Services Marketing By Shivanand Bhandarkar,Sr.Lecturer,Srinivas School Of Management.

1. Services Marketing Shivanand Bhandarkar

2. Examples Of Service Businesses Airline Courier Hotel Banking Legal Service Education Retailing Beauty Saloon

3. Service A service is the action of doing something for someone or something. It is largely intangible (i.e. not material). A product is tangible (i.e. material) since you can touch it and own it. A service tends to be an experience that is consumed at the point where it is purchased, and cannot be owned since is quickly perishes.

4. Introduction to SERVICES 50% of Indian GDP comes from SERVICES.. Pure GOODS Pure SERVICES Combination of GOODS and SERVICES

5. Nature of services Inseparable Intangible Perishable Variability Right of ownership

6. GOODS and SERVICES Higher Intangibility: Though services have many tangible components, there is an element of the service which remains Intangible. This element is higher and more critical in case of many services.

7. GOODS and SERVICES Lack of ability to store them for future sale: This creates mismatches between the demand and supply of services. Greater Interaction between Customer and the service factory: As an observer /participant Greater Variability in service delivery: Lack of standardization of services in most of the service sectors.

8. GOODS and SERVICE Greater Variability among service customer’s expectation:

9. Service Experience A service experience is the best way to define “service” It is the sum of all encounters between customer and the service provider. It is appropriate to think of a service as an experience comprising many intangibles, processes and encounters.

10. Some other popular ways of looking at the services Moments of truth: CEO of Scandinavian Airlines- Mr. Jan Carlzon Servuction Model: popularized by Bateson: 2 components visible and invisible. As the service Theatre: Stephen Grove and Raymond Fisk Playing a role as per the script:

11. Classification of services The degree of tangibility of the service: some services are more tangible than others. Whether the service is directed at the consumer or his possessions The time and place of service delivery Level of customization versus standardization Formal or Informal relationship with the customer

12. Classification of Services Extent to which Demand and Supply fluctuate: Degree of Interaction with people:

13. STP- OR Strategic Aspects of Service Marketing STP= Segmentation, Target marketing and Positioning Example: Businessman who wishes to start a new business *Whom you want to market your service to? *There might be well defined segments already defined. Eg: GOA- Hotel Tourists and Business Travelers

14. STP Some commonly used segmenting variables are: *Type: *Age *Sexender *Preferences- Indoor or Outdoor *Income Level

15. Segmenting Institutional Customers Volume of purchase Amount of paperwork Decision making Types Price sensitive versus Quality sensitive Technically aware versus unaware Final users versus intermediate buyers

16. Segment Selection/Targetting A service marketer may be tempted to target all available segments, all at once. But usually this is not a good way to begin… Example: An entrepreneur from Udupi who decides to set up a restaurant serving south Indian food… Host of choices=south Indian food One Location=Bangalore One locality= Railway station

17. An Opposite View 30 restaurants in Bangalore of different kinds in different areas Test his resources Hamper his control Massive amount of loan Increasing chances of failure

18. Positioning for a selected Segment Once the target segment is clear, the service marketer has to position himself appropriately for that segment… Example: Mc Donald’s

21. Introduction to Service P’S PRODUCT PRICE PLACE PROMOTION PROCESS PEOPLE PHYSICAL EVIDENCE PRODUCTIVITY

23. Target Market Selection

24. Positioning

26. The service Product concept Theodore Levitt The service firm has to differentiate its services from that of its competitors to create its own position in the minds of the consumer

27. Product Concept Model Core Benefit Basic Service Product Expected Service Augmented Service Potential Service

28. Service Quality A lot of work is been done by 3 prominent thinkers PARASURAMAN ZEITHMAL BERRY All the three are professors at various business schools in America

29. SERVICE QUALITY They developed a questionnaire called SERVQUAL- to measure service quality And A MODEL for shortfall in service quality called GAPS Model

31. Access

32. Security

33. Credibility

34. Degree of customer understanding

36. SERVICE QUALITY Later they proposed that these TEN criteria can be reduced to five factors: Tangibles Reliability Responsiveness Assurance : ( Competence, credibility, courtesy and security) Empathy : (access, communication and understanding)

37. Service quality SERVICE QUALITY= PERCEPTION-EXPECTATION SATISFACTION=SERVICE RECEIVED-SERVICE EXPECTED Factors influencing a service customers expectations: Word of mouth communications from friends and acquaintances

38. SERVICE QUALITY Personal needs /preferences Past experience of the provider’s service External communication

39. GAPS MODEL Gap 1 : customer expectation minus service company’s understanding of these expectations Gap 2: Service Company’s understanding of customer expectations minus the standards set by the company Gap 3: Standards set minus actual delivery Gap 4 : The Actual Delivery minus external communication

40. Gaps model of Service Quality

41. Filling the GAPS Gap 1: Market Research, getting feedback from one’s own staff who interact with customers, quick and easy service recovery Gap 2 : If service design is clear, systematic and customer oriented. Gap two cannot be closed if physical evidence aspect of service quality is ignored.. Gap 3: Recruiting employees who have the right skill sets and attitude for the job. Even customer has a vital role to close this gap.

42. GAPS MODEL Gap 4: can be closed by not promising undeliverable quality through the company’s external communications through advertising or any other promotional tools.

43. The Zone of Tolerance

44. Delighting customers According to Dr. Darrel Edwards, a market researcher, a customer will be delighted when the customer satisfaction is very high. A delighted customer may become loyal to the brand in future. According to Kano, a researcher in the area of customer delight, a customer expects a service provider to fulfill the core benefits which he calls must-be-requirements.. Must-be-requirements+ some attractive requirements= customer delight.

45. Defects, Failures and Recovery Service defects in any part of the delivery process can lead to a failure of service. Usually , services are prone to failure, unless the provider is obsessive about service quality and takes a lot of precautions. Service Guarantees …do they work?

46. Service Guarantee challenge of providing good customer service is identifying ways to help customers understand that the products or services they receive are guaranteed by the company providing them. Customer service guarantees can be part of a customer service strategy and can be simply stated or very complex but either way, they communicate the company’s intent to stand behind the product or service they provide. Customer Service Guarantees are communicated in different ways. Sometimes there is a sign stating the written guarantee in the waiting room of a business, or it may be written in an informational pamphlet or incorporated into information shared on a businesses’ website. No matter the format, it is important to put a guarantee in writing so customers have a comfort level in using products or services.