STCO 426 Ch.3

Perishability

A distinguishing characteristic of services in that they cannot be saved, their unused capacity cannot be reserved, and they cannot be inventoried.

Intangibility

A distinguishing characteristic of services that makes them unable to be touched or sensed in the same manner as physical goods.

Inseparability

A distinguishing characteristic of services that reflects the interconnections among the service provider, the customer involved in receiving the service, and other customers sharing the service experience.

Heterogeneity

A distinguishing characteristic of services that reflects the variation in consistency from one service transaction to the next.

Critical Incident

A specific interaction between a customer and a service provider.

Nonpeak Demand Development

A strategy in which service providers use their downtime to prepare in advance for peak periods or to market to different target markets that follow different demand patterns than the firm's traditional market segment.

Consumer Management

A strategy service personnel can implement that minimizes the impact of other customers on each individual customer's service experience (e.g., separating smokers from nonsmokers in a restaurant).

Reservation System

A strategy to help smooth demand fluctuations in which consumers ultimately request a portion of the firm's services for a particular time slot.

Third Parties

A supply strategy in which a service firm uses an outside party to service customers and thereby save on costs, personnel, etc.

Customer Participation

A supply strategy that increases the supply of service by having the customer perform part of the service, such as providing a salad bar or dessert bar in a restaurant.

Multisite Locations

A way service firms that mass-produce combat inseparability, involving multiple locations to limit the distance the consumers have to travel and staffing each location differently to serve a local market.

Factories in the Field

Another name for multisite locations.

Activity-Based Costing (ABC)

Costing method that breaks down the organization into a set of activities, and activities into tasks, which convert materials, labor, and technology into outputs.

Service-Dominant Logic

Philosophical viewpoint that the primary role of marketers is to deliver service. Consequently, goods are simply a means of rendering a service to the customer.

Expansion Preparation

Planning for future expansion in advance and taking a long-term orientation to physical facilities and growth.

Creative Pricing

Pricing strategies often used by service firms to help smooth demand fluctuations, such as offering "matinee" prices or "early bird specials" to shift demand from peak to nonpeak periods.

Complimentary Services

Services provided for consumers to minimize their perceived waiting time, such as driving ranges at golf courses, arcades at movie theaters, or reading materials in doctors' offices.

Personal Sources of Information

Sources such as friends, family, and other opinion leaders that consumers use to gather information about a service.

Capacity Sharing

Strategy to increase the supply of service by forming a type of co-op among service providers that permits co-op members to expand their supply or service as a whole.

Customization

Taking advantage of the variation inherent in each service encounter by developing services that meet each customer's exact specifications.

Standardization

The goal of standardization is to produce a consistent service product from one transaction to the next.

Physical Evidence

The physical characteristics that surround a service to assist consumers in making service evaluations, such as the quality of furnishings, the appearance of personnel, or the quality of paper stock used to produce the firm's brochure.

Physical Evidence/Tangible Clues

The physical characteristics that surround a service to assist consumers in making service evaluations, such as the quality of furnishings, the appearance of personnel, or the quality of paper stock used to produce the firm's brochure.

Tangible Clues

The physical characteristics that surround a service to assist consumers in making service evaluations, such as the quality of furnishings, the appearance of personnel, or the quality of paper stock used to produce the firm's brochure.

Other Customers

The term used to describe customers who share a service experience.