Marketing of Services


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In this lecture delivered to working librarians, importance of service management to librarianship in general and marketing of library services in particular are analysed and explained with illustrations. The talk introduces the concept of marketing, how marketing of services differ from that of goods that too in not-for-profit (NFP) organizations like library and the resultant extended marketing mix (7Ps). Also discussed are economics of demand analysis, importance of physical evidence, people, process and place in marketing of library services. Setting the background to the theme, the importance of six interdependent facets of service management are diagrammatically explained together with how they are applied in management of library services. The way in which consumers of services differ from consumers of goods in evaluating services is also explained to make the differences clear. Various issues relating to library customer management are presented. Some tips for marketing of library services are offered in the conclusion.

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Marketing of Services

  1. 1. Marketing of Services M S Sridhar Head, Library & Documentation ISRO Satellite Centre Bangalore 560017 E-mail: & A lecture delivered in the UGC Refresher Course on “Library and Information Science” at Academic Staff College of Bangalore University on March 22, 2001
  2. 2. Marketing of Services • What are we selling? Information? (‘we sell dreams’ – Raj Kapoor; “in the factory we make cosmetics, in the the store we sell hope’ – Revlon) • Customer buy satisfaction and not what we make – Customer needs are core to marketing; product should not come in-between organisation and customer and block the vision • Know your customer • Choose a segment for proper focus – Define target market don’t offer one universal service to all – If you don’t know where you want to go, any road will take you there • Chalk-out service marketing strategy; Positioning the service • Environmental & SWOT analyses, goals, resource allocation • Common questions, uncommon answers – Type of business, customer, competitors, etc. • Expand 4Ps to 8Ps and co-ordinate marketing mix (product, price, place, promotion, people, physical evidence and process) Marketing of Library Services M S Sridhar, ISRO
  3. 3. Marketing of Services contd. • Marketing within the organisation –what you can’t sell to your own staff, you can’t sell to the customer either • Do internal marketing ; real/ crucial heroes are front line employees; social interaction between the customer and service personnel, customer focus and care, etc., • Developing marketing connections with operations - Mutual dependence of marketing and operations • Continuous customer care, focus and maintenance - putting the customer at the centre of all organisational efforts in the ultimate aim • Tangiblise the intangibles; create physical evidence in service to appeal to senses of customers • Pricing should take care of perishability nature and fluctuations in demand • Do niche marketing with unique customised services Marketing of Library Services M S Sridhar, ISRO
  4. 4. Marketing by NFP Organisations & Extended Marketing Mix Types of Marketing by NFP Extended Marketing Mix {(4+3+1) P} Organisations for Marketing of Services 1. Commercial marketing 1. Product 2. Social marketing (a long 2. Price term goal) 3. Place – Dissemination of ideas 4. Promotion – Changing the public’s 5. Physical evidence attitudes 6. People (uniform / dress) 3. Marketing to donors 7. Process (equipment, furniture, – Facilitating indirect etc.) ‘exchange’ 8. PR & social marketing – Range & complexities of motivations of donors Note: ‘Place’, ‘physical evidence, 4. Marketing to Official funders ‘people’ and ‘process’ are major ‘Barrier’ approach components relating to ‘creation of ‘Facilitator’ approach physical environment’ Marketing of Library Services M S Sridhar, ISRO
  5. 5. The economics of demand analysis The internet and aviation are made for each other: flights are a high-value, perishable commodity on which up-to-date information can be made available electronically. The buyer is hungry for such information so he can get the best deal. The airtimes, for their part, depend for their profits on what they call yield - management systems, which are highly sophisticated computerised models for altering the price of seats on the given flight to reflect the demand over time. ⇒ Cheap tickets for early bankers and last minute travelers needing flexible tickets pay much more for the privilege ( it may be 20 times) 1. Price (negatively related) 2. Income - “What distinguishes want from effective demand is the willingness and ability to pay the price asked’ (a) Normal goods (positively related) <1 income elasticity of demand (b) Inferior goods (positively related) <1 income elasticity of demand therefore shifting to better higher quality alternatives (C )Superior or luxury goods positive increase by a greater percentage than income i.e, income elasticity of demand >1 Marketing of Library Services M S Sridhar, ISRO
  6. 6. The economics of demand analysis contd... 3. Price of related goods (a) Substitute goods (positive): Increase in price results in increase in demand for the others (b) Complimentary goods(-ve) : Increase in price of one results in a decrease in the demand for the other (cross-price elasticity of demand) 4. Tastes and preferences: Unlike essentials, books, journals etc., have positive income elasticity (i.e expenditure decreases as income rises) Demand types 1. Latent demand i.e, potential or unrealised 2. Induced or ‘generated demand 3. Diverted’ and ‘Substitute’ demand (e.g.: books Vs TV) Capacity utilization or load factor 1. Pricing - Price discrimination; Membership scheme 2. Cost-plus price or full-cost price 2. Variable cost + gross profit (to cover FC and profits) 3. Marginal cost ( public sector) Marketing of Library Services M S Sridhar, ISRO
  7. 7. ‘Physical Evidence’ in Marketing of Services • Physical environment is ‘packaging’ for service • Customer judges the service quality through the process of deduction • Creation of service environment (i.e., context) should not be left to chance • Both dominant and peripheral physical evidences should be co- ordinate to achieve uniformity in its projected service image • Peripheral evidences are small and trivial but have impact on customer perception about services and are real sources of competitive differentiation • When it comes to perception “feelings are facts” • Help to reinforce the proposed position and image of the organisation, i.e.., tangibilise the intangible service Marketing of Library Services M S Sridhar, ISRO
  8. 8. ‘People’ & ‘Process’ in Marketing of services ‘People’ in Marketing of ‘Process’ in Marketing of services Services • Service employees • Policies – Training • Procedures – Discretion • Systems – Commitment • Use of technology – Incentives • Customer involvement – Appearance • Customer direction – Interpersonal behaviours • Workflow • Attitudes • Standardisation • Customer contact • Employee discretion • Customer interactions • Demand control • Quality control Marketing of Library Services M S Sridhar, ISRO
  9. 9. ‘Place’ in Marketing of Services • Location is important for homogeneous services – Site selection – Choice of community, region, etc. • Factors – Convenience – Operating cost – Proximity to competitor – Availability of support system – Geographical or environmental factors – Communication networks – Transport facilities • Channels /distribution / service centres Marketing of Library Services M S Sridhar, ISRO
  10. 10. Interdependent Facets of Service Management Objectives Evaluation User requirement SERVICE MANAGEMENT Marketing of Output Service services measurement quality Marketing of Library Services M S Sridhar, ISRO
  11. 11. Interdependent facets of library services 1. Objectives - where you want to go? – In line with the needs of users 2. User requirements – Service which empower the customer will thrive & those that frustrate the customer will shrivel 3. Marketing of services – What are we selling ? Information? – Customer seeks technology solutions to complex problems & buys ‘confidence’ or reduction of uncertainty surrounding the problem 4. Quality in service – Greatest lever for marketing – Intangible, relativistic, indivisible & has tendency to deteriorate – Like ‘happiness' difficult to measure – What a client expects of a service and how he perceives that the service received lived up to those expectations 5. Output measurement – Service & NFP nature cause many problems 6. Evaluation – Only outcome can be evaluated & process is difficult to evaluate – User evaluation is affected by service process, physical evidence & Marketingquality of service personnel M S Sridhar, ISRO of Library Services
  12. 12. How Consumers of Services differ from Consumers of Goods in Evaluation ? 1. Rely more on personal sources of information 2. Greater post-purchase evaluation and information seeking 3. Price and physical facilities are used as major cues to service quality 4. Evoke a smaller set of alternatives 5. For nonprofessional services, self-provision is more frequentaly considered 6. Adoption to innovation is slower 7. Perceive greater risk 8. Brand switching is less frequent 9. Part of the dissatisfaction is attributed to own inability to specify or perform their part of the service 10 Complain less frequently due to the belief that they are partly responsible 11 Intangibility, inseparability, heterogeneity and permissibility lead them to possess high levels of experience and credence properties, which in turn, make them more difficult to evaluate Marketing of Library Services M S Sridhar, ISRO
  13. 13. Customer Management 1. Can timing of demand be influenced? 2. Does the customer have spare time while he is waiting? 3. Do customers and contact personnel meet unnecessarily face to face? 4. Are such contacts used to the maximum effect? 5. Are contact personnel doing respective work which the customer could do himself (e.g. customer-operated machines) 6. Do the customers sometime try to 'get past' the contact personnel and do things themselves? could that interest and knowledge be better utilised? 7. Do the customers show interest in a knowledge about the tasks of the contact personnel? 8. Is there minority of customers which disturbs the service delivery system and its effectiveness? 9. Do the customers ask for information which is available elsewhere? 10. Can the customers do more work for each other, or use the resources of `third parties'? 11. Can part of the service delivery process be relocated to decrease cost? (e.g. cost of premises) 12. Can the customer be given an opportunity to choose between service levels? Marketing of Library Services M S Sridhar, ISRO
  14. 14. Conclusions 1. Customers give importance to: Reliability (dependency, accuracy & consistency) Responsiveness (quick & prompt delivery) Assurance (courteous, knowledgeable & assuring employee) Empathy (individualised & personalised attention) Tangibility (clean physical evidence & well groomed employee) Competency (of service employee) Courtesy (of service personnel) 2. Patron judgments differ from those of experts 3. Satisfaction is heavily influenced by expectations. Marketing of Library Services M S Sridhar, ISRO
  15. 15. References Applegate, Rachel. “Models of satisfaction”. In Kent, Allen, ed. Encyclopedia of library and information science. New York: Marcel Dekker, 1997, v.60, Supplement 23, p 199-227. Batra, Pramod. Simple ways to make your customers happy. New Delhi, Think Inc., 1994. Chase, R B and Tansik, D A. “The customer contact model for organisational design”. Management Science, 29, 1983, p 1037 – 1050. Chase, R B and Dasu, Sriram. “Want to perfect your company’s service? Use behavioural science”. Harvard Business Review, June 2001, p 79 – 84. Czepiel, John A, et. al., eds. The service encounter. Lexington, MA: Lexington Books, 1985. Jones, Thomas O. “Why satisfied customers defect”. IEEE Engineering Management Review 26 (3) Fall 1998, p16 – 26. Lovelock, Christopher H. Managing services: marketing, operations and human resources. New Delhi: Prentice Hall, 1988. Marketing of Library Services M S Sridhar, ISRO
  16. 16. References contd. Sridhar, M S. quot;Customer participation in service production and delivery systemquot;, Library science with a slant to documentation and information studies, 35 (3) September 1998, 157-163. Sridhar, M S. quot;Waiting lines and customer satisfactionquot;, SRELS journal of information management, 38 (2) June 2001, 99-112. Sridhar, M S. quot;Book procurement delay : a de-motivator to user participation in collection developmentquot;. In : Building Library Collections and National Policy for Library and Information Services : Seminar Papers presented in XXX All India Library Conference, Rajasthan University, Jaipur, 28-31 January 1985. ed. by P.B.Mangala. Delhi: ILA, 1985. 329-334. Sridhar, M S. quot;Customer-characteristics as criteria for market-segmentation in librariesquot;. In: Marketing of library and information services in India : Papers presented at the 13th National Seminar of IASLIC, Calcutta, December 20 - 23 , 1988, ed. by S.K.Kapoor and Amitabha Chatterjee. IASLIC Special Publication No. 28. Calcutta : IASLIC, 1988, p43-52. Sridhar, M. S. quot;Managerial quality and leadershipquot;. In: Management of library and information centres. New Delhi: Indira Gandhi National Open University, 1995, MLIS-05, Unit 3, p 43-68. Wilson, Au brey. New directions in marketing: Business-to-business strategies in 1990s. New Delhi: Excel books, 1995. Marketing of Library Services M S Sridhar, ISRO
  17. 17. About the Author Dr. M. S. Sridhar is a post graduate in Mathematics and Business Management and a Doctorate in Library and Information Science. He is in the profession for last 36 years. Since 1978, he is heading the Library and Documentation Division of ISRO Satellite Centre, Bangalore. Earlier he has worked in the libraries of National Aeronautical Laboratory (Bangalore), Indian Institute of Management (Bangalore) and University of Mysore. Dr. Sridhar has published 4 books, 81 research articles, 22 conferences papers, written 19 course materials for BLIS and MLIS, made over 25 seminar presentations and contributed 5 chapters to books. E-mail:,, ; Phone: 91-80-25084451; Fax: 91-80-25084476. Marketing of Library Services M S Sridhar, ISRO