Marketing of Products and Services
Stephen A. Oyewole
Northcentral University
Prescott Valley, Arizona USA
Presentation Outline
 Evolution of Product and Service
 Global Service Marketing
 Legal Issues on Marketing of Products...
Evolution of Product
[Goods→ Product→ Service]
Goods: objects having the requisites of utility,
materialness, limitedness ...
What is Product?
Product is anything that can be offered in a market for attention,
acquisition, use, or consumption that ...
Product/ Service Design Logic (SDL)
Service design addresses the functionality and form of services
from the perspective o...
Legal Issues on Marketing of Products and Services
Issues over Truth and Honesty
 In the 1940s and 1950s, tobacco used to...
Legal and Ethical Issues Continue
Issues with Taste and Controversy
 The advertising of certain products may strongly off...
Establishing Culture of Legal and Ethical
Data Stewardship
 Senior managers such as board members, presidents,
Chief Info...
International Marketing Service
 International marketing service is defined as the
performance of business activities des...
Culture and Society Relationship
Culture
 Societal forces affecting the values, beliefs, and actions of a distinct
group ...
Global Economic Factors Sources of Economic Factors
 Differences in economic, political, legal, and cultural
systems.
 ...
Global Cultural Factors
 Geert Hofstede’s Culture Dimensions
 Power Distance: the inequality among the people of a natio...
Role of Culture in Consumers’ Service
National Culture
(Cultural Dimensions)
● Hofstede’s
● Hall’s
● Hofstede and Bond’s
●...
Self-Reference Criterion/Ethnocentrism
 Self-Reference Criterion (SRC) is an unconscious reference to
one’s own cultural ...
Benefits of Global Service Marketing
 The role of world trade and international service
marketing in producing peace.
• I...
Environmental Adaptation
 The most challenging and important adaptation
international marketers must make is cultural
adj...
Obstacles to Adaptation
 Adaptation is a conscious effort on the part of the
international marketer to anticipate the
inf...
Summary
• It is imperative for firms to pay attention to the global
environment in the wake of intense globalization of se...
References
 Alahmad, A. (2010). To be ethical or not to be: An international code of
ethics for leadership. Journal of Di...
References
 Hawkins, D., Best, R., and Coney, K. (2004). Consumer behavior:
Building marketing strategy (9th ed.). New Yo...
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Marketing of products and services

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  • This module will cover 9 major topics:
  • Goods implies consumption linked to aimless thrusts. Product is the direction of a preformed desire in a pre-constituted itinerary.Service is the elevated margins of freedom that offers the value proposition .
  • Product design as tools of sellingthe organization : Will the design be the selling point for the organization ?Quality has to consistent with other elements of the marketing mix. A premium based pricing strategy has to reflect the quality a product offersWhat features will you add that may increase the benefit offered to your target market? Products and services for personal consumption. (Tangible and Intangible)Brands have the power of instant sales, use strong brand to convey message of confidence, quality and reliability to their target market and pricing policy in offering additional benefits.
  • Products + Services = ExperiencesExperiences represent what buying the product or service will do for the customer Products, Services, and Experiences.Service-profit chain links service firm profits with employee and customer satisfaction,Internal service quality,Satisfied and productive service employeesGreater service value,Satisfied and loyal customers,Healthy service profits and growth.SDL promotes product quality includes level and consistency Quality level is the level of quality that supports the product’s positioning. SDL conform to quality in the product’s freedom from defects and consistency in delivering a targeted level of performance Individual Product and Service Decisions.
  • Issues over Truth and Honesty-The law permits "puffery" (a legal term) which is synonymous to fraud, and fraud is a slippery slope which can descend fairly quickly to lies and false advertising.Issues with violence, sex and profanity-The word innuendo is an insinuation or intimation about a person or thing, especially of a disparaging or a derogatory nature.In the latter sense, the intention is often to insult or accuse someone in such a way that one's words, taken literally, are innocent.
  • Taste and controversy- Some companies marketed themselves on the basis of controversial advertising - example Benetton.- Sony has also attracted criticism for unethical content (portrayals of Jesus which infuriated religious groups; racial innuendo in marketing and graffiti adverts in major US cities (Cole,2005).Negative AdvertisingNegative campaigning, also known as "mudslinging", is trying to winan advantage by referring to negative aspects of an opponent or of a policy rather than emphasizing one's own positive attributes or preferred policies. Negative campaigning can be found in most marketplaces where ideas are contested.
  • Important that data and database administrators as well as business analysts and software developers recognize and understand the issues surrounding IP both to ensure that their ideas can be protected and to ensure that other people’s rights are not infringed.IP is the product of human creativity in the industrial, scientific, literary, and artistic fields.Covers inventions, inventive ideas, designs, patents and patent applications, discoveries, improvements, trademarks, designs and design rights (registered and unregistered), written work (including computer software) and know-how devised, developed, or written by an individual or set of individuals.Two types of IP:Background IP – IP that exists before an activity takes place. Foreground IP - IP that is generated during an activity.
  • International marketing service is to plan, price, promote, and direct (marketing mix) the flow of a company’s goods and services to consumers for a profit. The only difference between the definitions of domestic servicemarketing and international service marketing is the “environment.” International service marketing, activities take place in more than one country. This difference in environment accounts for the complexity and diversity found in international marketing operations. The complexities include competition, legal restraints, government controls, weather, fickle consumers, economic conditions, technological constraints, culture etc.
  • The sphere of business transactions has extended with the beginning of the Internet. Global market has appeared in practice and miscellaneous specialties. The spectacular upturn in international business transactions has shaped a need for further cultural codes.  
  • The Google is a multinational organization. When a large and successful business attempted to grow their business into China, there were several factors to consider example disclosure limitations, disparities in labor laws and regulation corporate image.
  • The global market is the appearance of commerce activity in countries with different political centre.  Google faced diverse ethical problems in an effort to broaden her client base to China. However, google required making up moral rules in "resolving cross-cultural ethical controversy.
  • Hofstede’s classification was originally related to work values rather than consumer behavior and this identifies all the possible ways a service product are adapted to a new market, it also helps to segments its many dimensions into distinct of global service components.
  • Self-Reference Criterion (SRC) is cultural values, experiences, and knowledge as a basis for decisions. The risks of SRC are great. SRC can prevent marketing managers from being aware of cultural differences or from recognizing the importance of those differences. This will result in firms failing to recognize the need to take action, discounting the cultural differences that exist among countries, and reacting to a situation in a way offensive to your hosts. A common mistake made by Americans is to refuse food or drink when offered. In the United States, a polite refusal is certainly acceptable, but in Asia or the Middle East, a host is offended if you refuse hospitality. Although you do not have to eat or drink much, you do have to accept the offering of hospitality. Also, SRC influences the evaluation of the appropriateness of a domestically designed marketing mix for a foreign market.
  • Global commerce causes peace. Let us look at two companies that use their business to promote peace, at least indirectly. Boeing Company, with more than 11,000 commercial jets in service around the world and carrying about one billion travelers per year, engages in global marketing and peace when it sells its aircraft to airlines around the world. And, all the activity associated with the development, production, and marketing of commercial aircraft and space vehicles requires millions of people from around the world to work together. Building both business and personal relationships is the foundation of global peace and prosperity. Another company also making a difference, perhaps a subtler one than large multinational companies, but one just as important in the aggregate, is PeaceWorks. The company, that fosters a joint venture between Arabs and Israelis, creates gourmet food and has over 5000 stores in the U. S. Whether or not a U.S. company wants to participate directly in international business, there is one undeniable fact: international markets are ultimately unpredictable. In order to survive, organizations have to be flexible.
  • To be successful in the global marketplace, marketers must be able to effectively interpret the influence and impact of each of the uncontrollable environmental elements on the marketing plan for each foreign market in which they hope to do business. The most challenging and important adaptation global marketers must make is cultural adjustments. Because judgments are derived from experience that is the result of acculturation in the home country, marketers must have two strategies. Establish frames of reference and “culture conditioning.” Once a frame of reference is established, it becomes an important factor in determining or modifying a service marketer’s reaction to situations—social and even nonsocial. For example, “time” is not valued the same way in many countries. Also hand gestures vary between countries. Cultural conditioning is like an iceberg—we are not aware of nine-tenths of it. In study of product service marketing systems of different peoples, their political and economic structures, religions, and other elements of culture, foreign marketers must constantly guard against measuring and assessing the markets against the fixed values and assumptions of their own cultures.
  • The key to successful global service marketing is adaptation to the environmental differences from one market to another. Adaptation is a conscious effort on the part of the international marketer to anticipate the influences of both the foreign and domestic uncontrollable factors on a marketing mix and then to adjust the marketing mix to minimize the effects. Two primary obstacles to success in global service marketing are Self-Reference Criterion (SRC) and Ethnocentrism. They are explained in detail in the next few slides.
  • Resources
  • Marketing of products and services

    1. 1. Marketing of Products and Services Stephen A. Oyewole Northcentral University Prescott Valley, Arizona USA
    2. 2. Presentation Outline  Evolution of Product and Service  Global Service Marketing  Legal Issues on Marketing of Products and Services  Culture and Society Relationship.  Global Economic/Cultural factors.  Role of Culture in Consumers’ Service.  Self-Reference Criterion/Ethnocentrism.  Benefits of Global Service Marketing.  Environmental Adaptation.  Resources.
    3. 3. Evolution of Product [Goods→ Product→ Service] Goods: objects having the requisites of utility, materialness, limitedness and accessibility. Product: set of tangible and intangible attributes for procuring a benefit to a user/consumer. Service: capacity for orienting the information variety of a context to the advantage of the interlocutor (Vargo & Lusch, 2010).
    4. 4. What is Product? Product is anything that can be offered in a market for attention, acquisition, use, or consumption that might satisfy a need or want.  Product Design  Product Quality  Product Features  Product Branding What is Service ? Service’ is recognized as the common denominator of exchange.  Service Design/Quality/Features/Branding
    5. 5. Product/ Service Design Logic (SDL) Service design addresses the functionality and form of services from the perspective of clients. It aims to ensure that service interfaces are useful, usable, and desirable from the client’s point of view and effective, efficient, and distinctive from the supplier’s point of view.  Services Marketing  Internal marketing  Managing service quality SDL is the innovation model governed by different service categories and points out the roles of corresponding service design based on the statement that service innovation is the process of value creation.
    6. 6. Legal Issues on Marketing of Products and Services Issues over Truth and Honesty  In the 1940s and 1950s, tobacco used to be advertised as promoting health. Today an advertiser who fails to tell the truth not only offends against morality but also against the law. Issues with Violence, Sex and Profanity  Sexual innuendo is a mainstay of advertising content (Hawkins, Best, & Coney, 2004, p.732), and yet is also regarded as a form of sexual harassment.  Violence is an issue especially for children's advertising and advertising likely to be seen by children.
    7. 7. Legal and Ethical Issues Continue Issues with Taste and Controversy  The advertising of certain products may strongly offend some people while being in the interests of others (Waller, 2003). Examples include: feminine hygiene products, hemorrhoid and constipation medication.  The advertising of condoms has become acceptable in the interests of AIDS-prevention, but are nevertheless seen by some as promoting promiscuity. Negative Advertising  Negative advertising techniques, such as attack ads. In negative advertising, the advertiser highlights the disadvantages of competitor products rather than the advantages of their own.  The methods are most familiar from the political sphere. Democrats and Republicans
    8. 8. Establishing Culture of Legal and Ethical Data Stewardship  Senior managers such as board members, presidents, Chief Information Officers (CIOs), and data administrators are increasingly finding themselves liable for any violations of these laws.  Steps to consider include -  Develop an organization-wide policy for legal and ethical behavior.  Professional organizations and codes of ethics.  Intellectual Property (IP)
    9. 9. International Marketing Service  International marketing service is defined as the performance of business activities designed to plan, price, promote, and direct the flow of a company’s goods and services to consumers or users in more than one nations for a profit (Alahmad, 2010).  The difference in an online, interstate, and export marketing is the “environment”  Competition, legal restraints, government controls, weather, fickle consumers, economic conditions, technological constraints, infrastructure concerns, culture, and political situations.
    10. 10. Culture and Society Relationship Culture  Societal forces affecting the values, beliefs, and actions of a distinct group of people.  Society is a broad group of people and other organizations, interest groups, a community, a nation. Business and society interrelate in a macro environment as stakeholders. Society as the Macro-environment Culture Four segments of the Macro-environment Culture  Social environment culture focuses on demographics, lifestyles and social values.  Economic environment culture focuses on the economy.  Political environment culture focuses on the legislative process, election process and the interaction between firms, politics and government.  Technological environment culture focuses on the changes in technological advancement.
    11. 11. Global Economic Factors Sources of Economic Factors  Differences in economic, political, legal, and cultural systems.  Global Economic Interdependence  Regional trade and political alliances  NAFTA, EU, WTO  Global Productivity and Strategic Management  Issue: How to increase organizational effectiveness and performance (productivity) in the face of global influences and foreign competition.
    12. 12. Global Cultural Factors  Geert Hofstede’s Culture Dimensions  Power Distance: the inequality among the people of a nation.  Individualism: the extent to which people prefer to act as individuals instead of members of groups.  Masculinity/Femininity: the degree to which “masculine” service values prevail over “feminine” service values.  Uncertainty Avoidance: the preference of people in a country for service structured rather than unstructured situations.  Long-Term Orientation: the preference for long-term service values emphasizing the future as opposed to short-term service values focusing on the present.
    13. 13. Role of Culture in Consumers’ Service National Culture (Cultural Dimensions) ● Hofstede’s ● Hall’s ● Hofstede and Bond’s ● Schwartz’s ● Others Consumer Service Experience Dimensions Service Expectations Evaluations of Service ● Confirmation/Disconfirmation ● Satisfaction/Dissatisfaction Reactions to Service ● Word of Mouth/Complaint behavior ● Loyalty/Switching behavior
    14. 14. Self-Reference Criterion/Ethnocentrism  Self-Reference Criterion (SRC) is an unconscious reference to one’s own cultural values, experiences, and knowledge as a basis for decision.  Risk of SRC:  Prevent you from becoming aware of cultural differences.  Influence the evaluation of the appropriateness of a domestically designed marketing mix for a foreign market.  The notion that people in one’s own company, culture, or country know best how to do things.  Risk of Ethnocentrism:  Impedes the ability to assess a foreign market in its true light.  Ethnocentrism is generally a problem when managers from affluent countries work with managers and markets in less affluent countries. The risk of ethnocentrism is that it impedes the ability to assess a foreign market in its true light.
    15. 15. Benefits of Global Service Marketing  The role of world trade and international service marketing in producing peace. • International marketing promotes peace and prosperity through the marketing of products and services that meet the needs and wants of customers in other lands. • Two examples – Large Multinational – Boeing – Small Multinational – Peace Works
    16. 16. Environmental Adaptation  The most challenging and important adaptation international marketers must make is cultural adjustments.  Must establish a frame of reference.  Time-conscious Americans vs. Time-is-not-an- asset thinking Latin Americans.  Hand gestures vary between countries  “Cultural Conditioning” – be aware of home cultural references before making decisions.
    17. 17. Obstacles to Adaptation  Adaptation is a conscious effort on the part of the international marketer to anticipate the influences of both the foreign and domestic uncontrollable factors on a marketing mix and then to adjust the marketing mix to minimize the effects.  Two primary obstacles are:  Self-Reference Criterion (SRC)  Ethnocentrism
    18. 18. Summary • It is imperative for firms to pay attention to the global environment in the wake of intense globalization of service markets and competition. • The difference between domestic service marketing and global service marketing is the environment that consist of laws, customs, and cultural differences. • Key obstacles to successful international service marketing are self-reference criterion (SRC) and Ethnocentrism. • Global awareness and sensitivity are solutions to the obstacles of SRC and ethnocentrism. • Firms must have global orientation – the world is seen as one market.
    19. 19. References  Alahmad, A. (2010). To be ethical or not to be: An international code of ethics for leadership. Journal of Diversity Management, 5(1), 31-35. Retrieved from http://www.search.proquest.com.proxyl.ncu.edu  Executive concepts in business strategy (VitalSource Bookshelf electronic version). (2010). Boston, MA: Pearson Learning Solutions  Fugate, D. L. (2008). Marketing services more effectively with neuromarketing research: A look into the future. The Journal of Services Marketing, 22 (2), 170-173. http://search.proquest.com.proxy1.ncu.edu  Hamilton, J., Knouse, S., & Hill, V. (2009) Google in China: A manager- friendly heuristic model for resolving cross-cultural ethical conflicts. Journal of Business Ethics, 86(2), 143-157. Retrieved from http://www.proquest.com
    20. 20. References  Hawkins, D., Best, R., and Coney, K. (2004). Consumer behavior: Building marketing strategy (9th ed.). New York: McGraw-Hill Irwin.  Hofstede, G., Neuijen, B., Ohayv, K., Daval, D. & Sanders, G. (1990). Measuring organizational cultures: A qualitative and quantitative study across twenty cases. Administrative Science Quarterly, 35 (2), 286. Retrieved from http://proxy1.ncu.edu  Klinefelter, G. (2008). Corporate ethics: the business code of conduct for ethical employees. Review of Choice, 45(10), 1699. Retrieved from http://www.proquest.com  Vargo, S. and Lusch, R. (2010). It's all B2B…and beyond: Toward a systems perspective of the market. Retrieved from www.sciencedirect.com

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