Post on 09-Apr-2018
transcript
8/7/2019 JOHANSSON - chap (13)
http://slidepdf.com/reader/full/johansson-chap-13 1/24
8/7/2019 JOHANSSON - chap (13)
http://slidepdf.com/reader/full/johansson-chap-13 2/24
Global Services
C h
a p
t e r
13
© 2006 The McGraw-Hill Com anies Inc. All ri hts reserveMcGraw-Hill Irwin
8/7/2019 JOHANSSON - chap (13)
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Outline
Characteristics of Services
Services as Products
Service Globalization Potential
Foreign Entry Modes of Services
Service Quality and Cultural Differences
Two special cases: Fast Food and Professional Services
Takeaways.
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• Accounting
• Advertising
• Banking
• Broadcasting• Computer services
• Consulting
• Data processing
• Design & engineering
• Distribution
• Education
• Entertainment
• Health care
• Insurance
• Investment banking
• Leasing
• Legal Services• Lodging
• Media
• Reservation systems
• Restaurants
• Tourism
• Telecommunications
• Transportation
• Utilities
The Service Industries
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• INTANGIBILITY – you cannot easily touch a service
• HETEROGENEITY – the service is not exactly the same
each time
• INSEPARABILITY – services are produced when they are
consumed
• PERISHABILITY – you cannot store a service
Characteristics of Services
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CORE SERVICE : IS WHAT THE BUYER IS REALLY BUYING. FOR
EXAMPLE, AN OIL CHANGE AND TUNE-UP FOR YOUR CAR
PROVIDES TROUBLE-FREE OPERATION.
FORMAL SERVICE PACKAGE : SPECIFIC SERVICES OFFERED TO THE
CUSTOMER INCLUDING PRICE, SERVICE FEATURES, THE
PACKAGING, GUARANTEES.
AUGMENTED SERVICE : THE TOTALITY OF THE BENEFITS ACUSTOMER RECEIVES OR EXPERIENCES THEY HAVE WHEN
BUYING THE PRODUCT.
The Service
“Product”
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Generic benefits
Provider’s
behavior
Physical
surroundings
Provider’s
appearance
Brand image
Features
Quality
Packaging
After-sales
support
Price
Warranty
Coreservice
Formalservice package
Augmentedservice
The service as a “product”
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• Stage in the Life Cycle – potential is highest during the maturity
stage because then the service is fully developed and can be
blueprinted.
• Infrastructure barriers – service applicability depends on
availability of infrastructure, as when, for example, warehouse
stores require customers to take home large items in their own
cars.
• Idiosyncratic Home Markets – special regulations inducedomestic service providers to develop practices that are not
applicable elsewhere, as when, for example, advertising
agencies in Japan produce television programs whose
sponsorship the agency controls.
Three factors that influence the globalizationpotential of services
Service Globalization
Potential
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Reasonable similarity to the home country situation
Distilling exactly what the key features of the
product/service concept are
Localization of the key features to another environmentwhile still maintaining the FSA's of the firm
2
1
3
eys to Successful Service Globalizatio
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1. EXPORTING – where services can be transferred via
communications media or personal travel to countries
2. LICENSING – when local involvement is important, where
the service can be standardized (e.g. franchising)
3. STRATEGIC ALLIANCES – when a local presence is
necessary but where government regulations are
restrictive to foreigners
4. FOREIGN DIRECT INVESTMENT – when a local presence
is feasible, where foreign ownership is permitted
The Four Service Entry Modes
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Foreign Entry of Services
Tourism exports provide an illustration of foreign trade in
services, as when Americans visit France.
A franchising expansion by McDonalds provides an
illustration of a licensing mode of service entry.
In marketing research, it is common to strike up alliances
with research firms in other countries to be able to provide
global coverage to clients.
In consulting services, foreign direct investment is
sometimes necessary, as when Price-Waterhouse opens an
office in Brussels.
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1. MARKET SEGMENTATION – typically new services from
abroad target very specific segments or audiences
2. POSITIONING – the customer benefit of the service needs
to be identified clearly to position the service accordingly
3. PRODUCT LINE – a service provider that fits the local
infrastructure
4. BRANDING – is always important given the intangibility of
services.
The Local Marketing of a Service
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5. PRICING – competitive parity, costs, demand, and the
value of time spent by customers must be factored in
6. PROMOTION – many professional services haverestrictions on promotional activities that differ across
countries
7. DISTRIBUTION – since a service is produced &
consumed at the same time, service delivery is identical
to service production; consequently, distributionbecomes the “critical incident” or “moment of truth.”
he Local Marketing of a Service (cont’d)
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CRITICAL INCIDENTS/MOMENTS OF TRUTH – the period of time
during which an individual consumes the service
Desired Service – highest or ideal quality
Predicted or Expected Service – lies somewhere
between the desired & the adequate service
Adequate Service – forms the lower limit below which
the service quality is unacceptable
Perceived Service –must lie between the desired & the
adequate service levels to make sure customer is
satisfied
Service Quality
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Desired Service
Predicted/Expected
Service
Adequate
Service
(Perceived Service
low)
Surprise
Acceptable
Dissatisfaction
Zone of
tolerance
PerformanceGap
Service Quality: The Gap and the Zone of Tolerance
(Perceived Service
high)
Inadequate Service
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•Since services are intangible, service quality is more
difficult to quantify, allowing for a more subjective
view
•Different cultures have different habits andpreferences and therefore different definitions of
service quality
•So culture affects perceived service quality &
customer satisfaction strongly•And what is considered high service quality in one
country is not necessarily high in another country.
Culture and Service Quality
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• Asking • Listening
JapaneseAmericans
•Expressing doubt
•Expressing sympathy
• Explain what cannot be done • Explain what can be done
• Defending company policy • Apologize for company policy
• Responsibility of the buyer • Responsibility of the seller
• “We’ll fix it, but…” • “I’m very sorry”
• Low customer satisfaction • High customer satisfaction
Personal Service Quality:Differences in Complaint Handling
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Services have become an increasingly important part of the
economy, especially in developing countries.
Like manufacturers of products, service providers are turning
increasingly to foreign markets for growth.
Takeaway
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Services have characteristics that make foreign expansion
different from products. Intangibility of many services makes
the mode of entry different from physical goods.
Takeaway
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Globalizing a service means identifying what the core
advantages of the service are & whether they can bereproduced in a foreign market.
This usually means that foreign expansion of services occurs
in the mature life cycle stage.
Takeaway
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Because of the human factor, the way services are marketed
locally & the trade-off between standardization & adaptation
hinge very much on cultural factors.
Takeaway