mm.11.10 deleted

04/11/23 20:03 Prof. U.M. Amin, CMS, JMI University, New Delhi

1

Marketing ManagementMBA CP 205


2

Managing Services


3

Learning Objectives:

• Know how services are defined and classified, and how do they differ from goods.• Know how services are marketed.• Know how service quality can be improved.• Know how service marketers create strong brands.• Know how goods-producing companies can improve customer support services.

Managing Services


4

Managing Services

Any act of performance that oneparty can offer another that is

essentially intangible and does notresult in the ownership of anything;

its production may or may notbe tied to a physical product.

Service


5

Managing Services

Government

Business

Retail

PrivateNon-Profit

Manufacturing

Service Sectors


6

Managing Services

Pure tangible good

Pure service

Hybrid

Tangible withAccompanying

services

Service withAccompanying

goods

Categories of Service Mix


7

Managing Services

• Services vary whether they are equipment based or people based.

• Companies can choose different processes to deliver services.

• Some services require client’s presence, some do not.

• Services differ whether personal or business needs met.

• Service providers differ on objectives (profit, non-profit) and ownership (private, public).

Service Distinctions


8

Managing Services

Continuum of Evaluation for different types of Products


9

Managing Services

IntangibilityIntangibility

InseparabilityInseparability

VariabilityVariability

PerishabilityPerishability

Characteristics of Services


10

Managing Services

Intangibility

• Services can’t be seen, heard, felt, tasted or smelled before buying.

• Service provider’s task is to manage the evidence, to tangibilize the intangible.

• Service providers can demonstrate their quality through physical evidence and presentation.

• Services marketers can make their positioning strategy tangible through various marketing tools.


11

Managing Services

The service marketing tools

1. Place.

2. People.

3. Equipment.

4. Communication material.

5. Symbols

6. Price


12

Managing Services

Ways to improve service quality control

• Investment in good hiring and training procedures. Well trained employees exhibit competence, a caring attitude, responsiveness, initiative, problem solving ability and goodwill.

• Standardizing the service performance process across organization.

• Monitoring customer satisfaction by employing suggestion & complaint system and customer surveys.


13

Managing Services

Perishability, Matching demand and supply

Demand side• Differential pricing.• Non-peak demand.• Complementary services.• Reservation systems.

Supply side• Part-time employees.• Peak-time efficiency.• Increased consumer

Participation.• Facilities for future

expansion.


14

Managing Services

Demand side

• Differential pricing, Shifts some demand from peak to off-peak periods.

• Non-peak demand, can be cultivated.

• Complementary services, can be developed to provide alternatives to waiting customers like ATMs in banks.

• Reservation systems, are a way to manage demand level.


15

Managing Services

Supply side

• Part time employees, can be hired to serve peak demand.

• Peak time efficiency routines, can be introduced.

• Increased consumer participation, can be encouraged.

• Shared services, can be developed.

• Facilities for future expansion, can be developed.


16

Managing Services

InternalMarketin

g

ExternalMarketin

g

InteractiveMarketingEmployees

Customers

CompanyHolistic marketing for services

Hospitalitysector

Financial/ bankingsector

Civil aviationsector


17

Managing Services

Factors leading to customer switching behavior

Pricing

High price Price increases Unfair pricing Deceptive pricing

Inconvenience

Location/hours Wait for appointment Wait for service

Service Encounter failures

Uncaring Impolite Unresponsive Not knowledgeable

Response to service failures

Negative response No response Reluctant response

Competition

Found better service

Ethical problems

Cheat Hard-sell Unsafe Conflict of interest

Involuntary Switching

Customer moved Provider closed

Core service failures

Service Mistakes Billing errors Service Catastrophe


18

Managing Services

Service Quality Model


19

Managing Services

Gaps that cause unsuccessful service delivery

1. Gap between consumer expectation and management perception, Management does not perceive what customers want.

2. Gap between management perception and service-quality specifications, management may correctly perceive consumers’ needs but not set a performance standard.

3. Gap between service-quality specifications and service delivery, personnel are poorly trained or incapable.

4. Gap between service delivery and external communications, customer expectations affected by ads.


20

Managing Services

5. Gap between perceived service and expected service, consumer misperceives service quality.

Determinants of service quality

• Reliability: The ability to perform the promised service dependably and accurately.

• Responsiveness: The willingness to help customers and provide prompt service.

• Empathy: The provision of caring, individualized attention to customers.

• Tangibles: The appearance of physical facilities, equipment, personnel and communication material.


21

Managing Services


Reliability

Providing service as promised. Dependability in handling customers service problems. Providing services at the promised time. Maintaining error-free records.

Responsiveness

Keeping customer informed as to when services will be performed. Prompt service to customers. Willingness to help customers. Readiness to respond to customers’ requests.


22

Managing Services


Empathy

Giving customers focused attention. Employees who deal in caring fashion. Convenient business hours. Having the customers’ best interests at heart.

Assurance

Employees who instill confidence in customers. Making customers feel safe in their transactions. Employees who are knowledgeable. Employees who are consistently courteous.


23

Managing Services

• Strategic Concept.• Top-Management

Commitment.• High Standards.• Self-Service Technologies.• Monitoring Systems.• Satisfying Customer

Complaints.• Satisfying Employees.

Best practices


24

Managing Services

Choosing Brand Elements

Establishing ImageDimensions

Devising BrandingStrategy

Developing Brand StrategiesFor Services


25

Managing Services

Customer Worries

Failure frequency

Downtime

Out-of-pocket costs


26

Recap:

• How services are defined and classified, and how do they differ from goods.• How services are marketed.• How service quality can be improved.• How service marketers create strong brands.• How goods-producing companies can improve customer support services.

Managing Services