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SERVICES MARKETING

WHAT ARE SERVICES?

SERVICES COMPARED AGAINST


PRODUCTS

THE HISTORICAL VIEW

Goods (Commodities) were objects of value over


which ownership rights could be established and
exchanged.
Ownership Tangible possession of an object
that had been acquired through purchase, gift or
barter from the producer or a pervious owner and
was legally identifiable as the property of the
current owner

ADAM SMITH PRODUCTIVE VS


UNPRODUCTIVE LABOR
Produced goods that could be stored
and subsequently exchanged fro
value

onorable.Useful. Necessary, but no wealth creation!!!

FRESH PERSPECTIVE BENEFITS


WITHOUT OWNERSHIP

Where is the value???

SO, ARE SERVICES RENTAL???

Rented Goods and Services

Space and Place

Labor and Expertise

Shared Physical environment

Systems and networks

DEFINING SERVICES

Initially associated with the master servant


relation

Action of serving, helping or benefitting;


Contending to the welfare of others

Activities, benefits and satisfactions, which are


offered for sale or are provided in connection with
the sale of goods (AMA)
Services include all economic activities whose
output is not a physical product or construction, is
generally consumed at the time it is produced, and
provides added value in forms that are essentially
intangible concerns of its first purchaser

Services are economic activities offered by one party to


another, most commonly employing time based
performances to bring about desired results in recipients
themselves or in objects or other assets for which
purchasers have responsibility
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.

WHAT ARE SERVICES?

Deeds, processes and performances provided by one


entity for another entity whose output is not a physical
product, is generally consumed at the time it is
produced , does not result in ownership and provides
mostly intangible value

High

Categories of Services
The Product Tangibility Spectrum

Bread,
Salt,
Detergent

T
a
n
g
i
b
i
l
i
t
y

Television,
Radio

Car, Motor
Bike ,Car

Restaurant

Gardening
Service,
Health Club

Intangibility

Airlines,
Banks,
Advertising
Consulting,
Agencies
Teaching,
Life
Insurance

High

SERVICES AND ECONOMY

ROLE OF SERVICES IN THE


ECONOMY

Contribution to the GDP

Service Employment 28%


FDI

Service Exports

GROWTH OF SERVICES IN INDIAN


ECONOMY
PRE INDUSTRIAL
SOCIETY

Basic Struggle
to Survive
Agriculture,
Mining and
Fishing
Agrarian
Society
structured
around
traditions,
routine and
authority

INDUSTRIAL
SOCIETY
Industrial
Revolution
Characterized
by Production
of goods
Focus on
manufacturing
and Mass
production
Hierarchical
and
bureaucratic

POST
INDUSTRIAL
SOCIETY

Life no more
measured on
quantity of goods
but quality of
services
Automatic
response to the
needs of industrial
society
Labour saving
initiatives of
manufacturing
Mass production
led to mass
consumption
Rise in income

GROWTH OF SERVICES IN INDIA


1

Increasing Levels of Income


Urbanization

Women in workforce

3
4

Demographic Shifts

Concern for Environment


Government

6
7
8

Industrialisation
Competitive Pressures
National Specialisation

9
10

International Specialisation

SERVICES VS PRODUCTS
Why not apply product marketing strategies for
Services?

Services are different from Products

CHARACTERISTICS OF SERVICES
Intangibility

Inseparabilit
y

Services

Variability

Perishabilit
y

SERVICE MARKETING MIX

Traditional Marketing Mix Elements


PRODUCT

PRICE

PLACE

PROMOTION

PEOPLE
PROCESS

PHYSICAL EVIDENCE

Marketing Mix 7Ps in Services


Price
- Pricing method
-Discounts
-- Allowances
Promotion
- Personal selling
-Advertising
-Sales promotions
-- Publicity
--Internet

Place
- Channel Management
- Outlet locations
-- Transportation

Service Product
- Features
-Accessories
-Packaging
- Branding

5
People
- Employees
- Customers
- Management

Marketing
Strategy

MIX

7
6
Physical Evidence
- Facilities
- Interface
- Tangibles

Process
- Steps involved in Delivery
- Methodology/Sequence
- Customer Involvement

CLASSIFICATION OF SERVICES
BFSI

Credit services, investments, loans, insurance etc

Healthcare

Hospitals & clinics, gyms and spas

Hospitality

Hotel & lodging, Restaurants & cafes, Event management

Entertainment

Movies, theatre, amusement parks

Transportation

Airlines, Railways, Vehicles

Utilities

Electricity, plumbing services

Education

Teaching , Training, etc

Telecommunications

Phone, mobile service

IT Services

MC, Consulting, BPO

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