Marketing of Services

Definition of  A service, is any act or performance by the service provider to

Services the customer where there is no transfer of ownership.

 Examples of
various categories
of services
  Marketing can be defined as the process of identification,
Definition of creation, communication and delivery of value to satisfy
Services customer needs profitably. Thus, marketing of services implies
to the same; however, with special attention to the unique
Marketing characteristics of services.
Characteristics
of Services
    Both goods and services carry some value or need satisfying
attribute.
   Both goods and services are designed, developed and
delivered keeping a specific customer segment.
Common Aspects    Almost all the goods require some form of services and the
of Goods and services require some kind of products for creation and
consumption.
Services    Both are created to meet or surpass the expectations of the
customers or users.
   Both the manufacturers and the service providers have some
expectations (may be monetary or non-monetary) in return.
 Goods Services
These are tangible in nature. These are intangible in nature.

These can be stored. These cannot be stored.

Purchase of goods result in Purchase of services do not

Difference transfer of ownership. amount to transfer of
ownership.
Between Goods
and Services These can be standardised. These cannot be standardised.

Other than a specific category These are perishable in nature.

of product; these are durable
and definitely lesser perishable.

These can be separated from These cannot be separated from

the manufacturer. the service provider in most
cases.

Customization of products at Customization of services is

the level of the manufacturer is abundant.
Goods and
services
continuum
  Marketing mix for product include 4 Ps (Product, Price, Place
Services and Promotion). For marketing of services the marketing mix

Marketing Mix includes 7Ps (Product, Price, Place, Promotion, People, Process
and Physical Evidence).
 Services
Marketing
Environment
Types of Service  Micro environment
Marketing  Macro Environment
Environment
 Elements of
Micro
Environment
 Elements of
macro
environment
Environmental  Environmental scanning refers to a careful and systematic
analysis of the elements of the business environment and then
Scanning formulating strategies based on the findings of the analysis.
  It helps in self-discovery (identification of own strengths,
weaknesses, core competencies etc.)
  It enables identification of opportunities and threats
 It gives us information, direction and helps us in preparation of
Importance of action plans and
Scanning  channelization of resources
  It makes us proactive and well equipped to respond to changes
or situations
  It prepares us to respond to or tackle competitive moves
 Role of
Services in
Economy
  Increasing affordability or purchasing power
 Increasing demand for convenience
 Demanding professional or work life
 Focus on leisure and spending quality time
Reasons for the  Higher percentage of women in the workforce
growth of the  Greater life expectancy
service sector  Greater complexity of products
 Increasing complexity of life
 Social and environmental awareness
 Scarcity of resources and time
  Gross Domestic Product (GDP): The survey estimates nominal
GDP growth of 15.4% and real GDP growth of 11% in 2021-
22. In 2020-21, GDP declined by 23.9% in the first quarter and
by 7.5% in the second quarter. Overall, GDP is expected to
Services sector decline by 7.7% in 2020-21 as compared to the growth of 4.2%
in 2019-20.
in India  Inflation: The Consumer Price Index (CPI) based inflation was
6.6% in 2020-21 (April- December). The inflation mainly due
to food inflation which increased from 6.7% in 2019-20 to
9.1% in 2020-21 (April-December).
 In 2020-21, the service sector is estimated to contract by 8.8%
(with trade and hospitality contracting the most (21.4%)) as
compared to 5.5% growth in 2019-20. Software services was
the only sub-sector with positive growth (3.6%) in the period of
April-September 2020.
 While the pandemic led to a global slowdown in trade, the
Indian service sector export remained resilient. The net services
export receipts in first half of 2020-21 was USD 41.67 billion,
which is 3% higher than the service export receipts in first half
of 2019-20 (USD 40.47 billion).
THANK YOU
  Product
 Pricing
 Promotion

Services  Place

Marketing Mix  People

 Process
 Physical Evidence
SERVICE
QUALITY
  Tangibles

DIMENSIONS  Reliability

OF SERVICE  Responsiveness

QUALITY  Assurance
 Empathy
  Providing service as promised

RELIABILITY Dependability in handling customers’ service problems

Performing service right the first time
 Providing services at the promised time
Maintaining error-free records
  Keeping customers informed as to when services will be
RESPONSIVEN performed Prompt service to customers

ESS  Willingness to help customers

Readiness to respond to customers’ requests
  Employees who instil confidence in customers. Making
customers fell safe in their transactions.

ASSURANCE  Employees who are consistently courteous.

 Employees who have the knowledge to answer customer
questions
  Giving customers individual attention
 Employees who deal with customers in a caring fashion
EMPATHY Having the customer’s best interest at heart.
 Employees who understand the needs of their customers.
  Modern equipment
Visually appealing facilities
TANGIBLES  Employees who have a neat and professional appearance
 Visually appealing materials associated with the service.
MEASURING
SERVICE  Difficult to measure..
QUALITY
  Functional: This component involves interaction between the
customer and the service personnel. For example, when a
customer visits a hotel, the warmth at the reception, the
promptness in check-in and the responsiveness of room service,

Components of all comprise the functional component of service.

 Technical: This component refers to the output of the service
Service operation. For example, if a flight reaches its destination
exactly on time, the airlines is said to have delivered quality
service with respect to the technical component.
MANAGING  The service quality of a firm is tested at each service encounter.
SERVICE ….
QUALITY
  GAP 1: The first gap in service quality occurs when
management fails to accurately identify customer expectations.
It is referred to as the knowledge gap. Specifically, it is the
difference in customer expectations and management’s

Service Quality perception of customer expectations.

 GAP 2: The second gap is referred to as the design gap. It is
Model measured by how well the service design specifications match
up to management’s perception of customer expectations.
 GAP 3: The third gap represents the variation in service design
and service delivery.
 GAP 4: The fourth gap is called the communications gap. It is
the difference between what is promised to customers, either
explicitly or implicitly, and what is being delivered.
 GAP 5: It represents the difference between expectation and
perceived service.
 Customer
Relationship N
Retention
  Financial Bonds
 Social Bonds
Retention  Customization Bonds
strategies  Structural Bonds
  the company on the top most corner
SERVICEMARKE
TING TRIANGLE  customers and its front-line employees on either of the two
corners.
STRUCTURE
 EXTERNAL
MARKETING,  EXTERNAL MARKETING, INTERNAL MARKETING AND
INTERNAL MARKETING INTERACTIVE MARKETING.
AND INTERACTIVE
MARKETING.
RELATIONSH  According to Berry and Parasuraman, “Relationship marketing
IP is attracting, maintaining and in multi-service organizations,
enhancing customer relationships”.
MARKETING
                      
                     

Generation of Ideas

                     
Screening

                     
Testing the concept

                    
NEW SERVICE Business analysis and design

DEVELOPMEN                      
Test Marketing

T PROCESS                         
Infrastructure Development

                     
Service Launch
  Identifying processes:
 Identification of the customer segment
DEVLOPING  Mapping the customer’s view

THE SERVICE  Mapping the onstage and backstage employee action

BLUEPRINT  Identification of support activities

 Adding physical evidence wherever possible in the service
process
  Van Ark et al. (2003). “A new or considerably changed service
concept, client interaction channel, service delivery system or
technological concept that individually, but most likely in
SERVICE combination, leads to one or more (re)new(ed) service

INNOVATION functions that are new to the firm and do change the
service/good offered on the market and do require structurally
new technological, human or organizational capabilities of the
service organization.”
  Quality Function Deployment (QFD) is a structured approach
to defining customer needs or requirements and translating
QUALITY them into specific plans to produce products to meet those
FUNCTION needs.

DEPLOYMENT  The “voice of the customer”

 It was developed in Japan beginning in 1966