service sector as the main stay of the economy. This shift has also brought
about a change in the definition of goods and services themselves. No longer are goods
considered separate from services. Rather, services now increasingly represent an integral
part of the product and this interconnectedness of goods and services is represented on a
goods-services continuum. The American Marketing Association defines services as -
“Activities, benefits and satisfactions which are offered for sale or are provided in connection
with the sale of goods.” Customer life cycle starts with identification of customer needs,
acquisition of customers, development of customers and finally retaining the customers.
Above all stages of life cycle the very first and the most important stage is identification of
customer needs. This aspect influences the customer right from the time of selection of the
hotel itself. According to customer expectations, he selects the respective hotel where he can
fulfil his requirements with utmost personalization and customization. To understand certain
expectations and services one should not forget the basic characteristics of Hospitality Sector.
The services features include (i) perishability- services are perishable and it cannot be stored
for future periods. Services can be stored to some extent for future with the help of tangible
goods but not fully. (ii) intangibility- services are intangible i.e. they cannot touch or taste.
While the physical structure and certain components of the hospitality product are tangible.
(iii) inseparability- the special characteristic of services is production and consumption is
inseparable. Services should be consumed when they are produced and (iv) variability
services can be deliberately varied to meet the specific needs of individual customers.1
In simple words, services are deeds, processes, and performances. But, the increasing interest
in the services sector has been accompanied by considerable disagreement and debate as to
what constitutes a service and whether service marketing is a distinctive subject area. In order
to develop clarity on service as a concept, it is desirable to look at the way various
researchers and scholars have defined it over the years. One of the first to define services was
the American Marketing Association which as early as in 1960 defined services as “activities,

1
http://www.managementstudyguide.com/definition-and-characteristics-of-services.htm

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benefits, or satisfactions which are offered for sale, or provided in connection with the sale of
goods”. This definition took a very limited view of services as it proposed that services are
offered only in connection with the sale of goods. The other definition which was proposed in
1963 by Regan suggested that “services represent either intangible yielding satisfactions
directly (transportation, housing etc.), or intangibles yielding satisfactions jointly when
purchased either with commodities or other services (credit, delivery, etc.)”. For the first time
services were considered as pure intangibles - capable of providing satisfaction to the
customer and can be marketed like tangible products.
Robert Judd defined service as “a market transaction by an enterprise or entrepreneur where
the object of the market transaction is other than the transfer of ownership of a tangible
commodity”. In 1973 Bessom proposed that “for the consumer, services are activities offered
for sale that provide valuable benefits or satisfactions; activities that he cannot perform for
himself or that he chooses not to perform for himself”.
Another definition given by Blois in 1974 says that, “a service is an activity offered for sale
which yields benefits and satisfactions without leading to a physical change in the form of a
good”.2
Stanton proposed a definition in 1974 and defined service as “Separately identifiable,
intangible activities which provide want satisfaction when marketed to consumers and/or
industrial users and which are not necessarily tied to the sale of a product or another service”.
Kotler and Bloom in 1984, defined service as, “any activity or benefit that one party can offer
to another that is essentially intangible and does not result in the ownership of anything. Its
production may or may not be tied to a physical product”. Gronroos defined a service as “an
activity or series of activities of more or less intangible nature that normally, not necessarily,
take place in interactions between the customer and service employees and/or physical
resources or goods and/or systems of the service provider, which are provided as solution to
customer problems”. We may conclude service as, “an activity or series of activities rather
than things which has some element of intangibility associated with it, which involves some
interaction between the customer and the service provider, and does not result in a transfer of
ownership. Customer has a vital role to play in the production process as the services are
provided in response to the problems of customers as solution. The production of the service
may or may not be closely associated with a physical product”.

2
http://www.yourarticlelibrary.com/marketing/service-marketing-definition-features-and-problem-faced-in-
marketing-services/32336/

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 MARKETING OF SERVICES
Service marketing is marketing based on relationship and value. It may be used to market a
service or a product. With the increasing prominence of services in the global economy,
service marketing has become a subject that needs to be studied separately. Marketing
services is different from marketing goods because of the unique characteristics of services
namely, intangibility, heterogeneity, perishabil-ity and inseparability.
In most countries, services add more economic value than agriculture, raw materials and
manu-facturing combined. In developed economies, employment is dominated by service
jobs and most new job growth comes from services.
Jobs range from high-paid professionals and technicians to minimum-wage positions. Service
organizations can be of any size from huge global corporations to local small businesses.
Most activities by the government agencies and non-profit organizations involve services.
The American Marketing Association defines services as activities, benefits, or satisfactions
that are offered for sale or provided with sale of goods to the customer, that is, pre-sale and
after-sales services. Berry states, ‘while a product is an object, devise or physical thing, a
service is a deed, performance, or an effort’.3

Features of Services:

1. Intangibility:
A physical product is visible and concrete. Services are intangible. The service cannot be
touched or viewed, so it is difficult for clients to tell in advance what they will be get-ting.
For example, banks promote the sale of credit cards by emphasizing the conveniences and
advantages derived from possessing a credit card.

2. Inseparability:
Personal services cannot be separated from the individual. Services are created and consumed
simultaneously. The service is being produced at the same time that the client is receiving it;
for example, during an online search or a legal consultation. Dentist, musicians, dancers, etc.
create and offer services at the same time.

3
http://www.marketingteacher.com/introduction-to-services-marketing/

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3. Heterogeneity (or variability):
Services involve people, and people are all different. There is a strong possibility that the
same enquiry would be answered slightly differently by different
people (or even by the same person at different times). It is important to minimize the
differences in performance (through training, standard setting and quality assurance). The
quality of services offered by firms can never be standardized.

4. Perishability:
Services have a high degree of perishability. Unused capacity cannot be stored for future use.
If services are not used today, it is lost forever. For example, spare seats in an aeroplane
cannot be transferred to the next flight. Similarly, empty rooms in five-star hotels and credits
not utilized are examples of services leading to economic losses. As services are activities
performed for simultaneous consumption, they perish unless consumed.

5. Changing demand:
The demand for services has wide fluctuations and may be seasonal. Demand for tourism is
seasonal, other services such as demand for public transport, cricket field and golf courses
have fluctuations in demand.

6. Pricing of services:
Quality of services cannot be standardized. The pricing of services are usu-ally determined on
the basis of demand and competition. For example, room rents in tourist spots fluctuate as per
demand and season and many of the service providers give off-season discounts.

7. Direct channel:
Usually, services are directly provided to the customer. The customer goes directly to the
service provider to get services such as bank, hotel, doctor, and so on. A wider market is
reached through franchising such as McDonald’s and Monginis.

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 NATURE OF SERVICES
It is utmost important to explore the distinctive features of services, because recognition of
these special characteristics will provide insights for enlightened and innovative
management. One reason for the poor quality of service levels across different service
industries is that managers often tend to solve service marketing problems with tools and
techniques that are essentially meant for tangible products. It happens because of inadequate
understanding about the nature of services. As our knowledge of the characteristics of
services grows, so does our ability to deal with them from both an economic and marketing
perspective. Services have a number of unique characteristics that make them different from
products.
Some of most commonly accepted characteristics are as follows:
(i) Intangibility: The most basic and universally cited characteristic of services is
intangibility, because services are performances or actions rather than objects, they cannot be
seen, felt, tasted, or touched in the same manner that we can sense tangible goods. For
example, when we buy a cake of soap, we can see, feel, smell and use to check its
effectiveness in cleaning. But, when we pay fees for a semester in the university, we are
paying for the benefits of deriving knowledge, skills and education which is delivered to us
by teachers. Teaching is an intangible service. When we travel by a plane, the benefit which
we are deriving is a service (transportation) but, it has some tangible aspects such as the
particular plane in which we fly (Boeing, Avro, Concorde, etc.) and the food and drink which
are served.
The broad definition of services implies that intangibility is a key determinant of whether an
offering is or is not a service. While this is true, it is also true that very few products are
purely tangible or purely intangible. Instead, services tend to be more intangible than
manufactured products, and manufactured products tend to be more tangible than services.
Intangibility presents several marketing challenges. Services cannot be inventoried, and
therefore fluctuations in demand are often difficult to manage. It cannot be patented legally,
and new service concepts can, therefore, easily be copied by competitors. It cannot be readily
displayed or easily communicated to customers, so quality may be difficult for consumers to
assess. The actual costs of a ‘unit of service’ are hard to determine and the price/quality
relationship is complex.
(ii) Inseparability: In most cases a service cannot be separated from the person or firm
providing it. A service is provided by a person, who possesses a particular skill (singer,

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doctor, etc.), by using equipment to handle a tangible product (dry cleaning) or by allowing
access to or use of a physical infrastructure (hotel, train, etc.). Services are typically produced
and consumed at the same time. The relationship between production and consumption,
therefore, dictates that production and marketing are highly integrated processes. The
telephone company produces telephone service while the telephone user consumes it. A
plumber has to be physically present to provide the service; the beautician has to be available
to perform the massage. The service provider and the client are often physically present when
consumption takes place.

Generally, most goods are produced first, then sold and consumed. On the other hand,
services are usually sold first and produced and consumed simultaneously. Sasser observed
that the firm is unable to store or transport services that only direct distribution is possible,
thereby potentially limiting the number of markets that firm can cover. Apart from the stress
laid on ‘right place’ and ‘right time’ in case of distributing goods, there is additional
importance given to the performance of service in the ‘right way’ as well. Another outcome
of simultaneous production and consumption is that service producers find themselves
playing a role as part of the product itself and as an essential ingredient in the service
experience for the consumer.
Since services often are produced and consumed at the same time, mass production is
difficult if not impossible. The quality of service and customer satisfaction will be highly
dependent on actions of employees and the interactions between employees and customers.
It is not usually possible to gain significant economies of scale through centralization.
Usually operations need to be relatively decentralized so that the service can be delivered
directly to the consumer at convenient locations. Since the customer is involved in and
observes the production process, and thus may affect (positively or negatively) the outcome
of the service transaction.
(iii) Heterogeneity: Since services are performances, frequently produced by human beings,
no two services will be precisely alike. The human element is very much involved in
providing and rendering services and this makes standardization a very difficult task to
achieve. The doctor who gives us complete attention in one visit may behave a little
differently in next visit. The new bank clerk who encashes our cheques may not be as
efficient as the previous one and we may have to spend more time for the same activity.

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This is despite the fact that rules and procedures have been laid down to reduce the role of the
human element and ensure maximum efficiency. Airlines, banks, hotels, etc. have a large
number of standardized procedures. Human contact is minimal in the computerized
reservation systems, but when we go to the hotel there will be a person at the reception to
hand over the key of the reserved room. The way that person interacts with us will be an
important factor in our overall assessment of the service provided by the hotel. The rooms,
the food, the facilities may be all perfect, but it is the people interacting with us who make all
the difference between a favourable and unfavourable perception of the hotel.
Heterogeneity also results because no two customers are precisely alike; each will have
unique demands or experience the service in a unique way. Thus, the heterogeneity connected
with services is largely the result of human interaction (between and among employees and
customers) and all of the vagaries that accompany it.
Levitt argues that owing to the industrialisation of services, their production can no longer be
viewed as being heterogeneous. Attempts have been made to improve productivity in the
service sector by introduction of technology. Uniformity can be achieved by substituting
equipment and machinery for labour. Hostage suggested that service firms could also reduce
variability by training the service providers in appropriate responses to each customer
situation. They can also monitor customer satisfaction through suggestion and complaint
system so that poor service can be detected and corrected.
Services are heterogeneous across time, organisations, and people and as a result, it is very
difficult to ensure consistent service quality. Quality actually depends on many factors that
cannot be fully controlled by the service supplier, such as the ability of the consumer to
articulate his or her needs, the ability and willingness of personnel to satisfy those needs, the
presence (or absence) of other customers, and the level of demand for the service.
Because of these complicating factors, the service manager cannot always know for sure that
the service is being delivered in a manner consistent with what was originally planned and
promoted.4
(iv) Perishability: Perishability refers to the fact that services cannot be saved, stored, resold,
or returned. Since services are deeds, performances or acts whose production and
consumption takes place simultaneously, they tend to perish in the absence of consumption.
Goods can be stored and sold at a later date in the absence of a customer.

4
http://www.marketingteacher.com/introduction-to-services-marketing/

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Services, on the other hand, go waste if they are not consumed. A seat on an airplane or in a
restaurant, an hour of a professor’s time, or telephone line capacity not used cannot be
reclaimed and used or resold at a later time.
A primary issue that marketers face in relation to service perishability is the inability to hold
inventory. Demand forecasting and creative planning for capacity utilisation are, therefore,
important and challenging decision areas. The fact that services cannot typically be returned
or resold also implies a need for strong recovery strategies when things do go wrong. Kurtz
and Boone observed that the utility of most services is short lived; therefore, they cannot be
produced ahead of time and stored for periods of peak demand. The perishability of services
is not a problem when demand is steady because it is easy to staff for the service in advance.
When there are wide fluctuations in demand there should be a highly flexible production
system or idle productive capacity. Sasser has described several strategies for producing a
better match between demand and supply in a service business.
On the demand side, the firm can make use of differential pricing, cultivating non-peak
demand and developing complementary services. On the supply side, for effective matching
with demand, the firm may hire part time employees to serve peak demand; peak-time
efficiency routines can be introduced, facilities for future expansion can be developed, and
increased consumer participation can be encouraged.
(v) No Transfer of Ownership: When we buy a product, we become its owner-be it a pen,
book, shirt, TV or Car. In the case of a service, we may pay for its use, but we never own it.
By buying a ticket one can see the evening film show in local cinema theatre; by paying
wages one can hire the services of a chauffeur who will drive his car; by paying the required
charges we can have a marketing research firm survey into the reasons for our product’s poor
sales performance, etc. In case of a service, the payment is not for purchase, but only for the
use or access to or for hire of items or facilities; and transfer of ownership does not take
place.

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 SERVICES PROVIDED BY HOTELS (CASE STUDY)

The Hotel Industry is a broad category of fields within the service industry that includes
lodging, restaurants, event planning, theme parks, transportation, cruise line and additional
fields within the tourism industry. The hospitality industry is a billion dollar industry that
mostly depends on the availability of leisure time and disposable income. A hospitality unit
such as a restaurant, hotel, or even an amusement park consists of multiple groups such as
facility maintenance, direct operations (servers, housekeepers, porters, kitchen workers,
bartenders, etc.), management, marketing, and human resources.

Seven P’s of Service Industry

Product Physical features, quality, accessories, packaging, warranties,
brands
Place Channel type, Outlet locations, Transportation, Storage.
Promotion Sales People, Advertising, Sales Promotion, Publicity.
Price Discounts, Allowances, Price levels.
People Employees, Customers.
Process Flow of activities, Customer Involvement.
Physical Evidence Facility, Equipment, Other Tangibles.

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Introduction to Hotel Sarvodya

Name of the business Lodging and Fooding

Year of Establishment 2004
Name of the Owner D.N Singh
Name of the Manager Aslan Parvez
Address In front of Ashish Lok Appartment, Mahavir Complex,
Bhatacharya Road, Rajendra Path, Ghrounda, Patna-
800001
Contact No. 9334103678

Number of Employees in Sarvodya

Owners 2
Clerks 2
Bellhops 6
Maids 7
Waiters 6
Cleaners 3
Others 4
Total 30

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Service Encounter Chart of Sarvodya Hotel

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Other tangible goods provided with basic services in Hotel Sarvodya
Along with the basic services of lodging the other tangible goods provided by the Hotel
Sarvodya are:
1. Hot/Cold Water
2. Telephone
3. Food Basket
4. Transportation Services

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 FINDINGS AND SUGGESTIONS
 Findings

Customers’ Response to the services provided by Sarvodya

How long have you been

visiting Sarvodya?

0-4 months

4-6 months

6-8 months

More than 8
months

Are you satisfied by the

overall service quality of
Sarvdya?

Highly satisfied
Satisfied
Neutral
Dissatisfied

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 Are you satisfied with the
way the Employees behave
with you at Pakwaan?

Highly Satisfied
Satisfied
Neutral
Dissatisfed
Highly dissatisfied

Are you satisfied with the

other tangible goods
provided along with basic
services at Sarvodya?
Highly Satisfied
Satisfied
Neutral
Dissatisfied
Highly Dissatisfied

Do you find the other

tangible goods provided by
Sarvodya better than other
hotels?

Yes
No

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 Would you recommend
Sarvodya to your friends and
family members?

Yes
No
Maybe

Suggestions
The researcher would like to suggest the following things to the hotel about the tangible
goods provided along with the basic services of lodging in a hotel:
1. The customers should be provided with some extra tangible goods like complimentary
snacks or cold drinks on their visit to the hotel.
2. The regular customers/loyal customers should be rewarded by the hotel by providing
them with some special services.
3. The customers should be asked to give their feedback about the services provided to
them and the hotel should try to improve its services if possible.
4. The hotel managers should also keep studying their rivals’ strategies of attracting
more and more customers and should try to be better than them.

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 CONCLUSION
Hotels are service businesses, and most traditional hotel marketing strategies focused on the
different service offerings, as well as the guest experience. However, many hotels have
started selling hotel products as part of their overall marketing strategies. There are many
differences in service and product marketing, as well as several different products that a hotel
may offer. The two main differences between service marketing and product marketing are
the target audience and the main marketing message. In product marketing, the target
audience is typically a mass audience, and the main marketing message is used to build
product recognition and branding. Many product companies buy expensive national ad spaces
to reach a wide variety of potential customers. Service marketing is generally focused on a
specific target market, such as business travelers or leisure travelers, but most hotel chains
typically choose one or the other. While a service-oriented business, like a hotel, wants to
create a strong brand, the branding is not as important as actually booking the rooms.
Therefore, marketing dollars may be spent wooing meeting planners, rather than on costly
television ads. In the past, hotels were successful by simply having a service-business
marketing focus. However, the Internet market changed the face of the industry. This
marketing medium allowed consumers to search for and find hotels they would’ve never
found in the past without a referral. Hoteliers recognized that potential customers used a
hotel’s status in the decision-making process, which made branding, or product marketing, a
more feasible way to attract consumers. Also, in an effort to earn more revenue in a down
economy, many hotels seek ways to up sell to current customers by offering tangible
products. By offering product lines, hotels can also reach non-guests. The service part of the
hotel business will most likely always be the main “star” in the marketing strategy. Some of
the most common marketed hotel services include convenience of booking, free breakfasts
and free high-speed wireless Internet services. Luxury properties often advertise the
numerous property amenities, such as water sports or onsite day spas. Some hotels seek to
sell the luxurious hotel experience to guests in the form of products. For example, many
hotels offer bathrobes, bath products and even the in-room coffee maker. Others sell bedding
and mattresses. Trendy hotels even offer music compilations and the in-room CD/MP3
player/alarm clock. Customers can purchase these items online without even being a hotel
guest, or guests can simply take the items from their room and pay for them on their hotel
bill.

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 BIBLIOGRAPHY
 Books

1. Marketing Management-Comprehensive Text, Best Practices, Corporate Insight Arun

Kumar & N. Meenakshi /Vikas Publications
2. Paul Baines, Chris Fill & Kelly Page, Essentials of Marketing (Oxford University
Press, New Delhi, 2013)

 Websites
1. http://www.marketingteacher.com/introduction-to-services-marketing/
2. http://www.managementstudyguide.com/definition-and-characteristics-of-
services.htm
3. http://www.yourarticlelibrary.com/marketing/service-marketing-definition-features-
and-problem-faced-in-marketing-services/32336/

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