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1、1,Chapter 11 Services Marketing,2,Chapter 11,Skip Pricing Strategies (p. 297) Managing Service Quality (p. 301-end of chapter) Self-study: Scope of Services (p. 293-294),3,Definition of Services,Services are exclusive, intangible activities that are the main object of the transaction designed to pro
2、vide want-satisfaction to customers. Two classes of services:Core Services - Services that are the main purposes or object of the transaction, e.g., movie tickets (entertainment).Supplementary or Support Services - Services that support or facilitate the sale of a good or another service, e.g., rese
3、rvation center, credit card services.,4,Characteristics of Services,1. IntangibilityIt is impossible to sample a service before they buy it.Promotional strategies must suggest the service benefits:Visualization Association - connecting the service with a tangible good, person, object, or place. Phys
4、ical representationDocumentation - past performance and capabilityWeb sites can reduce intangibility by increasing the available information and thereby improves the customers understanding.,5,Characteristics of Services,2. InseparabilityServices cannot be separated from the creator-seller of the se
5、rvices.Services are created, given out, and consumed simultaneously.Inseparability limits distribution:Direct sale is the only possible channel.Direct contact is needed to sell service. Some services are sold by the intermediaries.,6,Characteristics of Services,3. HeterogeneityIt is difficult to sta
6、ndardize output of services because human factor in production and delivery e.g., Hair cut. It is difficult to forecast quality in advance of consumption or after service has been received.Management must ensure consistency of quality and to maintain high levels of quality control.,7,Characteristics
7、 of Services,4. PerishabilityService capacity cannot be stored or inventoried for future use.Perishability creates potential imbalances in supply and demand. The demand for many services fluctuates considerably e.g., movie ticket, hotel roomFluctuating demand poses challenges on promotion, product-p
8、lanning, scheduling, and pricing.,8,The Service Customer,Provider Market The contributors of money, labor, materials, or other resources to the organization. Client MarketThe recipients of money or services from the organization.,9,Selecting Target Markets,The psychological (motivation, perceptions,
9、 attitudes, personality) and the sociological factors (social classes and reference group) are more significant when marketing services than goods. This is because we cannot touch, smell, taste the service offered.,10,4Ps for services,Product Planning Pricing Structure Distribution System Promotiona
10、l Program,11,Product Planning,Services OfferingDifferentiation is key, however, differentiated feature should not be easily duplicated or will be quickly neutralized. Product-Mix StrategiesExpanding the linesContract/Prune services mixAltering its services offeringManaging the life cycle,12,Product
11、Planning,Product Features Branding of services is a problem because of the heterogeneity and intangibility characteristics. To create an effective brand image: Use a tangible object to communicate the brand image.Develop a memorable slogan to accompany the brand.Use a distinctive color scheme on all
12、 tangible aspects of the services.,13,Pricing Structure,Price Determination in For-Profit FirmsPrices are set based on costs plus desired profit or what customers are willing to pay. The demand for a service influences its price. Price Determination by NonprofitsProvider MarketPrice is set by contri
13、butors. Client MarketPrice is set by the organization.,14,Distribution System,Channels of DistributionThe channel for most services is short and simpleDirect distribution or one agent Short channels mean more control on the part of seller:Service marketers can reduce the heterogeneity or variance in
14、 the service. Distribution FacilitiesA convenient location is essential when a service requires personal interaction.,15,Promotional Program,Personal SellingService employees must be skilled at customer relations as well as capable of producing a quality service. All employees who come into contact
15、with a customer are part of organizations sales force.Service Encounter - a customers interaction with any service employees, or with any tangible element such as a services physical surroundings, e.g., ABAC.This influences a customers evaluation of a firm and its service. Internal Marketing - a vie
16、w that employees should be treated as a firms customers.,16,Promotional Program,AdvertisingThrough mass media, direct mail, and web site, a service firm can share information and reach target customers. Cause-Related Marketing - developing a relationship that generate sales for the firm and publicity for the nonprofit organization. Other Promotional MethodsSales promotion and publicity,
