Marketing Chapter 13: Services

services vs goods

- Intangible - Inseparable Production and Consumption - Heterogeneous - Perishable

Increase Service Recovery

- Listen to the customer - Resolve problems quickly - Provide a fair solution

5 dimensions of quality

- Reliability - Responsiveness - Assurance - Empathy - Tangibles

Perishable

A characteristic of a service: it cannot be stored for use in the future • Services can not be produced ahead of time and stored. • If not consumed, revenue potential is lost • Must carefully manage supply and demand

Inseparable

A characteristic of a service: it is produced and consumed at the same time; that is, service and consumption are inseparable. • Cannot inspect out defects ahead of time • Consumer is part of service • Lower risk by offering guarantees or warranties

Intangible

A characteristic of a service; it cannot be touched, tasted, or seen like a pure product can. Requires using cues to make more tangible • Atmosphere • Images

Standards gap

A type of service gap; pertains to the difference between the firm's perceptions of customers' expectations and the service standards it sets. • Establish policies, performance standards • Based upon consumer needs • Educate employees

Communication gap

A type of service gap; refers to the difference between the actual service provided to customers and the service that the firm's promotion program promises. • Commercials, comments from sales people • Must reflect actual service

Knowledge gap

A type of service gap; reflects the difference between customers' expectations and the firm's perception of those expectations. • Use research to understand consumers' needs • Do not assume customers are happy

Delivery gap

A type of service gap; the difference between the firm's service standards and the actual service it provides to customers. • Employees do not perform correctly • Hire well, train, monitor, and reward

Service

Any intangible offering that involves a deed, performance, or effort that cannot be physically possessed; intangible customer benefits that are produced by people or machines and cannot be separated from the producer.

Heterogeneity

As it refers to the differences between the marketing of products and services, the delivery of services is more variable. -Technology/automation -Training and scripts

Emotional support

Concern for others' well-being and support of their decisions in a job setting.

Service quality

Customers' perceptions of how well a service meets or exceeds their expectations.

Empowerment

In context of service delivery, means allowing employees to make decisions about how service is provided to customers.

distributive fairness

Pertains to a customer's perception of the benefits he or she received compared with the costs (inconvenience or loss) that resulted from a service failure.

Products

Physical good, idea, or service

Instrumental support

Providing the equipment or systems needed to perform a task in a job setting.

Service gap

Results when a service fails to meet the expectations that customers have about hot it should be delivered

Customer service

Specifically refers to human or mechanical activities firms undertake to help satisfy their customers' needs and wants.

Reliability

The ability to perform the service dependably and accurately

Tangibles

The appearance of physical facilities, equipment, personnel, and communication materials

Empathy

The caring, individualized attention provided to customers

Assurance

The knowledge of and courtesy by employees and their ability to convey trust and confidence

Responsiveness

The willingness to help customers and provide prompt service

Voice-of-customer program

VOC An ongoing marketing research system that collects customer inputs and integrates them into managerial decisions.

procedural fairness

refers to the customer's perception of the fairness of the process used to resolve complaints about service.

Product

• Emphasize the service process • Build brand image

People

• Employees • the customer • and other customers all influence quality of experience

Core service

• Focus on "core" service - Key service being purchased - British airways • Use a logo that reflects service (interactive imagery)

Promotion

• Focus on making services seem tangible - "Like a Good Neighbor, State Farm is There®," - prudential - university of phoenix • Share good performance ratings

Place

• Generally no intermediaries • Convenience is important

Price

• Prices are harder to set and justify to customers for many services • Use price to adjust demand to supply

expanded 4P's

• Strategies/applications differ in each of the 4 P's as compared to applications for physical goods -Process -People -Physical evidence

Processes

• activities which lead up to and are a part of the service

Physical evidence

• the tangible part of the service • the "servicescape"