Services

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Services

  1. 1. SERVICE MARKETING TRIANGLEService marketing triangle involves 3 types of marketing:1. EXTERNAL MARKETING2. INTERNAL MARKETING3. INTERACTIVE MARKETING 1. External Marketing: "Setting the Promise" · Marketing to END-USERS. · Involves pricing strategy, promotional activities, and all communication with customers. · Performed to capture the attention of the market, and arouse interest in the service. 2. Internal Marketing: "Enabling the Promise" · Marketing to EMPLOYEES. · Involves training, motivational, and teamwork programs, and all communication with employees. · Performed to enable employees to perform the service effectively, and keep up the promise made to the customer. 3. Interactive Marketing: (Moment of Truth, Service Encounter) · this refers to the decisive moment of interaction between the front-office employees and customers, i.e. delivery of service. · This step is of utmost importance, because if the employee falters at this level, all prior efforts made towards establishing a relationship with the customer, would be wasted.
  2. 2. SERVICE MARKETING MIX (7PS)Product: The term “product” used to describe either a manufactured good or service. Service products refer to an activity or benefit that a service provider offers to perform for customers. A product in service marketing mix is intangible in nature. Service product can not be measured as well as they are heterogeneous, perishable and can not be owned. Price: Pricing is one of the P’s in the marketing mix which has received much less attention in service firms. Pricing of services is tougher than pricing of goods. Thus, service marketers must set prices that target customers are willing and able to pay. Almost every service has its own price terminology, unlike in manufactured goods where price is not varied enough for different product items and market segments. Place: Place in case of services determine where the service product is going to be located. Services must be created and sold at the same time, since service delivery is concurrent with its production and cannot be stored or transported. Promotion: Services are easy to be duplicated therefore promotions are becoming a critical aspect in the service marketing mix. The promotion element of the services marketing mix forms a important role in communicating the positioning of the service to customers. Promotion provides significance to services by adding tangibility to service and help the customer make a better evaluation of the service.People: People are an essential ingredient in service provision; recruiting and training theright staff is required to create a competitive advantage. Customers make judgmentsabout service provision and delivery based on the people representing your organization.This is because people are one of the few elements of the service that customers can seeand interact with. The praise received by the volunteers (games makers) for the London2012 Olympics and Paralympics demonstrates the powerful effect people can createduring service delivery.Staff require appropriate interpersonal skills, aptititude, and service knowledge in orderto deliver a quality service. In the UK many organizations apply for the "Investors inPeople" Accreditation to demonstrate that they train their staff to prescribed standardsand best practices.Process: This element of the marketing mix looks at the systems used to deliver theservice. Imagine you walk into Burger shop and order a Whopper Meal and you get itdelivered within 2 minutes. What was the process that allowed you to obtain an efficientservice delivery? Banks that send out Credit Cards automatically when their customer’sold one has expired again require an efficient process to identify expiry dates and
  3. 3. renewal. An efficient service that replaces old credit cards will foster consumer loyaltyand confidence in the company. All services need to be underpinned by clearly definedand efficient processes. This will avoid confusion and promote a consistent service. Inother words processes mean that everybody knows what to do and how to do it.Physical Evidence (Physical Environment)Physical evidence is about where the service is being delivered from. It is particularlyrelevant to retailers operating out of shops. This element of the marketing mix willdistinguish a company from its competitors. Physical evidence can be used to charge apremium price for a service and establish a positive experience. For example all hotelsprovide a bed to sleep on but one of the things affecting the price charged, is thecondition of the room (physical evidence) holding the bed. Customers will makejudgments about the organisation based on the physical evidence. For example if youwalk into a restaurant you expect a clean and friendly environment, if the restaurant issmelly or dirty, customers are likely to walk out. This is before they have even receivedthe service.SummaryThe Service Marketing Mix involves Product, Price, Place, Promotion, People, Processand Physical Evidence. Firms marketing a service need to get each of these elementscorrect. The marketing mix for a service has additional elements because thecharacteristics of a service are different to the characteristics of a product.The Characteristics of a service are:(1) Lack of ownership(2) Intangibility(3) Inseparability(4) Perishability(5) Heterogeneity.To certain extent managing services are more complicated then managing products,products can be standardized, to standardize a service is more difficult as there it can beaffected by factors outside the service providers control.

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