4.5e-

• Service

  An intangible product
• Consumers of services do not actually take anything away with them after payment is made
• Goods


  Physical or tangible products
• Goods


  • Smartphones
  • Toys
  • Books
  • Clothes
• Difference between goods and services

  • Services are perishable
  • Services are heterogeneous
• Customers pay for services to fulfil their wants and needs
• Product differentiation


  Important for marketing of services
• Traditional marketing mix for physical goods

  • Price
  • Product
  • Promotion
  • Place
• Additional elements in marketing services


  • People
  • Processes
  • Physical evidence
• People


  Employees who interact with customers, delivering the services
• The provision of services relies on the input and commitment of willing and able employees
• It is important for service-orientated businesses to build good relationships and trust with their customers
• The reputation of a business largely depends on the training, motivation and communication skills of employees
• Effectiveness of people in marketing or delivering a service

  • Appearance and body language
  • Aptitudes and attitudes
  • Feedback
  • Efficiency
• Appearance and body language

  Customers create an image of the organisation based on physical appearance and body language of employees
• Examples of appearance

  • Uniforms
  • Formal business attire
• Aptitudes and attitudes


  Capabilities and conduct of employees
• If employees have positive attributes, customers will likely be happy with the service
• Positive customer experiences


  Affects the business positively with word-of-mouth and referral marketing
• Feedback


  Comments made by various stakeholder groups regarding the effectiveness of employees
• Methods of feedback

  • ‘Employee of the month’
  • Suggestion schemes
  • Records of customer complaints
• Efficiency

  Employees who don't keep customers waiting and don't make careless mistakes
• Staff training is important to ensure employees are efficient in their jobs
• Late deliveries and long waiting times are signs of poor customer care and operational inefficiencies
• Inadequacies make it more difficult for a business to market its goods and services
• The behaviour of people is not consistent and numerous factors affect their level of motivation
• Cultural variations


  Have a direct impact on how people interact with customers
• Cultural variations in customer interaction

  • Directly expressing disagreements is considered rude in some cultures
  • Eye contact norms vary by culture
  • Customer service practices differ by region
  • Formality in customer service varies by country
• Challenges in service marketing

  • Correcting mistakes
  • Measuring productivity
  • People management
• It can be difficult to correct mistakes made in the provision of service
• A poor corporate image caused by substandard customer service might not be irreversible
• Measuring the output of services can be difficult
• Devising strategies to reward staff who are most productive can be difficult
• The provision of services tends to be labour-intensive, which can be costly to an organisation
• The lack of motivation from just one worker could tarnish the reputation of the entire business