SERVICES
MARKETING
MARKETING
COMMUNICATIONS FOR
SERVICES [ Part 1 ]
Himansu S M
INTRODUCTION :
Modern marketing process involves
something more than:
• Just developing a good product (the First
P),
• Pr...
INTRODUCTION :
• For most companies today, the
question is:
• not whether to communicate,
• but rather what to say, to who...
Flow of Entities
• In our earlier discussion of
introduction to modern marketing
concept we had elicited the idea of a
sim...
Flow of Entities
Entities
that flow from
Industry to
Market
Entities
that flow from
Market to
Industry
Goods / Services,
C...
Communications
• In addition to being a global force,
communication is the unique tool that
marketers use to persuade the ...
Communications
• Communications are in many forms, like
verbal, visual or symbolic, and convey
special meaning that the ma...
Internal Communication
• Marketing communications can be
used to communicate with service
employees as well as with extern...
Internal Communication
• Communications may also be needed to
nurture team spirit and support common
corporate goals.
• Ex...
COMMUNICATION STRATEGIES FOR
SERVICES
• Several of the differences
distinguishing services from goods
have important marke...
Intangible Nature of Service
Performances
• Since services are performances rather
than objects, their benefits can be dif...
Intangible Nature of Service
Performances
• Ex. : MasterCard television and print
advertisements emphasise the
tangible th...
Intangible Nature of Service
Performances
• Easily recognizable corporate symbols are
especially important for internation...
Communications Issues In Services
Marketing
• A company’s communications strategies
help it project a desired image and
po...
1. Technology :
• Technology helps a company to
communicate fast and efficiently. At the
same time, since this is highly c...
2. Budgetary Constraints :
• Some companies may not have
sufficient funds to install a good
communication system in their ...
3. Content :
• Content of communications is
important. Any mistake while choosing
messages with correct and accurate
termi...
4. Delivery :
• Communication issues in delivery arise
in wrong timing, wrong message,
wrong place or wrong target audienc...
4. Delivery :
2. Often, telemarketing executives of
service providers call up customers
during business hours to inform th...
THE MARKETING COMMUNICATIONS MIX :
• Most service marketers have access to
numerous forms of communication,
referred to co...
THE MARKETING COMMUNICATIONS MIX :
• "This is a way of looking at the whole
marketing process from the viewpoint
of the cu...
THE MARKETING COMMUNICATIONS MIX :
• SALES PROMOTION : A variety of
short term incentives to
encourage trial or purchase o...
THE MARKETING COMMUNICATIONS MIX :
• Personal Selling : Face-to-Face
interactions with one or more
prospective purchasers ...
ADVERTISING & SALES PROMOTION SUB-DIVISIONS
Advertising Sales Promotion
Audio-Visual Materials Contests, Games
Billboards ...
Applications
• In well-planned campaigns, several
different communication elements may be
used in ways that mutually reinf...
Applications
• There’s a broad division between
• (1) "Personal Communications", involving
personalised messages that move...
Applications
• However, technology has created a gray
area between the two. It's now very easy for
a firm to combine word-...
ADVERTISING :
• Advertising plays a major role in
promoting a company’s products and
service on a large scale. However,
de...
Advertising Features - 1
• Advertising is non-personal mass
communication by an identified sponsor.
This is a cost effecti...
Advertising Features - 2
• As the most dominant form of
communications in consumer
marketing, advertising is often the fir...
Advertising Features - 3
• One of the challenges facing advertisers
is how to get their messages noticed. TV
and radio bro...
Advertising Features - 4
• A broad array of paid advertising media is
available, including broadcast (TV and
Radio), print...
Advertising Features - 5
• Service providers should involve front line
employees in designing the advertising
campaign as ...
Advertising Features - 6
• The second aspect to consider is the
variability in services i.e., the way
services are deliver...
Advertising Features - 7
• Service customers face high perceived risks due
to the intangibility of the services. Therefore...
Advertising Features - 8
• A company can improve its brand image and
brand equity with the help of advertising.
• It also ...
Sales Promotion
• Introduction : Sales Promotion is a
variety of short-term incentives to
encourage trial or purchase of a...
Sales Promotion Characteristics
• Sales promotions are used to intensify a
brand contact for customers or prospects,
espec...
Sales Promotion Characteristics
• Where the decision process takes weeks or
months sales promotion can be used to
help mov...
Sales Promotion Characteristics
• Some marketers consider SP as a
supplement to Adv and PS because it can
make both more e...
Sales Promotion Tools
There are basically three types of sales
promotions :
1. Consumer Promotion : It may consist of
Samp...
Sales Promotion Tools
2. Trade promotions : It may consist of Prices
off, Advertising Display Allowances, and
Free Goods. ...
Advertising vs. Sales Promotion :
Often the term Sales Promotion is
confused with Advertising, because
the former frequent...
Advertising vs. Sales Promotion :
Advertising creates awareness and interest
and brings about attitude change,
SP influenc...
I N T E R M I S S I O N
END OF PART -1
© Himansu S M / 16-08-2013
45
16/08/2013 Himansu S M
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SERVICES MARKETING
MARKETING COMMUNICATIONS FOR SERVICES [ Part 1 ]
Introduction:
Modern marketing process involves something more than Just developing a good product (the First P), Pricing it attractively (the Second P), and Making it accessible (the Third P).
It also calls for communication with the present and potential stakeholders and the general public (the Fourth P). Marketing communications, in one form or another, are essential to a company's success.
For most companies today, the question is not whether to communicate, but rather what to say, to whom, and how often. So managers need to debate the question: “How should the Marketers communicate what our service has to offer?”
Communications:
In addition to being a global force, communication is the unique tool that marketers use to persuade the consumers to act in a desired way, say to vote, to buy, to donate, to patronise, etc.
The location and atmosphere of a service delivery facility, corporate design features like the consistent use of colours and graphic elements, the appearance and behaviour of employees, website design—all of these factors contribute to an impression in the customer's mind.
Communications are in many forms, like verbal, visual or symbolic, and convey special meaning that the marketers want to impart to the consumers. Communications can evoke emotions that put consumers in more receptive frames of mind, and it can encourage purchases that help consumers solve problems or avoid negative outcomes.
In short, Communications is the bridge between marketers and consumers, and between consumers and their socio-cultural environments.

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Transcript of "Services Marketing - Marketing Communications-1"

  1. 1. SERVICES MARKETING MARKETING COMMUNICATIONS FOR SERVICES [ Part 1 ] Himansu S M
  2. 2. INTRODUCTION : Modern marketing process involves something more than: • Just developing a good product (the First P), • Pricing it attractively (the Second P), and • Making it accessible (the Third P). • It also calls for communication with the present and potential stakeholders and the general public (the Fourth P). Marketing communications, in one form or 216/08/2013 Himansu S M
  3. 3. INTRODUCTION : • For most companies today, the question is: • not whether to communicate, • but rather what to say, to whom, and how often. • So managers need to debate the question: • ―How should the Marketers communicate what our service has to 316/08/2013 Himansu S M
  4. 4. Flow of Entities • In our earlier discussion of introduction to modern marketing concept we had elicited the idea of a simple marketing system where two- way flow of entities between - • The ―Industry‖ (a collection of Marketers) • And the ―Market‖ (a collection of Buyers) take place. • They are given in the following matrix, 416/08/2013 Himansu S M
  5. 5. Flow of Entities Entities that flow from Industry to Market Entities that flow from Market to Industry Goods / Services, Communications. Money, Information / Feedback. 516/08/2013 Himansu S M
  6. 6. Communications • In addition to being a global force, communication is the unique tool that marketers use to persuade the consumers to act in a desired way, say to vote, to buy, to donate, to patronise, etc. • The location and atmosphere of a service delivery facility, corporate design features like the consistent use of colours and graphic elements, the appearance and behaviour of employees, website design— all of these factors contribute to an impression in the customer's mind. 616/08/2013 Himansu S M
  7. 7. Communications • Communications are in many forms, like verbal, visual or symbolic, and convey special meaning that the marketers want to impart to the consumers. Communications can evoke emotions that put consumers in more receptive frames of mind, and it can encourage purchases that help consumers solve problems or avoid negative outcomes. • In short, Communications is the bridge between marketers and consumers, and between consumers and their socio- cultural environments. 716/08/2013 Himansu S M
  8. 8. Internal Communication • Marketing communications can be used to communicate with service employees as well as with external customers. • "Internal Communications" from senior managers to their employees play a vital role in maintaining and nurturing a corporate culture founded on specific service values. 816/08/2013 Himansu S M
  9. 9. Internal Communication • Communications may also be needed to nurture team spirit and support common corporate goals. • Ex. : Consider the challenge of maintaining a unified sense of purpose at the overseas offices of companies such as Citibank, Air Canada, Marriott, or McDonalds, where people from different cultures who speak different languages must work together to create consistent levels of service. 916/08/2013 Himansu S M
  10. 10. COMMUNICATION STRATEGIES FOR SERVICES • Several of the differences distinguishing services from goods have important marketing communications implications. • Thus communication strategies need to reflect the special characteristics of services. 1016/08/2013 Himansu S M
  11. 11. Intangible Nature of Service Performances • Since services are performances rather than objects, their benefits can be difficult to communicate to customers. • Service providers should use tangible cues whenever possible in their advertising campaigns, especially for low- contact services that involve few tangible elements. • is also helpful to include "vivid information" that will produce a strong, clear impression on the senses, especially for services that are complex and highly intangible. 1116/08/2013 Himansu S M
  12. 12. Intangible Nature of Service Performances • Ex. : MasterCard television and print advertisements emphasise the tangible things that can be purchased with its credit card - complete with a listing of the price of each item. In each ad, all of the items purchased with the card lead to a priceless experience (a clever and memorable reference to the concept of intangibility). 1216/08/2013 Himansu S M
  13. 13. Intangible Nature of Service Performances • Easily recognizable corporate symbols are especially important for international companies when services are offered in markets where the local language is not written in Roman script or where a significant proportion of the population is functionally illiterate. • Some companies have created metaphors that are tangible in nature to help communicate the benefits of their service offerings. Insurance companies often use this approach to market their highly intangible products. 1316/08/2013 Himansu S M
  14. 14. Communications Issues In Services Marketing • A company’s communications strategies help it project a desired image and position itself in the market. Firms use communications strategies to bring about awareness of their goods and services among their target audience. Further they try to attract customers to consume their services with various techniques as we will see. However, there are several challenges the service provider faces while communicating. They are broadly : 1416/08/2013 Himansu S M
  15. 15. 1. Technology : • Technology helps a company to communicate fast and efficiently. At the same time, since this is highly complex, there are several problems that need to be solved on a real time basis. Else, the business is lost or a wrong and detrimental message may be delivered. Ex., the internet banking transaction is very convenient but highly complex and needs high degree of security, else it is risky and disastrous. 1516/08/2013 Himansu S M
  16. 16. 2. Budgetary Constraints : • Some companies may not have sufficient funds to install a good communication system in their offices. In today’s world the technology needs are costly and need sufficient technically competent manpower. 1616/08/2013 Himansu S M
  17. 17. 3. Content : • Content of communications is important. Any mistake while choosing messages with correct and accurate terminology may prove disastrous. Imagine what happens if tour operator mistakes ―family‖ for ―a couple‖ for a tour package of 3 days and 2 nights. 1716/08/2013 Himansu S M
  18. 18. 4. Delivery : • Communication issues in delivery arise in wrong timing, wrong message, wrong place or wrong target audience. Marketing communications personnel must take extra precaution to see these don’t happen. Examples are : 1. Sometimes, service providers communicate incomplete or wrong information to their customers. Ex., mostly happens with Insurance and MF advisors. 1816/08/2013 Himansu S M
  19. 19. 4. Delivery : 2. Often, telemarketing executives of service providers call up customers during business hours to inform them about their company’s service offerings. Customers get disturbed and develop a negative image about the company. 3. In some instances, the company might end up targeting the wrong audience. Ex. A mobile phone service provider might communicate the benefits of reduced charges of SMS to the elderly persons in a family, who normally don’t use the service. 1916/08/2013 Himansu S M
  20. 20. THE MARKETING COMMUNICATIONS MIX : • Most service marketers have access to numerous forms of communication, referred to collectively as the "Marketing Communications Mix". • Different communication elements have distinctive capabilities relative to the types of messages that they can convey and the market segments most likely to be exposed to them. • The mix includes personal contact, advertising, publicity and public relations, sales promotion, instructional materials, and corporate design. 2016/08/2013 Himansu S M
  21. 21. THE MARKETING COMMUNICATIONS MIX : • "This is a way of looking at the whole marketing process from the viewpoint of the customer" (-Kotler). The modern marketing communications mix consists of five major tools or models of communications (which may be further sub-divided), they are : • ADVERTISING : Any paid form of non- personal presentation and promotion of ideas, goods, or services by an identified sponsor. 2116/08/2013 Himansu S M
  22. 22. THE MARKETING COMMUNICATIONS MIX : • SALES PROMOTION : A variety of short term incentives to encourage trial or purchase of a product or service. • Public Relations and Publicity : A variety of programmes designed to promote or protect a company’s image or its individual products. 2216/08/2013 Himansu S M
  23. 23. THE MARKETING COMMUNICATIONS MIX : • Personal Selling : Face-to-Face interactions with one or more prospective purchasers for the purpose of making presentations, answering questions, and procuring orders. • Direct and Interactive Marketing : Use of mail, telephone, fax, e-mail, or internet to communicate directly with or solicit response or dialogue from specific customers and 2316/08/2013 Himansu S M
  24. 24. ADVERTISING & SALES PROMOTION SUB-DIVISIONS Advertising Sales Promotion Audio-Visual Materials Contests, Games Billboards Continuity Programmes Brochures and Booklets Coupons Directories Demonstrations Display Signs Entertainment Motion Pictures Exhibits Packaging – Inserts Fairs and Trade Shows Packaging – Outer Low Interest Financing Point-of-Purchase Displays Premiums and Gifts Posters and Leaflets Rebates Print and Broadcast Ads Sampling Reprints of Ads Sweepstakes, Lotteries Symbols and Logos Tie-ins Video Tape Trade-in Allowances 2416/08/2013 Himansu S M
  25. 25. Applications • In well-planned campaigns, several different communication elements may be used in ways that mutually reinforce each other. Effective sequencing of communications is important, since one element often paves the way for others. • Ex. : Advertising may encourage prospects to visit a Web site, request further information by mail, or shop in a specific store where they will be exposed to "retail displays" and can interact directly with a salesperson. 2516/08/2013 Himansu S M
  26. 26. Applications • There’s a broad division between • (1) "Personal Communications", involving personalised messages that move in both directions between two parties, and • 2) "Impersonal Communications", in which messages move in only one direction and are generally targeted at a large group of customers and prospects rather than at a single individual. 2616/08/2013 Himansu S M
  27. 27. Applications • However, technology has created a gray area between the two. It's now very easy for a firm to combine word-processing technology with information from a database to create an impression of personalization. • Ex. : Think about the direct mail and e-mail messages that you have received, containing a personal salutation and perhaps some reference to your specific situation or past use of a particular product. 2716/08/2013 Himansu S M
  28. 28. ADVERTISING : • Advertising plays a major role in promoting a company’s products and service on a large scale. However, developing advertising campaigns for services it is a difficult aspect because of the intangible properties services. The features : 2816/08/2013 Himansu S M
  29. 29. Advertising Features - 1 • Advertising is non-personal mass communication by an identified sponsor. This is a cost effective and powerful means to reach the masses. • The cost per unit of (audience) of exposure is the lowest in Advertising, when compared to other promotional approaches. It has the capacity to attract the market. • Informative, educative and persuasive objectives can be achieved thro’ advertising. Service firms use advertising for the achievement of the above mentioned objectives. 2916/08/2013 Himansu S M
  30. 30. Advertising Features - 2 • As the most dominant form of communications in consumer marketing, advertising is often the first point of contact between service marketers and their customers, serving to build awareness, inform, persuade, and remind. • It plays a vital role in providing factual information about services and educating customers about product features and capabilities. 3016/08/2013 Himansu S M
  31. 31. Advertising Features - 3 • One of the challenges facing advertisers is how to get their messages noticed. TV and radio broadcasts are cluttered with commercials, where as news papers and magazines sometimes seem to contain more ads than news and features. • How can a firm hope to stand out from the crowd ? Longer, louder commercials and larger format ads are not necessarily the answers. Some advertisers stand out by using striking designs or a distinctively different format. 3116/08/2013 Himansu S M
  32. 32. Advertising Features - 4 • A broad array of paid advertising media is available, including broadcast (TV and Radio), print (magazines and news papers), movie theatres, and many types of outdoor media (Posters, Billboards, Electronic message boards and exterior of buses and autos). • Some media are more focused than others, targeting specific geographic areas or audiences, with a popular interest. Advertising messages delivered thro’ mass media are often reinforced by direct marketing tools, such as mailing, telemarketing, faxes or e-mail. 3216/08/2013 Himansu S M
  33. 33. Advertising Features - 5 • Service providers should involve front line employees in designing the advertising campaign as service personnel directly interact with customers during the process of selling and they would understand what appeals to them. • A company’s image is damaged if its service personnel are inefficient, behave rudely, or are careless in dealing with customers. • The word of mouth publicity is a powerful advertising tool or a company and its services. Service providers should therefore educate their employees on the importance of customer service and motivate them to perform better. 3316/08/2013 Himansu S M
  34. 34. Advertising Features - 6 • The second aspect to consider is the variability in services i.e., the way services are delivered differs from one company to another. • Even if the service offering is the same, due to the attitude, expertise and skills of service personnel involved in delivering the services, the actual delivery can be different. • Customers can easily find out these difference and they indulge in word of mouth publicity, thus making or marring the business of the service provider. 3416/08/2013 Himansu S M
  35. 35. Advertising Features - 7 • Service customers face high perceived risks due to the intangibility of the services. Therefore, service providers should design ad campaigns that attach tangible clues to the intangible services. • In addition, companies should advertise services that they can [possibly] deliver. Firms should not cheat the target audience by making unrealistic promises. A company’s failure to keep its promise can prove to be more damaging to its business, than making no promise at all. • Finally, a company that advertises its services thro’ various media on a continuous basis is better recognised by customers than a company that rarely advertises its service. 3516/08/2013 Himansu S M
  36. 36. Advertising Features - 8 • A company can improve its brand image and brand equity with the help of advertising. • It also helps the company in differentiating and positioning its services from those of its competitors. • Advertising is expensive, its results are spread over time and therefore the returns can’t be measured immediately. • During a resource crunch, the first cost cutting measures is taken at the advertising front. Most companies try to cut down their promotional and advertising costs due to budgetary constraints. • However, they should use their direction in these situations as most companies might need the support of advertising for improving their business. 3616/08/2013 Himansu S M
  37. 37. Sales Promotion • Introduction : Sales Promotion is a variety of short-term incentives to encourage trial or purchase of a product or service. • It’s a key ingredient in marketing campaigns, and consists of a diverse collection of incentive tools, mostly short term, designed to stimulate quicker and / or greater purchases of particular products or services. 3716/08/2013 Himansu S M
  38. 38. Sales Promotion Characteristics • Sales promotions are used to intensify a brand contact for customers or prospects, especially when these people are in buying or using situations. • Although the primary object of the consumer sales promotion is to affect behaviour, it can (and should) also heighten awareness and reinforce a brand’s image. 3816/08/2013 Himansu S M
  39. 39. Sales Promotion Characteristics • Where the decision process takes weeks or months sales promotion can be used to help move prospects and customer thro’ the decision process. • Consumer promotional offers provide tangible added value and are generally available for a ―limited time only‖ to create a sense of urgency, which marketers think speeds up the decision making process. 3916/08/2013 Himansu S M
  40. 40. Sales Promotion Characteristics • Some marketers consider SP as a supplement to Adv and PS because it can make both more effective. • But in reality, as we will see, it is much more than that. Some years back the Adv / SP spending ratio was 60:40, but now it is almost 30:70 and SP spending is still growing. 4016/08/2013 Himansu S M
  41. 41. Sales Promotion Tools There are basically three types of sales promotions : 1. Consumer Promotion : It may consist of Samples, Coupons, Cash Refund Offers, Prices off, Gifts and Premiums, Prizes, Patronage, Rewards, Free Trials, Warranties, Tie-in Promotions, Cross Promotions, Point of Purchase Displays, Sweepstakes, Lotteries, Games, Rebates, Exhibits, Low Interest Financing, Entertainment, and Continuity Programmes, etc. 4116/08/2013 Himansu S M
  42. 42. Sales Promotion Tools 2. Trade promotions : It may consist of Prices off, Advertising Display Allowances, and Free Goods. Trade-in Allowances, Contests for Sales Representatives, 3. Business and Sale Force Promotions : It may consist of Fairs and Trade Shows and Conventions, Specialty Advertising. 4216/08/2013 Himansu S M
  43. 43. Advertising vs. Sales Promotion : Often the term Sales Promotion is confused with Advertising, because the former frequently use the latter to create awareness of the promotion. The basic difference between Advertising and Sales promotion is that while Advertising offers a REASON to buy, Sales Promotion offers an INCENTIVE to buy. 4316/08/2013 Himansu S M
  44. 44. Advertising vs. Sales Promotion : Advertising creates awareness and interest and brings about attitude change, SP influences the next steps in buying behaviour, such as desire and action. Marketers know that the prospects may be aware of and even have some interest in a brand but may not have enough desire to seek out the brand or risk buying it. An extra incentive, however, sometimes moves a prospect into the desire and action stages. 4416/08/2013 Himansu S M
  45. 45. I N T E R M I S S I O N END OF PART -1 © Himansu S M / 16-08-2013 45 16/08/2013 Himansu S M

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