Principle of MarketingPrinciple of MarketingTopic Topic

Service MarketingService Marketing

Lecture NoLecture No

By: Salman ShahidBy: Salman Shahid

What is Service Marketing?What is Service Marketing?

Examples:Examples: Defense, Postal, Education, Defense, Postal, Education, health, Religious Services, Hospitals, health, Religious Services, Hospitals, Airlines, Hotels, Law Firms, Entertainment, Airlines, Hotels, Law Firms, Entertainment, etc etc

Definition:Definition: Activity or benefit that one Activity or benefit that one party can offer to another that is party can offer to another that is essentially intangible and does not result essentially intangible and does not result in the ownership of anything. Its in the ownership of anything. Its production may or may not be tied to a production may or may not be tied to a physical product physical product

Designing a services marketing programDesigning a services marketing program

Fundamental Characteristics of a Fundamental Characteristics of a Service :Service :

What exactly are the characteristics of a What exactly are the characteristics of a service? service? How are services different from a How are services different from a product?product? In fact many organizations do In fact many organizations do have service elements to the product they have service elements to the product they sell, sell, for example for example McDonald’s sell physical McDonald’s sell physical products i.e. burgers but consumers are products i.e. burgers but consumers are also concerned about the quality and also concerned about the quality and speed of service, are staff cheerful and speed of service, are staff cheerful and welcoming and do they serve with a smile welcoming and do they serve with a smile on their face?on their face?

1. Lack of ownership.1. Lack of ownership. You cannot own and store a You cannot own and store a

service like you can a product. service like you can a product. Services are used or hired for a Services are used or hired for a period of time. period of time.

For example when buying a ticket to For example when buying a ticket to the USA the service lasts maybe 9 the USA the service lasts maybe 9 hours each way , but consumers hours each way , but consumers want and expect excellent service for want and expect excellent service for that time. that time.

Intangibility:Intangibility:

You cannot hold or touch a serviceYou cannot hold or touch a service

Inseparability:Inseparability:

Services cannot be separated from Services cannot be separated from the service providers.the service providers.

Perishability:Perishability: is used in marketing to is used in marketing to describe the way in which service describe the way in which service capacity cannot be stored for sale in capacity cannot be stored for sale in the future. It is a key concept of the future. It is a key concept of services marketing.services marketing.

Heterogeneity.Heterogeneity.

It is very difficult to make each It is very difficult to make each service experience identical. If service experience identical. If travelling by plane the service travelling by plane the service quality may differ from the first time quality may differ from the first time you travelled by that airline to the you travelled by that airline to the second, because the airhostess is second, because the airhostess is more or less experienced.more or less experienced.

Designing a services Designing a services marketing programmarketing program

The services customerThe services customer Selecting target marketingSelecting target marketing Product planning( service offering)Product planning( service offering) Product mix strategyProduct mix strategy Pricing structurePricing structure Pricing strategyPricing strategy Distribution systemDistribution system Promotional programPromotional program

Service Marketing Service Marketing Mix/Extended Marketing MixMix/Extended Marketing Mix

• • Product Product • Price• Price• Place• Place• Promotion• Promotion

• People• People• Process• Process• Physical evidence.• Physical evidence.

Lets now look at the remaining Lets now look at the remaining 3 p’s:3 p’s:

People: People: An essential ingredient to any service An essential ingredient to any service provision is the use of appropriate staff and provision is the use of appropriate staff and people. people. Recruiting the right staff and training Recruiting the right staff and training them appropriately in the delivery of their service them appropriately in the delivery of their service is essential if the organization wants to obtain a is essential if the organization wants to obtain a form of competitive advantage. Consumers make form of competitive advantage. Consumers make judgments and deliver perceptions of the service judgments and deliver perceptions of the service based on the employees they interact with. Staff based on the employees they interact with. Staff should have the appropriate interpersonal skills, should have the appropriate interpersonal skills, attitude, and service knowledge to provide the attitude, and service knowledge to provide the service that consumers are paying for.service that consumers are paying for.

ProcessProcess

Refers to the systems used to assist Refers to the systems used to assist the organization in delivering the the organization in delivering the service. Imagine you walk into service. Imagine you walk into Burger King and you order a Burger King and you order a Whopper Meal and you get it Whopper Meal and you get it delivered within 2 minutes. What was delivered within 2 minutes. What was the process that allowed you to the process that allowed you to obtain an efficient service delivery? obtain an efficient service delivery?

Physical EvidencePhysical Evidence

Where is the service being delivered? Where is the service being delivered? Physical Physical Evidence is the element of the service mix which Evidence is the element of the service mix which allows the consumer again to make judgments on allows the consumer again to make judgments on the organization.the organization. For ExampleFor Example:- If you walk :- If you walk into a restaurant your expectations are of a into a restaurant your expectations are of a clean, friendly environment. On an aircraft clean, friendly environment. On an aircraft if you travel first class you expect enough if you travel first class you expect enough room to be able to lay down! room to be able to lay down! Physical evidence is an essential ingredient of the Physical evidence is an essential ingredient of the service mix, consumers will make perceptions service mix, consumers will make perceptions based on their sight of the service provision based on their sight of the service provision which will have an impact on the organizations which will have an impact on the organizations perceptual plan of the service.perceptual plan of the service.

Scope of servicesScope of services Housing and other structures;Housing and other structures; Household operations:Household operations: Recreation and entertainment:Recreation and entertainment: Personal carePersonal care Medical and health careMedical and health care Private education:Private education: Professional business services:Professional business services: Financial services:Financial services: TransportationTransportation CommunicationsCommunications

N.F.P services organizationsN.F.P services organizations

EducationEducation CulturalCultural ReligiousReligious Social concernsSocial concerns Heath careHeath care PoliticalPolitical

And many more………….And many more………….

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