Marketing Batch 2010-12 - · PDF fileCharacteristics of service – Components and...

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Design: Velu S Gautam

ACKNOWLEDGEMENT

It would be erroneous to say that this book can be a product of marketing student’s efforts. As

we look back we realise at there were some other persons who personally and professionally

encouraged as to work on the book. We would like to acknowledge their support and

contribution to our efforts.

There were lot of a people whose professional support stimulated as to keep us on our toes to

complete this work .We would first like to thank Dr. K. Rajashekharan Pillai, Principal of our

institution, MSN Institute Of Management And Technology, Chavara, for providing us great

support which gave impetus to our work. Our marketing faculty, Asso. Professor Madhu R was

a constant source of inspiration for us .We will fail in our duties if we don’t mention the

encouragement provided to us by Mr. Madhu in whom we see all, a guide and our real

inspiration.

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PREFACE

Service dominates the expanding world economy as never before and nothing stands still.

Technology continues to evolve in dramatic ways. Established industries evolve or sink to

decline. Famous old companies merge or disappear, as new industries emerge and rising stars

seize the business headlines. Competitive activity is fierce, with firms often employing new

strategies and tactics in response to customers ever changing needs, expectations, and

behaviour.

Customers themselves are being forced to confront change, with some see as presenting

opportunities and others as an inconvenience or even a threat. If one thing is clear, it’s that

skills in marketing and managing services have never been more important!

As the field of services marketing has evolved so, too has this book, with more expertise to

include all the contents as per the Kerala university syllabi. Readers can be confident that it

reflects the reality of today’s world, incorporates recent academic and managerial thinking,

and illustrations of cutting edge service concepts.

You will find many examples of new edge services techniques; this text takes a strongly

managerial perspective, yet rooted in solid academic research.

Text book contents are contributed by the 22 stars of the marketing community in msn

institute of management and technology. Preparing this edition been an exciting challenge

since services marketing, once a tiny academic niche championed by just a handful of

pioneering professors, has become a thriving area of activity for both research and teaching.

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CONTENT BRIEF

This text book is divided in to five chapters which discusses various aspects of service industry

as per the Kerala University MBA Syllabi

Module 1 gives an introduction to service sector, its role structure, and characteristics. It also

focuses on some areas such as recent trends in service sector, service marketing triangle and so

on.

Module 2 deals with the areas such as creating, delivering and performing of services, pricing

promotional mix and communication etc.

Module 3 deals with consumer behaviour in services, customer satisfaction, role of employees

and technology and so on.

Module 4 focuses on segmentation, positioning and differentiation.

Chapter 5 deals with marketing of banking services, tourism, financial services, consultancy

and transportation.

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CONTENTS

UNIT I : Role of service sector – Structure and growth –Recent trends in service sector –

Characteristics of service – Components and tangibility spectrum – Distinctive marketing

challenges and need for separate marketing strategies – Classification of services – Service

marketing mix – services marketing triangle.

UNIT II : Creating delivering and performing services – Basic , articulated , and exciting

attributes – Service blur prints – Pricing promotional mix and communication efforts –

Delivery of services through intermediaries, People , Process and Physical evidence.

UNIY III : Consumer behaviour in services - Customer satisfaction , customer expectation,

and customer perception – gap analysis – quality perceptions in services – guarantee

customization of service – service recovery and problem solving – employee role of service

marketing – role of technology.

UNIT IV : Segmentation – Positioning – differentiation and retention strategies applicable to

service marketing – measuring customer satisfaction surveys – design and analysis.

UNIT V: Marketing of banking services, tourism, financial services, consultancy, and

transport services.

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MSN INSTITUTE OF MANAGEMENT AND TECHNOLOGY

Services Marketing

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MODULE -1

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ROLE OF SERVICE SECTOR

INTRODUCTION

According to Shostack (1977), "Breaking Free from Product Marketing" required further

Research interest in services. The researcher further argues that the traditional marketing and

management theories do not provide relevant tools for the characteristics of services. This

critique was accepted later by academicians and practitioners. Kotler (1991) refers to services

as "Any act or performance that one party can offer to another that is essentially

intangible and does not result in the ownership of anything. Its production may or may not be

tied to a physical product. This definition can be linked to the activities of Leith agency. A

similar definition was offered by Collins and Payne (1991) when the researchers stated that

“services are any primary or complementary activity that does not directly. Produce a

physical product - that is, the non-goods part of the transaction between customer and

provider”. Services are deeds, processes, and performances.

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Nature of product.

Greater involvement of customers in the production process.

People as part of the product.

Greater difficulties in maintaining quality control standards.

A Different Context for Services Marketing

Narrow definition of marketing by other managers.

Limited appreciation for marketing skills.

Different organizational structure.

A relative lack of competitive data.

Problems determining costs.

Constraints and opportunities facing marketers of public and non-profits.

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Examples of Service Industries

Health Care : Hospital, Medical Practice, Dentistry, Eye Care

Professional Services : Accounting, Legal, Architectural

Financial Services : Banking, Investment Advising, Insurance

Hospitality : Restaurant, Hotel/Motel, Bed & Breakfast, Ski Resort, Rafting

Travel : Airlines, Travel Agencies, Theme Park

Others : Hair Styling, Pest Control, Plumbing, Lawn Maintenance, Counseling Services, Health Club

THE TAJ MAHAL PALACE The history of Mumbai and The Taj Mahal Palace are dramatically intertwined. The hotel is Mumbai’s first harbour landmark (built 21 years before the Gateway of India) and the site of the first licensed bar in the city. For more than a century, the Taj has played an intrinsic part in the life of the city, hosting Maharajas, dignitaries and eminent personalities from across the globe. Today it is a Leading Hotel of the World and favourite destination for discerning business travellers.

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CHALLENGES OF SERVICES

Defining and improving quality

Communicating and testing new services

Communicating and maintaining a consistent image

Motivating and sustaining employee commitment

Coordinating marketing, operations and human resource efforts

Setting prices

Standardization versus personalization

Fast growing services for the next decade

Health services, Business services, Finance, insurance, real estate, Residential care, Computer&

data processing, Child day-care, Social services, Transportation services

SERVICES MARKETING MIX

Traditional Marketing Mix Expanded Mix for Services: 7 Ps Building Customer Relationships Through People, Processes, and Physical Evidence Ways to Use the 7 Ps

The 7 Ps

Product Price Place Promotion People Process Physical Evidence

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DIFFERENT SERVICES

STRUCTURE AND GROWTH OF SERVICE SECTOR

The Services Sector constitutes a large part of the Indian economy both in terms of employment

potential and its contribution to national income. The Sector covers a wide range of activities

from the most sophisticated in the field of Information and Communication Technology to

simple services pursued by the informal sector workers, for example, vegetable sellers,

Eg: PAY AS YOU DRIVE

Usage based insurance, also known as pay as you drive (PAYD) and mile-based auto insurance is a type

of automobile insurance whereby the costs ofmotor insurance are dependent upon type of vehicle used, measured against Time, Distance and Place.

Goods Services Resulting Implications

Tangible Intangible Services cannot be inventoried. Services cannot be patented. Services cannot be readily displayed or communicated. Pricing is difficult.

Standardized Heterogeneous Service delivery and customer satisfaction depend on employee actions. Service quality depends on many uncontrollable factors. There is no sure knowledge that the service delivered matches what was planned and promoted.

Production separate from consumption

Simultaneous production and consumption

Customers participate in and affect the transaction. Customers affect each other. Employees affect the service outcome. Decentralization may be essential. Mass production is difficult.

Nonperishable Perishable It is difficult to synchronize supply and demand with services. Services cannot be returned or resold.

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http://en.wikipedia.org/wiki/Automobile_insurance

http://en.wikipedia.org/wiki/Motor_insurance


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Activities Comprising the Services Sector

(a) Trade (b) Hotels and restaurants (c) Transport including tourist assistance activities as well as activities of travel agencies and tour operators (d) Storage and communication (e) Banking and insurance (f) Real estate and ownership of dwellings (g) Business services including accounting; software development; data processing services; (h) Public administration and defense (i) Other services including education, medical& health, religious& other community services, legal services, recreation and entertainment services (j) Personal services and activities of extra-territorial organizations and bodies

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GROWTH OF SERVICE SECTOR

Service sector is the lifeline for the social economic growth of a country. It is today the largest and fastest growing sector globally contributing more to the global output and employing more people than any other sector. The real reason for the growth of the service sector is due to the increase in urbanization, privatization and more demand for intermediate and final consumer services. Availability of quality services is vital for the well-being of the economy. In advanced economies the growth in the primary and secondary sectors are directly dependent on the growth of services like banking, insurance, trade, commerce, entertainment etc.

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Indian Service Sector

In alignment with the global trends, Indian service sector has witnessed a major boom and is one of the major contributors to both employment and national income in recent times. The activities under the purview of the service sector are quite diverse. Trading, transportation and communication, financial, real estate and business services, community, social and personal services come within the gambit of the service industry.

One of the key service industries in India would be health and education. They are vital for the country‖s economic stability. A robust healthcare system helps to create a strong and diligent human capital, who in turn can contribute productively to the nation‖s growth.

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Service economy

Can refer to one or both of two recent economic developments. One is the increased

importance of the service sector in industrialized economies. Services account for a higher

percentage of US GDP than 20 years ago. The current list of Fortune 500 companies contains

more service companies and fewer manufacturers than in previous decades.

GDP Composition by Sector and Labor Force By Occupation

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CHARCTERISTICS OF SERVICES

INTRODUCTION

A service is an act or performance offered by one party to another. Although the process may be tied to

a physical product, the performance is essentially intangible and does not normally result in ownership

of any of the factor of production. Services are economics activities that create value and provide

benefits for customer specific time and places, as a result of on bringing about a desired change in or

behalf of the recipient of the services .Services are those separately identified, essentially intangible

activities which provides want satisfaction, and that are not necessarily tied to the sale of product or

another services.

CHARACTERISTICS OF SERVICE

Intangibility: The service cannot be touched or viewed, so it is difficult for clients to tell in advance

what they will be getting. The goods of tangible nature can be displayed, the prospectors or buyers can

have a view, and they can even test and make a trial before making the buying decision. Services cannot

generally be seen, tasted, felt, heard or smelt before being bought

Perishability: Inability of a service to be inventoried or stored. Unused capacity cannot be stored

for future use. For example, spare seats on one aero plane cannot be transferred to the next

flight, and query-free times at the reference desk cannot be saved up until there is a busy

period.

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Inseparability: Simultaneous production and consumption of a service. The service is being

produced at the same time that the client is receiving it ( eg: during an online search, or a legal

consultation).

Variability: Unwanted or random levels of service quality customers receive when they

patronize a service firm.Services involve people, and people are all different. There is a strong

possibility that the same enquiry would be answered slightly differently by different people (or

even by the same person at different times). It is important to minimize the differences in

performance (through training, standard-setting and quality assurance).

COMPONENTS AND TANGIBILITY SPECTRUM

Intangibility is the dominant characteristics of services and is defined as the lack of tangible

assets which can be seen, touched or smelled prior to purchase. However, services vary in the

degree to which they are intangible and most services include some kind of tangible element.

The tangibility spectrum places highly tangible offerings at one end of the continuum and

intangible services on the opposite end of the continuum. It is clear that very few offerings are

totally tangible or intangible. For example, the fast food industry, while classified as a service,

also has many tangible components such as the food, the packing and so on. Automobiles,

while classified within the manufacturing sectors, and also supply many intangibles, such as

transportation.

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Distinctive Marketing challenges in service marketing

Managing, growing, and profiting with both product and service businesses are challenging

tasks. But the challenges are different from one to the other. Listed below are some of the most

common and difficult challenges of growing and managing consulting, professional, or

technology service businesses that don't necessary apply to product businesses.

1. Clients can't see or touch services before they purchase them. This makes services

difficult to conceptualize and evaluate from the client perspective, creating increased

uncertainty and perception of risk. From the firm's perspective, service intangibility can make

services difficult to promote, control quality, and set price.

2. Services are often produced and consumed simultaneously. This creates special challenges in service quality management that product companies do not even consider.

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Products are tested before they go out the door. If a product has quality problems while in production, the company can fix them and customers are none the wiser. Service production happens with the customer present, creating a very different and challenging dynamic.

3. Trust is necessary. Some level of trust in the service organization and its people must be established before clients will engage services. This is as important, sometimes more important, than the service offerings and their value proposition.

4. Competition is often not who you think. Competition for product companies is other product companies. Competition for service companies are often the clients themselves. Sure, sometimes you find yourself in a competitive shootout (some firms more than others), but often the client is asking 'should we engage this service at all' and 'if so, should we just do it in-house'.

5. Brand extends beyond marketing. Brand in service businesses is about whom you are as much as what you say about yourself. And internal brand management and communications can be equally as vital to marketing success as are external communications.

7. Proactive lead generation is difficult. Many service companies have tried, and failed, at using lead generation tactics that work wonders for product companies. Implemented correctly, traditional product techniques, such as direct marketing and selling, can work for services, but the special dynamics of how clients buy services must be carefully woven into your strategy.

8. Service deliverers often do the selling. Many product companies have dedicated sales forces. For services, the selling is often split between sales, marketing, professional, and management staff.

9. Marketing and sales lose momentum. Most product companies have dedicated marketers and sellers. They market and sell continuously, regardless of the revenue levels they generate. In many services companies the marketers and sellers also must manage and deliver. This can often lead to the Services Revenue Rollercoaster-wide swings between revenue and work overflow, and revenue and work drought.

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10. Passion is necessary, yet elusive. The more passion, spirit, hustle, and desire your staff brings to the organization every day, the more revenue and success you will have. The correlation between staff passion and financial success is direct and measurable (as is the correlation between lack-of-passion and organizational failure). Yet institutionalizing passion, while necessary, is agonizingly elusive.

MARKETING STRATEGY

A strategy is well defined when you clearly make the correct choices

Competing in today‖s business has not been any easier. The choices to choose become harder every day. The whole business world is constantly changing and affecting strategy on daily basis, but only those companies that have strong understanding of their customers‖ needs. Meeting these needs by solving customers‖ problems and enhancing their daily lives by creating innovative products with revolutionized communication approach to position the value proposition to the target group or groups will build a sustainable strategy that can last for at least beyond the next business cycle.

DIFFERENTIATING AND POSITIONING MARKET STRATEGY

The issues discussed in the area of differentiating and positioning the market offering is:

Tools for Competitive Differentiation Developing a Positioning Strategy Communicating the Company‖s Positioning

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Tools for Competitive Differentiation

Differentiation

Definition: is the act of designing a set of meaningful differences to distinguish the company's offering from competitor's offerings.

Boston Consulting Group's differentiation opportunities matrix: Actually it is a competitive advantage matrix applicable to differentiation opportunities.

Four types of industries identified by BCG matrix are:

Volume industry: only a few but very large competitive advantages are possible. The benefit of the advantage is proportional with company size and market share. Example given - construction industry

Stalemated industry: in this type there are only few opportunities and the benefit from each is small. The benefit is also not proportional to the size or market share.

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Example: Steel industry - It is hard to differentiate the product or decrease its manufacturing cost.

Fragmented industry: in this type, there are many opportunities, but the benefit of each of them is small. Benefit does not depend on size or market share.

Specialized industry: in this type, the opportunities are more and benefit of each opportunity is high. The benefit is not related to size or market share.

Kotler mentions, MilindLela‖s observation that companies differ in their potential maneuverability long five dimensions: their target market, product, place (channels), promotion, and price. The redeem of maneuver is affected by the industry structure and the firm's position in the industry. For each potential competitive opportunity or option limited by the maneuverability, the company needs to estimate the return. Those opportunities that promise the highest return define the company's strategic leverage. The concept of maneuverability brings out the fact that a strategic option that worked very well in one industry may not work equally well in the other industry because of low maneuverability of that option in the different industry and by the firm in consideration.

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Five Dimensions of Differentiation

Regarding the tools of differentiation, five dimensions can be utilized to provide differentiation.

Product Services that accompany marketing, sales and after sales services. Personnel that interact with the customer Channel Image

DIFFERENTIATING A PRODUCT

Features

Quality: performance and conformance Performance - the performance of the prototype or the exhibited sample, Conformance - The performance of every item made by the company under the same

specification Durability Reliability Reparability Style Design

Services differentiation

Ordering ease Delivery Installation Customer training Customer consulting

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Miscellaneous services Personnel Differentiation Competence Courtesy Credibility Reliability Responsiveness Communication

Channel differentiation

Coverage Expertise of the channel managers Performance of the channel in ease of ordering, and service, and personnel

Image differentiation

First distinction between Identity and Image - Identity is designed by the company and through its various actions company tries to make it known to the market.

Image is the understanding and view of the market about the company.

An effective image does three things for a product or company.

1. It establishes the product's planned character and value proposition.

2. It distinguishes the product from competing products.

3. It delivers emotional power and stirs the hearts as well as the minds of buyers.

The identity of the company or product is communicated to the market by

Symbols Written and audiovisual media Atmosphere of the physical place with which customer comes into contact Events organized or sponsored by the company.

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For example:Nike mainstream popularity turns off 12-to-24-years-olds, who prefers

Airwalk and other alternative brands that convey more extreme sports image. Hence Image

differentiation is important for a company or product. An effective image establishes the

product’s character and value proposition, it conveys this character in a distinctive way and it

delivers emotional power beyond a mental image. For image differentiation to work, it must

be conveyed through every available communication vehicle and brand contact, including

logos, media and special events.

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DEVOLOPING A POSITIONING STRATEGY

Levitt and others have pointed out dozens of ways to differentiate an offering (Theodore Levitt: "Marketing success through differentiation-of anything", Harvard Business Review, Jan-Feb, 1980)

While a company can create many differences, each difference created has a cost as well as consumer benefit. A difference is worth establishing when the benefit exceeds the cost. More generally, a difference is worth establishing to the extent that it satisfies the following criteria.

Important: The difference delivers a highly valued benefit to a sufficient number of

buyers. Distinctive: The difference either isn't offered by others or is offered in a more

distinctive way by the company. Superior: The difference is superior to the ways of obtaining the same benefit. Communicable: The difference is communicable and visible to the buyers. Preemptive: The difference cannot be easily copied by competitors. Affordable: The buyer can afford to pay the higher price Profitable: The Company will make profit by introducing the difference.

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POSITIONING

Positioning is the result of differentiation decisions. It is the act of designing the company's offering and identity (that will create a planned image) so that they occupy a meaningful and distinct competitive position in the target customer's minds.

The end result of positioning is the creation of a market-focused value proposition, a simple clear statement of why the target market should buy the product.

Example:

Volvo (station wagon)

Target customer-Safety conscious upscale families,

Benefit - Durability and Safety,

Price - 20% premium,

Value proposition - The safest, most durable wagon in which your family can ride.

How many differences to promote?

Many marketers advocate promoting only one benefit in the market (Your market offering may have many differentiators, actually should have many differentiators in product, service, personnel, channel, and image).

Kotler mentions that double benefit promotion may be necessary, if some more firms claim to be best on the same attribute. Kotler gives the example of Volvo, which says and "safest" and "durable".

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Four major positioning errors

1. Under positioning: Market only has a vague idea of the product.

2. Overpositioning: Only a narrow group of customers identify with the product.

3. Confused positioning: Buyers have a confused image of the product as it claims too many benefits or it changes the claim too often.

4. Doubtful positioning: Buyers find it difficult to believe the brand‖s claims in view of the product‖s features, price, or manufacturer.

Different positioning strategies or themes

1. Attribute positioning: The message highlights one or two of the attributes of the product.

2. Benefit positioning: The message highlights one or two of the benefits to the customer.

3. Use/application positioning: Claim the product as best for some application.

4. User positioning: Claim the product as best for a group of users. - Children, women, working women etc.

5. Competitor positioning: Claim that the product is better than a competitor.

6. Product category positioning: Claim as the best in a product category Ex: Mutual fund ranks – Lipper.

7. Quality/Price positioning: Claim best value for price

Which differences to promote?

This issue is related to the discussion of worthwhile differences to incorporate into the market

offering done earlier. But now competitors positioning also needs to be considered to highlight

one or two exclusive benefits offered by the product under consideration.

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Communicating the Company‖s Positioning

Once the company has developed a clear positioning strategy, the company must choose various signs and cues that buyers use to confirm that the product delivers the promise made by the company.

CLASIFICATION OF SERVICES

The two reasons for service classification are: • To provide a checklist of service dimensions possessed by a particular service provider.

For example…., does your service have a people focus or equipment focus or professional (accountant) or mass service (transportation)

• To provide a base for determining strategic roles in the marketing and management

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Service classification scheme enable current and future market positioning to be identified and justified

THESE CLASSIFICATIONS ARE BASED ON:

• Service and operation dimension

• Level of tangibility

• Customer - employee presence during the service

• Level of customization /empowerment

• Service delivery and processing focus

Classification based on Service operation dimensions

Mainly six service dimensions

o Does the service have people focus (eg an accountant) or an equipment focus (e g an ATM)?

o What is the length of customer contact time in a typical service encounter ? o what is the extent of customization of the service ,i.e. is it tailored to the specific need

of individual clients o to what extent are in the customer contact personnel empowered to exercise

judgment in the customer need ?i o Is the source of value added mainly front office (e g. a hairdresser)or back office (e g

in a bank) o Does the service have product focus (eg: car mechanic ) or a process focus (a higher

education course)

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Classification based on level of tangibility

From the consumer perspective the more tangible product(that is ,good) the easier it is evaluate(in the terms of quality, suitability and so on)Whereas the more intangible product the opposite is true.

Classification based on Customer -Employ presence during the service

Swhilst researching the importance of the physical surroundings (the so-called ―services cape‖) on customers and employees involved with services provision, has classified service organization as

Self-Services ,eg- ATM

Interpersonal Services (both customer and employ) eg-school, dry-cleaning center.

Remote service(employ only) eg- Insurance company

.

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Classification based on customisation/empowerment

Services classified according to customisation of service and empowerment of employees

Empowerment of level of customisation of service

Employees low high

Low food retailing superstore telephone banking

High national health dental accountant

Care

Classification based on service delivery and processing focus

• Uses the delivery system, job shop, assembly line and batch processing instead of professional, service shop and mass service, respectively. The other dimension of services is the process focuses, that is whether the service focuses on the body ,the mind ,the tangible or the intangible assets of customers

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SERVICE MARKETING MIX

• Product • Price • Place • Promotion • People • Physical evidence • Process

Product

It requires consideration of the range of services provided, the quality of service provided

and the level of services provided. Attention should be given to the branding, warranties,

and after sales service.

Price

• Includes levels of prices, discounts, allowances and commissions, terms of payment and credit

• Pay a part in differentiating one service from one another .Therefore the customer perception of value obtained from a service.

• The interaction of price and quality are important in many service price sub mixes. Place

• Location of service providers and their accessibility • Not only physical accessibility but also other means of communication and contact • Distribution channels and their coverage are linked to service accessibility

Promotion

• Includes various methods of communicating with markets whether through; – Advertising – Personal selling activities – Direct forms of publicity – Indirect forms of communication like PR

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People

• All human actors who play a part in service delivery and thus influence the buyer‖s

perception ; namely – The firm‖s personnel, the customer, and other customer in the service

environment Physical evidence

• The environment in which the service is delivered and where the firm and customer

interact, and tangible components that facilitate performance or communication of service.

Process The actual procedure, mechanism and flow of activities by which the service is delivered • Service delivery and operating systems

THE SERVICES MARKETING TRIANGLE

Three Types of Service Marketing

Internal Marketing

External Marketing

Interactive Marketing

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External Marketing: Making Promises Company promises customer about what to expect and how it is delivered

Advertising, sales promotions – traditional activities

Employees, décor of the facility, price of service, service processes help the customer set

expectations These promises should be consistent and realistic to ensure customer satisfaction

Do not over-promise

SERVICES MARKETING TRIANGLE

COMPANY

Internal Marketing

Enabling Promises

PROVIDERS CUSTOMERS

External Marketing

Making Promises

Interactive Marketing

Keeping Promises

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Interactive Marketing: Keeping Promises Most critical from the customer‖s point-of-view

Occurs in the moment of truth when the customer interacts with the organization and

the service is produced and consumed The promises can be kept or broken by employees, third party service providers or even

technology Reliability of the promises is tested with every interaction of the customer

Internal Marketing: Enabling Promises To deliver on the promises made, the service provider and system needs to have

necessary SKILLS, ABILITIES, TOOLS & MOTIVATION to deliver Promises are easy to make, more important to be kept

Providers need to be RECRUITED, TRAINED, PROVIDED WITH APPROPRIATE TOOLS

AND SYSTEMS & REWARDED keeping in mind the promises made Employee satisfaction and customer satisfaction are closely linked

All the three marketing activities are critical to the success of the service. Each side has significant challenges and requires strategies for success.

eg: FEDEX CORPORATION

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External Marketing: extensive market research (2400 per quarter), award-winning

advertising, consistent statements

Interactive Marketing: goal of each employee is that every service encounter should be flawless from the customer‖s point of view

Internal Marketing: quality service through technology, rewards, empowerment, open communication, fair treatment of employees , increasing employee loyalty

To understand the complex role of marketing in service companies I would like to use a central

model from Grönroos, which many other authors like Kotler and Zeithamlalso refer to and

which suits perfectly well to my study. This model is the service marketing triangle.

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EXPANSION OF MARKETING MIX

The marketing mix is the combination of marketing activities that an organization engages in

so as to best meet the needs of its targeted market. The marketing mix consists of four main

elements:

Product- The product is the physical product or service offered to the customer. In the case of

physical products, it also refers to any services or conveniences that are part of the offering.

Product decisions include aspects such as function, appearance, packaging, service, warranty,

etc.

Price – pricing decisions should take into account profit margins and the probable pricing

response of competitors. Pricing includes not only the list price, but also discounts, financing,

and other options such as leasing.

Place – place decisions are those associated with channels of distribution that serve as the

means for the product to the target customers. The distribution system performs transactional,

logistical, and facilitating functions. Distribution decisions include market coverage, channel

member selection, logistics, and levels of service.

Promotion – promotion decisions are those related to communicating and selling to potential

consumers. Since these costs can be large in proportion to the product price, a break-even

analysis should be performed when making promotion decisions. It is useful to know the value

of a customer in order to determine whether additional customers are worth the cost acquiring

them. Promotion decisions involve advertising, public relations, media types, etc.

Getting the mix of these elements right enables the organization to meet its marketing

objectives and to satisfy the requirements of customers.

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In addition to the traditional four Ps it is now customary to add some more Ps to the mix to give

us Seven Ps.

The additional Ps have been added because today marketing is far more customer oriented than

ever before, and because the service sector of the economy has come to dominate economic

activity in this country. These 3 extra Ps are particularly relevant to this new extended service

mix.The three extra Ps are:

Physical layout - in the days when manufacturing dominated the UK economy the physical

layout of production units such as factories was not very important to the end consumer

because they never went inside the factory. However, today consumers typically come into

contact with products in retail units - and they expect a high level of presentation in modern

shops - e.g. record stores, clothes shops etc. Not only do they need to easily find their way

around the store, but they also often expect a good standard or presentation. The importance of

quality physical layout is important in a range of service providers, including:

Students going to college or university have far higher expectations about the quality of their

accommodation and learning environment than in the past. As a result colleges and universities

pay far more attention to creating attractive learning environments, student accommodation,

shops, bars and other facilities.

Air passengers expect attractive and stimulating environments, such as interesting departure

lounges, with activities for young children etc.

Hair dressing salons are expected to provide pleasant waiting areas, with attractive reading

materials, access to coffee for customers, etc.

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Physical layout is not only relevant to stores, which we visit, but also to the layout and structure

of virtual stores, and websites.

2. Provision of customer service - customer service lies at the heart of modern service

industries. Customers are likely to be loyal to organizations that serve them well - from the

way, in which a telephone query is handled, to direct face-to-face interactions. Although the

'have a nice day' approach is a bit corny, it is certainly better than couldn‖t a care less approach

to customer relations. Call Centre staff and customer interfacing personnel are the front line

troops of any organization and therefore need to be thoroughly familiar with good customer

relation's practice.

3. Processes - associated with customer service are a number of processes involved in

making marketing effective in an organization e.g. processes for handling customer

complaints, processes for identifying customer needs and requirements, processes for handling

order etc. The 7 Ps - price, product, place, promotion, physical presence, provision of service,

and processes comprise themodern marketing mix that is particularly relevant in service

industry, but is also relevant to any form of business where meeting the needs of customers is

given priority.

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CREATING DELIVERING AND PERFORMING SERVICE

All service organizations face choices concerning the types of products to offer and the oper-ational procedures to employ in creating them. These choices are often driven primarily by market factors, with firms seeking to respond to the expressed needs of specific market segments and to differentiate the characteristics of their offerings against those of competitors. The availability of new delivery processes—such as the Internet for information- based services—allows firms to create new methods of delivering existing services that effectively change the nature of the service experience and create new benefits; the shift to Internet bank-ing is a case in point. A more radical form of product innovation involves exploiting technological developments to satisfy latent needs that customers have not previously articulated or even recognized.

Service offerings typically consist of a core product bundled together with a variety of sup-plementary service elements. The core, responds to the customer's need for a basic benefit—such as transportation to a specific location, resolution of a specific health problem, obtaining a professional solution to a problem, or repair of malfunctioning equipment. Supplementary services are those that facilitate and enhance use of the core service. They range from provision of needed information, advice, and documentation to problem solving and acts of hospitality.

Designing new services is a challenging task because it requires thinking about processes, people, and experiences as well as outputs and benefits. Processes can be depicted through blueprints that specify employee tasks and operational sequences as well as track the experience of the customer at each step in service delivery.

PLANNING AND CREATING SERVICES

What do we mean by a service product? In earlier chapters; we noted that a service is a performance rather than a thing. When customers purchase manufactured goods, they take title to physical objects. But service performances, being intangible and ephemeral, are experienced rather than owned. Even when there are physical elements to which the customer does take title—such as a cooked meal (which is promptly consumed), a gold filling in a tooth,

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a replacement part inside a car—a significant portion of the price paid by customers is for the value added by the accompanying service elements, including labor and expertise and the use of specialized equipment

When customers are required by the nature of the service process to visit the service site— as in people-processing services—or choose to do so in other types of services (such as traditional retail bank branches), they may be asked to participate actively in the process of service creation and delivery. In situations where customers perform self-service, their experiences are often shaped by the nature and user-friendliness (or lack thereof!) of the supporting technology. In both instances, evaluations of the service product are likely to be much more closely interwoven with the nature of the delivery process than is the case for manufactured goods.

Key Steps in Service Planning

One of the challenges in services marketing is to ensure that the product management task maintains a strong customer focus at all times. Historically, operations management was often allowed to dominate this task, with the result that customer concerns were sometimes sub-jugated to operational convenience. On the other hand, marketers cannot work in isolation on new product development, especially when its delivery entails use of new technologies; they need to form a partnership with operations personnel and, in the case of high-contact services, with human resource managers as well. Figure 8.1 outlines the key steps involved in planning and creating services, emphasizing the need for managers to relate market opportunities to deployment of their firm's resources—physical, technological, and human.

The task begins at the corporate level with a statement of objectives. This statement leads into a detailed market and competitive analysis (addressing each of the markets in which the firm is currently involved or is thinking of entering). Paralleling this step is a resource allocation analysis, requiring definition and appraisal of the firm's current resources and how they are being allocated as well as identification of additional resources that might reasonably be obtained. This pair of steps can be thought of collectively as a form of strengths, weaknesses, opportunities, and threats (SWOT) analysis, identifying these factors on both the marketing and operational/human resources fronts. Each leads to a statement of assets.

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The marketing assets statement includes details of the firm's existing customer portfolio (such as its size, profile, and value), knowledge of the market and competitors, its current product line, the reputation of its brand(s), its marketing implementation skills, and its current posi-tioning strategy(-ies). We saw in chapter 7 that a positioning statement can be developed for each service that the firm offers to one or more target market segments, indicating the characteristics that distinguish that service from competitive offerings.

The marketing opportunities revealed by this analysis must now be matched against an operating assets statement. Can the organization afford to allocate the physical facilities, equipment, information technology, and human resources needed to market existing service products more effectively; add enhancements designed to improve competitive appeal; or create new service offerings? Conversely, does an analysis of these operating assets suggest new opportunities to improve their utilization in the marketplace? If the firm lacks the resources needed for a new marketing initiative, could it leverage its existing assets by partnering with intermediaries or even with customers themselves? Finally, does an identified marketing opportunity promise sufficient profits to yield an acceptable return on the assets employed after deducting all relevant costs?

From a marketing perspective, the next step in transforming an opportunity into reality involves creating a service marketing concept to clarify the benefits offered to customers and the costs that they will incur in return. This marketing concept considers both core and supplementary services; the characteristics of these services in terms of both performance level and style; and where, when, and how customers will be able to have access to them. The related costs of service include not only money but also definition of the amount of time, mental hassle,physical effort, and negative sensory experiences likely to be incurred by customers in receiving service.

A parallel step is to establish a service operations concept, which stipulates the nature of the processes involved (including use of information technology) and how and when the different

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types of operating assets should be deployed to perform specific tasks. Hence, one must define the geographic scope and scheduling of operations, describe facilities design and layout, and identify the human resources required. The operations concept also addresses opportunities for leveraging the firm's own resources through use of intermediaries or the customers themselves. Finally, it clarifies which tasks and resources will be assigned to front stage and which to backstage operations.

Fig: planning and Creating Services

Service Delivery

Process

Service Operations Concept

Nature of processes People processing Possession processing Mental stimulus

processing Information

processing

Geographic scope of operation Area(s) served Single site versus

multisite Facilities location Telecommunications

linkages

Scheduling Hours/days/seasons of

service Continuous versus

intermittent If intermittent, what

frequency

Facilities design and layout

Human resources (numbers and skills)

Leverage through partnerships and self service

Specific tasks assigned to front stage and backstage operations

Corporate Objectives and

resources

Market Competitive

Analysis Resource Allocation

Analysis

Market Assets Statement

Customer portfolio

Market knowledge

Marketing implementation skill

Product line

Positioning strategy

Reputation of brand

Operating Assets Statement

Physical facilities

Equipment

Information technology

Human resources (numbers and skills)

Alliances and partnership

Cost structure

Service marketing Concept

Benefit to Customer Core product Supplementary

services Service levels and

style Accessibility (where

and when)

User cost Price and other

monetary costs Time Mental effort Physical effort Negative sensory

experiences

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THE IMPACT OF TECHNOLOGY

Technological developments during the last 20 years have had a remarkable impact on the way in which services are produced and delivered. Innovations in core services range from new types of medical treatments to high-speed rail service and from satellite-based weather forecasting to addressable (that is, interactive) cable television systems. Many important changes relate to the use of information technology to improve supplementary services. Developments in telecommunications and computer technology have also led to many innovations in how services are delivered, including increased use of telephone and Internet-based services.

Android is an operating system for mobile devices such as smartphones and tablet computers. It is developed by the Open Handset Alliance led by Google.

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UNDERSTANDING THE SERVICE OFFERING

Most manufacturing and service businesses offer their customers a package of benefits, involv-ing delivery of not only the core product but also a variety of service-related activities. Increasingly, these services provide the differentiation that separates successful firms from the also-rans. With both services and goods, the core product sooner or later becomes a commodity as competition increases and the industry matures. (If a firm can't do a decent job on the core elements, it's eventually going to go out of business!) Although managers continually need to consider opportunities to improve the core product, the search for competitive advantage in a mature industry often emphasizes performance on the supplementary services that are bundled with the core.

The Augmented Product

Marketing textbook authors have long been writing about the augmented product—also referred to as the extended product or the product package—in an effort to describe the supplementary elements that add value to manufactured goods. Several frameworks can be used to describe augmented products in a services context Lynn Shostack developed a molecular model, which uses a chemical analogy to help marketers visualize and manage what she termed a "total market entity."1 Her model can be applied to either goods or services. At the center is the core benefit, addressing the basic customer need, linked to a series of other service characteristics. She argues that as in chemical formulations, a change in one element may completely alter the nature of the entity. Surrounding the molecules are a series of bands representing price, distribution, and market positioning (communication messages).

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The molecular model helps us to identify the tangible and intangible elements involved in service delivery. The example shows a Visit to theatre. By highlighting such elements, marketers can determine whether their services are tangible dominant or intangible dominant. The more intangible elements exist, the more necessary it is to provide tangible clues about the features and quality of the service.

Eiglier and Langeard propose a model in which the core service is surrounded by a circle containing a series of supplementary services that are specific to that particular product. Their approach, like Shostack's, emphasizes the interdependence of the various components. They distinguish between those elements needed to facilitate use of the core service (such as the

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reception desk at a hotel) and those that enhance the appeal of the core service (such as a fitness center and business services at a hotel).

Both models of the augmented product offer useful insights. Shostack wants us to determine which service elements are tangible and which are intangible to facilitate the formulation of product policy and communication programs. Eiglier and Langeard ask us to think about two issues: first, whether supplementary services are needed to facilitate use of the core service or simply to add extra appeal, and second, whether customers should be charged separately for each service element or whether all elements should be bundled under a single price tag. Further insight is provided by GrSnroos, who clarifies the different roles played by supplementary services by describing them as either facilitating or supporting.

Defining the Nature of the Service Offering

Product planners need to include three components in the design of the service offering.

The most basic component is the core product, which addresses these questions: What is the buyer really purchasing, and what business are we in? The core product supplies the central problem- solving benefits that customers seek. Thus, transport solves the need to move a person or a physical object from one location to another, management consulting is expected to yield expert advice on the actions that a company should take, and repair services restore a damaged or malfunctioning machine or building to good working order.

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The second component concerns the core delivery process—how the core product is delivered to the customer, the nature of the customers role in that process, how long it lasts, and the prescribed level and style of service to be offered. In chapter 2, we discussed four core processes—people processing, possession processing, mental stimulus processing, and information processing—each of which has different implications for customer involvement; operational procedures; the degree of customer contact with service personnel, equipment, and facilities; and requirements for supplementary services.

The third component is the group of supplementary services that augment the core product, both facilitating its use and enhancing its value and appeal. Each of these supplementary elements, in turn, requires its own delivery system (which may or may not be tied to the core delivery process) and prescribed service level. These three components are captured in Figure. Introducing the temporal dimension is central to understanding the role that time plays not only in process scheduling but also as a potential cost of service for customers and as a resource allocation issue for the supplier. An important aspect of service planning is determining what is an appropriate amount of time for the customer to spend on different service elements. In some instances, research may show that customers from a given segment expect to budget a specific amount of time for a given activity that has value for them and would not wish to be rushed (for instance, eight hours for sleeping, an hour and a half for a business dinner, 20 minutes for breakfast). In other instances, such as making a reservation, checking in, payment, or waiting for a car to be retrieved from valet parking, customers may wish to minimize or even eliminate time spent on what they perceive as nonproductive activities.

Example: Hotel Service

1. Core and Supplementary Product Design: What Do Us Offer and How Do We Create and Deliver It?

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2. Core and Supplementary Services in a Luxury Hotel (Offering Guests Much More than a Cheap Motel!)

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3. What Happens, When, and in What Sequence?

The Time Dimension in the Augmented Service Product

The Flower of Service: Categorizing Supplementary Services

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SERVICE BLUEPRINT

The service blueprint is a technique used for service innovation. The technique was first described by Lynn Shostack, a bank executive, in the Harvard Business Review in 1984. The blueprint shows processes within the company, divided into different components which are separated by lines.

Blueprints are especially useful, when it comes to developing and designing new services. It visualizes the service simultaneously depicting the visible components of the service, the roles of employees and customers, the intersections of customer contact, and the process of service delivery. The blueprint provides a way to divide a service into logical elements and to picture the tasks or steps in the process, the guideline how customer experience a service, and the instruments by which the tasks are accomplished. Blueprinting is already used in different techniques and fields, including computer systems analysis, industrial engineering, decision theory, and logistics.

Components

The service blueprint consists of 5 components:

1. Customer Actions 2. Onstage / Visible Contact Employee Actions

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3. Backstage / Invisible Contact Employee Actions 4. Support Processes 5. Physical Evidence

Customer Actions

This component contains all of the steps that customers take as part of the service delivery process. This element is always on top of the service blueprint.

Onstage / Visible Contact Employee Actions

This element is separated from the customer actions by a ―line of interaction‖. These actions are face-to-face actions between employees and customers.

Backstage / Invisible Contact Employee Actions

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The ―line of visibility‖ separates the Onstage from the backstage actions. Everything that appears above the line of visibility can be seen by the customers, while everything under the line of visibility is invisible for the customers. A very good example of an action in this element is a telephone call; these are an action between an employee and a customer, but they don‖t see each other.

Support Processes

The ―internal line of interaction‖ separates the contact employees from the support processes. These are all the activities carried out by individuals and units within the company who are not contact employees. These activities need to happen in order for the service to be delivered.

Physical Evidence

For each customer action, and every moment of truth, the physical evidence that customers come in contact with is described at the very top of the service blueprint. These are all the tangibles that customers are exposed to that can influence their quality perceptions.

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Building a blueprint

The process of structuring a blueprint involves six steps:

1. The identification of the service process, that is supposed to be blueprinted 2. The identification of the customer segment or the customers that are supposed to experience the

service 3. Picturing the service from the customer‖s perspective 4. Picturing the actions of the contact employee (onstage and backstage), and/or technology

actions 5. Linking the contact activities to the needed support functions 6. Adding the evidence of service for every customer action step

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Pricing Products and Services

Attaching a fair and accurate price tag to your products and services can be a tricky balancing act. It should come as no surprise that many business owners have an ongoing struggle with setting their pricing strategies. Some use inappropriate approaches, for example, attempting to always be the lowest-priced player in the market, while others fail to change their approach to capitalize on market changes.

There are some simple, yet definitive measures you can take to accurately price your product or service. By exercising creative judgment and a keen awareness of consumer motivations, you can greatly increase your chances of owning the market. The following road map will guide you through the pricing maze and set your company on the road to accurate pricing..

II. Conducting Market Research

Market research is required if you intend to gain a competitive advantage through pricing. You'll want to use research to determine what competitors are charging for products or services similar to yours and assess how your offerings measure up in terms of quality compared to those competitors. Knowing this will help you determine a fair price.

There are many ways to conduct market research, including the Internet, trade publications and trade shows. You can also go out and physically shop the competition, or if you are too busy or too recognizable to do so, you can hire professional shoppers to do it for you.

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When conducting market research, don't be afraid to go straight to the customer. One company that performs valuable market research with customers is multimedia sound technology innovator Bose Corporation. When Bose introduces a new stereo speaker, for example, the company often takes it right into retail stores to show it to prospective buyers. Company representatives use the opportunity to ask potential buyers what they would expect and be willing to pay for a speaker of that caliber. This firsthand information gives the company a good idea of the price they should set when they introduce that product to the market.

Prices and the Law

When it comes to setting prices, there are certain strictly enforced rules and regulations that you should be aware of. They include:

Price Fixing -- As a business owner, you should never agree upon or even discuss your prices with other companies.

Price Fixing by Purchasers -- If purchasers join together in order to demand prices from their suppliers, this too can be considered price fixing..

Exchanging Price Information -- You can keep your eye on competitors and their pricing strategies through market research, but you cannot have any direct conversations with them about prices..

Bid Rigging -- If your company is bidding on a contract, you must not discuss your bid with any competitors; nor should you enter into any kind of an agreement with another bidder to make an identical bid.

Parallel Pricing -- In some instances, you can be charged with price fixing even if you have never spoken a word with your competitors, simply because your pricing strategies are the same.

Price Squeezes -- A classic "squeeze" involves setting wholesale prices too high for small-sized orders. Big chains are usually the culprit of price squeezing, as it's designed to drive small business owners who can't compete with high prices out of business.

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SERVICE PROMOTION

Communication is the most visible or audible some would say intrusive of marketing activities, but its value is limited unless it‖s used intelligently in conjunction with other marketing efforts. Through communication marketers inform existing or prospective customers about service features and benefits, price and other costs, the channels through which service is delivered and when and where it is available. Where appropriate persuasive arguments can be marshaled for using a particular service and preference can be created for selecting a specific brand. And both personal instructions and impersonal communications can be employed to help customers become effective participants in service delivery processes.

ADVERTISING

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Advertisingis a form of communication intended to persuade an audience (viewers, readers or

listeners) to purchase or take some action upon products, ideals, or services. It includes the name of a product or service and how that product or service could benefit the consumer, to persuade a target market to purchase or to consume that particular brand

A recent advertising innovation is "guerrilla marketing", which involve unusual approaches such as staged encounters in public places, giveaways of products such as cars that are covered with brand messages, and interactive advertising where the viewer can respond to become part of the advertising message. Guerrilla advertising is becoming increasing more popular with a lot of companies. This type of advertising is unpredictable and innovative, which causes consumers to buy the product or idea. This reflects an increasing trend of interactive and "embedded" ads, such as via product placement, having consumers vote through text messages, and various innovations

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Digital advertising

Television advertising / Music in advertising Radio Advertising Online advertising Product placements

Personal Selling

Personal selling or Salesmanship is one of the most important methods to contact the prospective buyer personally and to persuade him or her to buy the products. The objective is not only to sell the product to a buyer but to make him or her permanent customer. This can be achieved by putting the things to the prospective buyer in such a way that he or she is convinced that the products being presented for sale can well satisfy his or her needs

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SALES PROMOTION

The term Sales Promotion broadly refers to all those promotional activities which are undertaken to stimulate interest, trial or purchase of a product by the end user or other intermediaries in between. Besides advertising and personal selling, all other activities undertaken to promote a product can be classified under sales promotion. Sales promotional activities basically intends to increase the sales or demand of a particular product or service.

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TOOLS FOR SALES PROMOTION

Free Samples Money-off price Incentives Coupons Gift Offers Short term Discounts Point of display Materials

PUBLICITY & PUBLIC RELATION

The goal of public relations is to mold opinion. The saying "perception is reality" speaks to the need for public relations. Public relations work to protect an organization's or individual's reputation. Effective PR strengthens credibility, enhances image, develops goodwill and influences behavior. Speeches, special events, newsletters, annual reports and news releases are examples of PR tactics.

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DIRECT MARKETING

Direct marketing is a form of advertising that reaches its audience without using traditional formal channels of advertising such as TV, newspapers, or radio. Direct marketing with two way communication between the firm & each one of the customers. It is a larger process than non–store retailing .It tackles all the modification, price negotiation, marketing communication, is an integrated & compressed manner

Types of Direct Marketing

Internet marketing Face-to-face selling Direct mail Catalogs Telemarketing Direct-response advertising Kiosk marketing

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DELIVERING SERVICE THROUGH INTERMEDIARIES

Service intermediaries also make service loyalty available providing time and place convince for customers. Because they represent multiple service principle. In any financial or professional service intermediaries functions as glue between brands or companies name and customers by building the trusting relationship required in these complex and expect offering. Service principles depending on their intermediaries to deliver service to their specifications.Service intermediaries depending how the customers evaluate the quality of the companies.

Primary types of intermediaries used in service delivery are

• franchisees

• agents and brokers

• electronic channels

Franchises are service outlets licensed by a principal to deliver a unique service concept it has created. Examples include fast food chains (McDonald‖s), video stores (Blockbuster), automobile repair services (Jiffy Lube) and hotels (Holiday Inn) Agents and Brokers are representatives who distribute and sell the services of one or more service suppliers. Examples include travel agents (American Express), Insurance agents (Paul Revere Insurance Company), and financial services (Oppenheimer mutual funds). Electronic Channels includes all forms of service provision through electronic means. Examples are ATMs, university video courses, Tax Cut software.

Key Issues Involving Intermediaries

conflict over objectives and performance conflict over costs and rewards control of service quality empowerment versus control channel ambiguity

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FRANCHISING

The franchise is an alternative to building 'chain stores' to distribute goods and avoid investment and liability over a chain. The franchisor's success is the success of the franchisees. The franchisee is said to have a greater incentive than a direct employee because he or she has a direct stake in the business. Businesses for which franchising works best have the following characteristics:

Businesses with a good track record of profitability. Businesses which are easily duplicated.

As practiced in retailing, franchising offers franchisees the advantage of starting up quickly based on a proven trademark, and the tooling and infrastructure as opposed to developing them. The midi-franchises like restaurants, gasoline stations, trucking stations which involve substantial investment and require all the attention of a business. There are also the large franchises - hotels, spas, hospitals, etc. - which are discussed further in Technological Alliances.

One of the biggest names in franchising, the Starbucks franchise, is a prime example of the growth potential inherent in the food and drink industry when the national palate catches on to your particular flavour. It used to be that coffee shops were few and far between, but following a 1990s boom, overshadowed only by the dot com explosion, one cannot walk a block without passing a Starbucks franchise or one of its competitors. From the food end of the spectrum, the Subway franchise and Pizza Hut franchisee offer similar examples. Clever marketing and solid brand management have allowed these two franchises to take ubiquitous foodstuffs, such as pizza and the sandwich and pizza, and make it their own product, their creation. The Subway franchise and Pizza Hut franchisee are prime examples of the security afforded by an established brand when launching your own franchise business.

AGENTS AND BROKERS

An agent is an intermediary who acts behalf of service principle or a customer. Some agents called selling agents, work with the principle and have contractual authority to sell principle output usually because principles lacks the resources or desire to do so. Other agents called purchasing agents often have long term relationship with buyers and help them in evaluating and making purchase. Such agents are usually hired by companies and individuals to find art antique and rare jewellery. A broker is

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an intermediary who brings buyer and seller together while assisting in negotiation. Brokers are paid by the party who hired them, rarely become involved in franchising or assuming risk, and are not long term representatives of buyers or sellers. Most familiar examples are real estate brokers, insurance broker and security brokers. Agents and Brokers are do not take title to service but instead deliver to right to them.

Benefits and Challenges in Distributing Services through Agents and Brokers

Benefits

• Reduced selling and distribution costs

• Intermediary‖s possession of special skills and knowledge

• Wide representation

• Knowledge of local markets

• Customer choice

Challenges

• Loss of control over pricing and other aspects of marketing

• Representation of multiple service principals

ELECTRONIC CHANNELS

Electronic Channels are only service distributers that do not require direct human interaction. They require some predesigned service and an electronic vehicle to deliver it. You are familiar with telephone and television channels and internet and web and may be aware of the other electronic vehicles that are currently under development. The consumer and business services that are made possible through these vehicles include movies on demand and interactive news

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and music, banking and financial services, multimedia service and database, distance learning, desktop video conferencing and remote health service. The more a service relies on technology for service production and less it release on face to face contact with service providers, the less the service is characterized by inseparability and non standardization.

Benefits and Challenges in Electronic Channels

Benefits

• Consistent delivery for standardized services

• Low cost

• Customer convenience

• Wide distribution

• Customer choice and ability to customize

• Quick customer feedback

Challenges

• Customers are active, not passive

• Lack of control of electronic environment

• Price competition

• Inability to customize with standardized services

• Lack of consistency with customer involvement

• Security concerns

• Competition from widening geographies

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UNIT-3

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CONSUMER BEHAVIOUR IN SERVICES

Consumer behavior is the study of when, why, how, and where people do or do not buy a product or service. It blends elements from psychology, sociology, social, anthropology and economics. It attempts to understand the buyer decision making process, both individually and in groups. It studies characteristics of individual consumers such as demographics and behavioral variables in an attempt to understand people's wants. It also tries to assess influences on the consumer from groups such as family, friends, reference groups, and society in general. Customerbehavior study is based on consumer buying behavior, with the customer playing the three distinct roles of user, payer and buyer. Delivering quality service consistently gives a competitive edge to services to organizations. It requires an understanding of customer expectations. Further, knowledge of factors influencing the desired service level, adequate service level, and zone of tolerance helps service organizations to consistently meet and exceed service expectations of the customers.

Knowledge of the factors influencing consumer behavior has several implications for service providers, which are described below.

Customers gather and rely on information obtained from personal sources when making service purchase decisions. Therefore marketers should be careful in satisfying

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http://en.wikipedia.org/wiki/Sociology

http://en.wikipedia.org/wiki/Social_Anthropology

http://en.wikipedia.org/wiki/Anthropology

http://en.wikipedia.org/wiki/Economics

http://en.wikipedia.org/wiki/Demographic

http://en.wikipedia.org/wiki/Consumer


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the existing customers by meeting or exceeding their expectations. Otherwise the customers might spread negative word-of-mouth publicity.

Services are intangible in nature. Customer needs the assistance of the service provider to assess the value of a service with high credence qualities and to add value to the service delivery process by assisting customers to assess the intangible features of a service.

In marketing of services, the customer becomes a part of the services delivery process. This, termed as customer co-production, has become the buzzword for service marketers as it helps them reduce their fixed costs in delivering the services. Customer co-production refers to the involvement of customers in the production and delivery process of a service. The service is a co-produced and costs much lesser than the traditional over-the-counter services provided by marketers. Examples of customer‖s involvement in producing a service are actions such as making an online reservation for a train ticket or a movie ticket.

Times being a crucial factor in gaining ahead of the competitors, customers in the new millennium are willing to trade off money against time. Service providers thus compete on the basis of time taken to deliver the service. Transportation and logistics services that are time-bound provide new opportunities for service providers to differentiate themselves from their competitors. For example, passengers of the Delhi-Bombay Shatabdi express shifted to metro shuttle flights introduced by Indian Airlines, Air Deccan and Jet Airways even though it cost them more in terms of money. This example clearly shows the importance of time to customers.

CUSTOMER SATISFACTION

Customer satisfaction, a business term, is a measure of how products and services supplied by a company meet or surpass customer expectation. It is seen as a key performance indicator within business and is part of the four perspectives of a Balanced Scorecard.

In a competitive marketplace where businesses compete for customers, customer satisfaction is seen as a key differentiator and increasingly has become a key element of business strategy.

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There is a substantial body of empirical literature that establishes the benefits of customer satisfaction for firms.

Measuring customer satisfaction

Organizations are increasingly interested in retaining existing customers while targeting non-customers; measuring customer satisfaction provides an indication of how successful the organization is at providing products and/or services to the marketplace.

Customer satisfaction is an ambiguous and abstract concept and the actual manifestation of the state of satisfaction will vary from person to person and product/service to product/service. The state of satisfaction depends on a number of both psychological and physical variables which correlate with satisfaction behaviors such as return and recommend rate. The level of satisfaction can also vary depending on other options the customer may have and other products against which the customer can compare the organization's products.

Because satisfaction is basically a psychological state, care should be taken in the effort of quantitative measurement, although a large quantity of research in this area has recently been developed. Work done by Berry (Bart Allen) and Brodeur between 1990 and 1998 defined ten 'Quality Values' which influence satisfaction behavior, further expanded by Berry in 2002 and known as the ten domains of satisfaction. These ten domains of satisfaction include: Quality, Value, Timeliness, Efficiency, Ease of Access, Environment, Inter-departmental Teamwork, Front line Service Behaviors, Commitment to the Customer and Innovation. These factors are emphasized for continuous improvement and organizational change measurement and are most often utilized to develop the architecture for satisfaction measurement as an integrated model. Work done by Parasuraman, Zeithaml and Berry (Leonard L) between 1985 and 1988 provides the basis for the measurement of customer satisfaction with a service by using the gap between the customer's expectation of performance and their perceived experience of

performance. This provides the measurer with a satisfaction "gap" which is objective and quantitative in nature. Work done by Cronin and Taylor propose the "confirmation/disconfirmation" theory of combining the "gap" described by Parasuraman, Zeithaml and Berry as two different measures (perception and expectation of performance)

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into a single measurement of performance according to expectation. According to Garbrand, customer satisfaction equals perception of performance divided by expectation of performance.

The usual measures of customer satisfaction involve a survey with a set of statements using a Likert Technique or scale. The customer is asked to evaluate each statement and in term of their perception and expectation of performance of the organization being measured.

METHODOLOGIES

The University of Michigan's American Customer Satisfaction Index (ACSI) is a scientific standard of customer satisfaction. Academic research has shown that the national ACSI score is a strong predictor of Gross Domestic Product (GDP) growth, and an even stronger predictor of Personal Consumption Expenditure (PCE) growth. On the microeconomic level, research has shown that ACSI data predicts stock market performance, both for market indices and for individually traded companies. Increasing ACSI scores has been shown to predict loyalty, word-of-mouth recommendations, and purchase behavior. The ACSI measures customer satisfaction annually for more than 200 companies in 43 industries and 10 economic sectors. In addition to quarterly reports, the ACSI methodology can be applied to private sector companies and government agencies in order to improve loyalty and purchase intent.

The Net Promoter score is a management tool that can be used to gauge the loyalty of a firm's customer relationships. It serves as an alternative to traditional customer satisfaction research. Companies obtain their Net Promoter Score by asking customers a single question (usually, "How likely is it that you would recommend us to a friend or colleague?"). Based on their responses, customers can be categorized into one of three groups: Promoters, Passives, and Detractors. In the net promoter framework, Promoters are viewed as valuable assets that drive profitable growth because of their repeat/increased purchases, longevity and referrals, while Detractors are seen as liabilities that destroy profitable growth because of their complaints, reduced purchases/defection and negative word-of-mouth. Companies calculate their Net Promoter Score by subtracting their % Detractors from their % Promoters.

The Kano model is a theory of product development and customer satisfaction developed in the 1980s by Professor Noriaki Kano that classifies customer preferences into five categories:

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Attractive, One-Dimensional, Must-Be, Indifferent, Reverse. The Kano model offers some insight into the product attributes which are perceived to be important to customers. Kano also produced a methodology for mapping consumer responses to questionnaires onto his model.

SERVQUAL or RATER is a service-quality framework that has been incorporated into customer-satisfaction surveys (e.g., the revised Norwegian Customer Satisfaction Barometer) to indicate the gap between customer expectations and experience.

J.D. Power and Associates provides another measure of customer satisfaction, known for its top-box approach and automotive industry rankings. J.D. Power and Associates' marketing research consists primarily of consumer surveys and is publicly known for the value of its product awards.

Other research and consulting firms have customer satisfaction solutions as well. These include A.T. Kearney's Customer Satisfaction Audit process, which incorporates the Stages of Excellence framework and which helps define a company‖s status against eight critically identified dimensions.

One of the newest and most innovative customer satisfaction measurement methodologies is called Gustometria. Gustometria is realtime measurement of customer and employee satisfaction. Customers are invited to answer a short survey by touching the "gustometer" screen with their fingers. The responses are collected immediately by the Gustometria servers which tabulate the results in real time. Management can then log into their private website and use the sophisticated business intelligence reports which are built in to the Gustometria system.

Most innovative contact centers make increasing use of multi-media surveys including web, email and telephone surveys. Although extremely challenging, many have introduced automated voice surveys at the end of a call, provided by companies such as VIRTUATel. These use IVR technology, whether hosted or on-premise, to collect the valuable feedback data collection. However, the real power of such surveys is in making use of sophisticated data analysis techniques and comparison indicators such as Advocacy Index to drive powerful Performance Management to increase customer retention and revenue per-customer rates.

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CUSTOMER EXPECTATIONS OF SERVICE

Customer expectations are beliefs about service delivery that function as standards or reference points against which performance is judged. Because customers compare their perceptions performance with these reference points when evaluating service quality, thorough knowledge about customer expectations is critical to service marketers. Knowing what the customer expects is the first and possibly most critical step in delivering quality service. Being wrong about customers want can mean losing a customer‖s business when another company hits the target exactly. Being wrong can also mean that expending money, time and other resources on things that don‖t count to the customer. Being wrong can even mean not surviving in a fiercely competitive market.

Among the aspects of expectations that need to be explored and understood for successful services marketing the following: What type of expectation standards do customers hold about service? What factors most influence the formation of the expectations? What role do these factors play in changing expectations? How can Service Company meet or exceed customer expectations?

EXPECTED SERVICE: LEVELS OF EXPECTATIONS

Desired service: the level of service the customer hopes to receive-the “wished for “level performance. Desired service is blend of what the customer believes “can be” and ―should be”. The expectation reflects the hopes and wishes of these consumers.

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Adequate service: the level of service the customer will accept. It represents the” minimum tolerable expectation, “the bottom level of performance acceptable to the customer. The figure shows these expectation standards as the upper and lower boundaries for customer expectations. This figure portrays the idea that customers access service performance on the basis of two standard boundaries: What they desire and what they deem acceptable.

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THE ZONE OF TOLERANCE

Services are heterogeneous in that performance may vary across providers, across employees from the same provider, and even with the same service employee. The extent to which customers recognize and are willing to accept this variation is called the zone of tolerance. If service drops below adequate service-the minimum level considered acceptable-customers will be frustrated and their satisfaction with the company will undermined .If service performance is higher than the zone of tolerance at the top end-where performance exceeds desired service-customers will be very pleased and probably quite surprised as well.

Different customers possess different zones of tolerance:

Some customers have narrow zones of tolerance, requiring a tighter range of service from providers, where as other customers allow a greater range of service. For example very busy customers would likely always be pressed for time, desire short wait times in general, and also hold a constrained range for the length of acceptable wait times.

An individual customer‖s zone of tolerance increases or decreases depending on a number of factors, including company-controlled factors such as price. When prices increase, customers tend to be less tolerant of poor service. In this case, the zone of tolerance decreases because the adequate service level shifts upward.

Zones of tolerance vary for service dimensions

Customer‖s tolerance zones also vary for different service attributes or dimensions. The more important the factor, the narrower the zone of tolerance is likely to be. In general customers

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are likely to be less tolerant about unreliable service than other service deficiencies, which mean that they have higher expectations for this factor.

FACTORS THAT INFLUENCE CUSTOMER EXPECTATIONS OF SERVICE

Because expectations play such a critical role in customer evaluation of services, marketers need to understand the factors that shape them. Marketers would also like to have control over these factors as well, but many of these forces influence customer expectations are uncontrollable.

SOURCES OF DESIRED SERVICE EXPECTATIONSThe two largest influences on desired service level are personal needs and philosophies about service. Personal needs those states or conditions essential to the physical and psychological well-being of the customer, are pivotal factors that shape what we desire in service. Personal needs can fall into many categories including physical, social, psychological, and functional.

Some customers are more demanding on others, greater sensitivity to, and higher expectations of, service. Enduring service intensifiers are individual, stable factors that lead the customers to a heightened sensitivity to service. One of the most important of these factors can be called derived service expectations, are driven by another person or group of people.

Another enduring intensifier is personal service philosophy –the customers underlying generic attitude about the meaning of service and proper conductor of service providers.

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SOURCS OF ADEQUATE SERVICE EXPECTATIONS

A different set of determinants affects adequate service, the level of service the customer finds acceptable. In general these influences are short term and tend to fluctuate more than the factors that influence desired service.

FACTORS THAT INFLUENCE ADEQUATE SERVICE

The first set of elements, transitory service intensifiers, is temporary, usually short term, individual factors that make a customer more aware of the need for service. Personal emergency situations in which service is urgently needed (such as an accident and need for automobile insurance or breakdown in office equipment during a busy period) raise the level of adequate service expectations, particularly the level of responsiveness required and considered acceptable. Performing service right the first time is very important, because customers value service reliability above all other dimensions. If the service fails in the recovery phase, fixing it right the second time (i.e., being reliable in service recovery) is even more critical than it was the first time.

Perceived service alternatives are other providers from whom the customer can obtain service. If customers have multiple service providers to choose from, or if they can provide the service for themselves, their adequate service is higher than those of customers who believe it is not possible to get better service elsewhere. The customer‖s perception that service alternatives exist raises the level of adequate service and narrows the zone of tolerance. It is important that

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service marketers fully understand the complete set of options that customers view as perceived alternatives.

The third factor affecting the level of adequate service is the customers self-perceived service role. We define this as perceptions of the degree to which customers exert an influence on the level of service they perceive. Customer‖s expectations are partly shaped by how well they believe they are performing their own role in service delivery. One role is of the customer is specifying the level of service they expected. A final way the customer defines his or her role is assuming the responsibility for complaining when service is poor. A dissatisfied customer who complains will be less tolerant than one who does not voice his or her concerns. Customers‖ zone of tolerance seems to expand when they sense they are not fulfilling their roles.

Levels of adequate service are also influenced by situational factors, defined as service performance conditions that customers view as beyond the control of the service provider. Situational factors are temporarily lower the level of adequate service, widening the zone of tolerance.

The final factor is predicted service, the level of service customers believe they are likely to get. Predicted service performance implies some objective calculation of the probability of performance or estimate of anticipated service performance level. If customers predicted good service, their levels of adequate service are likely to be higher than if they predict poor service.

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ROLE OF EMPLOYEES IN SERVICES MARKETING

Before going on to discuss the employees role in services, we feel it is important to differentiate between products and services. Services in most simple terms are deeds, processes and performances. Services may also be defined as any activity or benefit that one party offer to another that is essentially intangible and does not result in the ownership of anything [1]. These simple definitions give us good idea about what services are. We can give examples of a barber, a tailor, or a restaurant as services. Products on the other hand are offerings that are tangible in nature like for example a car.

In today's world, services are becoming more and more significant in any country's economy. As Louis V. Gerstner said in 2001 "Services are going to move in this decade to being the front edge of the industry". This quote comes from the former CEO of a company which claims to be the world's largest service business in the world, IBM. The importance of services in today's world can be further emphasized by the fact that services comprised of almost 80% of United States of America's Gross Domestic Product in 2003 [2].

If we talk in Pakistani context we can see that the structure of the Pakistani economy has changed from a mainly agricultural base to a strong service base. Agriculture now only accounts for roughly 20% of the GDP, while the service sector accounts for 53% of the GDP with wholesale and retail trade forming 30% of this sector [3]. This fact also demands that more work should be done on services marketing for proper growth of the sector.

Now that we know about the difference and importance of services, we would like to shed some light on the difference between marketing of products and marketing of services. Marketing for services is thought to be different from that of a product by a lot of experienced marketers. This was found out by Gary Knisely, a principal of the consulting firm Johnson

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Smith and Knisely, in 1979 when he interviewed several high-ranking marketing executives who had all gone to work in consumer services industry after extensive experience in the consumer packaged goods industry. There are generally 4 Ps considered in packaged goods marketing namely Product, Price, Place and Promotion. But when we talk about services, it is believed that there are three additional P's that should be considered for services marketing namely People, Process and Physical evidence [4].

The fifth P i.e. People include both employees and customers as customers also play an important role in the service delivery process. But we are going to focus on employees as far as this article is concerned. From the above discussion it is obvious that employees play an important role in the services marketing because of the vary reason that employees are involved in the process of delivery of any service e.g. a waiter in a restaurant is actually the conductor of all the process related to the customers. So it is of great importance that he gives the right image to the customer otherwise the customer might never return. So those employees that are a part of service delivery, we can call them customer-contact service employees, play an absolutely crucial role in building a repute for any service.

The importance of customer-contact service employees can be understood because of the following statements, which will also show that why employees may be the most valuable asset of a services organization. Customer-contact service employees are very important because:

oThey are the service o They are the organization in the customer's eyes o They are the brand o They are marketers [4]

In many cases, in a service, there is just the employee and nothing else i.e. employee is the service e.g. hair cutting, physical trainers, legal services etc. This means that the service being offered by the business is the employee. Thus, investing in the employee is same as investing in the manufacture of a product.

A customer-contact service employee may reflect the image of the service organization even if he or she is not directly providing the required service. If you enter a hospital, every employee that you encounter from the receptionist to the clerk might influence your opinion about that organization. Thus, employees sometimes do become the organization in customer's eyes.

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Employees also become the brand for a service. A very good example can be of a university which is well reputed amongst students. The quality of most universities is judged by the caliber of the teachers that are teaching there. When a student interacts with a professor, he has positive emotions about the university only when he feels that the teacher is knowledgeable and understanding and has complete control over his subject. We can say that one reason, among others, LUMS is thought to be better than other universities is due to the perception that its faculty contains more PhDs than anybody else, hence having better educational quality than others. Thus, an employee also becomes the brand for a service.

Because contact employees represent the organization and can directly influence customer satisfaction, they perform the role of marketers. They physically embody the service and are walking billboards from a promotional point of view [4] If we are on the road and we see a person sitting on a motorcycle, going to deliver a free delivery, or to deliver letters or documents, you can tell from their appearance, clothing or even kind of vehicle that which organization they belong to. So, even when the service employees are just doing their duty, they are acting as marketers for their organization.

Here we would like to refer to Mr. Dennis Harting who says "What is the most valuable asset that a company has? Is it the name, customers, goodwill, physical resources, or product line? The answer is that it is none of these. A company's most valuable resource is its' employees. Any organization will go only as far as the people who are driving it. In fact, a company is really just a group of people who interact for a common purpose. They are the ones who make up the organization." [5].

He also states that "It is important that managers and owners begin to realize that the employees are the most valuable asset any organization can have. Those who accept this new business model will structure their compensation and bonus program to reflect this belief."

Above discussion only points to one thing, generally for every business, and particularly for any services business, employees are definitely the most valuable assets. We personally feel that in Pakistan employees are still not given the right place and importance. One feels that more and more attention should be paid to role of employees in services and investments should be made to improve the most valuable asset of services

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SERVICE TRIANGLE

External Marketing: includes anything or anyonethat communicates to the customer before servicedelivery.

Interactive Marketing: its the real time marketingwere promises are kept.

Internal Marketing: management aids the providers in their ability to deliver the service promise-recruiting, training, motivating, rewarding, and providingequipment& technology.

Boundary Spanning Roles

The frontline service employees are referred to as boundary spanners because they operate at the organization's. They provide a link between external customer and environment and the internal operations of the organization. They serve as a critical function in understanding, filtering, and interpreting information and resources to and from the organization and its external constituencies. They vary from the least skilled, lowest paid employees like order takers, front desk employees, delivery people to well paid highly educated professionals like doctors, lawyers. These positions require extraordinary levels of emotional labor, frequently demand an ability to handle interpersonal and inter-organizational conflict. Emotional Labor arises from the

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discrepancy between the way frontline staff feel inside and the emotions they are expected to portray in front of customers.

Sources of Conflict

Personal/ Role Conflict: conflict between what their job requires and their own personalities, self perceptions, and beliefs

Organization/ Client Conflict: dilemma of whether they should follow the company‖s rules or satisfy customer demands.

Interclient Conflict: conflict between customers. Eg: speaking o mobile phone in a cinema hall, noisy guests in a restaurant

Service Culture To move an organization towards service excellence, we

need a strong service culture that is continuously reinforced

and developed by the firm‖s management.

“A culture where an appreciation for good service exists, and where giving good service to internal as well as ultimate, external customers, is considered a natural way of life and one other most important norms by everyone in the organization.”

SOURCES OF BOTH DESIRED AND PREDICTED SERVICE EXPECTATIONS

Explicit service promises are personal and non-personal statements about the service made by the organization to customers.

Implicit service promises are service-related cues other than explicit promises that lead to inferences about what the service should and will be like.

Word of mouth communication are personal sometimes non personal statements made by parties other than organization convey to customers what the service will be like

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Past experience, the customer‖s previous exposure to service is another force in shaping predictions and desires.

CUSTOMER PERCEPTION

PERCEPTION:

The process by which an individual selects, organizes, and interprets stimuli into a meaningful and coherent picture of the world.

Elements of Perception:

1. Sensation

2. Absolute threshold

3. Differential threshold

4. Subliminal perception

Wide Angle TV AD from Samsung

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SENSATION:

Immediate and direct response of the sensory organs to stimuli

Stimuli: products, packages, brands names advertisements etc

Absolute threshold:

The absolute threshold is the lowest level at which an individual can experience a sensation

Minimal difference that can be detected between two similar stimuli Also known as the just noticeable difference (the j.n.d)

Differential threshold:

Minimal difference that can be detected between two similar stimuli .Also known as the just noticeable difference (the j.n.d)

Subliminal perception:

Stimuli that are too weak or too brief to be consciously seen or heard may be strong enough to be perceived by one or more receptor cells

CUSTOMER PERCEPTION:

Consumer can evalaluate a product in certain levels.Its basic characteristics are inherent to the generic version of the product and are defined as the fundamental advantages it can offer to acustomer.

Generic products can be made distinct by adding value through extra features, such as quality or performance enhancements

The final level of consumer perception involves augmented properties, which offer less tangible benefits, such as customer assistance, maintenance services, training, or appealing payment options. In terms of competition with other products and companies, consumers greatly value these added benefits when making a purchasing decision,making it important for

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manufacturers to understand the notion of a “total package” when marketing to their

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customers

For example, when manufacturing automotive parts, a high-performing product will provide the customer base with basic benefits, while adding spare parts, technical assistance, and skill training will offer enhanced properties to create a total package within increased appeal to consumers

If a customer is satisfied it mean A product or services met his expectation!!!!!!! And he was not disappointed by itA loyal customer truly prefers a product, brand or company over competitive Offerings…….. Thus loyalty goes beyond a rational decision for known qualityOr Superior price performance ratio. It is about the customer‖s feeling andperception about the brand or product………..

Consumer perception is influenced by a variety of factors ………..

1. Did the product or services deliver the expected function

2. Did it fulfill the customer‖s needs….

Depending on the nature of the product and customer‖s preferences,

Increasing Market share can have positive or negative effects on how

The customer perceives the product…………..

Positive:

Increasing market share can send out positive signal by acting as an indicator of superior quality that is recognized by more and more other customer. Many brands offer positive emotional benefits of using a product that is popular in the value of the services or products can rise through increasing number of users of the product

Negative:

For premium and luxury products, customers may translate an increasingMarket share a loss of exclusivity and thus perceive it as less valuable…….

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The concept of customer perception does not only relateto individual Customer in consumer market. It also valid inbusiness to business Situations…………..

For example, a competitor benchmarking survey of a large industrial supplier revealed that the market leader, although recognized for excellent quality and services and known to be highly innovative was perceived s arrogant in some regions. If we take in to consideration that there are about 4 other large players with a similar level Of quality and innovative ideas, this perceived arrogance could develop in to a Serious problem

SEVERAL ASPECTS OF MEASURING CUSTOMER PERCEPTION

1. The company has to find out how it and its offerings are perceived by the Customers……….

2. Surveys should also identify the relative importance of several influencing Variables in the eyes of the customer. To know what matters most to the Customers helps to set priorities for projects………….

3. Customer segmentation…………………

First of all the company has to find out how itself and its Offerings are perceived by the customers. It is essential to identify what the customer is actually buying and which Factor most important to him. Only this way it is possible to align the internal focus and resources to the customer‖s expectation. This information is of great value if it can be Compared to the customers perception of competitive offerings Not only will this reveal relative strength and weaknesses, it is also a valuable source of ideas for improvements

Companies should try to make sure that their customers are aware of all the ways their offerings can provide value to them. They Have to explain the customer how this particular product can deliver more value than those from competitors. This approach means to widen the customer perception and to extend their awareness and appreciation to more features or aspects of the Offering. However this point has to be considering very carefully in order not to produce an diametrical effect.

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A customer who use a large part of the functionality of his Mobile phone might be delight to learn the additional features And functions of the next generation product. Here the perceived value of the new product could be increased by highlighting the utility of the new function. Another type of customer only uses his mobile to make and receive phone calls would probably not appreciate this type of communication. His equation of product value Cost will shift to the perception that he should pay an higher price for even more feature does not need and will not use.

GAP ANALYSIS

In business and economics, gap analysis is a tool that helps companies compare actual performance with potential performance. At its core are two questions: "Where are we?" and "Where do we want to be?" If a company or organization does not make the best use of current resources, or forgoes investment in capital or technology, it may produce or perform below its potential. This concept is similar to the base case of being below the production possibilities frontier.

Gap analysis identifies gaps between the optimizedallocation and integration of the inputs (resources), and the current allocation level. This reveals areas that can be improved. Gap analysis involves determining, documenting, and approving the variance between business requirements and current capabilities. Gap analysis naturally flows from benchmarking and other assessments. Once the general expectation of performance in the industry is understood, it is possible to compare that expectation with the company's current level of performance. This comparison becomes the gap analysis. Such analysis can be performed at the strategic or operational level of an organization.

Gap analysis is a formal study of what a business is doing currently and where it wants to go in the future. It can be conducted, in different perspectives, as follows:

1. Organization (e.g., human resources) 2. Business direction 3. Business processes 4. Information technology

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http://en.wikipedia.org/wiki/Business

http://en.wikipedia.org/wiki/Economics

http://en.wikipedia.org/wiki/Capital_%28economics%29

http://en.wikipedia.org/wiki/Production_possibilities_frontier



http://en.wikipedia.org/wiki/Operations_research



http://en.wikipedia.org/wiki/Benchmarking

http://en.wikipedia.org/wiki/Business

http://en.wikipedia.org/wiki/Organization

http://en.wikipedia.org/wiki/Business_process

http://en.wikipedia.org/wiki/Information_technology


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Gap analysis provides a foundation for measuring investment of time, money and human resources required to achieve a particular outcome (e.g. to turn the salary payment process from paper-based to paperless with the use of a system). Note that 'GAP analysis' has also been used as a means for classification of how well a product or solution meets a targeted need or set of requirements. In this case, 'GAP' can be used as a ranking of 'Good', 'Average' or 'Poor'. This terminology does appear in the PRINCE2 project management publication from the OGC (Office of Government Commerce).

The need for new products or additions to existing lines may emerge from portfolio analysis, in particular from the use of the Boston Consulting Group Growth-share matrix—or the need may emerge from the regular process of following trends in the requirements of consumers. At some point, a gap emerges between what existing products offer and what the consumer demands. The organization must fill that gap to survive and grow.

Gap analysis can identify gaps in the market. Thus, comparing forecast profits to desired profits reveals the planning gap.: This represents a goal for new activities in general, and new products in particular. The planning gap can be divided into three main elements:

USAGE GAP

This is the gap between the total potential for the market and actual current usage by all consumers in the market. Data for this calculation includes:

Market potential Existing usage Current industrial potential

Market potential

The maximum number of consumers available is usually determined by market research, but it may sometimes be calculated from demographic data or government statistics. Ultimately there are, of course, limitations on the number of consumers. For guidance one can look to the numbers who use similar products. Alternatively, one can look to what happened in other

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countries. Increased affluencein all major Western economies means such a lag can now be much shorter.

Existing usage

Existing consumer usage makes up the total current market, from which market shares, for example, are calculated. It usually derives from marketing research, most accurately from panel research, such as conducted by the Nielsen Company, but also from ad hoc work. Sometimes it may be available from figures collected that governments or industries have collected. However, these are often based on categories that make bureaucratic sense but are less helpful in marketing terms. The 'usage gap' is thus:

Usage gap = market potential – existing usage

This is an important calculation. Many, if not most marketers, accept existing market size—suitably projected their forecast timescales—as the boundary for expansion plans. Though this is often the most realistic assumption, it may impose an unnecessary limit on horizons. For example: the original market for video-recorders was limited to professional users who could afford high prices. Only after some time did the technology extend to the mass market.

In the public sector, where service providers usually enjoy a monopoly, the usage gap is probably the most important factor in activity development. However, persuading more consumers to take up family benefits, for example, is probably more important to the relevant government department than opening more local offices.Usage gap is most important for brand leaders. If a company has a significant share of the whole market, they may find it worthwhile to invest in making the market bigger. This option is not generally open to minor players, though they may still profit by targeting specific offerings as market extensions.All other gaps relate to the difference between existing sales (market share) and total sales of the market as a whole. The difference is the competitor share. These gaps therefore, relate to competitive activity.

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PRODUCT GAP

The product gap—also called the segment or positioning gap—is that part of the market a particular organization is excluded from because of product or service characteristics. This may be because the market is segmented and the organization does not have offerings in some segments, or because the organization positions its offerings in a way that effectively excludes certain potential consumers—because competitive offerings are much better placed for these consumers.This segmentation may result from deliberate policy. Segmentation and positioning are powerful marketing techniques, but the trade-off—against better focus—is that market segments may effectively be put beyond reach. On the other hand, product gap can occur by default; the organization has thought out its positioning, its offerings drifted to a particular market segment.The product gap may be the main element of the planning gap where an organization can have productive input; hence the emphasis on the importance of correct positioning.

Gap analyses to develop a better process

The gap analysis also can be used to analyse gaps in processes and the gap between the existing outcome and the desired outcome. this step process can be summarised as below: Identify the existing process, Identify the existing outcome, Identify the desired outcome, Identify the process to get the desired outcome, Document the gap. develop the means to fill the gap

MARKET GAP ANALYSIS

In the type of analysis described above, gaps in the product range are looked for. Other perspective (essentially taking the "product gap" to its logical conclusion) is to look for gaps in the "market" (in a variation on "product positioning," and using the multidimensional "mapping"), which the company could profitably address, regardless of where the current products stand.

Many marketers would question the worth of the theoretical gap analysis described earlier. Instead, they would immediately start proactively to pursue a search for a competitive advantage.

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Different types of gap analysis

Gap analysis is a very useful tool for helping marketing managers to decide upon marketing strategies and tactics. Again, the simple tools are the most effective. There's a straightforward structure to follow. The first step is to decide upon how you are going to judge the gap over

What is Gap Analysis?

Your next step is to close the gap. Firstly decide whether you view from a strategic or an operational/tactical perspective. If you are writing strategy, you will go on to write tactics - see the lesson on marketing plans. The diagram below uses Ansoff's matrix to bridge the gap using strategies:

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Strategic Gap Analysis

You can close the gap by using tactical approaches. The marketing mix is ideal for this. So effectively, you modify the mix so that you get to where you want to be. That is to say you change price, or promotion to move from where you are today (or in fact any or all of the elements of the marketing mix).

Tactical Gap Analysis

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QUALITY PERCEPTIONS IN SERVICE

QUALITY

Quality is defined as the ability of the service provider to satisfy customer needs. Quality of service results in customer satisfaction. Perception behind that is the value of the service received it‖s greater than the price paid for it.

Customer expectation and experiences of service can vary of a single organization. While one customer praises the services, the other would relate it as a horror story yet it is perception of each customer. Customer service is about perception. Perceptions are consumer judgement about the actual service performance or delivery by a company. Perceived value is the customers overall assessment of the organization service based on the complete experience of the service delivery process, they are subjective. As services are intangible, customers search for evidence of service in every interaction they have with a service firm. The experience of service experienced by the customer are :

People Process and Physical evidence

people : Who may be the contact employees, the customer who participates in the service delivery process?

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process: The operational flow of activities, the steps involved in the process reflect the reliability and the promptness of the service.

Physical evidence : The tangible aspect of service dimensions are reflected in the physical evidence. It includes the servicescape, brochure, the equipment and any other tangible aspect which implies quality.

Approaches to service quality

The approaches of service quality are as follows: The transcendent approach The manufacturing based approach The user based approach The product based approach The value based approach The transcendent approach:

It refers to ―degree of excellence, relative nature‖. For example a five star hotel will be classed as a quality hotel as opposed to a one star, family run hotel.

The manufacturing based approach : It relates to conformance with design or specification. A quality service is one which is free of errors. For example the performance of a child playing a simple piece of music with no wrong notes and the correct timing could, with this approach, be classified as a quality performance, while a concert pianist playing a difficult piece of music by A.R.Rahman and hitting the odd wrong note, could be classified as of lower quality.

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The user based approach: The user based approach adopts the attitude that, if a service meets the requirements of the user, then it is a quality. For example a cheap watch which keeps time accurately and meets the requirements of the wearer would be classified as a quality approach.

The product based approach: The product based approach is quantitatively based approach, and considers measurable characteristics. For example, a dentist who takes only 5 minutes, as compared with 10 minutes, to complete a filling would be considered as providing a higher quality service.

The value based approach: The value based approach is based on customs and traditions. If the service conforms to traditional beliefs and emotions, it is perceived to be of high value.

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SEGMENTATION

Market segmentation is based on the generally true concept that the market for a product is not homogeneous to its needs and wants. The opposite of market segmentation is called Market Aggression. Market segmentation is the process of disaggregating the total market for a given product into no of sub production markets. The heterogeneous market is broken up in the process into a no of relatively homogeneous unit. The process is based on the recognition that (a) any given market or consumer group is made to up of no of sub groups distinguished by varying needs and buying behavior and (b)it is feasible to disaggregate the consumers into suitable segments in such a manner that characteristics of the segmented groups would vary significantly among segments. A company segments its markets in different ways. The basis for segmentation varies from one product to another. However the first is divide a potential market into two broad categories ultimate consumers and business users.

A strategy that presumes there is one undifferentiated market and that one product will appeal to all consumers in that market.

Advantages

Lower cost One advertising campaign is needed One marketing strategy is developed Usually only one standardized product is developed

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Disadvantage

It only works if all consumers have the same needs, wants, desires, and the same background, education and experience

SEGMENTATION VARIABLES

Marketers may use a single variable

Marketers may use two or more variables

Geographic demographic Behavioral Demographic Psychographic

Geographic Segmentation

Division of the market based on the location of the target market People living in the same area have similar needs and wants that differ from those

living in other areas Climate Population density Taste Micromarketing

Demographic Segmentation

Partitioning of the market based on factors such as age gender marital status income occupation

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education ethnicity

Age:

Product needs and interests often vary with consumers‖ age

Gender:

Gender is frequently a distinguishing variable Changes in the family and growth of the dual-income household have blurred some of

the lines

Marital Status:

Marketers have identified specific marital status groups, such as: Singles Divorced individuals Single parents Dual-income married couples They then market products specifically designed for one or more groups

Income, Education & Occupation

o These three variables are often related and therefore often used together as a measure of one‖s social class.

o Income is commonly used because marketers feel it is a strong indicator of ability to pay for a particular product or service

o Income is often combined with other variables to narrow target markets: With age to identify the important affluent elderly With age and occupation to produce the yuppie segment

Race and Ethnicity

The size and purchasing power of minorities make them an attractive target market

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The size of the market is growing dramatically relative to the “majority” population Targeting certain products (e.g., alcohol, tobacco) to such groups raises ethical

issues

Psychographic Segmentation

Partitioning of the market based on lifestyle and personality characteristics Marketers use it to further refine a target market Its appeal lies in the vivid and practical profiles of consumer segments that it can

produce Accomplished by using AIO inventories

AIO Inventories AIO research seeks consumers‖ responses to a large number of statements that

measure Activities Interests Opinions

Behavioral Segmentation

Partitioning of the market based on attitudes toward or reactions to a product and to its promotional appeals. Behavioral segmentation can be done on the basis of:

Usage rate Benefits sought from a product Loyalty to a brand or a store

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POSITIONING

Positioning is about communicating your unique selling advantage or proposition to your target audience in everything you do. Marketing, sales, customer service. The consistency helps your customerremember. Positioning allows a marketer to think about why a customer would want to do business with them. What do you offer that the other producers don't? What does a potential client get by doing business with you that will serve their needs well?

Positioning has three components:

What are your strengths? Your distinctive competencies? What about your offerings

provide value to your customers? Who is your target customer? What about them, makes them an ideal fit for the value

you offer? How are you different from your competitors in ways that your customers and potential

customers will value? In other words, what is your unique selling proposition? Your competitive advantage?

When all three are put together, you have a positioning statement. Positioning statements are the basis for all marketing messaging, sales scripts, and at a corporate level: branding. What we want are relationship customers. No one survives in business without a strong reputation and referral customers. Customers who trust us to serve their needs. Who defend us, in light of new product offerings, and service innovations? For them to do that, they need to know what we stand for. They had a good experience with us, but time passes. They forget. But if they see our messages, our positioning, and then they remember and are pleased to do business with us, again. When you consider the big picture, positioning is everything. It drives marketing plans, websites, recruiting and sales scripts. It is the basis of every conversation, every sales call, every customer service interaction.

Differentiate from competition on attributes that target customers highly value Entails two decisions: Choice of target market (where to compete) Creation of

differential advantage (how to compete)

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Determine important choice criteria of customers carefully Most important decision of a service organization is selecting the factors on which it

will compete Select a few factors and provide superlative performances in the chosen factors

CANNES AD-FEST at MSNIMT

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DIFFERENTIATION AND RETENTION IN SERVICE MARKETING RETENTION A key principle of service marketing is the retention of customers through varying means and practices to ensure repeated trade from preexisting customers by satisfying requirements above those of competing companies through a mutually beneficial relationship.. This technique is now used as a means of counterbalancing new customers and opportunities with current and existing customers as a means of maximizing profit and counteracting the "leaky bucket theory of business" in which new customers gained in older direct marketing oriented businesses were at the expense of or coincided with the loss of older customers.]This process of "churning" is less economically viable than retaining all or the majority of customers using both direct and relationship management as lead generation via new customers requires more investment.

The increased profitability associated with customer retention efforts occurs because of several factors that occur once a relationship has been established with a customer.

The cost of acquisition occurs only at the beginning of a relationship, so the longer the relationship, the lower the amortized cost.

Account maintenance costs decline as a percentage of total costs (or as a percentage of revenue).

Long-term customers tend to be less inclined to switch, and also tend to be less price sensitive. This can result in stable unit sales volume and increases in dollar-sales volume.

Long-term customers may initiate free word of mouth promotions and referrals. Long-term customers are more likely to purchase ancillary products and high margin

supplemental products. Customers that stay with you tend to be satisfied with the relationship and are less likely

to switch to competitors, making it difficult for competitors to enter the market or gain market share.

Regular customers tend to be less expensive to service because they are familiar with the process, require less "education", and are consistent in their order placement.

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Increased customer retention and loyalty makes the employees' jobs easier and more satisfying. In turn, happy employees feed back into better customer satisfaction in a virtuous circle.

Customer retention efforts involve considerations such as the following:

Customer valuation - describes how to value customers and categorize them according to their financial and strategic value so that companies can decide where to invest for deeper relationships and which relationships need to be served differently or even terminated.

Customer retention measurement - This is simply the percentage of customers at the beginning of the year that are still customers by the end of the year. In accordance with this statistic, an increase in retention rate from 80% to 90% is associated with a doubling of the average life of a customer relationship from 5 to 10 years. This ratio can be used to make comparisons between products, between market segments, and over time.

Determine reasons for defection - Look for the root causes, not mere symptoms. This involves probing for details when talking to former customers. Other techniques include the analysis of customers' complaints and competitive benchmarking (see competitor analysis).

Develop and implement a corrective plan - This could involve actions to improve employee practices, using benchmarking to determine best corrective practices, visible endorsement of top management, adjustments to the company's reward and recognition systems, and the use of "recovery teams" to eliminate the causes of defections.

A technique to calculate the value to a firm of a sustained customer relationship has been developed. This calculation is typically called customer lifecycle value.

Retention strategies also build barriers to customer switching. This can be done by product bundling (combining several products or services into one "package" and offering them at a single price), cross selling (selling related products to current customers), cross promotions (giving discounts or other promotional incentives to purchasers of related products), loyalty programs (giving incentives for frequent purchases), increasing switching costs (adding termination costs, such as mortgage termination fees), and integrating computer systems of multiple organizations (primarily in industrial marketing).

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DIFFERENTIATION

It is the act of designing a set of meaningful differences to distinguish the company's offering from competitor's offerings. Five Dimensions of Differentiation Regarding the tools of differentiation, five dimensions can be utilized to provide differentiation. Product Services that accompany marketing, sales and after sales services. Personnel that interact with the customer Channel Image DIFFERENTIATING A PRODUCT Features Quality: performance and conformance Performance - the performance of the prototype or the exhibited sample,

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Conformance - The performance of every item made by the company under the same specification Durability Reliability Reparability Style Design Services differentiation Ordering ease Delivery Installation Customer training Customer consulting Miscellaneous services Personnel Differentiation Competence Courtesy Credibility Reliability Responsiveness Communication Channel differentiation Coverage Expertise of the channel managers Performance of the channel in ease of ordering, and service, and personnel Image differentiation First distinction between Identity and Image - Identity is designed by the company and through its various actions company tries to make it known to the market.

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Image is the understanding and view of the market about the company. An effective image does three things for a product or company. 1. It establishes the product's planned character and value proposition. 2. It distinguishes the product from competing products. 3. It delivers emotional power and stirs the hearts as well as the minds of buyers. DEVELOPING A POSITIONING STRATEGY While a company can create many differences, each difference created has a cost as well as consumer benefit. A difference is worth establishing when the benefit exceeds the cost. More generally, a difference is worth establishing to the extent that it satisfies the following criteria Positioning Positioning is the result of differentiation decisions. It is the act of designing the company's offering and identity (that will create a planned image) so that they occupy a meaningful and distinct competitive position in the target customer's minds. The end result of positioning is the creation of a market-focused value proposition, a simple clear statement of why the target market should buy the product. Different positioning strategies or themes 1. Attribute positioning: Themessage highlights one or two of the attributes of the product.

2. Benefit positioning: The message highlights one or two of the benefits to the customer.

3. Use/application positioning: Claim the product as best for some application. 4. User positioning: Claim the product as best for a group of users. - Children, women, working women etc. 5. Competitor positioning: Claimthat the product is better than a competitor. 6. Product category positioning: Claim as the best in a product category Ex: Mutualfund ranks – Lipper. 7. Quality/Price positioning: Claim best value for price

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MEASURING CUSTOMER SATISFACTION SURVEYS: DESIGN AND ANALYSIS

Customer satisfaction Customer satisfaction is a measure of how products and services supplied by a company meet or surpass customer expectation. It is seen as a key performance indicator within business and is part of the four of a Balanced Scorecard.

In a competitive marketplace where businesses compete for customers, customer satisfaction is seen as a key differentiator and increasingly has become a key element of business strategy.

Customer Satisfaction Surveys

Successful customer satisfaction surveys maximize the retention of current customers, and help enterprises to better position themselves among prospective clients. However, customer satisfaction surveys that do not uncover customer perceptions or needs, improve customer loyalty, or help the enterprise to make improvements are essentially useless. To develop successful customer satisfaction surveys, IT and line of business (LOB) executives and their staffs should learn how to plan, design, implement, and manage survey questions that lend themselves to effective trend analysis. This will help ensure that customers are completely satisfied with enterprise offerings and/or support, and identify areas of potential improvement.

BUSINESS IMPERATIVES:

Customer satisfaction surveys are important vehicles for enterprises, as they measure customer satisfaction, and therefore help to determine customer loyalty. However, with the advent of globalization and the Internet, today's customers expect more from the enterprise. For this reason, IT and LOB executives need to ensure customers are completely, not merely, satisfied to achieve competitive advantage in the marketplace.

Historical data tracking is crucial in the customer satisfaction survey system. If an enterprise does not manage customer data, it cannot analyze responses over a given time, making it difficult to see if products, services, and/or support are improving, worsening, or remaining stagnant. IT and LOB executives should therefore design a

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database for question and response management, to monitor overall satisfaction as well as to observe satisfaction by sub-groups.

Successful customer satisfaction surveys require clear and well-understood processes. This means that IT, LOB executives, and their employees need to set concrete and realistic objectives, and to understand different sampling, methodology, and design issues. Moreover, survey developers should understand customer satisfaction question creation, and how each question helps to attain the desired objectives.

CUSTOMER RELATIONSHIP

In an era of high competition and expectations, customer satisfaction surveys are essential tools for listening to customers about their satisfaction levels, and for developing strategies for improvement. Now that quality has become a deciding factor in product selection for the customer, IT and LOB executives must leverage the customer relationship through customer satisfaction surveys. Knowing what customers think about the enterprise's product(s),

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service(s), and/or support, as well as their opinions of competitors' offerings, is crucial for survival.

Consequently, the primary reasons for assessing customer satisfaction are to maximize customer retention, and to gain and build customer loyalty. It is important to realize that customer satisfaction does not equate to customer loyalty. Merely satisfied customers will switch to a competitor that will exceed their expectations, especially in a highly competitive market, within the blink of an eye. True competitive advantage therefore requires that customers are completely satisfied. In addition, it is important to inform customers that their opinions matter, and that their responses will instigate change within the organization.

Before a customer satisfaction survey can be designed, it is necessary for IT and LOB executives and their staffs to have a clear process in place. The first step is to establish comprehensive and realistic objectives. If objectives are not set, the survey will be of little to no value. As a result, survey developers should ask themselves why they are conducting the survey, and what do they want to learn from it. Moreover, if a process is not in place, objectives cannot be met, and survey developers will see results they do not want to see.

There are a multitude of reasons as to why enterprises perform periodic studies of customer satisfaction. Figure one below discusses some of these motivators.

Reasons to Conduct Customer Satisfaction Surveys

Demonstrate commitment to listening to customers. Enhance profits. Gain feedback from customers about products, services, and/or support, outside of what

customers provide the sales force. Improve customer satisfaction and retention. Improve quality of service. Increase market share. Increase repeat business. Learn where the company stands in comparison with competitors. Measure and compensate the sales organization. Obtain information on product developments, priorities, and requirements. Obtain input on new products or services. Provide a way for unhappy customers to vent. Target resources on issues of concern to customers.

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It is imperative for the enterprise to conduct surveys proactively, and not merely in reaction to a problem. More often than not, a company assesses customer satisfaction after it has already experienced a negative event, such as a decrease in market share, or an increasing number of complaints. To prevent this from happening, IT and LOB executives should anticipate a potential problem, survey customers in regard to the issue, and then bring about change and inform clients about those changes to ward off the problem.

Once the objectives have been determined, survey developers need to decide whether or not they will use an existing customer satisfaction survey, or develop a new one. RFG believes it is best to reuse a survey that has been well designed, tested, and proven. This approach allows the enterprise to compare results over time. Such comparisons enable IT and LOB executives and their staffs to monitor products, services, and/or support to see if they are improving, worsening, or staying stagnant. In addition, such an approach avoids the cost of developing a new survey, and if results are released to customers, it enables customers to also monitor change.

However, in specific cases, there are valid reasons for developing a new survey. Some of these include the following.

There is no previous survey on the topic. The old survey does not gather the required data. The old survey is poorly designed. The old survey does not touch upon current issues, and is therefore obsolete.

If the survey is not completely out of date, but just needs some rewriting, it would be best to incorporate new questions into the old survey. By doing this, the enterprise can perform trend analysis, while learning about new issues. This keeps the survey fresh, interesting, and relevant, but allows for the management of customer data.

IT departments [or those conducting surveys] should also use survey question libraries. Maintaining questions can allow survey developers to easily recreate similar surveys if they are accidentally misplaced, and enable cross-referencing with a new survey. In addition, it saves survey developers large amounts of time in survey creation.

The next phase of customer satisfaction survey development is to decide on the target population, sampling, methodology, and frequency. To find the target population, survey developers should ask themselves who has the information they need - this could be either

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customers or non-customers. Oftentimes, the organization will gather data from one or more sub-groups of the target population. It is necessary to make sure the sample sizes for each sub-group are the same number, so results can be compared.

As for the methodology, there are several types from which to choose. For customer satisfaction surveys, choice of method depends on a few issues, including:

customer characteristics; time availability; the costs the enterprise is willing to incur; and the information that the company wishes to maintain.

With regard to survey frequency, IT and LOB executives and their staffs should conduct customer satisfaction surveys at predetermined times throughout the year. Several factors drive survey frequency such as:

changes in customer base; changes in the product or service delivery process; complexity of the survey; length of the survey; and The seasonal nature of products or services.

Customer satisfaction surveys should be conducted at a minimum of twice a year and a maximum of four times a year. Such surveys should be conducted periodically (monthly, quarterly, etc.) to help track seasonality issues, and measure trends relative to timing. Regardless of how often a survey is conducted, the enterprise should to allot sufficient time between surveys to analyze results, make any needed changes to the survey, and measure progress.

When designing customer satisfaction survey questions, survey developers should use a "drill-down" technique, so the questions flow back up to the objectives. This can be done by "mapping" objectives to questions, or vice versa, to determine that every question adds value, and that every objective is covered. If the questions do not refer back to the objectives, then the survey will be valueless. Survey developers should try to incorporate a short list of several types of questions, including closed-ended and open-ended, multiple and single choice, ranking, and rating.

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Open-ended questions are difficult to analyze and measure. However, they allow customer satisfaction survey respondents to elaborate on aspects that are of the most concern to them. Sometimes, respondents who rate four to five aspects low on a rating scale focus their answers to open-ended questions on a single aspect. In such cases, open-ended questions allow the enterprise to pinpoint specific problem areas for improvement. In addition, open-ended questions allow customers to bring up issues about which the company had no idea. The following is an example open-ended question.

Nevertheless, open-ended questions should be kept to a minimum. If respondents are large customers, or if the relationship with the target population is close, open-ended questions are worthwhile. In short, IT and LOB executives and their staffs should only ask open-ended questions if they are going to be used and analyzed.

IT and LOB executives and their staffs can also incorporate historical benchmarking questions, which are provided in some software applications, as well as by survey design consultants. Historical benchmarking data is biased, however, as industries and issues change rapidly over time. For example, historical data may evaluate competitors' products that are no longer current and have since been improved. Thus, the comparative results of a survey rating the company's current product against the historical data may be of little to no value. Therefore, it is best to consult the enterprise software provider or consultant when using benchmarking questions, to ensure that the benchmarking is against current competitor offerings.

Once the survey design issues have been determined, the survey should be pre-tested, ideally on the same kinds of people that will be interviewed in the main survey. This ensures the survey layout is attractive, the instructions and questions are understandable, and the length is not too long. Moreover, it allows survey developers to catch any flaws before the survey goes into "production."

Customer satisfaction surveys are essential for continuous improvement of product, services, and/or support, as well as enterprise competitiveness and survival. IT and LOB executives and their staffs should use customer satisfaction surveys to verify that they are well positioned amongst prospective clients, and that clients are completely, not merely, satisfied. IT and LOB executives and their staffs should learn how to plan, design, implement effective surveys, track historical data, and incorporate customer assessment into the organizational culture, to gain customer loyalty and competitive advantage.

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MARKETING OF BANKING SERVICES

Banks are defined as the “Organizations, which accepts deposits from public and give loans from the general public." In the present time they are over and above this definition. Banks are providing innovative services with innovates styles. ATMs, Credit cards and Internet banking have changed the quality of delivery of services of banks. Banking services are growing with many new additions such as money transfers, Bank assurance, NRI services and so on. Promotion of service has been a challenging task. Banking services being of a sophisticated nature should be promoted carefully, clearly and innovatively.

Mass Media Advertising: Most Preferred mode for marketing of Banking Services

Mass media advertising includes TV commercials and advertising in national level newspapers which have a wide coverage. Advertising in these has made maximum people aware about the offerings of the banks and established most of the bank names as big brands. In a recent survey ICICI Bank has been considered as the most popular banks in private sector. The use of umbrella branding works well in promotion of banking services. Different types of advertisement campaigns have been seen in form of TV commercials and as print ad in newspapers. Print ads mainly focus on corporate image advertising of banks as well as a new offering of the bank such as increase in interest rate on deposits or decrease in the interest rates

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in loans and so on. TV commercials mainly focused on corporate advertising, where banking service is promoted as a whole rather than a particular product of banks.

Themes and appeals used in TV commercials of banking:

Advertising appeal is the method used to draw the attention of consumers and to influence their feelings toward the product, service, or cause. There are hundreds of different appeals that can be used as the foundation for advertising messages. These are the central idea of an ad which has been used to catch the attraction of customer by heart. The theme of a commercial strikes a person in depth and forces him/her to act in the desired manner. Generally advertising appeals are broken into two categories: rational appeals and emotional appeals.

Uses of Appeals in Banking Services Advertising:

Name of Bank Broad Category Personal/Social Marketing Approach Theme/Punch Line Union Bank of India Emotional

Appeal Social/Parental Affection Security and Future benefit Because your dreams are not only yours.

Royal Bank of Scotland Group

Emotional Appeal

Personal/Style Differentiation In years a player comes who change the way the game is played.

HSBC Rational Practical Customization of Service Offering

Not two people are the same

IDBI Rational Practical Comprehensiveness of Services offering

Banking for All

State Bank of India Emotional Personal/Reliability Security

Supporting the customers With you all the way

Personal Selling is being very much popular and effective for private banks in India. It is concerned with face to face meeting with the customer and making the presentation of the service offering to the prospect and making the person customer of the bank. This process has its own advantages and disadvantages. Banks may have some complex service offer which may include so many charges and facilities of different types. The biggest advantage of personal selling in banking services is that the salesperson can make the prospect well understood about the product. Further customers may prefer it because they need not to go anywhere the sales person comes to them. But there is certain limitation also people usually do not give their time to meet and talk on issue. It also does not become cost effective if the sales are not closed in a handsome number. Banks are going to be societal now and taking care of environment the plantation Bank of Baroda and Punjab National Bank is the examples of the same. Consumers are always emotional about the Brands doing social and national services. Banks wants to win

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the faith of the customers and also wants to come out from their typical financial image. Societal marketing really helps to attain this objective.

Sales promotional has become popular due to the popularity of the usage of debit and credit cards. The offers are also given to the customers for registering and transacting with internet banking. For example recently HDFC bank has come with the offer where a flip book light is free on opening an account and a DVD of famous movie on shopping with Debit Card. Further there are lots of other schemes also giving discount and other gifts on different types of purchase on debit and credit card of the bank. The corporation/Brands such as India timesshopping, Barista, Mudra Pure Gold, Ayush Therapy Center, VLCC Slimming Beauty Fitness, Welcome, Dr. Batra's Multispecialty Hospitals, Javed Habib, Gini & Jony, Vishal Mega mart, Dominos and Book my Show have clubbed with the bank to provide this promotion to the customers. However the sales promotion has its nature that it is always for a particular time being. The purpose of sales promotion is to enhance the sales in particular time duration. The sales promotion offers are redesigned frequently for effective promotion in sales. Consumers feel happy when they get something extra then the regular utility. Sales promotion offers really attract customers.

In present time the most popular tool for promotion of banking services has become Internet marketing of services. E-Advertising is being very much popular. In city areas of India, people use internet so frequently. Studies tell that they use internet mostly for checking their mails, finding results and educations and research purposes. The e-advertising of banking services not only promote the services by giving offers but it also interacts with the person and a potential customer can purchase the product with the help of this. However internet advertising in pop ups irritates the internet users but advertisements done on home page of any website such as email service provider is useful and customers get knowledge about the new banking services and promotions. When they see something in front of their eyes they can remember it much.

The bank is a financial institution which accepts deposits and lends that money to its customers. As banks deal with their customers ―finances, banking is a high-involvement

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service. Therefore banks need to win the trust of their customers. Based on the customer profiles, banks segment their market into retail banking, corporate banking, personal banking etc. Depending on customer needs for finance, the market can also be segmented into trade finance, consumer finance, etc. For the banker to derive maximum returns and enhance his market position the marketing mix has to be effectively managed. The products offered by a bank may be in the core or augmented form. The core products offered by a bank include a savings bank account or a housing loan.

The augmented product includes services like internet banking, ATMs, 24-hour customer service etc. These augmented services help the banker differentiate his service offering from those of his competitors. In the pricing of banking services, determining the interest rates plays an important role, as these rates in turn determine the revenues and profits of the bank. The multiple sources of revenue for today's banks include annual charges for core services and augmented services, penalties, commissions for cross selling and charges for payment of utility bills, apart from the differential interest rate. The basic pricing strategy in banks is based on risk-return pay-offs. However, the competitor and customer reaction have to be taken into consideration while initiating a price change.

The place element of the marketing mix refers to making the services available and accessible to customers. Improvements in the availability and accessibility of services have changed the process of banking. Technological innovations have given rise to modern channels like the Internet, which have helped banks increase business volumes and attract new customers. ATMs and credit and debit cards offer convenience to customers and have also improved the efficiency of banking operations. These changes have helped banks tackle the challenges of services marketing. The promotion or communication mix in banking refers to varied strategies like personal selling, advertising, discounts, and publicity etc. used by present day banks to promote their service offerings.

People also play an important role, even though their role has been eclipsed by technology in the recent past. Process determines the efficiency of banking operations and thus the service quality in a bank. Physical evidence includes the infrastructure and buildings not only in

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branch offices, but also the ATMs or other places of interaction. Even the quality of cheque books and mailers to customers forms physical evidence.

The banking industry has changed drastically over the past decade. The banking reforms and the opening of the economy to foreign and private banks have improved the working of the public sector banks. This has resulted in improved service to the customers of the banking industry. Increased competition and technology have enhanced the quality of service offered to the customers and also improved the returns for bankers.

TOURISM MARKETING

There can be various reasons for a tourist to visit a destination of some interest‖s destination might be visited because of its natural landscape or resources, historical monument, religious

significance, shopping or it may be a man-made tourist attraction. But how to create the need amongst the potential tourist about the destination is what tourism marketing is all about.

In tourism marketing we are marketing a destination. Once a destination is sold to a customer or customer group, everyone who is providing some service in relation to tourism gets benefited. The hotels or the carriers or the travel agencies, all benefits if tourist traffic is generated for a destination from domestic or foreign or both sources.

A destination can have a variety of products to offer.It could be of historical importance or have a natural resource or an artistic land scape and in the absence of each an unique resource cold be created.A destination offers a unique combination of features which cannot be duplicated

In tourism Marketing

we are marketing a

destination.

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elsewhere.Building on this uniqueness of benefits to generate more tourism is the name of the game which is called Tourism Marketing.

TRANSPORT SERVICE IN SERVICE MARKETING

Transport or transportation is the movement of people and goods from one location to another. Modes of transport include air, rail, road, water, cable, pipeline, and space. The field can be divided into infrastructure, vehicles, and operations.

Transport infrastructure consists of the fixed installations necessary for transport, and may be roads, railways, airways, waterways, canals and pipelines, and terminals such as airports, railway stations, bus stations, warehouses, refueling depots (including fueling docks and fuel stations), and seaports. Terminals may be used both for interchange of passengers and cargo and for maintenance.

In the transport industry, operations and ownership of

Building on the uniqueness

of benefits to generate

more tourism is the name

of the game Tourism

Marketing.

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http://en.wikipedia.org/wiki/Cargo

http://en.wikipedia.org/wiki/Modes_of_transport

http://en.wikipedia.org/wiki/Aviation

http://en.wikipedia.org/wiki/Rail_transport

http://en.wikipedia.org/wiki/Road_transport

http://en.wikipedia.org/wiki/Ship_transport

http://en.wikipedia.org/wiki/Cable_transport

http://en.wikipedia.org/wiki/Pipeline_transport

http://en.wikipedia.org/wiki/Space_transport

http://en.wikipedia.org/wiki/Infrastructure

http://en.wikipedia.org/wiki/Vehicle

http://en.wikipedia.org/wiki/Business_operations

http://en.wikipedia.org/wiki/Road

http://en.wikipedia.org/wiki/Railway

http://en.wikipedia.org/wiki/Airway_(aviation)

http://en.wikipedia.org/wiki/Waterway

http://en.wikipedia.org/wiki/Canal

http://en.wikipedia.org/wiki/Pipeline_transport

http://en.wikipedia.org/wiki/Airport

http://en.wikipedia.org/wiki/Train_station

http://en.wikipedia.org/wiki/Bus_station

http://en.wikipedia.org/wiki/Warehouse

http://en.wikipedia.org/wiki/Fuel_station



http://en.wikipedia.org/wiki/Seaport


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infrastructure can be either public or private, depending on the country and mode.

Mode

A mode of transport is a solution that makes use of a particular type of vehicle, infrastructure and operation. The transport of a person or of cargo may involve one mode or several modes, with the latter case being called intermodal or multimodal transport. Each mode has its advantages and disadvantages, and will be chosen for a trip on the basis of cost, capability, route, and speed

1. Human –powered transport services

Human powered transport is the transport of people and/or goods using human muscle-power, in the form of walking, running and swimming. Human-powered transport remains popular for reasons of cost-saving, leisure, physical exercise and environmentalism. Human-powered transport is sometimes the only type available, especially in underdeveloped or inaccessible regions. It is considered an ideal form of sustainable transportation.

Although humans are able to walk without infrastructure, the transport can be enhanced through the use of roads, especially when enforcing the human power with vehicles, such as bicycles and inline skates. Human-powered vehicles have also been developed for difficult environments, such as snow and water, by watercraft rowing and skiing; even the air can be entered with human-powered aircraft.

Animal-powered transport services

Animal-powered transport is the use of working animals for the movement of people and goods. Humans may ride some of the animals directly, use them as pack animals for carrying goods, or harness them, alone or in teams, to pull sleds or wheeled vehicles. Animals are superior to people in their speed, endurance and carrying capacity; prior to the Industrial Revolution they were used for all land transport impracticable for people, and they remain an important mode of transport in less developed areas of the world.

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http://en.wikipedia.org/wiki/Human

http://en.wikipedia.org/wiki/Walking

http://en.wikipedia.org/wiki/Running

http://en.wikipedia.org/wiki/Human_swimming

http://en.wikipedia.org/wiki/Leisure

http://en.wikipedia.org/wiki/Physical_exercise

http://en.wikipedia.org/wiki/Environmentalism

http://en.wikipedia.org/wiki/Sustainable_transportation

http://en.wikipedia.org/wiki/Bicycles

http://en.wikipedia.org/wiki/Inline_skates

http://en.wikipedia.org/wiki/Watercraft_rowing

http://en.wikipedia.org/wiki/Skiing

http://en.wikipedia.org/wiki/Human-powered_aircraft

http://en.wikipedia.org/wiki/Working_animal

http://en.wikipedia.org/wiki/Pack_animal

http://en.wikipedia.org/wiki/Team

http://en.wikipedia.org/wiki/Sled

http://en.wikipedia.org/wiki/Vehicle


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AIR TRANSPORT SERVICES

A fixed-wing aircraft, commonly called airplane, is a heavier-than-air craft where movement of the air in relation to the wings is used to generate lift. The term is used to distinguish from rotary-wing aircraft, where the movement of the lift surfaces relative to the air generates lift. A gyroplane is both fixed-wing and rotary-wing. Fixed-wing aircraft range from small trainers and recreational aircraft to large airliners and military cargo aircraft

RAIL TRANSPORT SERVICES

Rail transport is where a train runs along a set of two parallel steelrails, known as a railway or railroad. The rails are anchored perpendicular to ties (or sleepers) of timber, concrete or steel, to maintain a consistent distance apart, or gauge. The rails and perpendicular beams are placed on a foundation made of concrete, or compressed earth and gravel in a bed of ballast. Alternative methods include monorail and maglev.

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http://en.wikipedia.org/wiki/Fixed-wing_aircraft

http://en.wikipedia.org/wiki/Rotorcraft

http://en.wikipedia.org/wiki/Gyroplane

http://en.wikipedia.org/wiki/Airliner

http://en.wikipedia.org/wiki/Train

http://en.wikipedia.org/wiki/Steel



http://en.wikipedia.org/wiki/Perpendicular

http://en.wikipedia.org/wiki/Railroad_tie

http://en.wikipedia.org/wiki/Rail_gauge

http://en.wikipedia.org/wiki/Soil

http://en.wikipedia.org/wiki/Gravel

http://en.wikipedia.org/wiki/Monorail

http://en.wikipedia.org/wiki/Maglev_(transport)


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ROAD TRANSPORT SERVICES

A road is an identifiable route, way or path between two or more places. Roads are typically smoothed, paved, or otherwise prepared to allow easy travel. Tough they need not be, and historically many roads were simply recognizable routes without any formal construction or maintenance. In urban areas, roads may pass through a city or village and be named as streets, serving a dual function as urban space easement and route.

The most common road vehicle is the automobile; a wheeled passenger vehicle that carries its own motor. Other users of roads include buses, trucks, motorcycles, bicycles and pedestrians. As of 2002, there were 590 million automobiles worldwide.

Automobiles offer high flexibility and with low capacity, but are deemed with high energy and area use, and the main source of noise and air pollution in cities; buses allow for more efficient travel at the cost of reduced flexibility. Road transport by truck is often the initial and final stage of freight transport.

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http://en.wikipedia.org/wiki/Road_number

http://en.wikipedia.org/wiki/Trail

http://en.wikipedia.org/wiki/Location_(geography)

http://en.wikipedia.org/wiki/Pavement_(material)

http://en.wikipedia.org/wiki/Construction

http://en.wikipedia.org/wiki/Maintenance,_repair_and_operations

http://en.wikipedia.org/wiki/Urban_area

http://en.wikipedia.org/wiki/City

http://en.wikipedia.org/wiki/Village

http://en.wikipedia.org/wiki/Street

http://en.wikipedia.org/wiki/Easement

http://en.wikipedia.org/wiki/Wheel

http://en.wikipedia.org/wiki/Car_engine

http://en.wikipedia.org/wiki/Bus

http://en.wikipedia.org/wiki/Truck

http://en.wikipedia.org/wiki/Motorcycles

http://en.wikipedia.org/wiki/Bicycles

http://en.wikipedia.org/wiki/Pedestrians

http://en.wikipedia.org/wiki/Noise_pollution

http://en.wikipedia.org/wiki/Air_pollution


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WATER TRANSPORT SERVICES

Water transport is the process of transport a watercraft, such as a barge, boat, ship or sailboat, makes over a body of water, such as a sea, ocean, lake, canal or river. The need for buoyancy unites watercraft, and makes the hull a dominant aspect of its construction, maintenance and appearance.

In the 1800s the first steam ships were developed, using a steam engine to drive a paddle wheel or propeller to move the ship. The steam was produced using wood or coal. Now most ships have an engine using a slightly refined type of petroleum called bunker fuel. Some ships, such as submarines, use nuclear power to produce the steam. Recreational or educational craft still use wind power, while some smaller craft use internal combustion engines to drive one or more propellers, or in the case of jet boats, an inboard water jet. In shallow draft areas, hovercraft re propelled by large pusher-prop fans.

Although slow, modern sea transport is a highly effective method of transporting large quantities of non-perishable goods. Commercial vessels, nearly 35,000 in number, carried 7.4 billion tons of cargo in 2007.Tansport by water is significantly less costly than air transport for trans-continental shipping; short sea shipping and ferries remain viable in coastal areas.

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http://en.wikipedia.org/wiki/Watercraft

http://en.wikipedia.org/wiki/Barge

http://en.wikipedia.org/wiki/Boat

http://en.wikipedia.org/wiki/Ship

http://en.wikipedia.org/wiki/Sailboat

http://en.wikipedia.org/wiki/Sea

http://en.wikipedia.org/wiki/Ocean

http://en.wikipedia.org/wiki/Lake

http://en.wikipedia.org/wiki/Canal

http://en.wikipedia.org/wiki/River

http://en.wikipedia.org/wiki/Hull_(watercraft)

http://en.wikipedia.org/wiki/Steam_ships

http://en.wikipedia.org/wiki/Steam_engine

http://en.wikipedia.org/wiki/Paddle_wheel

http://en.wikipedia.org/wiki/Propeller

http://en.wikipedia.org/wiki/Steam

http://en.wikipedia.org/wiki/Coal

http://en.wikipedia.org/wiki/Engine

http://en.wikipedia.org/wiki/Petroleum

http://en.wikipedia.org/wiki/Bunker_fuel

http://en.wikipedia.org/wiki/Submarine

http://en.wikipedia.org/wiki/Nuclear_power

http://en.wikipedia.org/wiki/Recreation

http://en.wikipedia.org/wiki/Education

http://en.wikipedia.org/wiki/Internal_combustion_engine

http://en.wikipedia.org/wiki/Propeller

http://en.wikipedia.org/wiki/Hovercraft

http://en.wikipedia.org/wiki/Shipping

http://en.wikipedia.org/wiki/Short_sea_shipping

http://en.wikipedia.org/wiki/Ferry


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Functions and Systems of Hospitals

Admission

Diagnosis

Treatment

Inspection

Control

Discharge

Three major hospital systems

The medical staff who diagonise,admit and treat patients and perform quality control procedure through their Para-medical staff organization

Nursing ,x-ray and laboratory

Support and administrative services such as record keeping, finance and administration

Patient care function

It is important to remember that, besides treatment . The attitudes and behavioral pattern of health professionals are known to have an important influence on patient care as they are directly related to quality of care

Systems affecting patients

Environmental

Social

Cultural relationship

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Seasons

Providing a work shop for Physicians

It is to ensure that hospital is a part of physician‖s practice

Working as community health centre

To improve the health of the population they serve

CURE AND CARE Cure is a result of professional and technical quality

Care is an outcome experience of functional quality of system

HOSPITAL MARKETING MIX

Marketing has grown in importance for hospitals, looking to strengthen their position in a increasingly competitive healthcare market place.

A world class hospital is a multi-disciplinary super specialty medical centre of international standards. Most hospitals today are well equipped with the most advanced diagnostic and treatment facilities. They try for total health care – preventive Most hospitals in developing counties like India have grown to a truly words class stature over the years. Some hospitals have even obtained ISO 9002 certification.

Ex. Malaya Hospital, Bangalore. ISO 9002 quality assurance is a structured and user friendly set of systems, which allows the staff at all levels of the hospital to follow simple procedures, which make the most complex tasks easy and efficient. It frees the senior management of everyday stress in observing and monitoring tasks, which have to be completed on daily basis.

Hospitals today offer the following services

1. Emergency services – Emergency services and care at most of the hospitals is unique and advanced. The hospitals have state-of-the-art ambulances. The CCU's on Wheels under supervision by medical and Para-medical staff. There is hi-tech telecommunication available to a patient in an emergency at any given time.

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2. Ambulance services – Hi-tech ambulances linked by state-of-the-art telecommunications are fully equipped with doctors that are available to render medical attention and assistance in case of emergencies at the patient's doorstep.

3. Diagnostic services – Modern Hospitals are multi-speciality and multi-disciplinary, that can handle any kind of ailment, they offer a wide range of facilities for instance, Oncology, Orthopedics, Neurology, Plastic surgery and so on. 4. Pharmacy services – Most of the hospitals also have a pharmacy which is open 24 hours. It caters to the needs not only of the inpatients and outpatients, but also patients from other hospitals who require emergency drugs. 5. Causality services – Causality service includes a 24 hrs. causality department, which attends to the accident or emergency cases. Apart from the above mentioned services, hospital also offers "Health Diagnosis Programme" which is a complete, comprehensive, periodic health check up offered for busy executives, professionals, business persons and so on. The health diagnosis programme comprises of the following: 1. Master health check up 2. Executive Health check up 3. Diabetics health checkups etc.,

Generally, the service offering in a hospital comprises of the following levels:

1. Core level – it comprises of the basic treatment facilities and services offered by the hospital like diagnostic services, emergency services, casualty services etc. 2. Expected level – it comprises of cleanliness and hygiene levels maintained in the hospital. 3. Augmented level – it comprises of dress code for staff, air conditioning of the hospital, use of state of art technology, services of renowned consultants.

PRICE

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It is one of the most prominent elements in the marketing mix. Price charged must be able to target customers and it should co-ordinate with other elements of the marketing mix. Price usually depends on treatment prescribed by the respective consultants and the facilities offered to the patient.

As a service is intangible, it is very hard for deciding the price of the particular service offered. Pricing strategy adopted does not depend on the price offered by competitors. The pricing strategy is formulated after consulting the concerned heads of department. Prices of various facilities revised every year depending on the change in technology. Before fixing prices, government controls are also taken into consideration.

PROMOTION Promotion function of any service organization involves the transmission of message to present,

past and potential customers. Customers need to be made aware of the existence of the service offered. Promotion includes advertising, personal selling, sales promotion and publicity.

Hospitals do not normally undertake aggressive promotion; they rely a lot on a favorable word of mouth. To crease the clientele, a hospital may continuously introduce different health services like the acupressure clinic, master health programmers and diabetes health checkups apart from annual health checkups offered to different companies. (Corporate clients)

Hospitals conduct camps in rural areas to give medical checkups at a reasonable price so that the rural people approach the hospital again in the future. They also sponsor frequent visits to the spastic society, old age homes, etc. Hospitals generally advertise in health and fitness magazines.

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PLACE It refers to contact point between the customer and the service provider, who gets the benefit of

the service. This element in the marketing mix leads to the identification of a suitable location.

The two major issues considered regarding the decision of a place are accessibility and availability of the service to customers. Accessibility refers to the ease and convenience with which a service can be purchased, used or received. Availability refers to the extent to which a service is obtainable or capable of being purchased, used and received.

Factors influencing the placing decision are market size and structure by geographical regions, number and types of competitors in the region, location of potentially attractive consumer segments, local infrastructure, good road access facilities and public transportation network. A hospital must be ideally located and must be easily accessible to all.

PEOPLE The People component reflects the important role played by individuals in the provision of

services. People are also an important element in the marketing mix.

Service personnel play an important role in an organization which offers service. The behavior and attitude of the personnel offering service will influence the customer's overall perception of the service. Customers are a source of influencing other customers by word of mouth.

It is necessary that the staff in hospital is trained to offer quality patient care with human touch using state of the art technology.

The objective of offering quality service to the patients can be attained by:

Motivating employees to be efficient, dedicated and loyal to the organization.

Offering regular on-job training of employees to ensure continuous improvement in health care.

Utilizing services of professional competent medical consultants.

Use of latest technology.

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PHYSICAL EVIDENCE

It is the environment in which the service is delivered with physical or tangible commodities and where the firm and the customer interact. Physical evidence plays an important role in hospital services.

It makes a huge impact on the customer. Physical evidence offers customers means of evaluating the service. Corporate image plays in important role in terms of physical evidence. This can be developed through corporate relation programmers.

Modern hospitals need to create a good ambience. Right from the reception one finds very cordial and comforting staff. The ambience plays an important role because when a patient walks into the hospital he immediately forms an opinion about the hospital.

The staff follows a dress code to show professionalism and to maintain discipline. The staff is trained to be understanding, warm and comforting because the clientele that goes to the hospital is usually disturbed or unhappy.

It is necessary for a hospital to be well organized and segregated into different departments. All the doctors should be offered with a well-equipped cabin. The entire hospital requires to be centrally air-conditioned with good lighting. Ventilation is taken care of by air-conditioning

Special care should be taken to maintain hygienic, cleanliness and whole hospital must be well lit. This is taken care of by the housekeeping department. A hospital has to keep in mind both the aspects of physical evidence that is essential and peripheral evidence. Physical evidence particularly plays an important role in the hospital where the patients are already depressed or traumatized and a good atmosphere could make all the difference.

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CONCLUSION

Marketing is a function by which a marketer plans, promotes, and delivers goods and services to the customers. In the services marketing, the providers are supposed to influence and satisfy the users. When people buy services offered by a service provider in a true sense, they buy the time, knowledge, skill or resources. Marketing the service is meant marketing something intangible. It is like marketing a promise. The applications of marketing principles in the services sector are the main things in the services marketing. It is the managerial process of managing the service.

MARKETING OF FINANCIAL SERVICES

Financial services refer to services provided by the finance industry. The finance industry encompasses a broad range of organizations that deal with the management of money. Among these organizations are credit unions, banks, credit card companies, insurance companies, consumer finance companies, stock brokerages, investment funds and some government sponsored enterprises.All financial services companies need to have marketing strategy. With a marketing strategy, financial services companies will be able to determine which tools they should be using to reach prospective clients. With a marketing strategy, financial services

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http://en.wikipedia.org/wiki/Credit_union

http://en.wikipedia.org/wiki/Bank

http://en.wikipedia.org/wiki/Credit_card

http://en.wikipedia.org/wiki/Insurance

http://en.wikipedia.org/wiki/Consumer_finance

http://en.wikipedia.org/wiki/Stock_broker

http://en.wikipedia.org/wiki/Investment_management

http://en.wikipedia.org/wiki/Government_sponsored_enterprise




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companies will know what they can do to use local newspapers, direct mail and the internet effectively in order to grow their business. Financial services with a marketing strategy will better know what message they are trying to communicate to current and prospective clients. And a marketing strategy will give financial service providers the tools that they need to show prospective clients why the products and services their company offers are better tools for financial planning than the products and services that competitors have to offer. When financial services companies are ready to develop a marketing strategy, it is important that they determined what message they will be communicating. It is equally important for financial services companies to know who they are trying to reach with their messages.

MARKETING OF CONSULTANCY

Consulting is the business of providing advice to clients for a fee in order to help them solve a particular problem or range of problems within a certain area of business. Consulting services are provided by consultants, a majority of whom have gained their expertise from previous employment. Some consultants work for large consulting firms, such as Anderson Consulting or Gemini Consulting, that offer expertise in a wide range of business areas; other consultants hail from academia and assist companies with problems relating to research or theory; and still other consultants are self-employed, independent contractors who offer specialized skills in a certain field.

Consultancies may also provide organizational change management assistance, development of coaching skills, technology implementation, strategy development, or operational improvement services.

Organizations hire the services of management consultants for a number of reasons, including gaining external (and presumably objective) advice and access to the consultants' specialized expertise.

Management consulting indicates both the industry of, and the practice of, helping organizations improve their performance, primarily through the analysis of existing business problems and development of plans for improvement. , the consultant takes the role of expert, and provides expert advice or assistance to the client, with, compared to the facilitative

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approach, less input from, and less collaboration with, the client(s). the consultant focuses less on specific or technical expert knowledge, and more o Management consulting refers generally to the provision of business consulting services, but there are numerous specializations, such as information technology consulting, human resource consulting, virtual management consulting and others, many of which overlap, and most of which are offered by the large diversified consultancies n the process of consultation itself.

Internal Consulting Groups

Internal consulting groups are often formed around a number of practice areas, commonly including: organizational development, process management, information technology, design services, training, and development.

Advantages

There are several potential benefits of internal consultants to those who employ them:

If properly managed and empowered, internal consulting groups evaluate engagement on projects in light of the corporation's strategic and tactical objectives.

Often, the internal consultant requires less ramp up time on a project due to familiarity with the corporation, and is able to guide a project through to implementation — a step that would often be too costly if an external consultant were used.

Internal relationship provides opportunities to keep certain corporate information private.

It is likely that the time and materials cost of internal consultants is significantly less than external consultants operating in the same capacity.

Internal consulting positions can be used to recruit and develop potential senior managers of the organization.

Disadvantages

The internal consultant may not bring the objectivity to the consulting relationship that an external firm can.

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http://en.wikipedia.org/wiki/Information_technology_consulting

http://en.wikipedia.org/wiki/Human_resource_consulting

http://en.wikipedia.org/wiki/Virtual_management

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An internal consultant also may not bring to the table best practices from other corporations. A way to mitigate this issue is to recruit experience into the group and/or proactively provide diverse training to internal consultants.

Where the consulting industry is strong and consulting compensation high, it can be

difficult to recruit candidates. It is often difficult to accurately measure the true costs and benefits of an internal

consulting group. When financial times get tough, internal consulting groups that have not effectively

demonstrated economic value (costs vs. benefits) are likely to face size reductions or reassignment.

The successful consultants are usually those who find a market niche for themselves through research, intensive marketing, and locale. Charging the right fee and avoiding falling into the trap of "free" consulting (for instance, when a client whose contract with a consultant has ended insists upon additional "feedback" or "follow up") requires business sense. Consulting fees can vary from almost nothing to several thousand dollars per assignment, depending on the assignment, market conditions, and the minimal rate for that type of work.

EVALUATING CONSULTING OPPORTUNITIES

New consultants may be tempted to jump at any business opportunity that comes along. But Salmon and Rosenblatt recommend that consultants gather information about the client in order to make an informed decision about pursuing a consulting opportunity. This process, called qualifying the client, involves considering the nature, scope, and urgency of the project, as well as the client's budget. It is also helpful to find out about the client's desired outcomes and decision-making process. In addition, it may be useful to know whether the client has had successful experiences with consultants in the past, and what they feel the major obstacles to success would be for the project under consideration.

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TEAM BEHIND THE WORK

AKHIL PS

PALLASERIL VEEDU,

PROKKULAM P O

KOLLAM-691602

Email Id: [email protected]

JAYAROSHNI PS,

SINDHU BHAVAN,

EDAYAM .PO,

KOLLAM – 691532

EMAIL ID: [email protected]

AMAL KS,

KAVIL,

AZHEEKAL PO

KARUNAGAPPALLY,

KOLLAM – 690547


JAYALAKSHMI AJ,

AYKKARAPARAMBIL,

THIRUMOOLAPURAM .PO,

THIRUVALLA,

PATHANAMTHITTA – 689115


ANISHA ANDREW

ANISHA DALE

MOOTHEZHATHU THOPPE

SAKTHIKULANGARA

KOLLAM – 691581


MANU M MOHANAN,

MARANATTU VADAKKATHIL,

MEMANA,

OACHIRA .PO,

KOLLAM – 690526


ANJALI G,

GEETHANJALI,

KAREELAKULANARA . PO,

ALAPPUZHA – 690572

Email id: [email protected]

RAMJITH R

SREERAGAM

CLAPPANA .PO

KOLLAM – 690574


ANJALI NAZAR

DARUL SIYAD

EDAKULANGARA .PO

KARUNAGAPPALLY

KOLLAM – 690562

Email id : [email protected]

SHAHEER K

KANJIRATHUMOODU

KUREEPPUZHA

KAVANAD .PO

KOLLAM – 691003


ANJU S,

MANIYAMPALLIL,

MARU SOUTH,

ALUMKADAVU .PO

KARUAGAPPALLY,

KOLLAM – 690573

EMAIL ID:[email protected]

SHARI V

PADMAVILASAM,

EDAKKUNNU,

MANIYAR .PO,

PUNALOOR,

KOLLAM – 691325


ARATHY KRISHNAN R,

NANDANAM,

MUKUDAPURAM .P,

CHAVARA,

KOLLAM – 691585

EMAIL ID; [email protected]

SUJITH S,

THIRUVATHIRA, ARN – 122,

THEKKEVILA .PO,

POLAYATHOD,

KOLLAM – 16,


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mailto:[email protected]










ARYA J NAIR,

CHAITHRAM,

KARINGANOOR .PO,

KOLLAM – 691585


SURYAGOPAN JAYADEVAN

LATHIKA BHAVAN

PALAYAMKUNNU .PO

VARKALA

TRIVANDRUM _- 695146


DEPTHI,

KELATHARA,KOTTAKAM,

CHAVARA,

KOLLAM


VELU S GAUTAM

KAUSTHUBHAM,

MUKKADA,

KUNDARA,KOLLAM – 691501


DEEPTHI DJ

DEEPTHI NIVAS,

SOORANADU NORTH.

ANAYADI .PO,

KOLLAM – 690561

EMAIL ID:

YEDHU BABU

YEDUKULAM

KANJAVELI PO

PRAKKULAM

KOLLAM – 691602

Email id : [email protected]

DINESH BK

SREENILAYAM,

MANAYIKULANGARA,

THIRUMULLAVARAM .PO

KOLLAM – 691012


HARIKRISHNAN KS

LEELALAYAM,

KUREEPPUZHA,

KAVANADU .PO

KOLLAM – 691003

EMAIL ID:[email protected]

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