,McGraw-Hill, 2000 The McGraw-Hill Companies,Chapter 1,INTRODUCTION TO SERVICES,A note on the PowerPoint Slides.,These PowerPoint slides contain selected exhibits, figures and tables from the chapters as well as objectives for the chapters. For many chapters, we include extra lecture slides and in-class exercises that we have compiled and used in our classes. The lecture slides are not intended to provide full outlines or complete lectures for the chapters, but rather may be used selectively to enhance class sessions.,Objectives for Chapter 1:Introduction to Services,Explain what services are and identify service trends Explain the need for special services marketing concepts and practices Outline the basic differences between goods and services and the resulting challenges for service businesses Introduce the service marketing triangle Introduce the expanded services marketing mix Introduce the gaps model of service quality,Challenges for Services,Defining and improving quality Communicating and testing new services Communicating and maintaining a consistent image Motivating and sustaining employee commitment Coordinating marketing, operations and human resource efforts Setting prices Standardization versus personalization,Examples of Service Industries,Health Care hospital, medical practice, dentistry, eye care Professional Services accounting, legal, architectural Financial Services banking, investment advising, insurance Hospitality restaurant, hotel/motel, bed Eli Ginzberg and George J. Vojta, “The Service Sector of the U.S. Economy,” Scientific American, 244,3 (1981): 31-39.,Year,Services Manufacturing Mining Eli Ginzberg and George J. Vojta, “The Service Sector of the U.S. Economy,” Scientific American, 244,3 (1981): 31-39.,Services Manufacturing Mining & Agriculture,Differences Between Goods and Services,Intangibility,Perishability,Simultaneous Production and Consumption,Heterogeneity,Implications of Intangibility,Services cannot be inventoried Services cannot be patented Services cannot be readily displayed or communicated Pricing is difficult,Implications of Heterogeneity,Service delivery and customer satisfaction depend on employee actions Service quality depends on many uncontrollable factors There is no sure knowledge that the service delivered matches what was planned and promoted,Implications of Simultaneous Production and Consumption,Customers participate in and affect the transaction Customers affect each other Employees affect the service outcome Decentralization may be essential Mass production is difficult,Implications of Perishability,It is difficult to synchronize supply and demand with services Services cannot be returned or resold,Table 1-2 Services are Different,Source: Adapted from Valarie A. Zeithaml, A. Parasuraman, and Leonard L. Berry, “Problems and Strategies in Services Marketing,” Journal of Marketing 49 (Spring 1985): 33-46.,Figure 1-5The Services Marketing Triangle,Internal Marketing,Interactive Marketing,External Marketing,Company (Management),Customers,Employees,“enabling the promise”,“delivering the promise”,“setting the promise”,Source: Adapted from Mary Jo Bitner, Christian Gronroos, and Philip Kotler,Services Marketing Triangle Applications Exercise,Focus on a service organization. In the context you are focusing on, who occupies each of the three points of the triangle? How is each type of marketing being carried out currently? Are the three sides of the triangle well aligned? Are there specific challenges or barriers in any of the three areas?,Ways to Use the Services Marketing Triangle,Overall Strategic Assessment How is the service organization doing on all three sides of the triangle? Where are the weaknesses? What are the strengths?,Specific Service Implementation What is being promoted and by whom? How will it be delivered and by whom? Are the supporting systems in place to deliver the promised service?,Source: Adapted from A. Parasuraman,Company,Customers,Providers,Technology,Figure 1-6 The Services Triangle and Technology,Services Marketing Mix:7 Ps for Services,Traditional Marketing Mix Expanded Mix for Services: 7 Ps Building Customer Relationships Through People, Processes, and Physical Evidence Ways to Use the 7 Ps,Traditional Marketing Mix,All elements within the control of the firm that communicate the firms capabilities and image to customers or that influence customer satisfaction with the firms product and services: Product Price Place Promotion,Expanded Mix for Services -the 7 Ps,Product Price Place Promotion People Process Physical Evidence,Table 1-3Expanded Marketing Mix for Services,Table 1-3 (Continued)Expanded Marketing Mix for Services,