Marketing of Services

Purpose of this presentation

Reasons and causes as to why focus on acquiring new customers and not on satisfying existing customers To propose a solution to the problem

 Service Sector is growing and it is

Growing Fast

Growing Fast

Growing Fast

Growing Fast

Growing Fast

 Every one wants the

largest market share

largest market share

largest market share

largest market share

 Designing and offering new, better and customized services Communicating how committed, willing and happy our companies, are to serve the customer better.

The Good looking scenario

Companies are given a makeover with new bright colour logos, punch lines and new appealing advertising.

Hospital with five star facilities 247 servicing Credit card - free for life Anywhere ATM Our network follows Best speed and instant activation Insurance policies - Just for you

But is all this true?

SMS at SMS @ 12345 6/Yes - Y No - N

The Reality
Pre Sale / During Sale / After Sale / Post Sale

Hospital
Services not at all personalized Visible Profit orientation

Banks
ATMs have long queues / out of order / Out of cash Tedious and cumbersome processes Unfriendly staff,specially during peak hours

Mobile and Internet connections

Network busy Connection failed Inaccurate billing But keep on adding customers

Credit Card The less said is better

Extra ordinary interest rates. You can get it but cannot get rid of it.

Insurance
Getting a policy is convenient, available at your door step Difficult to settle claims Sales person deposits fake documents to complete the sales target

Insurance

Some clauses are in fine print and not disclosed or explained to the customers Different people for different works with little or no coordination / communication or inter connection. High rate of Employee turnover

In most cases
Once the customer is in he / she is forgotten or neglected Company is busy looking for new customers Only lip service is paid to satisfy

What customer gets is?

Glittering offices Good looking personnel Call Centre Toll free lines - Keep on pressing the buttons of your phone, while your call is transferred from one operator to another.

Why ?
Primary focus is on getting new customers We do not think of our customer handling capacities

We do not really differentiate between service v/s manufacturing sector

In fact the games are different, the rules of games are also supposed to be different Manufacturing sector is old and stabilized /Matured

We do not really differentiate between service v/s manufacturing sector

Service sector understanding is new and is fast growing. In manufacturing marginal costs are more tangible / measurable and these are high In service sector marginal costs are low in comparison to the revenues brought in so have new customers

The India factor

In India there is lot of Structural Bonding associated with services Focus is on luring more and more customers into the trap

India still a sellers market

Size and growth still outpace the number of alternatives available. Players from outside are still discouraged through complex regulations Law of marketing Higher the market share, higher is the profitability

Gaps in marketing orientation

Marketing came into existence for Satisfying Customers Profitability but ask any consumer, customer or practitioner. Marketing is all about Increasing the Demand and leading to increased revenues for organization.

Gaps in marketing orientation .

In fact role of marketing should not be restricted to Increasing the Demand but it should be Managing the Demand Marketers must realize that to be in Business, keeping the customer satisfied is as important as getting them.

Supply Side problems in India

Research, concept and strategies in the context of all the Ps of marketing are borrowed from the developed western market.

Supply Side problems in India .

India has a Supply Side Problem whereas in most of the developed markets it is a Demand Side Issue. Most of the time we study foreign books or plagiarized Indian books.

Recommendations
We can not have a formula based solution Orientation of marketing and companies needs to be changed Satisfied customers will work as your Loud speakers the same is true for the dissatisfied customers

Recommendations.

CLV of the existing customer is more profitable in the long run The benefit of low marginal costs will not be profitable in the long run Structural Bonding is a short-term phenomena

Recommendations.

In long term it will deteriorate and dilute the brand equity Service marketing communication has to be restrained Academicians of India should contribute in developing the marketing concepts applicable in Indian scenario

Thank you.