The slideshow talks about basics of Service Marketing, meaning and characteristics of services, difference between products and services, 7Ps of service marketing

1. Department of MBA
IMS Engineering College,
Ghaziabad
Marketing of Services
UNIT 1
Introduction to Services Marketing

2. Definition of Services
• Kotler (1991) defined services as ‘Any act or
performance that one party can offer to another
that is essentially intangible and does not result in
the ownership of anything. Its production many
not be tied to a physical product’
• Zeithaml et al. (2006) defined services as ‘An act
or performance offered by one party to the other.
Although the process may be tied to a physical
product, the performance is transitory and often
intangible in nature and does not normally result
in ownership of any of the factors of production ’

3. Characteristics of Services
• Intangibility – Services are intangible (although
products are involved in service delivery)
• Inseparability – Services are produced (generated)
and consumed simultaneously e.g. cinema
• Variability – Service exhibit variability, there is
difficulty in achieving uniform output. E.g.
education
• Perishability – Services are perishable, they
cannot be stored e.g. medical services
• Lack of ownership – While consuming services,
customers get ‘experience’, they do not own
anything at the end.

4. Differences between
Products and Services
PRODUCTS
• Products are tangible, can be
held physically
• Products are manufactured
and consumed separately.
• Products exhibit
standardization. E.g. a
mobile phone of a particular
model will look same all
over the country
SERVICES
• Services are intangible,
cannot be held physically
• Services are produced
(generated) and consumed
simultaneously
• Services exhibit variability
ad lacks standardization.
Through employee training,
standardization can be
brought into services to an
extent

5. Differences between
Products and Services
PRODUCTS
• Products can be perishable
or durable, e.g. eatables are
perishable, furniture etc are
durable.
• When a consumer purchases
a product, the physical
product is ‘owned’ by the
consumer
SERVICES
• Services are perishable in
the sense that they cannot be
stored like products.
• When a consumer purchases
a service, he/she get service
experience only, nothing
physical is owned by the
consumer at the end.

6. Classification of Services
• Services can be classified into various categories as per
the following criteria:
 On the basis of tangibility – services can be purely
intangible or partially intangible. E.g. hotel services
involve products such as towels, bed sheets etc,
counselling is intangible
 On the basis of Skills of service provider – service
providers can be unskilled (sweeper, peon), semi skilled
(technician, driver) or skilled (doctor, chartered
accountant)
 On the basis of Involvement of human labour –
Services can be labour (people) based or machine based
(mechanized) e.g. legal services involve lawyer, so its
people based

7. Classification of Services
 On the basis of degree of customer contact – Customer
contact can be high / low e.g. in case of education
services, customer contact with service provider is high
(2 years for MBA), in case of banking, its low
 On the basis of customization – Services can be
customized or standardized e.g. in case of salon
services, customization is important while aviation
services are standardized
 On the basis of Customer / Employee presence –
Certain services cannot be given without the presence
of service provider. E.g. cab services. while some other
services are automated.

8. The Service marketing mix: 7Ps
• Product (service offering)
• Place
• Price
• Promotion
• People
• Process
• Physical evidence

9. The Service marketing mix: 7Ps
• The 4Ps were developed by E. Jerome McCarthy
in 1960, to these 4Ps, Booms and Bitner added
another 3Ps in Late 1970s – People, Process and
Physical Evidence
• ‘People’ in service marketing mix means the
human resource
• ‘Process’ in service marketing mix means the
sequence of activities that leads to service
outcome
• ‘Physical Evidence’ in service marketing mix
means the ‘packaging’ of the service, it refers to
tangibility in service

10. Present
Marketing Environment
• In the area of service marketing the following
changes / developments can be observed:
Services have become ‘customer centric’
Focus is on providing a seamless ‘experience’
Processes have become customer friendly and
convenient using technology
Methods of service delivery have undergone
drastic change e.g. online availability
Promotion of services has become creative and
digital marketing is being used more than ever

11. Strategies of Service Marketing
Service Focus
• Service marketing can be done in the following
ways:
Unfocussed marketing: wide market + wide range
or services e.g. LIC
Service focused marketing: wide market + narrow
range of services e.g. CCD
 Market focused marketing: narrow market +
wide range of services e.g. lakme salon
Fully focused marketing: narrow market + narrow
range of services e.g 5 star category of hotels

12. Strategies of Service Marketing
Service Differentiation
• Differentiation on the basis of benefit – e.g. hotels
offer facilities such as banquet, conference halls
• Differentiation on the basis of Price – e.g.
discounts, offer of complementary services etc
• Differentiation on the basis of physical attributes
(tangibility) – in case of cinema halls, plush
chairs, dolby digital sound system etc
• Differentiation on the basis of service personnel –
institutes claim the presence of foreign faculty,
industry faculty etc

13. Strategies of Service Marketing
Service Differentiation
• Differentiation on the basis of location – hotels
and resorts in tourist places make use of this
differentiation e.g. sea facing hotel
• Image differentiation – use of superlatives
such as largest, oldest, latest etc.