Marketing of Services

Getting started

Identify the similarities

Defining Service
An

act or performance offered by one

party to another. The performance
being transitory and often intangible in
nature, does not normally result in
ownership of any of the factors of
production
An economic activity that creates value
and provides benefits for customers at
specific times and places by bringing
about a desired change in, or behalf,
the recipient of the service

Service Sector includes

Trade
Hotels

and Restaurants
Railways
Other Transport & Storage
Communication (Post, Telecom)
Banking
Healthcare/ Hospitals
Insurance
Real Estate
Consulting
Defence
Personal Services
Community Services
Other Services

Service sector in India

up from 15%
in 1950

Drivers of Growth
IT

and ITES growth (especially India): 20%

growth
Healthcare/Hospitals sector growth(15%
growth)
Internalization : Internal services are being
spun out as separate service operations
Labor Market flexibility
Government policies
Consumerism & social changes
Expansion of Cellular networks (recorded
growth of 115% in 2002-2003)

Services Vs Goods
Intangibility
Heterogeneous

(dependence on employee &

customer actions)
Simultaneous production and consumption
Ephemeral and cannot be inventoried
Ownership
Customer involvement
Search
in Production Process
Experien
Greater variability in
operational
inputs &
ce
outputs
Credence
Evaluation is difficult
Time factor assumes great importance
Distribution channels take different forms

Marketing Implications &

Challenges
Intangibility
Heterogeneity
Ephemeral
Ownership
Customer
Involvement

Employ

physical images and

metaphors to demonstrate
competencies and illustrate
benefits
Provide training to the
personal at the delivery end fo
it to be successful
Plan as per demand projections
Pricing

Implication
Try and train customers , also
the service delivery centers to

Marketing Implications &

Challenges

Variability in
inputs&
outputs
Evaluation
difficulty

service that is consumed and

produced at real time, it is a
challenging scenario
Reduce perceived expectations
by helping customers match
needs to specific features and
also by educating them on
Time factor
what to expect
important
Understand customers time
constraints and priorities
Distribution
channels take Take advantage of the internet
based delivery processes.
different forms

Service Examples

Religion as a service marketing

concept.

Categorizing Service
Processes
What is Process?
A particular method of operation
or series of actions, typically
involving multiple steps that
often need to take place in a
defined sequence.
What is a service process?
A simple transformation of an
input to a desirable output

What is the
Nature of the
Service Act?
Tangible Actions

Intangible
Actions

Who or what is the Direct Recipient of the

Service?
People
Possessions
People Processing
(services directed at
peoples bodies):
Passenger Transportation
Healthcare
Lodging
Beauty Salon
Fitness Centre/Gyms
Mental Stimulus
Processing (services
directed at peoples
minds):
Advertising / PR
Arts & Entertainment
Broadcasting/cable
Management consulting
Education
Psychotherapy

Possession Processing
(services directed at
physical possessions):
Freight Transportation
Repair & maintenance
Warehousing/storage
Cleaning services
(Office/home)
Laundry / dry cleaning
Information Processing
(services directed at
intangible assets):
Accounting
Banking
Data processing
Data transmission
Insurance
Legal services
Research , Programming

Service Factory

Discussion
Give

examples of how during the

past 10 years, Internet & telecom
technologies such as Interactive
voice response systems (IVRs)
and mobile commerce have
changed some of the services
that we used.

Flower of Service

By Christopher
Lovelock

ROLES OF SUPPLEMENTARY
SERVICES
Facilitati
ng
Services

Informatio
n

Enhanci
ng
Services

Consultati
on

Order
taking

Hospitality

Billing

Safekeepi
ng

Payment

Exceptions

INFORMATION ELEMENTS

Directions to service site

Schedules/service hours

Prices

Instructions on using core product/supplementary services

Reminders

Warnings

Conditions of sale/service

Notification of changes

Documentation

Confirmation of reservations

Summaries of account activity

Receipts and tickets

ORDER TAKING ELEMENTS

APPLICATIONS

Membership in clubs or programs

Subscription services

Prerequisite-based services

ORDER ENTRY

On-site order fulfillment

Mail/telephone order placement

Email/web site order placement

RESERVATIONS AND CHECK-IN

Seats/tables/rooms

Vehicles or equipment rentals

Professional appointments

Admission to restricted facilities

BILLING ELEMENTS

Periodic statements of account activity

Invoices for individual transactions

Verbal statements of amount due

Machine display of amount due

Self-billing

PAYMENT ELEMENTS
SELF SERVICE

Insert card, cash, or token in machine

Electronic funds transfer

Mail a check

Enter credit card number online

DIRECT TO PAYEE OR INTERMEDIARY

Cash handling and change giving

Check handling

Credit/charge/debit card handling

Coupon redemption

Tokens, vouchers, etc.

AUTOMATIC DEDUCTION FROM FINANCIAL DEPOSITS

Automated systems

Human systems

CONSULTATION ELEMENTS

Customized advice

Personal counseling

Tutoring/training in product use

Management or technical consulting

HOSPITALITY ELEMENTS

Greetings

Food and beverages

Toilets and washrooms

Waiting facilities and amenities

Transport

Security

SAFEKEEPING ELEMENTS
CARING FOR POSSESSIONS CUSTOMERS BRING WITH THEM

Child or pet care

Parking facilities, valet parking for vehicles

Coat rooms

Baggage handling, storage place, safe deposit boxes

Security personnel

CARING FOR GOODS PURCHASED OR RENTED BY CUSTOMERS

Packaging

Pickup

Transportation and delivery

Installation

Inspection and diagnosis

Cleaning

Refueling

Preventive maintenance, repairs and renovation

Upgrade

EXCEPTIONS ELEMENTS
SPECIAL REQUESTS IN ADVANCE OF SERVICE DELIVERY

Children's needs

Dietary requirements

Medical or disability needs

Religious observances

Deviation from standard operating procedures

HANDLING SPECIAL COMMUNICATIONS

Complaints, compliments, suggestions

PROBLEM SOLVING

Warranties and guarantees against product malfunction

Resolving difficulties that arise from using the product

Resolving difficulties caused by accidents, failures, etc

Assisting customers who have suffered an accident or medical emergency

RESTITUTION

Refunds

Compensation in kind for unsatisfactory goods and services

Free repair of defective goods

Applying Flower of Service

model

Case

Information

Order taking
Booking

through phone,
fax and
internet
Ticket office,
Call centers,
company
website, travel
sites
(makemytrip.co
m and the

Billing
Detailed

charges split.
Email of bills
Hard copy of bills in ticket offices

Payment
Payment

through cash, credit or

debit cards
Special cards like Jet Airways Citi
Card as well for more flying
points
Special payment privileges for
frequent flyers

Consultation
Regarding

Choices of
class, routes to
a destination &
special menus
for frequent
flyers

Hospitality
From

ticket booking to post flight

help
Cold towels as soon as you board
Menu options for food

Safekeeping
Luggage
Children

travelling without
assitance

Exceptions
Special

requests regarding meal

preferences
Special amenities for elderly
people or physically handicapped
Medical needs etc