Services Marketing

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  • Created by: Sess
  • Created on: 10-05-15 06:55
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  • Services
    • Characteristics of Services
      • Lack of Ownership
        • Nothing is transferred during the interaction.
        • Services are usually time shares of things eg seats on a place
        • Loyalty schemes promote a sense of ownership as it generates a perceived right to be part of a service provider.
      • Intangibility
        • Other ques besides our senses (that are used in assessing products) are used. These ques make the service more tangible
        • The ques can often come in the form of the 7Ps.
      • Perishability
        • Services perish in a way products do not.
        • They are manufactured and consumed simultaneously
        • Eg. seats on a train after it leaves. This is due to fluctuating demand.
        • One of the marketer's main goals is to reduce lose-forever revenue.
        • Price
          • This can be achieved through differential pricing.
          • Low prices during low demand and high prices in high demand.
      • Variability
        • Services are consumed as they are produced.
        • This makes it impossible to standardise quality or test it.
        • Demand may increase unexpectedly and over fill service capacity
        • Variability in a service may reduce customer satisfaction so that they end up defecting to competitors.
        • By planning when such situations may occur, marketers can generate solutions eg. entertainment in a line.
      • Inseparability
        • The consumer and the service provider must come into contact and interact.
        • Differences between whether its a mass service experience eg cinema or solo expericence eg doctor impact interaction.
        • Mass services leave room for the other consumers to affect the quality of a service eg by being noisy
        • Solo services allow for more control by provider, opportunities exist for adaptability to consumer
        • If there is a broad mix of consumers, this may dilute service standards in an effort to accommodate all.
    • Definition
      • 1) Any act or performance offered by one party to another that is essentially intangible.
      • 2) Consumption of the service does not result in any transfer of ownership even though the service process may be attached to a physical product.
      • Gronroos (1990)
    • Service Processes
      • People Processing
        • People present themselves to become emersed in the service
        • They must actively cooperate with the service provider
        • For marketers, considering the process and outcomes can give insight into what benefits and non-financial costs consumer is undergoing.
        • e.g. at a dentistry, a comfy chair, back ground music and a clean location can help
      • Possession Processing
        • Peoples possessions often needs maintenance also. They can be sent off or an attendant called.
        • The key difference is that people are detached to focus on other tasks should they need to.
        • The quality of the service is not dependent on the owner being there
      • Mental Stimulus Processing
        • Tries to shape attitudes of behaviour eg education
        • Focuses on the mind
        • Its delivery can occur through 2 methods: via media channels or in the location they originate from eg museum
        • But the distance channel is a lot less rich.
      • Information Processing
        • This is the most intangible of all processes.
        • Companies can push people away from telephoning or seeing a clerk towards going to the website.
        • e.g. RAKBank pushing online transactions and ATM machines
      • Lovelock et al (1999)
    • Service Management
      • Service Quality
        • Customer expectations of a service will shape their perception of the actual service encounter.
          • If it exceeds expectations then customers are deemed satified. If it doesn't, customers are unlikely to return
        • SERVQUAL
          • Parasuraman et al (1988)
          • Model into managing service quality
          • 'Measures' gaps between expected service and the actual perceived service
            • 1) Customers Expectations vs Management perception
              • if management doesnt understand customer needs, resources are inappropriately directed. eg trains may think they need bag storage but really they need safe comfy seats
            • 2) Management perception vs service quality specifitcation
              • Management gets customer needs but doesnt set performance standard or fails to set a realistic one eg train knows they need seats but doesnt set how many
            • 3) Service quality specification vs service delivery
              • Service delivery doesnt math the spec eg due to lack of training (grumpy train personel)
            • 4) Service delivery vs External communication
              • If adverts show train to be comfy and roomy and the actual train doesnt match the pic, the communication has distorted the consumers view of what is realistic
            • 5) Perceived service vs expected service
              • a misunderstanding of the service quality due to previous gaps of lack of customer knowledge.
          • 22 questions that given to consumers so tha tmanagment can assess their service
          • Thanks to this model, 5 dimensions of service quality are proposed
            • Reliability
            • Responsiveness of employees
            • Assurance of employees
            • Empathy of employees
            • Tangibles
          • An issue with the use of servqual is that customers use differenct dimensions to assess each time
          • There are statistical inaccuracies from measuring differences and reliability issues from asking customer opinion
            • Gabott & Hogg 1998
          • Based on qualitative interviews with exceutives and focus consumer groups
          • It offers little in the way of guidance as to how to close the gaps
      • Internal Marketing
        • Motivations for any existing employees
        • Google heavily internal markets for enthusiastic employees
      • Service Failure
        • Failure in the delivery system
          • eg slow service, service failure (uncooked food)
        • failure through employee actions
          • they are rude or dismissive
        • Booms et al 1990
        • Service recovery
          • Service recovery is concerned with an organisation’s systematic attempt to correct a problem following service failure (Gronroos, 1988)
          • Firms need to react quickly and empathically to a consumers concerns
          • The aim is to make a paradox so that customers were even more satisfied than they would have been previously
        • Service failure in response to customer requests
    • Product/Service Continuum

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