11-1

11-2

Services Marketing

Chapter 11Chapter 11Chapter 11Chapter 11

McGraw-Hill/Irwin Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved.

11-3

Chapter GoalsChapter GoalsChapter GoalsChapter Goals

McGraw-Hill/Irwin Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved.

• Importance of services in advanced economies• Nonbusiness services marketing• Characteristics of services and their marketing

implications• Design of a services marketing mix• Managing service quality• Productivity and performance challenges of service

marketers

11-4

Definition of ServicesDefinition of Services

Identifiable, intangible activities

that are the main objectof a transaction

designed to provide want-satisfaction to customers

Identifiable, intangible activities

that are the main objectof a transaction

designed to provide want-satisfaction to customers

Supplementary Services

support the sales of a good or service

Supplementary Services

support the sales of a good or service

11-5

Goods-Services ContinuumGoods-Services Continuum

11-6

Scope of ServicesScope of Services

NonProfit

For Profit

Not For Profit

11-7

Characteristics of ServicesCharacteristics of Services

IntangibilityIntangibility PerishabilityPerishability

HeterogeneityHeterogeneityInseparabilityInseparability

11-8

For Profit

Services CustomerServices Customer

Target MarketTarget Market

NonbusinessClientClientProviderProvider

11-9

Selecting Target MarketsSelecting Target Markets

Buying Behavior

GeographicDemographic

MarketSegmentation

11-10

Product PlanningProduct Planning

ServicesOffering

Product-MixStrategies

Product Features

DifferentiateDifferentiate Expandthe lineExpandthe line

Contractthe mix

Contractthe mix

Alter the service

Alter the service

Manage thelife cycle

Manage thelife cycle

Tangible object

Tangible object

Memorableslogan

Memorableslogan

Distinctivecolor schemeDistinctive

color scheme

CREATE ABRAND

CREATE ABRAND

11-11

Pricing StructurePricing Structure

Pricing for

Profit Firms

Pricing for

Nonprofits

MarkupMarkup

PerishabilityPerishability

Supply-DemandSupply-Demand

Less importantLess important

Client chargesdo not cover costs

Client chargesdo not cover costs

Willing to payWilling to payContributions set

by providerContributions set

by provider

11-12

Pricing StrategiesPricing Strategies

Discounts

Flexible price

One price

Markup

Non-price competition

Segmentation and price

Intense price competition

Three levels of price competition

11-13

Location

Distribution SystemDistribution System

Channelsof

Distribution

InseparabilityShortsimple

HeterogeneityNumber

ofmiddlemen

Convenience

Accessibility

DistributionFacilities

11-14

Promotional ProgramPromotional Program

AdvertisingAdvertising

PersonalSelling

Customer-contactpersonnel

PersonalSelling

Customer-contactpersonnel

SalesPromotion

SalesPromotion

Inseparability ServiceEncounterService

Encounter

Cause-relatedCause-related

IncentivesIncentives

11-15

Managing Service QualityManaging Service Quality

Compared toExpectations

of the customerHow work was

performed

Quality is defined by the customer

Helpformulate

expectations

Measureexpectation

level

Service qualityat or aboveexpectation

11-16

Future of Services MarketingFuture of Services Marketing

Impact of

Technology

IncreaseProductivity

PerformanceMeasurement

Prospectsfor

Growth

11-17

Key Terms and ConceptsKey Terms and ConceptsKey Terms and ConceptsKey Terms and Concepts

McGraw-Hill/Irwin Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved.

• Services

• For-profit services firms

• Not-for-profit services organizations

• Nonprofit organizations

• Intangibility

• Inseparability

• Heterogeneity

• Perishability

• Provider market

• Client market

• Service encounter

• Service quality