Services Marketing Concepts PDF

Lesson 1 SERVICES MARKETING Part 3 Designing the Service Setting IMPORTANT CONCEPTS (Service Environment) Part 1. Introduction to Services Marketing Importance of Service En...

Lesson 1 SERVICES MARKETING Part 3 Designing the Service Setting IMPORTANT CONCEPTS (Service Environment) Part 1. Introduction to Services Marketing Importance of Service Environments (Servicescape)  Definition: The physical surroundings in which What is Services Marketing? service encounters take place. Definition: Marketing of intangible services, as opposed  Impact on customer perceptions, behavior, and to physical goods. satisfaction. Key focus: Delivering value through experiences rather than tangible products. Components of the Servicescape  Ambient Conditions: Background characteristics Differences between Goods and Services like lighting, music, scent, temperature.  Intangibility - Services cannot be touched, tasted,  Spatial Layout: Arrangement of equipment, or stored. furniture, and spaces to facilitate service delivery.  Inseparability -Production and consumption  Signs, Symbols, and Artifacts: Visual cues that occur simultaneously. communicate the service brand and purpose (logos,  Variability -Quality can differ from one service décor). encounter to another.  Perishability -Services cannot be stored for later Role of Atmospherics in Service Marketing use or sale.  Creating emotional connections through the physical environment. Importance of Services Marketing  How a well-designed servicescape can reduce  The service sector dominates modern economies customer anxiety (healthcare waiting rooms). (e.g., tourism, healthcare, education).  Services marketing emphasizes customer Part 4 Customer Experience and Service Quality satisfaction and loyalty. What is Customer Experience? Part 2 The Service Marketing Mix (7Ps)  Total of all interactions a customer has with a service provider. Traditional 4Ps for Products  Importance of managing customer touch points  PRODUCT - In services, this refers to the (before, during, and after the service encounter). Intangible service being offered (healthcare, transportation) Service Quality Dimensions (SERVQUAL Model)  PRICE - Strategies for pricing services (demand-  Reliability -Ability to perform the promised based pricing, cost-plus pricing). service dependably and accurately.  PLACE - Distribution channels for services,  Assurance -Employees' knowledge, courtesy, and focusing on accessibility and convenience (online ability to inspire trust. services).  Tangibles -The appearance of physical facilities,  PROMOTION - Communication strategies to equipment, personnel. inform and attract customers (advertising)  Empathy -Providing caring and individualized Extended 3Ps for Services attention.  PEOPLE - The employees and customers  Responsiveness -Willingness to help customers Involved in the service delivery and provide prompt service.  PROCESS - The flow of activities that produce and deliver the service (service blueprinting) Part 5 Managing Service Employee  PHYSICAL EVIDENCE - Tangible elements (The People Factor) that help customers evaluate the service (facility design, service uniforms). Role of Frontline Employees in Service Delivery - Frontline staff directly impact customer Why the 7Ps Matter? satisfaction and perception of service quality. These elements work together to create a holistic service - The service-profit chain: Employee satisfaction offering and customer experience. leads to customer satisfaction and loyalty. Strategies for Managing Service Personnel Lesson 2 Services Marketing tailored  Training and Development -Regular training on to the Philippine Setting service skills, communication, and handling customer complaints.  Employee Empowerment -Giving employees the Important Note: authority to make decisions in real-time. List of services marketing lessons tailored to the  Motivation Techniques -Reward systems, Philippines business setting, considering: recognition programs, and fostering a positive  Local Consumer Behavior work environment.  Economic Factors  Unique Market Characteristics Part 6 Service Failure and Recovery 1. Adapting to Filipino Customer Service Expectations Understanding Service Failure Filipino consumers highly value warmth, respect, -A breakdown in service delivery that leads to customer and personalized service. Companies should train dissatisfaction (e.g.. delays, miscommunication). employees to greet customers warmly, use courteous language, and address specific needs, creating a Importance of Effective Service Recovery hospitable service atmosphere. Emphasizing a "family- -A well-handled recovery can turn a dissatisfied like" service approach helps build loyalty. customer into a loyal one. 2. Leveraging Social Media for Customer Engagement Types of Service Recovery: With high social media usage in the Philippines,  Compensation -Offering discounts, refunds, or businesses can actively engage with customers on upgrades to apologize for poor service. platforms like Facebook and Instagram. Sharing customer  Empathy -Demonstrating understanding and care testimonials, handling complaints promptly, and offering about the customer's concerns. special promotions through these channels can enhance  Follow-Up -Checking in with the customer after customer satisfaction and reach. resolving the issue to ensure satisfaction. 3. Effective Service Recovery Strategies Service Recovery Paradox Filipinos are often forgiving if businesses show Customers who experience a service failure and receive a genuine concern and make prompt efforts to correct satisfying recovery may end up more loyal than customers service failures. Offering timely apologies, clear who never had an issue. explanations, and fair compensation can help businesses recover from mistakes and build stronger relationships Part 7 Building Customer Loyalty with customers. through Service Quality 4. Building Strong Community Connections Customer Loyalty in Services Community engagement is a powerful tool in the -How consistent service quality fosters long-term Philippines, where relationships and community ties are relationships with customers. strong. Businesses can build brand loyalty by participating in local events, supporting community Loyalty Programs causes, or partnering with local organizations, enhancing -Using rewards programs, exclusive offers, and trust and recognition. personalized experiences to retain customers. 5. Flexible Payment and Service Options Key Drivers of Customer Loyalty: With a mix of economic backgrounds in the country, flexible payment options (e.g., installment plans,  Trust -Delivering reliable and consistent service cash-on-delivery, digital wallets like GCash and builds trust. PayMaya) can make services more accessible to a wider  Emotional Connection -Creating personalized, range of customers. This flexibility helps businesses cater memorable experiences. to diverse income levels and preferences.  Customer Engagement - Encouraging feedback and involvement in the service process. 6. Localized Digital Marketing and Search Engine 13. Innovating with Filipino-Centric Services Optimization (SEO) Offering services that cater specifically to Given the growth in online service inquiries, Filipino tastes, values, and traditions can create a strong businesses can use localized SEO strategies to attract connection with customers. For example, local food Filipino customers. Using local dialects, promoting delivery businesses can include traditional Filipino dishes relevant holidays or events (e.g., Christmas or fiestas), and desserts in their menu options, or banks can offer and listing services on local platforms can improve savings plans tailored for OFWs and their families. visibility in local searches. 7. Providing Services for OFW Families Many 14. Integrating Cashless and Contactless Payment Filipino families have members working abroad Systems (Overseas Filipino Workers). Businesses can cater to this With digital payment usage on the rise, segment by offering services tailored to OFWs and their integrating systems like GCash, PayMaya, or online families, such as secure remittance services, package banking can improve convenience. This is especially delivery, or financial advisory services, recognizing the useful for younger customers or tech-savvy users who unique needs of this demographic. prefer digital transactions over cash. 8. Managing Service Demand During Seasonal Peaks 15. Offering Bilingual Service Options Businesses in the Philippines experience demand surges during holidays, especially around Christmas and Providing service in both Filipino and English, New Year. Planning for increased staffing, offering early especially for customer support or informational promotions, and using appointment systems during peak materials, can ensure clear communication across various periods can improve service quality and prevent demographic segments, enhancing customer comfort and overcrowding. satisfaction. 9. Using Influencers and Celebrity Endorsements Lesson 3 Filipinos are influenced by celebrities and local TERMS related to SERVICES MARKETING influencers. Partnering with trusted personalities can effectively promote services, build credibility, and reach The following terms are fundamental for understanding target audiences, especially in industries like food, Services Marketing concept, along with their definitions: hospitality, and health.  Service: An intangible offering that involves a 10. Emphasizing Cleanliness and Safety Standards deed, performance, or effort that cannot be Especially since the COVID-19 pandemic, physically possessed, aimed at satisfying customer cleanliness and safety are crucial concerns for Filipino needs. customers. Clear communication of safety measures, well-maintained facilities, and visible sanitization efforts  Service Marketing: The process of promoting and can reassure customers and build trust, particularly in selling intangible services, as opposed to tangible industries like food, healthcare, and transportation. goods, focusing on creating and maintaining relationships with customers. 11. Promoting Sustainable and Socially Responsible Services  Service Quality: A measure of how well the Many Filipino consumers, especially younger service delivered meets or exceeds customer generations, appreciate brands that contribute positively expectations. It is often evaluated through factors to society. Businesses can promote eco-friendly practices like reliability, assurance, tangibility, empathy, and (like reducing plastic) and support social causes to attract responsiveness. customers who value sustainability and corporate social responsibility.  Intangibility: The characteristic of services that means they cannot be seen, touched, or owned, making it challenging for customers to evaluate 12. Creating Loyalty Programs for Repeat Customers before purchase. Loyalty programs are effective in the Philippines, where discounts, rewards, and points are highly valued.  Inseparability: A unique attribute of services Offering special perks, loyalty points, or discounts to which means production and consumption occur repeat customers can encourage them to keep coming simultaneously, often involving direct interaction back and recommend the service to others. between the service provider and the customer.  Perishability: The characteristic that services encouraging them to continue using the company’s cannot be stored for later sale or use. Once a service services. is delivered, it cannot be stored or inventoried.  Brand Loyalty: The degree to which a customer  Variability (or Heterogeneity): The tendency of prefers a particular brand over competitors due to services to be different each time they are delivered positive experiences and satisfaction. due to human involvement in service delivery, which can lead to inconsistencies in quality.  Relationship Marketing: A strategy focused on building long-term relationships with customers  Service Encounter: The interaction between a rather than focusing solely on individual customer and a service provider, often referred to transactions, emphasizing customer loyalty and as the "moment of truth," which greatly influences satisfaction. the customer’s perception of the service.  Physical Evidence: Tangible elements (e.g.,  Customer Experience: The overall perception and service environment, branding materials, staff feeling customers have about their interactions with appearance) that help customers form impressions a company, including service encounters, products, of a service. and brand reputation.  Gap Model of Service Quality: A framework that  Service Blueprinting: A detailed mapping of the identifies gaps between customer expectations and service process that highlights steps in the customer perceptions of service, helping companies improve experience, allowing businesses to identify areas service quality. for improvement.  Service Differentiation: Creating unique aspects  Customer Relationship Management (CRM): A of a service to make it stand out from competitors, strategy for managing a company’s interactions often a crucial strategy in competitive markets. with current and potential customers, focusing on improving customer satisfaction, loyalty, and  People, Process, and Physical Evidence: retention. Additional elements of the marketing mix (in addition to product, price, place, and promotion)  Internal Marketing: Efforts aimed at training and crucial in services marketing to manage the motivating employees to provide excellent service, customer experience. recognizing that satisfied employees are more likely to deliver high-quality customer service.  Service Innovation: The development of new or improved services to meet evolving customer  Service Failure: An instance when a service does needs,enhancing value and maintaining not meet the customer’s expectations, resulting in competitiveness. dissatisfaction.  Word of Mouth (WOM): Recommendations and  Service Recovery: Actions taken by a company to information shared between customers about a rectify a service failure, which may include service, which can significantly influence the compensation, apologies, or other solutions to buying decisions of others. regain customer trust and satisfaction.  Customer Satisfaction: A measurement of how  Moment of Truth: Any instance when a customer well a service meets or surpasses customer interacts with a company and forms an impression expectations. High customer satisfaction often about its service quality. leads to loyalty and positive word-of-mouth.  Value Proposition: The unique benefits or value a  Touchpoints: Any points of interaction between service provides to customers, setting it apart from the customer and the company, which can include competitors. pre-purchase research, the purchase process, and post-purchase support.  Customer Retention: The practice of keeping existing customers engaged and satisfied,  Service Environment (Servicescape): The physical environment where service transactions occur, including layout, ambiance, and design, which influences customer perceptions and behaviors.  Demand Management: Techniques used by service providers to align service capacity with customer demand, often through pricing, scheduling, and promotional strategies to prevent over- or underutilization.  Zone of Tolerance: The range between the minimum acceptable level of service and the level of service customers hope to receive. Within this range, customers are generally satisfied; outside it, they may feel dissatisfied