Services Marketing,Copyright Houghton Mifflin Company. All rights reserved.,PowerPoint Presentation by Charlie Cook,13,Part Three Product Decisions,Chapter Learning Objectives,To understand the nature and importance of services To identify the characteristics of services that differentiate them from goods To describe how the characteristics of services influence the development of marketing mixes for services To understand the importance of service quality and explain how to deliver exceptional service quality To explore the nature of nonprofit marketing,2,Copyright Houghton Mifflin Company. All rights reserved.*,Chapter Outline,The Nature and Importance of Services Characteristics of Services Developing and Managing Marketing Mixes for Services Service Quality Nonprofit Marketing,3,Copyright Houghton Mifflin Company. All rights reserved.*,The Nature and Importance of Services,Service An intangible product involving a deed, performance, or effort that cannot be physically possessed Application of human and/or mechanical efforts directed at people or objects Service Facts (U.S.) Service industries account for over 50% of GDP. Service industries employ 80% of nonfarm workers. More than half of new businesses are service firms. Services have increased in tandem with the long-term growth of the U.S. economy.,4,Copyright Houghton Mifflin Company. All rights reserved.*,Characteristics of Services,Intangibility Services are actions that have no permanent physical qualities as opposed to goods which can be touched and possessed over time. Inseparability of Production and Consumption The production of a service cannot be separated from its consumption by the customer. Services are produced, sold, and consumed all at the same time. Perishability Services cannot be produced ahead of time and stored until needed.,5,Copyright Houghton Mifflin Company. All rights reserved.*,Copyright Houghton Mifflin Company. All rights reserved.*,136,The Tangibility Continuum,FIGURE 13.1,Characteristics of Services (contd),Heterogeneity Variation in the quality of services delivered by individuals and organizations Client-Based Relationships Interactions that result in satisfied customers who use a service repeatedly over time,7,Copyright Houghton Mifflin Company. All rights reserved.*,Characteristics of Services (contd),Customer Contact The level of interaction between the service provider and the customer necessary to deliver the service High-contact services require the customer to be present during the production of the service. High contact services require well-trained and motivated service personnel. Low-contact services do not require the customers continuous presence while the service is carried out.,8,Copyright Houghton Mifflin Company. All rights reserved.*,9,Copyright Houghton Mifflin Company. All rights reserved.*,10,Copyright Houghton Mifflin Company. All rights reserved.*,Developing and Managing Marketing Mixes for Services,Development of Services Package or bundle of services consists of core services that are the expected basic service experience. supplementary services that differentiate the service bundle from those of other competitors. “Basic,” “Standard,” and “Deluxe” service combinations are custom-tailored to consumers specific needs.,11,Copyright Houghton Mifflin Company. All rights reserved.*,Developing and Managing Marketing Mixes for Services (contd),Development of Services (contd) Effective delivery of services Segment the pleasure and combine the pain Get bad experiences out of the way as soon as possible Build commitment through choice Give ritual to consumers Finish strong,12,Copyright Houghton Mifflin Company. All rights reserved.*,Developing and Managing Marketing Mixes for Services (contd),Distribution of Services Customers come to a service facility. Services are brought to the consumer. Services are provided at “arms length”, with no face-to-face customer contact.,13,Copyright Houghton Mifflin Company. All rights reserved.*,24/7 ATM,Developing and Managing Marketing Mixes for Services (contd),Distribution of Services Marketing channels are typically short and direct, with no or few intermediaries. Inseparability of service requires a focus on service demand/supply management (e.g., scheduling of service delivery). Accessibility to services is increased by substituting automated equipment for contact personnel.,14,Copyright Houghton Mifflin Company. All rights reserved.*,Developing and Managing Marketing Mixes for Services (contd),Promotion of ServicesOvercoming the Intangibility of Services Providing tangible (symbolic) cues/images Promoting price, guarantees, availability, personnel Using concrete, specific language in advertising Using personal selling and word-of-mouth advertising Offering services on a trial basis,15,Copyright Houghton Mifflin Company. All rights reserved.*,Developing and Managing Marketing Mixes for Services (contd),Pricing of Services