MKTG 5 - Chapter 12

Place

Distribution (place) decisions involve convenience, number of outlets, direct versus indirect distribution, and scheduling.

Promotion

Effective promotion strategies include; stressing tangible cues (hotels turn down the bedcovers and put mints on the pillows), using persinal sources of information, creating strong organizational images (McDonald's Golden Arches), and engaging in postpurchase communication.

Product

"Product" (service) strategy issues include what is being processed (people, possessions, mental stimulus, standardization, and the service mix. Product = Service

People

All human actors who play a part in service delivery and thus influence the buyer's perceptions: namely, the firm's personnel, the customer, and other customers in the service environment.

Examples of responsiveness

Calling the customer back quickly, serving lunch fastto someone who is in a hurry , or mailing a transaction slip immediately. The ultimate in responsiveness is offereing service 24 hours a day, seven days a week.

Empathy

Caring, individualized attention to customers. Firms whose employees recognize customers and learn their specific requirements are providing empathy.

Price

Pricing objectives for services can be revenue oriented, operations oriented, patronage oriented, or any combination of the three.

Expanded Mix for Services (7 Ps)

Product Price Place Promotion People Process Physical Evidence

What are the five components of service quality?

Reliability, Assurance, Tangibles, Empathy, Responsiveness

Relationship Marketing in Services

See slide #17 or Pg. 194-195 in book

4 Characteristics that distinguish services from goods

Services are intangible, inseparable, heterogeneous, and perishable

Service Quality is more difficult to define and measure than is the quality of tangible goods. TRUE or FALSE

TRUE

Process

The actual procedures, mechanisms, and flow of activities by which the service is delivered—the service delivery and operating systems.

Physical Evidence

The environment in which the service is delivered and where the firm and customer interact, and any tangible components that facilitate performance or communication of the service.

Assurance

The knowledge and courtesy of employees and their ability to convey trust. Skilled employees who treat customers with respect and make a customer feel that they can trust the firm exemplify assurance.

Heterogeneity

The variability of the inputs and outputs of services, which causes services to tend to be less standardized and uniform than goods

Service Recovery Paradox

customers often rate performance of service higher if a failure occurs and personnel successfully recover from it than if the service had been delivered correctly in the first place.

The Gap Model

identifies five gaps that can cause problems in service delivery and influence customer evaluations of service quality. (pg. 189-190)

American Customer Satisfaction Index (ACSI)

is an economic indicator that measures the satisfaction of consumers across the U.S. economy. The ACSI interviews about 80,000 Americans annually and asks about their satisfaction with the goods and services they have consumed. Potential respondents are screened prior to interviewing to guarantee inclusion of customers of a wide range of business-to-consumer products and services, including durable goods, services, non-durable goods, local government services, federal government services, and so forth. Results from data collection and analyses are released to the public throughout each calendar year. ACSI data has been used by academic researchers,[1] corporations[2][3], government agencies,[4] market analysts and investors,[5] industry trade associations, and consumers.

Reliability

the ability to perform a service dependably, accurately, and consistently. Reliability is performing the service right the first time. This component has been found to be the one most important to the cosumers.

Responsiveness

the ability to provide prompt service

Gap 3

the gap between service quality specifications and the service that is actually provided. If 1 and 2 are closed then it is lack of mgmt and employees to do what needs to be done.

Gap 5

the gap between the service customers receive and the service they want.

Gap 1

the gap between what customers want and what management thinks customers want.

Gap 2

the gap between what managers think customers want and the quality specifications that mgmt develops to provide the service

Gap 4

the gap between what the company provides and what customers are told it provides.

Perishability

the inability of services to be stored, warehoused, or inventoried

Intangibility

the inability of services to be touched, seen, tasted, heard, or felt in the same manner that goods can be sensed

Inseparability

the inability of the production and consumption of a service to be separated; consumers must be present during the production

Tangibles

the physical evidence of a service, including the physical facilities, tools and equipment used to provide the service

The tangible parts of a service include

the physical facilities, tools, and equipment used to provide the service, as well as the appearance of personnel.

Services

the result of applying human or mechanical efforts to people or objects