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Services Marketing
Module 4
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Service Decision Framework:
Decisions Involving Product ElementsWhat Business Are We In?
What Service Processes Can Be Used in
Our Operation? (PROCESS)
Who Are Our Customers andHow Should We Relate to Them?
WHAT SHOULD BE THE CORE AND SUPPLEMENTARY ELEMENTS
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What Price Should We Charge? (PRICE AND OTHER USER OUTLAYS)
How to Communicate? (PROMOTION &
EDUCATION, PHYSICAL EVIDENCE)
Options for Delivery? (PLACE, CYBERSPACE
& TIME, PHYSICAL EVIDENCE)
How Can We Balance
?PRODUCTIVITY AND QUALITY
How Should We Match Demand and Productive Capacity?
What Are Appropriate Roles for People and Technology? (PEOPLE)
How Can Our Firm Achieve Service Leadership?
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Conceptualizing the Service Product
Level 1 Consumer Benefit ConceptConcerned with what benefits do customers/clients seek
Level 2 Service ConceptConcerned with what general benefits will the service organization offer
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Level 3 Service OfferConcerned with more detailed shaping of the service concept.
Decisions on, and clarifications of:
• service elements (tangible and intangible)
• service forms (in what way / how)• service levels (quality and quantity)
Level 4 Service Delivery SystemConcerned with people, process, facilities etc.
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The Service Product
Intangibleproduct core
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Augmented level
Unexpected
positive level
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What Should Be the Core and Supplementary
Elements of Our Service Product?
• What are the characteristics of our core product?• What supplementary elements augment this
core?
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• What product benefits create the most value forcustomers?
• How can we differentiate our service offeringfrom the competition’s?
• How should we go about designing new
services?
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Molecular Model of
Passenger Airline ServiceDistribution
Price
Servicefrequency
Vehicle
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Pre andpost-flight
serviceFoodand
drink
In-flightservice
Transport
KEY
Tangible elements
Intangible elements
Marketing Positioning
(Weighted toward evidence)Source: Shostack
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Core Products and Supplementary Services• Most firms offer customers a package of benefits:
– core product (a good or a service)– supplementary services that add value to the
r
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• In mature industries, core products often become
commodities
• Supplementary services help to differentiate coreproducts and create competitive advantage by:
– facilitating use of the core service
– enhancing the value and appeal of the core
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The Flower of Service:
Core plus Supplementary Services
Information
ConsultationPayment
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Core Order-Taking
Hospitality
Safekeeping
Exceptions
Billing
KEY:
Facilitating
Enhancing
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Facilitating Services - Information
Customers often require
information about how to
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o a n an use a pro uc orservice. They may also need
reminders and documentation
Cor
eCore
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Facilitating Services - Order Taking
Many goods and services
must be ordered or reserved in
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know what is available and maywant to secure commitment to
delivery
Cor
eCore
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Facilitating Services - Billing
“How much do I owe you?”
t m r rv l r
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accurate and intelligible billsand statements
Cor
eCore
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Facilitating Services - Payment
Customers may pay faster
n m r h rf ll if
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make transactions simpleand convenient for them
Cor
e
Core
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Enhancing Services - Consultation
Value can be added to goods
and services by offering advice
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an consu a on a aretailored to each customer’s
needs and situation
Cor
e
Core
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Enhancing Services - Hospitality
Customers who invest timeand effort in visiting a
business and using its
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services deserve to betreated as welcome guests
(after all, marketing invited
them there!)
Cor
e
Core
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Enhancing Services - Safekeeping
Customers prefer not toworry about looking afterthe personal possessions
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to a service site; they alsoexpect firms to help carefor the goods that theypurchase or rent.
Cor
e
Core
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Enhancing Services - Exceptions
Customers appreciate some
flexibility in a business
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requests. They expect it
when not everything goes
according to plan
Cor
e
Core
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The secondary service• Differentiating features of the service:
– features– styling
– acka in
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– branding
– physical evidence
– service delivery– people
– quality
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Service Blueprinting: Key Components(Where appropriate, show Fail Points, risk of Excessive Waits)
1. Define standards for frontstage activities
2. Specify physical evidence
3. Identify principal customer actions
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4. ------------line of interaction (customers and frontstage personnel)--------
5. Frontstage actions by customer-contact personnel
6. ------------line of visibility (between front stage and backstage)--------------
7. Backstage actions by customer contact personnel
8. Support processes involving other service personnel
9. Support processes involving IT
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Flowcharts of Alternative Meal
Delivery Options
See signPark &enter
Order meal& pay
Pick upmeal
Find table& eat
Fast-FoodRestaurant
(eat in)
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See sign
atorder point
micro-phone
atpickup, pay
Drive away,eat in car
TelephoneRestaurant
Order food,give
address
Deliveryboy rings
doorbell
Paydelivery boy
take food
Eat
Arrange tomeet
caterer
Plan menupay
deposit
Food &staff
arrive
Mealprepared& served
Eat
Drive-In
Restaurant(Take Out)
Home
Delivery
Home
Catering