Management of Service Business PPT Session 1

1. Management of
Service Business
SESSION 1: INTRODUCTION TO SERVICES
DHARUN KASILINGAM

2. Case Study
URBANCLAP: A MARKETPLACE FOR ON-DEMAND SERVICES

3. Assignment Questions
1. How is UrbanClap’s value proposition different from that of the existing
options?
2. Initially, UrbanClap offered only lead-generation services. To what extent
is this choice of service category important for the challenge of scaling up an on-
demand marketplace?
3. What is your assessment of UrbanClap’s marketing? Critically examine how
UrbanClap performed its marketing activities.
4. How would you describe the customer decision journey of UrbanClap
customers?
5. How can UrbanClap prevent disintermediation by customers and service
providers?
6. Should UrbanClap focus on lead-generation or fulfilment services? Provide
your justifications for the way ahead.

4. Question 2
 Initially, UrbanClap offered only lead-generation services. To what extent is
this choice of service category important for the challenge of scaling up an
on-demand marketplace?

5. 3 approaches to scaling up
 Single Player Mode
 Buyers are Sellers Mode
 Fill Empty Seats Mode

6. 3 approaches to scaling up
 Single Player Mode
 Choose either customer side (demand) or service provider side (supply)
 Zomato choose supply side
 Amazon books chose demand side
 Buyers are Sellers Mode
 Lyft for ride sharing
 Fill Empty Seats Mode
 Service providers are engaged with their own business
 The platform can offer to utilize them during their non-busy hours

7. Question 3
 What is your assessment of UrbanClap’s marketing? Critically examine how
UrbanClap performed its marketing activities.

8. Consumer Concerns
 How the service will be delivered,
 Is it is safe to call a stranger home,
 Whether the consumable products used are good,
 Whether there is any guarantee of the originality of the spare parts used,
 Whether the service provider would bring the whole kit or if users would
have to provide some tools or equipment,
 Whether the service provider would clean up the mess left after delivering
the service

9. Marketing Content
 Real life customer videos
 Videos focusing on consumer concerns
 Videos revolving around contemporary themes
 Women Equality
 Article 377

10. What led to the success of marketing?
 For customers, marketing efforts aimed at identifying the target group and
communicating the right message using the right medium to address their
concerns and build trust.
 For service providers, marketing was aimed at making them aspire to join
the platform.
 PR was employed to reach out to other stakeholders.

11. Question 4
 How would you describe the customer decision journey of UrbanClap
customers?

12. Customer Decision Journey

13. How was Urban Clap Successful in the
Loyalty Loop?
 Automation
 Proactive personalization
 Contextual interaction
 Journey Innovation

14. Question 5
 How can UrbanClap prevent disintermediation by customers and service
providers?
 Lead generation business and Fulfilment business
 Current transaction and subsequent transaction
 Low value vs high value transactions
 Seasonal vs non-seasonal bookings

15. Question 6
 Should UrbanClap focus on lead-generation or fulfilment services? Provide
your justifications for the way ahead.
 Pros and Cons of Lead Generation Business
 Pros and Cons of Service fulfilment Business

16. Data
 Share of Service Requests for Lead-Generation and Fulfilment Services
 Share of Service Requests for Lead-Generation and Fulfilment Services
Description FY 2014–15 FY 2015–16 FY 2016–17 FY 2017–18
Fulfilment services (%) 0 11 9 13
Lead-generation services (%) 100 89 91 87
Total number of service providers 130 17,500 44,500 83,000
Description FY 2014–15 FY 2015–16 FY 2016–17 FY 2017–18
Fulfilment services (%) 0 21 40 50
Lead-generation services (%) 100 79 60 50
Total number of service requests 1,200 450,000 1,015,000 2,375,000

17. NPS Scores
 Lead Generation vs Service fulfilment

18. Pros and Cons of the Lead-Generation
Business
Pros Comments
The lead-generation business was easy to expand horizontally
and could cater to a larger market. UrbanClap could have added
numerous categories on the platform as perthe customers’
demand.
UrbanClap could find it difficult to manage the customer experience with
numerous categories. Thiswould have resulted in less cross-selling, as
unhappycustomers would not have been willing to try other services.
The onus of service delivery lay with the service provider and
not with UrbanClap.
Standardisation of service quality is impossible. Poorquality could have
negative spillover effects on the fulfilment business.
UrbanClap did not have to manage thesupply side (service
providers).
Only the service providers who understood UrbanClap’s culture and their
customer expectations would have been successful. The rest might get
attached for initial leads and then discontinue, leavinga huge gap on the
supply side.
UrbanClap was not liable to provide any perks, insurance,
uniform, kits, etc., to itsservice providers.
UrbanClap would miss out on the opportunity ofestablishing its brand name.
Cons Comments
The uniformity of service delivery would be anissue. The customer expectation would be clear that the service provider—and
not UrbanClap—is deliveringthe service. The platform is just a meeting
place forboth service providers and customers.
The service provider would accept the assignment as per their
availability and workschedule.
UrbanClap could lose out on many bookings during peak time, as service
providers would not accept anyassignment.
As the services are required once in a lifetimeor only in the long
term, UrbanClap had no risk of service providers’ or customers’
disintermediation.
After the initial contact through the platform, customers could still not book
on the platform and contact the service provider directly if both of them did
not accept the negotiations.

19. Pros and Cons of the Fulfilment
Business
Pros Comments
Using the power of technology,
UrbanClap brought a large unorganised
sector workforceinto the mainstream.
The challenge is to provide continuous work
assignments to all the service providers for
them toearn enough to sustain their families.
UrbanClap provided services providers
withan opportunity to earn at least
three to four times their earlier earnings.
The service providers still believed that they
were contractual and were denied the perks that
permanentemployees enjoyed.
Bringing service providers into the
mainstream changed their status quo,
which proved to be the main success
factor for UrbanClap among its
competitors.
UrbanClap invested in developing the supply
side, but chances were that the competitors
could easily poachits service providers.

20. Pros and Cons of the Fulfilment
Business
Pros Comments
UrbanClap undertook a long and stringent selection
process to onboard service providers, bringing only
serious and reliableservice providers to the platform.
The selection process is an investment by UrbanClap, but there is
still no guarantee that the service provider will eventually stick to
the platform.
UrbanClap provided uniforms and kits to all the
service providers, which helped build thebrand image.
The uniform and kits were always available with the service
providers, and hence, they could have used them for non-
UrbanClap customers as well.
Insurance was provided to customers for anydamage
during service delivery, building a lotof trust among
customers and encouraging them to try UrbanClap.
Some unscrupulous customers could blame serviceproviders who
were not that cautious, to claim damages that might have
happened before service delivery.
There is scope for vertical and horizontal expansion.
The only challenge is to developthe workforce of
service providers.
Managing a large contractual workforce is quite achallenge.
The stringent training paved the way for thequality
and uniformity of service delivery to create a
delightful customer experience.
A trained and well-equipped service provider could jointhe
competitor, as UrbanClap signed no bond with them.
UrbanClap provided raw materials for servicedelivery
in categories such as salon and spa,which helped keep
an eye on disintermediation.
Service providers had to anticipate the requirement and try to
order the raw material from UrbanClap. UrbanClap had to
maintain its inventory at all times; ashortage meant losing
bookings.

21. Pros and Cons of the Fulfilment
Business
Cons Comments
It is difficult to expand service offerings while
meeting service quality expectations.
UrbanClap focused on the more important categorieson the
basis of revenue. Pruning helped streamline operations and
make them smoother.
The end-to-end onus of service delivery meant more
responsibility for UrbanClap. Customers perceived
service providers asUrbanClap employees.
This created delighted customers who were ready tonot only
place a repeat booking but also try other services on the
platform.
UrbanClap would have been responsible forany
mishaps at the customer location.
Rigorous training and manuals of service delivery averted the
incidents in the first place. Furthermore,UrbanClap provided
insurance cover to its high-
performing service providers against any mishaps atthe
customer location.
Developing the supply side, i.e., service
providers, was a huge cost. Continuous training
had to be provided to the serviceproviders.
UrbanClap had to establish a training
department in order to train its
service providers to cater to customer
expectations.
The training created confident and professional service
providers, leading to satisfied customers.
UrbanClap had to bear the cost of insurance
provided to service providers.
This attracted service providers to the platform, whichhelped
build the supply side.
Female service providers’ safety was a hugeconcern
for UrbanClap.
UrbanClap trained its female service providers to leavea
customer’s premises the moment they felt uncomfortable.

22. What Happened?
 The lead generation business had too much inherent variability in terms of
service delivery
 The lead generation business was gradually paired down from 50% to 2%
revenue slowly over a span of 9 to 12 months
 UrbanClap closed its lead generation business on January 2020
 Renamed as “Urban company”