Understanding Service Phenomenon

Reasons for Growth & Current Status

Affluence Leisure Time Life Expectancy Dual Earning Couples/ Working wives Product Complexity/ Evolved Products Lifes Complexity

Myths about Services Industries

Service Production is primarily LabourIntensive People satisfy their product need before the need of services Service businesses are Cottage industries & service jobs are low-paying Services are only offered by Govt. Sector

Service Phenomenon
Definitions of services provided by different scholars which highlight that services are: Intangible Do not include transfer of ownership Produced & Consumed simultaneously Variable

The Service Experience

Sum- total of all the encounters between the customer & the service provider while using the service, feelings about the encounter immediately after the event or recollections after a period of time. Popular ways of looking at services: Moments of truth- Popularized by Jan Carlson Servuction Model- Bateson

The Service Experience

Servuction Model There are two components- the visible & the invisible on the service providers end (people & inanimate environment)
Customer interacts with the the visible or tangible parts Since large parts of services is intangible, there is a tendency to draw conclusion about service quality based on tangibles

The Service Experience

Service theatre
Implies comparing the experience of service planning, design & delivery to that of theatrical performance Actors Visible service providers Teamwork of front-stage & backstage people Success of performance (Service Task)

Segmentation of service market

Geographic Demographic Psychographic Behavioural

Segmenting Institutional Customers

Volume of purchase Amount of Paper work involved Decision-making type Price Sensitive vs Quality Conscious Technically aware vs Unaware

Positioning a Service Business

Positioning by Features Positioning by Comparison Positioning by benefit Positioning through Guarantees Positioning as a Leader Positioning through Emotions, Concern for Environment

Service Characteristics & Marketing Implications

Characteristics
Intangibility

M. Implications
Difficult to sample, judge & value

Strategies
Physical Evidence WOM Corporate Imagein larger Work groups Multi-site Locations

Inseparability

Requires presence of provider Geographically limited market

Service Characteristics & Marketing Implications

Characteristics
Variability

M. Implications
Difficult to Standardize

Strategies
Training Benchmarking Mechanization Establish better match between supply & demand

Perishability

Cannot be stored