Service Marketing PDF

FOR ALL MANAGEMENT COURSES SERVICE MARKETING Phystry with me INTRODUCTION TO SERVICE MARKETING The important aspect of service marketing is that services are something we interact with every now and then. it has become an integral part of our lives. We cannot avoid ourselves to expose wit...

FOR ALL MANAGEMENT COURSES SERVICE MARKETING Phystry with me INTRODUCTION TO SERVICE MARKETING The important aspect of service marketing is that services are something we interact with every now and then. it has become an integral part of our lives. We cannot avoid ourselves to expose with services of any kind in a day-to- day life. Every enterprise today strive to provide the best services possible to their customer when compared to their competitors. A service is an act or performance offered by one party to another. Although the process may be tied to a physical product, the performance is essentially intangible in nature and doesn’t lead to ownership of any of the factors of production.. INTRODUCTION TO SERVICE MARKETING Unlike products, you cannot touch or hold services, they are basically experiences or actions. Service marketing works well when businesses understand consumers need, what they want and expect from the service. Businesses also need to build trust through good services guarantee and to provide greater or positive experience for the customer from the moment they enquired about the services to after it is delivered. DEFINITION According to Kotler, Armstrong, Saunders and Wong; services are activity or benefit that one party can offer to another, which is essentially intangible and does not result in the ownership of anything. Its production may or may not be tied to a physical product. CHARACTERISTICS OF SERVICE MARKETING 1. Intangibility 2. Inseparability: in service cooperation, the production and consumption cannot be separated that is services are often provided and consumed at the same time. For example, a customer and a hairdresser they’re both present during a haircut and much of the services provided by hairdresser is at the same time during the haircut. 3. Variability: services can bury each time they are performed, depending on who provides them and how. Example- A meal at a restaurant might taste slightly different, depending upon the chef. 4. Perishability- services cannot be stored or saved for later use. CLASSIFICATION OF SERVICE MARKETING 1. Based on types of Service: This includes Consumer services and Business services. Consumer services are provide directly to individual consumer for their personal use like doctors, dentists schools, tutors, hair & salons, travel and entertainment, etc. Business services include services which are provided directly to businesses so that they can support their operations. This includes IT services, professional services, maintenance, and repair services and marketing and advertising. 2. Based on Service delivery: This includes people based services where services are delivered by people and require interaction between the service provider and customer like during hairdressing or counselling or personal training and equipment base services, where services are delivered through the use of equipment or technology like ATM services, car washes, automated customer support, etc. CLASSIFICATION OF SERVICE MARKETING 3. Based on Service Tangibility: This includes tangible dominant services that are closely related to a tangible product or outcome. For example, in a restaurant, food delivery tangible, but service is intangible similarly, if you are opting for any airline service transportation is tangible but service experience is intangible, another is intangible dominant services that are purely intangible services where the primary purpose is in the service itself examples can be consulting, education or Entertainment. 4. Continuous and discontinuous services: Services that are available continuously and are not specific to any time are continuous services. A common example can be Internet services. If the services are only available at specific times or by appointment, it is a continuous service. DIFFERENCE BETWEEN SERVICE MARKETING AND PRODUCT MARKETING Let’s try to understand the difference between service marketing and product marketing on the basis of following pointers: 1. Intangibility- At this point, we are aware in service marketing services are intangible that is they cannot be seen touched or held before the purchase, but in product marketing products are tangible so they can be seen, touched and evaluated before the purchase. 2. Inseparability- In service marketing services are often produced and consumed simultaneously that is the provider and customer needed to be present at the same time. But in product marketing product are produced stored and then sold. So the production and consumption process are quite separate. A manufacturer did not to be present while a customer buying a product. DIFFERENCE BETWEEN SERVICE MARKETING AND PRODUCT MARKETING 3.Services cannot be stored for future use that is, they are perishable. If a service opportunities is not utilised. It is lost, but in case of products they can be stored or put in an inventory until they are sold. 4.In service marketing, the quality of services depends upon who provides them when where, and how they are provided, but in case of product marketing products are, standardised and consistent in quality, no matter where or when they are purchased. 5.In service marketing focus is always on building relationships, customer experience and trust due to intangible and variable nature of services. Whereas in product marketing, the focuses on the product only that is its features, benefits, packaging and pricing aim here is to focus on products, value, quality, and competitive advantage. RELATIONSHIP MARKETING Relationship marketing is a strategy that focuses on establishing and maintaining long-term relationships with customers rather than making one-time sales. The goal is to develop a devoted clientele that feels appreciated and trusted by the business and returns often. let’s talk about some of the key features of relationship marketing: 1. Customer oriented 2. Customer loyalty 3. two-way communication process 4. Customer Satisfaction 5. long term goal SERVICE BLUEPRINTING A service blueprint depicts the entire service process on a map and shows various stages of customer interaction with service provider and details of service delivery processes, the tangible evidence of the service and the people involved in carrying it out. Think of it like a detailed map that shows how a service is basically delivered from start to finish. It shows what customer does during the services. It shows what employees do in direct view of the customer. It displays behind the scene activities that support the service but aren’t seen by the customer. It involves tools and resources needed to make the service works smoothly. The goal of service blueprinting is to make the service process clearer to spot that could be a potential problem and to improve the overall experience for customers through services. SERVICES MARKETING ENVIRONMENT This includes two factors that affect how services are promoted sold and delivered to customers. Basically, these are the factors that influences how a service process will take place in the market. Let’s talk about external and internal factors that impacts the service process. External environment factors are those that affect all service firms, not just one service firm. This includes social, cultural factors, legal factors, economic factors, political factors, and technological factors. Internal factors are aspects within the company that affects its service marketing. SERVICES MARKETING ENVIRONMENT Internal factors includes internal customers that is employees, providers, direct sales agents, etc. Internal factors also includes consumers, competitors, suppliers, and regulators SERVICE MARKETING MIX The marketing mix is a combination of product, price, place, promotion, people, process, and physical evidence for any business venture. No one element of the marketing mix is more important than another. Each element ideally supports the other. 1. Product: a tangible product or an intangible service that is mass produced or manufactured on a large scale with a specific volume of units. 2. Price: the price is the amount a customer pays for the product and it is determined by number of factors including market share, competition, cost of raw material and the customers perceived value of the product.  SERVICE MARKETING MIX 3.Place: Place means location where a product can be accessed. It can include any physical store as well as virtual stores on the Internet. 4.Promotion: promotion means how you let people know about your service, which includes advertising, public relations, word of mouth, and social media. 5.Poeple: This includes the staff or employees who interact with consumers. Since, they have some contact with consumer directly or indirectly, their skills, attitude and appearance can greatly affect how customers perceive the service. 6.Process: Process is basically the way services delivered. for example, in a hotel, this includes how easy it is to check in, the efficiency of service and the overall experience.  SERVICE MARKETING MIX 7.Physical Evidence: These are the physical or tangible aspects that help customers evaluate the service, which includes maybe if it is a restaurant, the cleanliness of a cafe or maybe the layout of an office or the quality of promotional materials. CHALLENGES IN SERVICE MARKETING 1. Intangibility 2. Inconsistency 3. Inseparability 4. Perishability 5. Lack or ownership 6. Customer Participation 7. High Competition  STP FOR SERVICE MARKETING STP stands for segmentation, targeting and positioning. it’s a key approach in service marketing and a significant study in order to understand the specific need of customer and stand out in a competitive market. Segmentation means breaking the market into groups, basically, more manageable groups of customers with similar needs or characteristics. Targeting means choosing which group to focus on that is once you have identified different segments, targeting means choosing which you want to focus on. Like for example, a hotel might decide to target business travellers by offering amenities like meeting rooms, and high speed Internet. Positioning means position the brand value of your company in the minds of customers. It’s about creating a unique image or reputation for your service.  CONSUMER BEHAVIOUR AND SERVICE MARKETING Lets discuss! SERVICE DEVELOPMENT, SERVICE DESIGN AND SERVICE STANDARDS Service development is the process of creating new services or improving the existing one in order to meet customer needs and business goals. so the steps involve in the service development processes starts with generating idea which involves brainstorming and coming up with new service ideas. Then you have to turn those ideas into detailed service concepts where you also defined the benefits and features of service, then you have to test it out with a smaller group of customers in order to gather feedback and make adjustment before launching it to the product market. SERVICE DEVELOPMENT, SERVICE DESIGN AND SERVICE STANDARDS Service design is the process of planning and organising all the elements of service to ensure that they deliver excellent customer experience experience. It’s like creating a detailed map of the service process, including customer interaction and behind the scenes operations. Service standards basically refers to the criteria and benchmark which is used to measure and ensure the quality and consistency of the service. Basically, it shows whether the service consistently meets quality expectations or not. ROLE OF EMPLOYEES AND CUSTOMERS IN SERVICE DELIVERY Employees are significant in service delivery as they directly interact with customers and they are the one who are responsible for the execution of service processes. So they perform task which basically are required to deliver the service like handling customer enquiries, providing support and executing service transaction. they involve themselves in engagement with customers in order to understand their needs and concerns which again enhance overall service experience. They also ensure that service meets the predefined quality standards and whenever possible they make adjustment to it. ROLE OF EMPLOYEES AND CUSTOMERS IN SERVICE DELIVERY Customers again play a very active role in service delivery because they participate and interact with the service provider and their involvement can significantly influence the outcome and the overall experience of service. The actively participate by providing necessary information to the service provider engaging in service related activities, providing feedback and evaluation about the service that they receive which further helps in excess the service quality and making improvements. They also bring their expectations to the service encounter, which again impacts this satisfaction and perceived value of service.  SERVICE PRICING CONSIDERATIONS Service pricing consideration includes the following: 1. Costs: determining how much it cost to provide the service which includes labour pro material overhead, you need to ensure that the price covers these cost and allows for profit. 2. Customer value: you also have to consider how much value the service provides to customers like a customer seat as highly valuable, they might be willing to pay more. 3. Then you have to look at your competitors also, what they are charging for similar services. 4. You also have to understand how much demand is there for the service. 5. Last, but not the least, consider the overall economic environment also like if people are spending less, you might need to adjust your prices accordingly. SERVICE PRICING STRATEGIES 1. Cost-plus pricing: In this method, we add a mark up to the cost of providing the service. For example, if it cost hundred rupees to deliver the service, you might add 20% mark up making the price. Rs 120. 2. Value-Based pricing: here the prices are set based on how much value the service provided to customers. 3. Competitive pricing in this method, prices are set based on what competitors are charging, so you might lower your price if the competitor is charging less. 4. Penetrating pricing: Here you start with a low price to attract customers and build your market, but once you have a customer base, you can gradually increase the price. ROLE OF ADVERTISING IN SERVICE MARKETING 1. Let’s discuss! ROLE OF CRM IN SERVICE MARKETING 1. Understanding Customer needs: CRM system help collect an analyse customer data to understand their preferences patterns, behaviour, and needs. 2. By using the information is stored in a CRM businesses can provide personalised service and communications, including special offers and discounts. 3. It also helps in managing customer enquiries, complaints, and request more efficiently 4. CRM data helps identify opportunities to offer 5. additional services or upgrades that may interest existing customers. GAP MODEL OF SERVICE QUALITY The gap model of service marketing is a framework used to identify and address, discrepancies or gaps that can possibly affect the quality of service delivery. This model helps businesses understand where service quality might be falling short and how to improve it. Let’s try to understand the following five gaps: 1. knowledge gap 2. Policy gap 3. Delivery gap 4. Communication gap 5. Perception gap THANK YOU [email protected]