services marketing

1. Week 4 & 5

2.  What are the key ingredients in a service
product?
 How might we categorize the
supplementary services that surround core
products?
 What are some of the approaches that can
be used in designing new services?
 What is the role of branding for service
products?

3. Operating Assets
(Facilities/Equipment, IT Systems,
People, Op. Skills, Cost Structure)
Corporate Objectives
and Resources
Service Delivery
Process
Marketing Assets
(Customer Base, Mkt. Knowledge,
Implementation Skills, Brand Reput.)
Service Marketing Concept
•Benefits to customer from core/
supplementary elements, style,
service level, accessibility
•User costs/outlays incurred
•Price/other monetary costs
•Time
•Mental and physical effort
•Neg. sensory experiences
Service Operations Concept
•Nature of processes
•Geographic scope of ops
•Scheduling
•Facilities design/layout
•HR (numbers, skills)
•Leverage (partners, self-service)
•Task allocation: front/backstage
staff; customers as co-producers

4. Understanding the
Components of the Service
Product

5.  Core product.
◦ Problem solving benefit that customers seek. E.g
transport, restore a damaged or malfunctioning
machine
 Supplementary services
◦ Augments the core product
 Delivery processes
◦ How the different service components are delivered
to the customer
◦ The nature of the customers’ role in those
processes
◦ How long the delivery lasts

6. Distribution
Price
Marketing Positioning
KEY
Tangible elements
Intangible elements
Service
frequency
Vehicle
Transport
Pre- and
post-flight
service
Food
and
drink
In-flight
service

7. Core
Scheduling Process
Service
Level
Customer
Role
Supplementary
services offered
and how created
and delivered
Delivery Concept
For Core Product
Reservation
Parking
Checkin/
check out
porter
meal
In room
movie
Room
service
phone

8.  Probable sequence in which customer will
use each of
◦ Core and supplementary services.
 Length of time required in each instance

9. Pre
Visit
Reservation
USE GUESTROOM OVERNIGHT
Parking Get car
Check in
Porter
USE ROOM
Meal
Pay TV Room service
Phone
Check out
Time Frame of an Overnight Hotel Stay
(real-time service use)

10. Identifying and classifying
supplementary services

11.  Facilitating services
◦ Information
◦ Order taking
◦ Billing
◦ Payment
 Enhancing services
◦ Consultation
◦ Hospitality
◦ Safe keeping
◦ Exceptions

12. Core
Information
Consultation
Order-Taking
Hospitality
Payment
Billing
Exceptions
Safekeeping
Facilitating elements
Enhancing elements
KEY:

13. Customers often
require information
about how to obtain
and use a product or
service. They may also
need reminders and
documentation
Core

14. Many goods and services
must be ordered or reserved
in advance. Customers need
to know what is available and
may want to secure
commitment to delivery
Core

15. “How much do I owe you?”
Customers deserve clear,
accurate and intelligible
bills and statements
Core

16. Customers may pay
faster and more
cheerfully if you
make transactions
simple and convenient
for them
Core

17. Value can be added
to goods and
services by
offering advice and
consultation tailored
to each customer’s
needs and situation
Core

18. Customers who invest
time and effort in
visiting a business and
using its services
deserve to be
treated as welcome
guests (after all,
marketing invited
them there!)
Core

19. Customers prefer not to
worry about looking after
the personal possessions
that they bring with them
to a service site.
They may also want
delivery and after-sales
services for goods that
they purchase or rent
Core

20. Customers appreciate
some flexibility in a
business when they
make special requests.
They expect it
when not everything goes
according to plan
Core

22. • Select a service that you are familiar with
and identify the core product and
supplementary services.
• Identify a competitor’s service and show
how the competitor’s core product and
supplementary services differ from the
one you had originally identified.

23. Branding
Service Products

24.  Brands are more than just names and
symbols
 Brand represents consumer’s perception and
feeling about a product and its performance
 Brand exist in the minds
 Brand equity is the positive differential effect
that knowing the brand name has on
customer response to the product
 Strongest brands go beyond attribute or
benefit positioning and are positioned on
strong beliefs and values

25. 2.
25
Customer-Based Brand Equity
Pyramid
RESONANCE
SALIENCE
JUDGMENTS FEELINGS
PERFORMANCE IMAGERY
4. RELATIONSHIPS =
What about you and me?
3. RESPONSE =
What about you?
2. MEANING =
What are you?
1. IDENTITY =
Who are you?
Intense
Active
loyalty
Positive
Accessible
reactions
POPs and
PODs
Deep,
broad,
brand
awarenes
s
Stages of brand
development
Brand objectives at
each stage

26. CORPORATE
BRANDING
INDIVIDUALPRODUCT
BRANDING
“Branded House”
e.g.,Virgin Group
“HouseofBrands”
e.g.,Yum!Brands
Subbrandse.g.,
Raffles Classat
Singapore Airlines
EndorsedBrands
e.g.,Starwood
Hotels &Resorts

27.  Marriott Hotel
Brands
◦ Marriott Hotels
◦ Marriott Resorts
◦ Courtyard by Marriott
◦ Fairfield Inns
◦ Residence Inns
◦ SpringHill Suites
◦ TownePlace Suites
◦ Marriott Vacation
Clubs International
 British Airways Brands
Intercontinental
◦ First
◦ Club World
◦ World Traveller Plus
◦ World Traveller
European
◦ Club Europe
◦ Euro-Traveller
UK Domestic
◦ Shuttle

28.  Corporate umbrella brand
◦ Sun Microsystems
 Product line brand (system support services)
◦ Sun Spectrum Support
 Sub-brands (4 levels of support service
programs)
 Platinum
 Gold
 Silver
 Bronze

29. Sub-branding clarifies service levels offered at
different fees
◦ Platinum: “Mission Critical”
On-site service 24/7, two-hour response;
telephone support 24/7, onsite parts replacement;
additional services available
◦ Gold: “Business Critical”
Onsite service Mon-Fri 8am-8pm, four-hour response;
telephone support 24/7; onsite parts replacement
◦ Silver: “Basic Support”
Onsite service Mon-Fri 8am-5pm, four-hour response;
telephone support Mon-Fri 8am-8pm; onsite parts
replacement
◦ Bronze: “Self Support”
Phone support Mon-Fri 8am-5pm; parts replacement by
courier

31. New Service
Development

32.  Style changes– are highly visible, create excitement, motivate
employees
 Service improvements… modest changes
 Supplementary service innovations--adding new or improved
facilitating or enhancing elements
 Process line extensions--alternative delivery procedures
 Product line extensions--additions to current product lines
 Major process innovations--using new processes to deliver
existing core products in new ways with additional benefits
 Major service innovations--new core products for previously
undefined markets

33. Home
Delivery
Order food,
give address
Driver rings
doorbell
Pay driver,
take food Eat
Telephone
Restaurant
Drive-In
Restaurant
(Take Out)
See sign Order via
microphone
Get meal at
pickup, pay
Drive away,
eat later
Stop car at
order point
Fast-Food
Restaurant
(Eat In)
See sign Park and
enter
Order meal,
and pay
Pick up
meal
Find table
and eat
Clear table
and leave
Home
Catering
Arrange to
meet caterer
Plan meal,
pay deposit
Food and
staff arrive
Meal is
prepared
and served
Eat
Staff cleans
up; pay

34.  Customers can rent goods—use and return for a
fee— instead of purchasing them
 Customers can hire personnel to operate their own
or rented equipment
 Any new durable product may create need for after-
sales services (possession processing)
◦ Shipping
◦ Installation
◦ Problem-solving and consulting advice
◦ Cleaning
◦ Maintenance
◦ Repair
◦ Upgrading
◦ Disposal

35. Perform the
Work Oneself
Hire Someone
to Do the Work
Own a Physical Good Rent the Use
of a Physical Good
•• Hire a taxi or limousine
•• Send work to secretarial service
• Rent car and drive it
• Rent word processor and type
• Hire chauffeur to drive car
• Hire typist to use word processor
• Drive own car
• Type on own word processor

36.  Market synergy
◦ Good fit between new product and firm’s image/resources
◦ Advantage vs. competition in meeting customers’ needs
◦ Strong support from firm during/after launch
◦ Firm understands customer purchase decision behavior
 Organizational factors
◦ Strong inter functional cooperation and coordination
◦ Internal marketing to educate staff on new product and its
competition
◦ Employees understand importance of new services to firm
 Market research factors
◦ Scientific studies conducted early in development process
◦ Product concept well defined before undertaking field
studies