Service Marketing Chapter 1

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Questions and Answers

What does service marketing primarily focus on the exchange of?

Customer information

Intangible services (correct)

Tangible goods

Physical products

How is marketing defined in the context of service marketing?

A method of production management

A sales-focused transaction process

A social and managerial process for exchanging value (correct)

Creating products exclusively for sale

Which of the following is not a characteristic of service marketing?

Intangibility

Inseparability

Perishability

Standardization (correct)

What is a primary focus of service management in the context of service marketing?

Solving marketing problems associated with services Signup and view all the answers

What does Philip Kotler emphasize in his definition of marketing?

Creating genuine customer value Signup and view all the answers

Which term best explains the nature of the service marketing exchange process?

Service-centric Signup and view all the answers

Which approach can be used to classify services?

By the degree of customer contact Signup and view all the answers

What is a significant problem associated with the intangible nature of services?

Inconsistency in service delivery Signup and view all the answers

What is essential for an organization to succeed in competitive markets?

Scanning the environment Signup and view all the answers

Which aspect is included in the micro environment analysis?

Vision and mission statements Signup and view all the answers

Which of the following can negatively impact the value for money offering?

High interest rates Signup and view all the answers

What does SWOT analysis primarily focus on?

Internal strengths and weaknesses, and external opportunities and threats Signup and view all the answers

How does the market environment analysis contribute to an organization's strategy?

It provides insights into customers, competitors, suppliers, and intermediaries. Signup and view all the answers

What are strengths in a SWOT analysis classified as?

Internal capabilities that assist in achieving objectives Signup and view all the answers

What should be a focus area in analyzing the macro environment?

Overall economic conditions and societal trends Signup and view all the answers

What might cause an increase in customer demand?

Lower interest rates Signup and view all the answers

Which category does a toothpaste fall under in the goods-versus-service continuum?

Pure tangible good Signup and view all the answers

What is an example of a core service with accompanying minor goods and services?

Airlines Signup and view all the answers

What characteristic distinguishes equipment-based services from people-based services?

Automation capabilities Signup and view all the answers

In which level of service classification does consumer presence play a critical role?

Level 2: Degree of dependence on consumer presence Signup and view all the answers

What type of service is provided by law firms?

People-based service Signup and view all the answers

Which of the following best describes hybrid service offers?

A combination of tangible goods with accompanying services Signup and view all the answers

Which of the following is an example of a pure service?

Medical services Signup and view all the answers

What does personal versus business use classification refer to?

The primary audience of the service Signup and view all the answers

What role do the staff of an organization play in service delivery?

Their actions directly affect the quality of the service. Signup and view all the answers

Which of the following describes the 'Process' aspect of service delivery?

It determines how customer needs are satisfied in real time. Signup and view all the answers

What is one of the purposes of the various terms used for pricing in services?

To cover costs and generate profits. Signup and view all the answers

In what way does 'Promotion' function within a service organization?

It effectively communicates benefits to the target audience. Signup and view all the answers

How is the nature of the service defined?

It is the performance that can be offered by one party to another. Signup and view all the answers

What does the 'Place' component of services depend on?

The nature of the service and customer preferences. Signup and view all the answers

Which of the following best describes 'Tangible evidence' of a service?

Brochures and other materials that showcase the service. Signup and view all the answers

What does the 'Service delivery exchange process' consist of?

Interactions between the service provider and customers on two levels. Signup and view all the answers

What is considered a weakness in the company's SWOT analysis?

Relatively low advertising and promotions budget Signup and view all the answers

Which of the following factors is categorized as an opportunity for the company?

Economic climate Signup and view all the answers

Identify the threat that could potentially impact the company's performance.

Channel pressure Signup and view all the answers

What does the term 'product' refer to in the context of service marketing?

The technical outcome of the service Signup and view all the answers

What is a common limitation associated with the internal capabilities of a company?

Need for diverse manufacturing skills Signup and view all the answers

Which characteristic of services emphasizes that they cannot be physically experienced?

Intangibility Signup and view all the answers

Which of the following elements is not part of the 7Ps of service marketing?

Planning Signup and view all the answers

How can changes in the macro environment affect a company?

Due to shifts in technology, economics, and politics Signup and view all the answers

What is a common problem associated with inseparability in service delivery?

Physical connection to the service Signup and view all the answers

What is a significant characteristic of service that distinguishes it from products?

Intangibility Signup and view all the answers

Which solution is suggested for addressing the perishability of services?

Utilize part-time employees during peak demand Signup and view all the answers

What issue does heterogeneity primarily present in service delivery?

Difficulty in standardising service delivery Signup and view all the answers

Which aspect of the 7Ps relates to how customers perceive the delivery of a service?

Physical evidence Signup and view all the answers

What is a key external factor threatening a company's performance?

Emerging competitors Signup and view all the answers

Which of the following is NOT a solution for addressing the issues of intangibility?

Ensure effective customer management Signup and view all the answers

What is a common solution for problems arising from high demand in perishability?

Offering differential pricing Signup and view all the answers

In terms of customer involvement, where does the challenge of inseparability lie?

Interaction levels vary among customers Signup and view all the answers

Which of the following best describes a strategy associated with heterogeneity?

Customisation of services Signup and view all the answers

What complication arises from the perishability of services?

Difficulties in inventory management Signup and view all the answers

Which of these characteristics means that services are produced and consumed simultaneously?

Inseparability Signup and view all the answers

Study Notes

Chapter 1: Service Marketing in Perspective

Learning Outcomes:
- Explain service marketing exchange processes and their relationship with information needs.
- Define the concept of "service."
- Differentiate between marketing physical goods and intangible services.
- Discuss various service classification approaches.
- Identify unique characteristics of services.
- Explain the marketing problems and solutions associated with service characteristics.
- Provide practical examples and solutions to marketing problems discussed in the chapter.

Introduction

Marketing is the art of creating genuine customer value and helping customers become better off.
- Key watchwords are quality, service, and value.

Overview: Basic Concepts of Service Marketing

Service Marketing Exchange Process: A complex process where organizations identify customer expectations and find innovative ways to meet their needs.
- Factors affecting value proposition: Rising petrol prices, high interest rates, lower disposable income, and more demanding customers.

Three Environments

Micro-environment: Organization's vision, mission, competencies, and capabilities.
Market environment: Focus on customers, competitors, suppliers, and intermediaries.
Macro-environment: Economic, political, legal, social, and technological factors.

SWOT Analysis

Strengths:
- Market leadership in specific segments (e.g., dry cat food, luxury pet food).
- Strong brand recognition and global position in food technology.
- Extensive global grocery distribution networks.
- Strong market leadership in several regions (e.g. France, Italy, Spain).
Weaknesses:
- Excessive product range with brands of varied volume.
- Limited marketing budget.
- Manufacturing capabilities related to product range.
- Limited retail presence in some key markets.
- Weak profit performance.
Opportunities:
- Economic conditions.
- Demographic shifts.
- Market trends.
- Technological advancements.
Threats:
- Competitive pressures.
- Pressure on distribution channels.
- Demographic shift.
- Political factors.

Service Marketing Mix (7Ps)

Product: The technical outcome of the service, the "what" of the service (tangible or intangible).
Physical Evidence: Tangible cues reflecting service quality (e.g., brochures, facilities). Hard to assess before consumption.
People: Staff involved in service delivery directly impacting quality.
Process: Customer experience, how the service satisfies needs (real-time).
Place: Service distribution channels. Dependent on service nature and customer value.
Pricing: Different terms related to pricing (e.g., charges, rents, commissions). Designed to cover costs and make a profit.
Promotion: Communication to the target audience on the benefits of the service and how to influence knowledge, attitudes, and behaviour.

Defining Services

Services are acts or performances offering intangible value.
- Their production may or may not be tied to a physical product.

Goods-Versus-Service Continuum

Pure Goods: Tangible products with minimal service.
Hybrid: Offers some combination of goods and services.
Pure Services: Primarily intangible, focusing on service delivery.

Classification of Services

Level 1: Means of delivery (equipment or people-based).
Level 2: Degree of dependence on consumer presence.
Level 3: Personal vs. business use.

Distinguishing Features of Services

Intangibility: Services are not physical products, making it hard to store or patent them.
Inseparability: Services are often produced and consumed simultaneously, making staff critical.
Heterogeneity: Service quality varies based on provider and circumstances.
Perishability: Services cannot be stored for later use.

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Description

This quiz covers the key concepts of service marketing as outlined in Chapter 1. You will explore the unique characteristics of services, the differences between marketing physical goods and services, and the challenges faced in service marketing. Practical examples will help solidify your understanding of the theoretical concepts discussed in this chapter.