The document discusses the traditional and extended marketing mix used for services. The traditional mix includes product, price, place, and promotion. The extended mix adds people, process, and physical evidence. It then provides examples and details for each element of the marketing mix as applied to services.

2. Marketing Mix
 Traditional Marketing Mix
◦ Product
◦ Price
◦ Place
◦ Promotion
 Extended Marketing Mix
◦ People
◦ Process
◦ Physical Evidence

3. Product
Level 1
• CUSTOMER BENEFITS CONCEPT concerned with what benefits do
customers seek
Level 2
• Translated into SERVICE CONCEPT is concerned with what the general
benefits will the service offer
Level 3
• Translated into SERVICE OFFER make greater detailed shaping of the
service concept decisions on: service elements (tangible and intangible),
service forms(In what way or how) service levels (quality and quantity)
Level 4
• Translated into SERVICE FORMS
Level 5
• Translated into SERVICE DELIVERY SYSTEM

4. Example in Context of
Product
Level 1
• Research what benefits do customers seek……For example
Entertainment
Level 2
• What business we are in like Entertainment Such as Drama, Live
Theatre, Street Play, Musical Concert, Stand Up Comedy etc…
Level 3
• More specific like if music …then classical, western, devotional,
fusion as well as proportion of tangibles and intangibles
Level 4
• What forms…whether ticket basis or membership, weekly, bi-
weekly or daily or what other options
Level 5
• Relation between tangibles, employees and physical evidence

5. Price
Pricing of services is tougher than
pricing of goods. While the latter can be
priced easily by taking into account the
raw material costs, in case of services
attendant costs - such as labor and
overhead costs - also need to be
factored in. Thus a restaurant not only
has to charge for the cost of the food
served but also has to calculate a price
for the ambience provided.

6. Price Terminology for Service
SectorService Terminology
Theatre/ School Entry time Admission fees
Transport Fare
Education Tuition
Insurance Service Premium
Employee Service Salary
Labor Service Wages
Usage of Loan/Overdraft Interest
Utilities Tariff Charge
Property usage Rent

7. Major Pricing Strategies
 Discount Pricing
 Diversionary Pricing
 Guaranteed Pricing
 Loss leader Pricing
 High price Maintenance Pricing
 Offset Pricing
 Differential Pricing
◦ Customer’s ability to pay
◦ Price time differential
◦ Place Differential

8. Place (Distribution Channel)
Since service delivery is concurrent with its
production and cannot be stored or transported, the
location of the service product assumes
importance. Thus a holiday resort is better situated
in the countryside away from the rush and noise of
a city. Following distribution channel are used by
service operators to distribute their services:
Direct Distribution Channel
Indirect Distribution channel
Agent
Brokers
Franchisee
electronic channel

9. Examples of Distribution Channel for
Services

10. Promotion
Since a service offering can be easily replicated promotion
becomes crucial in differentiating a service offering in the
mind of the consumer. Following are the promotion tools
which is/are used by service organization:
Paid Forms of Communication
 Advertising
 Sales Promotion
 Direct Marketing
 Personal Selling
 Public Relations
 Publicity
 Non paid but also uncontrolled form of Promotion:
WOM

11. Examples of Promotion
Mix

12. People
People are a defining factor in a service delivery
process, since a service is inseparable from the
person providing it. Thus, a restaurant is known
as much for its food as for the service provided
by its staff. The same is true of banks and
department stores. So it becomes important for
service organization to educate its employees
and customers to educate to deliver the best
services. The below mentioned parties are
important to make the service delivery happen.
 Employees
 Customers

13. Process
The process of service delivery is crucial since it
ensures that the same standard of service is
repeatedly delivered to the customers and
customers are with service provider while delivering
the services. Therefore, most companies have a
service blue print which provides the details of the
service delivery process, often going down to even
defining the service script and the greeting phrases
to be used by the service staff. Service can be
described on the basis of the types of service
delivered and this is of three types:
Line Operation (Self service restaurants)
Job shop operation (Hospital)
Intermittent operation (Consultancy, Event
Management)

14. Physical Evidence
Since services are intangible in nature
most service providers strive to incorporate
certain tangible elements into their offering
to enhance customer experience. Thus,
restaurants invest heavily in their interior
design and decorations to offer a tangible
and unique experience to their guests.
Physical Evidence is basically divided into
two categories:
 Core Evidence
 Peripheral Evidence

15. Core Physical Evidence
Peripheral Physical
Evidence