Services Marketing Communications PDF

**CHAPTER 7** **SERVICES MARKETING COMMUNICATIONS** **Communication** \- is the most visible or audible form of marketing activities**.** **Target audience for Marketing Communications:** ** Prospects -** not usually known in advance. It is a potential customer qualified to fit certain criteri...

**CHAPTER 7** **SERVICES MARKETING COMMUNICATIONS** **Communication** \- is the most visible or audible form of marketing activities**.** **Target audience for Marketing Communications:** ** Prospects -** not usually known in advance. It is a potential customer qualified to fit certain criteria outlined by a company based on its business offerings. ** Users -** existing target audience ** Employees** - secondary audience **Strategic Service Communications Objectives** \- Include building a service brand, and positioning it and its service products against competition. **Tactical Service Communications Objectives** \- Relate to shaping and managing customer's perceptions, beliefs, attitudes, and behavior in any of the three stages of the service consumption process. **"AIDA"**-stands for Awareness, Interest, Desire, and Action **Hierarchy-of-effects model** -(the most widely used framework) is used to set up a structured series of advertising message objectives for a particular product, to build upon each successive objective until a sale is ultimately made. **The hierarchy-of-effects theory** -is a model of how advertising influences a consumer\'s decision to purchase or not purchase a product or service **Problems of Intangibility** ** Abstractness** - financial security or investment-related matters do not have one-to-one correspondence with physical objects ** Generality** - items that comprise a class of objects, persons, or events are general and not specific enough **Non-searchability** - many of the service attributes cannot be searched or inspected physically before they are purchased **Mental impalpability** - many services are sufficiently complex, multi-dimensional, or novel; it is difficult to understand the experience of using them ** Tangible Cues** - "vivid information" that catches the audience's attention. It will produce a strong and clear feeling about the service offered.(e.g. employees,facilities, certificates, and awards, or its customers. ** Metaphors** - metaphors that are tangible in nature to help communicate the benefits of their service offerings and to emphasize key points of differentiation. **THREE KEY SOURCES OF MESSAGES** **MESSAGE TRANSMISSION CHANNELS** **1**. Messages transmitted through traditional marketing channels. **2**. Messages transmitted online. **3**. Messages transmitted through service delivery channels. **4**. Messages originating from outside the organization. **ETHICAL AND CONSUMER PRIVACY ISSUES IN** **COMMUNICATIONS** - Unrealistic Service promises - Unethical advertisers and salespeople - Unwanted intrusion - Deceptive promotions **Integrated Marketing Communications** **-**ties together and reinforces all communications in order to deliver a powerful brand identity. **CHAPTER 8** **DESIGNING & MANAGAGING SERVICE PROCESSES** **Processes -** describe the method and sequence in which service operating systems work and specify how they link together to create the value proposition promised to customers. **Badly designed processes** - are likely to annoy customers because they often result in slow, frustrating, and poor-quality service delivery. **DESIGNING AND DOCUMENTING SERVICE PROCESS** **Two key tools** that are used for documenting and redesigning existing service processes and designing new ones: 1. -is a technique for displaying the nature and sequence of the different steps involved when a customer "flows" through the service proc**ess.** **Flowchart** -describes an existing process, often in a fairly simple form. 2. -is a more complex form of flowcharting and specifies in detail how a service process is constructed Including what is visible to the customer and all that goes on in the back-office. **Service blueprints** map customer, employee, and service-system interactions. They show the full customer journey from service initiation to final delivery of the desired benefit. **Blueprints** show the key customer actions, how customers and employees from different departments interact (called the line of interaction), **DEVELOPING A SERVICE BLUE PRINT** **Typical service blueprints have the following design characteristics:** **1.Front-stage activities**. These maps the overall customer experience, the desired inputs and outputs, and the sequence in which the delivery of that output should take place. **2.Physical evidence of front-stage activities.** This is what the customer can see and use to assess service quality. **3.Line of visibility.** clearly separates what customers experience and can see front-stage, and the back-stage processes customers can't see. **4.Back-stage activities.** These must be performed to support a particular front-stage step. **5.Support processes and supplies** where support processes are typically provided by the information system, and supplies are needed for both front- and back-stage steps. **6.Fail points** are where there is a risk of things going wrong and affecting service quality. Fail points should be designed out of a process (e.g., via the use of poka-yokes), and firms should have backup plans for failures that are not preventable. **7.Identifying customer waits.** These can then either be designed out of the process, or if that is not always possible, firms can implement strategies to make waits less unpleasant for customers. **8.Service standards and targets** should be established for each activity to reflect customer expectations. They include specific times set for the completion of each task and the acceptable wait between each customer activity. **Most service processes can be divided into three main steps:** **1. Pre-process stage** - is where the preliminaries occur, such as making a reservation, parking the car, getting seated, and being presented with the menu. **2. In-process stage** - where the main purpose of the service encounter is accomplished, such as enjoying the food and drinks in a restaurant. **3. Post-process stage -** is where the activities necessary for the closing of the encounter happens, such as getting the check and paying for dinner. **David Maister** coined the acronym **OTSU ("opportunity to screw up")** -to stress the importance of thinking through all the things that might go wrong in the delivery of a particular service. **IMPROVING RELIABILITY OF PROCESSES BY FAILURE PROOFING** **Analysis of reasons for failure often reveals opportunities for failure proofing to reduce/eliminate the risk of errors** **Errors include:** **treatment errors** --- human failures during contact with customers **tangible errors** --- failures in physical elements of service **Need for fail-safe methods for both employees and customers** **Fail-safe procedure** --- include measures to prevent omission of tasks or performance of tasks in the wrong order, incorrectly and too slowly. **POKA-YOKES** roughly means **\"avoid unexpected surprises\"** or \"avoid blunders\" in Japanese. In English, a poka-yoke is sometimes referred to as**\"mistake-proof\"** or **\"foolproof.\"** **Richard Chase and Douglas Steward** **-**introduced this concept to fail-safe service processes. **CUSTOMER PARTICIPATION IN SERVICE PROCESSES** **Customer participation** -refers to the actions and resources supplied by customers during service production, including mental, physical, and even emotional inputs. **Levels of Customer Participation** **1.Low Participation Level** - employees and systems do all the work. Service products tend to be standardized. In situations where customers come to the service factory, all that is needed is the customers' physical presence e.g visiting a movie theater or taking a bus **2. Moderate Participation Level** - customers' inputs are required to assist the firm in creating and delivering the service, and in providing a degree of customization. **3.High Participation Level** - customers work actively with the provider to co-produce the service. Service cannot be created without the customer's active participation e.g marriage counseling and educational services **Self-service** is the ultimate form of customer involvement in service production. **Who is a "Jaycustomer"?** "A customer who behaves in a thoughtless or abusive fashion, causing problems for the firm itself, employees, or other customers". **TYPES OF JAY CUSTOMERS** **1.The Thief** -- seeks to avoid paying for service/ manipulates **2.The Rule breaker** -- ignores rules of social behavior and/or procedures for safe, efficient use of service. **3.The Deadbeat** -- fails to pay bills on time Ask for Pre-payments **4.The Belligerent** -- angrily abuses service personnel (and sometimes other customers) physically and/or emotionally **5.The Family Feuders** -- a sub-category of belligerents who get into arguments with other customers mostly their own family members, and spoil the scene around **6.The Vandal** -- consciously damages physical facilities, furnishings, and equipment **CHAPTER 9** **BALANCING DEMAND AND CAPACITY** **Four conditions potentially faced by fixed-capacity services:** **1.Excess demand.** The level of demand exceeds the maximum available capacity, resulting in some customers being denied service and business is lost. **2.Demand exceeds optimum capacity.** No one is turned away, but conditions are crowded and customers are likely to perceive a deterioration in service quality and may feel dissatisfied. **3.Demand and supply** are well balanced at the level of optimum capacity. Staff and facilities are busy without being overworked, and customers receive good service without delays. **4.Excess capacity** Demand is below optimum capacity and productive resources are underutilized, resulting in low productivity **Two basic approaches:** 1. **Adjust the level of capacity to meet demand.** This approach requires an understanding of what constitutes productive capacity and how it may be increased or decreased on an incremental basis. 2. **Manage the level of demand.** This requires a good understanding of demand patterns and drivers on a segment-by-segment basis, so that firms can use marketing strategies to smooth out variations in demand. **STRETCHING CAPACITY LEVELS** 1. **Elastic Capacity** -(ability to absorb extra demand) The actual capacity level remains unchanged, and more people are being served with the same capacity. e.g. the normal capacity for a subway car may offer 40 seats and allow standing room for another 60 passengers with enough handrails and floor space for all. 2\. **Utilize the facilities for longer periods** \- e.g. some banks extend their opening hours during weekdays and even open weekends. Universities may offer evening classes, and weekend and summer programs. 2. **Reduced the average amount of time customers** (or their possessions) spend in the process. **STRATEGIES TO MANAGE DEMAND** **Five basic approaches to managing demand:** 1\. Take no action and leave demand to find its own levels. 2\. Reduce demand during peak periods. -Higher prices, Communication promoting alternative times 3\. Increase demand during low periods. -Lower prices -Communication, including promotional incentives -Vary product features to increase desirability -More convenient delivery times and places 4\. Inventory demand using a queuing system. 5\. Inventory demand using a reservations system. **Reservations -** are intended to guarantee that service will be available when the customer wants it. **Demand can be inventoried in two ways:** **1. By asking customers to wait in line**, usually on a first-come, first-served basis, or by offering customers more advanced queuing systems. (e.g., systems that take into account urgency, price, or importance of the customer) **2. By offering customers the opportunity to reserve** or booking service capacity in advance. **Single line single server single stage.** Customers proceed and transact through a single serving operation. **Single line sequential stages.** Customers proceed through several serving operations. Bottlenecks may occur at any stage where the process takes longer to execute than at previous stages. **Parallel lines to multiple servers.** Offer more than one serving station, allowing customers to select one of several lines in which to wait. Banks and ticket windows are common examples. **Single line to multiple servers.** Commonly known as a "**snake**." This type of waiting line solves the problem of parallel lines to multiple servers moving at different speeds. This method is commonly used at post offices and airport check-ins. **Designated lines.** Involve assigning different lines to specific categories of customers. Examples include express lines for five items or less and regular lines at supermarket check-outs, and different check-in stations for first class, business class, and economy class airline passengers. **Taking a number.** Saves customers the need to stand in a queue. This procedure allows them to sit down and relax, or to guess how long the wait will be and do something else in the meantime **TEN PREPOSITIONS ON THE PSYCHOLOGY OF WAITING LINES** 1\. Unoccupied time feels longer than occupied time. 2\. Solo waits feel longer than group waits 3\. Physically uncomfortable waits feel longer than comfortable waits 4\. Pre-and post-process waits feel longer than in-process waits 5\. Unfair waits are longer than equitable waits 6\. Unfamiliar waits seem longer than familiar ones 7\. Uncertain waits are longer than known, finite waits 8\. Unexplained waits are longer than explained waits 9\. Anxiety makes waits seem longer 10\. The more valuable or important the service, the longer people will wait. **CHAPTER 10** **CRAFTING THE SERVICE ENVIRONMENT** **Service environments**, also called **servicescapes** **-**relate to the style and appearance of the physical surroundings and other experiential elements encountered by customers at service delivery sites. **PURPOSE OF SERVICE ENVIRONMENTS** 1. Shape customers' experiences and behaviors 2. Signal Quality, and Position, Differentiate and Strengthen the Brand 3. Core Component of the Value Proposition 4. Facilitate the Service Encounter and Enhance Productivity **THE THEORY BEHIND CONSUMER RESPONSES TO SERVICE ENVIRONMENTS** **Environmental psychology** -studies how people respond to particular environments. **Two important models help us better understand consumer responses to service environments.** **1. Mehrabian--Russell Stimulus--Response.** \- A model holds that our feelings are central to how we respond to different environmental elements. 3. **Russell's Model of Affect** \- Holds that affect can be modeled with the two interacting dimensions of pleasure and arousal, which together determine whether people approach. **Pleasure** is a direct, subjective response to the environment, depending on how much an individual likes or dislikes the environment. **Arousal** refers to how stimulated the individual feels, ranging from deep sleep (lowest level of internal activity) to the highest levels of adrenaline in the bloodstream, e,g. when bungee jumping (highest level of internal activity). 1. **Ambient conditions** \- refer to those characteristics of the environment that pertain to our five senses. **THE EFFECT OF AMBIENT CONDITIONS** **Music** **-**can have powerful effects on perceptions and behaviors in service settings, even if played at barely audible volumes **Scent** **-**is the next important ambient dimension. Ambient scent or smell pervading an environment may or may not be consciously perceived by customers and may not be related to any particular product. **Color** -can have strong effects on people's feelings.It pervades every aspect of our lives,embellishes the ordinary, and gives beauty and drama to everyday objects. - **Warm colors** are associated with elated mood states and arousal but also heightened anxiety (red, orange, and yellow hues). - **Cold colors** reduce arousal levels and could elicit emotions such as peacefulness, calmness, love, and happiness. **Hue** **-**is the pigment of the color (i.e., the name of the color: red, orange, yellow, green, blue, or violet). Value is the degree of lightness or darkness of the color, relative to a scale that extends from pure black to pure white. **Chroma** -refers to hue intensity, saturation, or brilliance; high chroma colors have a high intensity of pigmentation and are perceived as rich and vivid, whereas low chroma colors are perceived as dull. **Lighting** -creative use of lighting can bring an interior to life. **2. Spatial Layout and Functionality** **Spatial layout** **-**refers to the floor plan, size and shape of furnishings, counters, and potential machinery and equipment, and how they are arranged. **Functionality** -refers to the ability of those items to facilitate the performance of service transactions. **3.Signs, Symbols, and Artifacts** -help customers to draw meaning from the environment and guide them through the service process.