TABLE OF CONTENT

1.0 Background and problem statement 2

2.0 Objective and purpose. 3

3.0 Methods of gathering information... 4

4.0 Literature review.. 5

5.0 Critical findings and discussion... 6

6.0 Marketing implication.. 7

7.0 Appendices... 8

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1.0 BACKGROUND AND PROBLEM STATEMENT

Intangibility, heterogeneity, inseparability and perishabilty are the four characteristics

in marketing services firm. All of these four characteristics is representing the
uniqueness of the service that been offered to the consumers. Focus more on
intangibility characteristic, according to Russell (1998) introduced the idea of service
being consumed without having the tangible benefit that been served. Service in
intangible characteristic also can be explain through the smelt, tasted, touched and
also can only be seen and feel. Typically, it has been stated that intangibility is the key
to determining whether or not an offering is a service or product. More specifically,
intangibility is more on services form where the service is delivered through the effort
how the service firm makes their consumers feel of their services.

It has been argued that the single most important difference between products and
services is the characteristic of intangibility. In fact, it has been said that intangibility
is the key to determining whether or not an offering is a service or product. This
characteristic has a profound effect on the marketing of services. Some researcher
argued that special difficulties arise from this intangibility which lead to quality
control problems for the producer and evaluation problems for the consumer. It is this
intangibility, or lack of physical attributes, that most likely is the reason for service
variability, inseparability and perishability. Besides the concept of the lack of physical
attributes of the offering, there is also the concept of physical evidence of the process
which needs to be taken into consideration in an evaluation of intangibility.

Physical evidence is the environment in which the service is delivered and where the
firm and the customer interact; and any tangible commodities that facilitate
performance or communication of the service. The physical evidence of the service
production process can be used to communicate service quality attributes and create
the service experience. A distinction should be made between the degree of
intangibility of the actual service and the intangibility, or lack of physical evidence, of
the production process.

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2.0 0BJECTIVE AND PURPOSE

Intangibility is one of the service marketing characteristics that lack of using the sense
of touch in quality of goods. Intangibility is used in marketing to describe the inability
to estimates the value collected from engaging in an activity using any tangible
evidence. There are few objectives that can be applied in this intangibility
characteristic which are :

i. To determine whether the consumer meet the service quality expectation.

ii. To discover whether intangibility achieving its goal on service quality.

By focusing on this scope, it is easy for us to concentrates on the intangibility nature

of service and its effects. Other than that, it also can lead us to identify which
objectives are more reliable and effective.

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3.0 METHODS OF GATHERING INFORMATION

In gathering the information regarding this topic, we are only using a secondary data
that based on journal articles. Secondary data are data that have already been collected
for purposes other than the problem at hand. Secondary data can be classified as either
internal or external. Internal data are those generated within the organization for
which the research being conducted. External data are those data that are generated by
sources outside the organization. For this research, secondary data will be used, that is
academic journals, and articles. This is to gain an understanding for the topic chosen
for this research that is on the intangibility nature of service.

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4.0 LITERATURE REVIEW

Based on the articles that used regarding to this topic, the author stated that according
to the research conduct by Stephen and Robert, intangibility is lacking in able to touch
and felt quality of goods. Intangibility is the key to determining whether or not an
offering is a service or product. Intangibility means that a consumer's perception of
quality is often based on tangible evidence and price rather than the core service
(Charlene, 2000). According to Sanjeev and Mishra (2014), intangibility is not only
the most common difference between goods and services but also has been described
as the serious distinction from which all other differences come out. The difference
between physical intangibility, that which is unreal or cannot be touched and mental
intangibility, that which cannot be grasped mentally.

Intangibility of services holds the challenge of storing service and protecting new
services through patents. Also because of the characteristics of intangibility, services
cannot be willingly displayed or easily communicated and pricing decisions also
become hard (Sanjeev and Mishra, 2014). Intangibility as one of the key
characteristics of services. Introduced the idea of services being activities, benefits or
satisfactions which are offered for sale, or are provided in connection with the sale of
goods. The degree of intangibility has been proposed as a means of distinguishing
between products and services (Russell, 1998). The degree of tangibility has
implications for the ease with which consumers can evaluate services and products.
Other studies suggest that intangibility cannot be used to distinguish clearly between
all products and services (Russell, 1998). Moreover, the researcher feel that the
importance of intangibility is over emphasised. They believe that the service
providers offer is their productive capacity and not the tangible nature of the offer.

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5.0 CRITICAL FINDINGS AND DISCUSSION

The author of this research suggest a need to better understand the effects of
intangibility on consumers expectations for service quality. This research considers
the characteristic of tangibility as a key factor affecting consumer service quality
expectations. It recognizes the importance of tangibility as a classifying criteria of
services without adding multiple alternative dimensions. It takes into consideration
that consumers may not be able to mentally unbundle goods and services, and that
both process and outcome tangibles are an important source of tangibility to the
consumer and producer. Including additional classification characteristics may only
confuse and confound the conceptualization of differences in services, thereby
hindering the development of marketing strategies. As intangibility of the process and
outcome of a service increase, we know that the consumers expectations of quality
also increase.

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6.0 MARKETING IMPLICATION

This article has been stated that tangibilizing the intangible as a key to success in
services marketing. As for the marketing implication, based on the following issue it
can be concluded that the intangibility nature of service can direct influence on
customers whereas the customers experience to the service that provide by the
organization whether its can fulfil customer satisfaction or not. That is because service
quality of the information available are less in the case of intangible service and the
perceived risk is assume to be increases than with the products. Besides that,
intangibility means that a consumer's perception of quality is often based on tangible
evidence and price rather than the core service

The physical environment can effect the customer perception about the service quality
in the organization. Physical environment can lead the customer expectation to be
more positive towards the organization where the physical environment is the one of
element in intangibility service. Such as in restaurant industry, the physical
environment in restaurant can influence customer perception. So, they should increase
their service quality to customers. Next, the other implication of intangibility service
pricing is putting the value on their expertise and skills. The high price will make a
customer expect the high quality of service performance given by the firm. To make a
service with a excellent performance with a fair prices for their customer, they usually
use a marketing technique to attract customer attention. That is means, the
intangibility of service in pricing techniques also can influence customers to
perception.

A service has no physical appearance itself and so relies heavily on promotional

activity and material to provide an image. This is usually based on creating an image
for the provider of the service. This aspect of service promotion is closely associated
with "making tangible the intangible". All of this is a intangible services that can
influences customer perception tp the organization. It is important to know what is the
intangible service and why its important to marketing strategy.

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7.0 APPENDICES

Charlene P., B., (2000). Service intangibility and its impact on consumer expectations
of service quality. Journal of Services Marketing, Vol. 14, pp. 9 - 26.

Sanjeev Kumar & K. Mishra. (2014). Marketing of Services: Challenges and

Opportunities in Todays Global Competitive Business Environment.
International Journal on Recent and Innovation Trends in Computing and
Communication, Vol. 2.

Stephen L. Vargo & Robert F. Lusch. (2004). The Four Service Marketing Myths.
Journal of Service Research, Volume 6, No. 4, May 2004.

Russell W., Stavros K., & Patricia H. (1998). An Investigation Into Four
Characteristics of Services. Journal of Empirical Generalisations in Marketing
Science, Vol. 3. 1998.