2. Meaning of service
• A service is a non-material equivalent of goods. A service provision is an economic activity that
does not result in ownership and this is what differentiates it from providing physical goods.
• It is claimed to be a process that creates benefits by facilitating either a change in customers, a
change in their physical possessions, or a change in their intangible assets.
• Philip Kotler : “ A service is an act of performance that one party can offer to another that is
essentially intangible and does not result in the ownership of anything. Its production may or
may not be tied to a physical product.”
• Service industries vary greatly. Governments offers services through courts, employment
services, hospitals, military services, police and fire department, postal services, and schools.
Private non-for-profit organizations offers services through museums, charities, temples,
colleges, and hospitals. Large number of private business organizations offers services
though airlines, banks, hotels, insurance companies, consulting firms, medical and law
practices, entertainment companies, real state, retailing and so on.
3. Characteristics:
1. Intangibility:
do not have a physical existence.
Hence services cannot be touched, held, tasted or smelt.
2. Heterogeneity/Variability:
each service offering is unique and cannot be exactly repeated even by the same service provider.
While products can be mass produced and be homogenous the same is not true of services. the
service rendered by the same counter staff consecutively to two customers.
3. Perishability:
Services cannot be stored, saved, returned or resold once they have been used.
Once rendered to a customer the service is completely consumed and cannot be delivered to
another customer..
4. Inseparability/Simultaneity of production and consumption:
This refers to the fact that services are generated and consumed within the same time frame.
Eg: a haircut is delivered to and consumed by a customer simultaneously unlike, say, a takeaway
burger which the customer may consume even after a few hours of purchase.
5. Quality of work in not the quality of service.
4. Service marketing strategies
• Marketing strategies for service product are not very different form the
marketing strategies of goods because service organizations also operate
in same environmental variables as goods producing organization operate.
• Service organizations also adopt same marketing concept to satisfy
customers needs. They identify the target market and offer a marketing
mix strategies to the customers.
• Due to the distinct nature of service, service firms need to offer 3
additional marketing mix strategies to satisfy its customers.
• As a whole service marketing strategies can be termed as 7ps of marketing
mix that the service organizations offers to its customers to satisfy them.
6. Service marketing strategies
Product mix strategies:
services offerings
quality of service and
branding of service.
Firms needs to focus on
Service productivity
Differentiating service
Service image
7. Service marketing strategies
Price mix strategies:
i. one price,
ii. flexible pricing or
iii. competition based pricing strategy.
Normally service pricing needs to be based on the perceived delivery
value and perceived quality of service and perishable nature of service too.
8. Service marketing strategies
Place mix strategies:
• deciding on the
i. Place or location- based on customer convenience
ii. Selection of channel members
Normally the service is provided to the customer directly due to the
inseparability nature of service.
Some service like plumbing, cleaning, baby-sitting need to provide at
buyers location, other service like retailing, hotel, entertainment need to
be provided in a standard location, some service like insurance, share
brokering need to provide through use of agents.
9. Service marketing strategies
Promotion mix strategies:
Decisions regarding how to communicating service attributes to the
customers
Promotion strategies:
i. Personal selling
ii. Innovative advertising campaign
iii. Sponsorship
iv. Sales promotion
v. Public relation
10. Service marketing strategies
People mix strategies:
People mix strategy consists of three decisions:
i. decision regarding service personnel and
ii. Customers
iii. Profit
The relationship between employees, customers and profit is know as
service profit chain.
People mix strategy calls for
Employees Interactive
Marketing
External
Marketing
Customer
s
Company
Internal
marketing
11. Service marketing strategies
Physical evidence mix strategy:
• Physical evidence is the tool to demonstrate the service quality provided by
service provider.
• Decision on
i. Entry and exit
ii. Comfortable surrounding
iii. Decoration
iv. Furnishing
v. Reception counters and compartments
• hotels have elaborate decorations and beautiful gardens, dentist or doctors have
comfortable waiting rooms, airlines have unique dressed air hostesses, car
showroom have beautiful layout and decoration of showroom with beautifully
lighted rooms, banks have comfortable sofa sets and counters, all these are the
examples of physical evidence designed and created by service providers that
glances the evidence of quality that they provide.
12. Service marketing strategies
• Process mix strategy:
• procedures, mechanisms and flow of activities by which service is
acquired.
i. restaurants can be fast food, buffet, candlelight service.
ii. Hotels can be lodges, non-star, star.
• For choosing process strategy firms can pick any of the two options:
1. service differentiation based on delivery process,
2. service differentiation based on image.
