Services Unit-2.ppt

IFETCE/MBA/2012/III/BA9253/unit-II/SRM/PPT/Version1.0 1

Service Marketing Opportunities

Unit -2

What is marketing

Marketing is the process of planning and executing the conception ,pricing, promotion and distribution of ideas, goods and services to create exchanges that satisfying individual and organizational goals.

Marketing consists of activities designed to generate and facilitate exchanges intended to satisfy human or organizational needs or wants.

What is market assessment Definition: The evaluation of the market for a product or

services, including the analysis of market trend assessing the competition and conducting market studies is known as a “ Market assessment”.

Concept: The term market assessment concept holds that achieving organizational goals depends on knowing the needs and wants of target market and delivering the desired satisfactions. It purposes that in order to satisfy its organizational objectives, an organizational should anticipate the needs and wants of consumers and satisfy these more effectively than competitors.

Importance of service marketing.

Personally - in daily life, in career aspiration, in better informed consumer purchases.

Organizationally - only marketing directly produces revenue; marketing success depends on customer satisfaction

Domestically - employment and costs, creation of utility

Globally - closed, national markets no longer exist and companies compete in markets worldwide.

Marketing management process for services Organizing marketing planning

Assessing service market potential

Selection of Target markets

Developing marketing mix

Managing marketing efforts

The key to success in business is planning. And the key to successful planning is using a proven format to analyze your service marketability .

Market potential assessment is helping to

determine the expectation of success for conceptual products, services or programs.

As you look to the future, what potential is there in the market? Test your product and service concepts before they reach the market.

Market analysis services help you know the economic opportunity available to you in any geographic market. Whether you sell to consumers, to businesses, or both, market sizing provides intelligence you need to deploy sales and marketing resources effectively.

Classification of Services Classification of Services pg33-37pg33-37

Based on Degree Of Customer

Involvement ( Lovelock)’ People Processing Possession Processing Mental Stimulus Processing Information Processing

Four Categories of Services Employing Different Underlying Processes

Who or What is the Direct Recipient of the Service?What is the Nature of the Service Act?

People Processing(services directed at people’s body)

Possession Processing(services directed at physical possessions)

mental Stimulus Processing ( Services directed at people’s mind)

Information Processing(directed at intangible assets)

e.g., airlines, hospitals,haircutting, restaurants hotels,

fitness centers, beauty salon

e.g., freight, repair, cleaning, landscaping, retailing,

recycling

e.g., News, Education, consulting,education, psychotherapy

e.g., accounting, banking, insurance, legal, research

TANGIBLE ACTS

INTANGIBLEACTS

DIRECTED AT PEOPLE DIRECTED AT POSSESSIONS

“ Marketing mix is term used to describe the combination of the four inputs which constitute the core of a company’s marketing system – product, the price structure, the promotional activities and the distribution system”. __ StantonTraditional marketing mix / 4ps of marketing mix Product Price Place Promotion

Marketing mix

Product: Anything that can be offered to a market for attention, acquisition, use, or consumption and that might satisfy a want or need.

Physical good features Quality level Accessories Packaging Warranties Product lines Branding

PriceThe price of the service is the value attached to it, by

the service provider and it must correspond with the customer’s perception of value.

Flexibility Price levels Negotiation Differentiation Discounts Allowances

Place Channel type Exposure Intermediaries Outlet locations Transportation Storage Managing channels

Promotion

Sales promotion Sales people Selection Training Incentives Advertising Media types Types of ads Publicity

Expanded Marketing mix/Augmented service mix(pg: 21 to 24)

Expanded Marketing mix/Augmented service mix

This concept was developed by Booms and Bitner. The elements of the marketing mix provided a useful structure for marketing implementation, there is a need to strengthen the approach through the inclusion of four other elements: People, Physical evidence, Process and

productivity & quality.

1) People:All human actors who play a part in service delivery

and thus influence the buyer perceptions namely ,

the firm personnel, the customer and

other customer in the service environment.

Employees : Recruiting Training Motivation Rewards Teamwork Customers: Education Training Communicating Culture ad Values Employee Research

2) Physical evidence / physical environment: ( the appearance)

The environment in which the service is delivered and where the firm and the customer interact and any tangible components that facilitates performance or communication of the service. (e.g. Brochures, letterhead, signage etc)

Atmosphere, décor, music etc. Equipment Facilities Uniforms Staff Building

Facility design: Equipment Signage Employee dress Aesthetics ( work of Art)

Other Tangibles: Reports Business cards Statement Guarantees

3) Process: The actual procedure, mechanism and flow of activities by

which the service is delivered – the service delivery and the operating system.

Creating & delivering product elements requires design and implementation of effective service.

service delivery systems back stage front stage

Procedures Policies4) Productivity and quality:The employees are well trained in service recovery

procedures in case things do go wrong.

Signage e.g.:

Service Marketing Mix :-

The 7 P’s of service marketing mix are :

What is physical evidence? Physical evidence is everything that a

company physically exhibits to the customer. It includes the physical environment of the service outlet, the exterior, the interior, all tangibles like machinery, furniture, vehicles, stationery, sign boards, etc.,

Physical evidence is the element of the service mix which allows the consumer again to make judgment on the organization.

Elements of physical evidence Servicescape: used to position a service

organization or positioning and differentiating. Facility exterior Exterior design Signage Parking Landscape Facility interior Interior design Air quality/temperature Layout Equipment

Other tangibles: Business cards Billing statement Stationery Reports Uniforms Brochures Web pages

Types of services capeServices cape usage: Self service environment ( theaters) Remote(far –off) service - Telephone company

Insurance company ( little no customer involment) Interpersonal service – Hotel, Restaurant

Hospital( both customers and employees are actively present).

Services capes complexity:

Elaborate ( theatre, insurance, hotel)

Lean (bend) ATM, internet

Sporting event

Services capes: Parking Stadium exterior Entrance Seating Restrooms Playing fields

Continue…

Other tangibles: Tickets Programs Uniforms websites

Strategic roles of the services capes:

Package: wrap the service and convey to customers an

external image of what is inside Facilitator: In aiding the performances of person in the

environment

Strategic roles of the services capes:

Socialize: the design of the services capes aids in the

socialization of both employees and customers in the sense that it helps convey expected roles ,behaviors and relationship

Differentiator: can differentiate a firm from its competitors.

Positioning service in competitive Market Opportunity Analysis:

The factors that influence feasibility analyses, including external considerations (market size, competition, technology, inflation and the economy, government regulations, political conditions, social change), internal factors (purpose, corporate objectives, resources), and financial considerations (revenue estimates, cost estimates, return on investment).

Market positioning The essence of choosing to perform activities

differently than rivals do. Positioning strategy is concerned with creating,

communicating and maintaining distinctive differences that will be noticed and valued by customers with whom the firm would most like to develop a long-term relationship.

Distinguish yourself on the basis of the needs you fill ,the service you provide and distribution channel you use, the pricing strategy you employ.

Benefits of Market Potential Analysis selecting products or services that can be sold. Understand market potential for a single store,

network of stores or a new market . Deploy (arrange) resources effectively by ranking

markets in priority order. Find a profitable market. To plan a realistic target. Forecast total opportunity in terms of number of

customers and revenue potential.

Benefits of Market Potential Analysis Identify changes in consumer behavior. Improve marketing techniques.

Estimate your market share Forecast for the future. Understand your customers' future needs Research and develop proactively instead of

reactively Expand your company's offerings

Service positioning

The essence of positioning based upon the following principles

A company must establish a position in the minds of its target customers

The position should be singular, providing one simple and consistent message

The position must set a company apart from it competitors

A company cannot be all things to all people it must focus its efforts

Positioning maps

It is used to represent Customer perception of alternative products graphically.

Product positioning versus copy positioning Copy positioning: Create images and association for broadly similar

branded products so as to give special distinction in the customer minds

Co branding : The imaginary associated with one brand has the

potential to influence customer perception of the others.

Focus underlies the search for competitive advantage Four focus strategies: Focus: providing a relatively narrow product

mix for a particular market segment Fully focused organization: A limited range of services to a narrow

specific market segment

Continue…

Market focused company concentrates on a narrow range of segment but offers a wide ranges of services.

Service focused firms offer a narrow range of services to a fairly broad market.

Unfocused category try to serve broad markets and provide a wide range of services

Definitions of market segmentation

“Market segmentation is the sub-dividing of customers into homogeneous sub-set of customers where any sub-set may conceivably selected as market target to be reached with distinct marketing mix”--- Philip kotler.

Market segmentation consist of taking total heterogeneous (diverse) market for a product and dividing into several submarket of segments, each of which tends to homogenous in full significant aspects __ William Stanton

Benefits and limitations Benefits:1. The organization gets to know its customers better.2. Provides guidelines for resource allocation.3. It helps focus the strategy of the organization.4. Positioning

Limitations:1. Targeting multiple segment increases marketing

costs.2. Segmentation can lead to Proliferation of products.3. Narrowly segmenting a market can hamper the

development of broad-brand equity.

Steps in segmentation, targeting and positioning .

1. Identify Basesfor Segmenting the Market

2. Develop Profilesof Resulting Segments

3. Develop Measuresof Segment Attractiveness

4. Select TargetSegment(s)

5. Develop Positioningfor Each Target Segment

6. Develop MarketingMix for Each Target Segment Market

Positioning

MarketTargeting

Market Segmentation

Geographic

DemographicAge, gender, family size and life cycle, income eg: executive banking Drs, a/c, & professionals , tourism at old age – museums.

PsychographicSocial class, lifestyle, personality fast track young people, bank 5 years scheme deposit

BehavioralOccasions, benefits, uses, or responses

Nations, states, Regions, cities, towns e.g.: Bank new branch,

tourism

Bases of market segmentation 180- 199chirstoper 6th

Pg: 123 -129 S.M. JHA

Steps of markets segmentation Identify bases for market segmentation Develop profile of segments( relevant) Develop measures of segment attractiveness Select the target segments Ensure the segments are compatible( well –

watched)

Stage I: Identify Segmentation ProcessStage I: Identify Segmentation Process Marketers follow two methods to determine the

bases on which to identify markets: Segments are predefined by managers based on their

observation of the behavioral and demographic characteristics of likely users

Segments are defined by asking customers which attributes are important and then clustering the responses

Stage II: Develop Relevant ProfileStage II: Develop Relevant Profile Next, marketers seek further understanding of

the consumer in each promising segment Must develop a profile of the typical consumer

and each segment Helps to accurately match consumer needs

with the firm’s marketing offers

Stage III: Forecast Market PotentialStage III: Forecast Market Potential Market segmentation and market opportunity

analysis combine to produce a forecast of market potential within each segment

Defines a preliminary “go or no-go” decision since the sales potential in each segment must justify resources devoted to further analysis

Stage IV: Forecast Market ShareStage IV: Forecast Market Share The next step is to forecast the firm’s

probable market share Competitors’ positions in targeted

segments must be analyzed A specific marketing strategy must be

designed to serve the targeted segments

The firm determines the expected level of resources it must commit to tap the potential demand in each segment

Stage V: Select Specific SegmentStage V: Select Specific Segment The preceding information, analysis, and

forecasts allow management to assess the potential for achieving company goals and to justify committing resources in developing one or more segments

Marketers also weigh more than monetary costs and benefits at this stage

Requirements for effective segmentation Measurability: The degree to which the size and

purchasing power of the degree can be measured. Accessibility: The degree to which the segment

can be reached and served (communication & distribution channels)

Sustainability: The degree to which the segment are large or profitable enough

Actionable: The degree to which the effective programs can be designed for attracting and serving the segments.

Differentiable: The segments are conceptually distinguishable and respond differently to different marketing mix elements and programs.

Criteria for evaluating market segments and targeting Segment size and growth Segment structural attractiveness Company objective and resources

Service positioning strategies Market analysis Internal analysis Competitive analysis Position statement Anticipating competitive response Evolutionary positioning

Environment and Trends The Marketing Environment Marketing Environment:

The actors and forces outside marketing that affect marketing management’s ability to build and maintain successful relationships with target customers

MicroenvironmentIncludes the actors close to the company

Macro environment Involves larger societal forces

Microenvironment

ActorsActors

Marketing must consider other parts of the organization including finance, R&D, purchasing, operations and accounting

Marketing decisions must relate to broader company goals and strategies

1. The company2. Suppliers3. Marketing

intermediaries4. Customers5. Competitors6. Publics

Marketing Environment The actors and forces outside marketing

that affect marketing management ability to develop and successful transactions with its target customers.

Types of Marketing environment Micro environment Macro environment

Micro Environment Company ‘s Microenvironment

Forces close to the company that affect its ability to serve its customer

Micro EnvironmentCompany:- Its internal environment functional

areas such as top management, finance and manufacturing etc.

Supplier :- Suppliers are firms and individuals that provide

the resources needed by the company to produce its goods and services .

Intermediaries:- Marketing intermediaries help the company

promote, sell, and distribute its goods to the final buyers.

Micro Environment

Public:- Any group that perceives itself having an

interest in a company ability to achieve its objectives.

Competitors:- Those who serve a target market with

similar product and services.Customer :- They purchases goods and services .

Macro Environment: The macro environment consist of broader forces that not only affect the company and the industry but also other actors in the microenvironment.

Demographic Environment Demography is the study of human populations

in terms of size, density, location, age, gender, race, occupation, and other statistics.

Why its information useful for business:- To know consumer capacity. Identify Focus area. To know Human resources.

The demographic environment refers to the size, distribution, and growth rate of groups of people with different characteristics.

The demographic characteristics of interest to marketers relate in some way to purchasing behavior, because people from different countries, cultures, age groups, or household arrangements often exhibit different purchasing behaviors.

A global perspective requires that marketers be familiar with important demographic trends around the world as well as within the United States.

Population Estimate —Year 2025

Demographic Trends World and country population statistics are important, but

most marketers target subgroups. Trends in population subgroups are typically the most useful to marketers, for example, the growth of the urban population.

Demographic Trends Another interesting trend is the is especially evident

in Italy, Japan aging of the population. The aging of the population, Britain, and the United States.

Natural Environment

The natural environment consists of natural resources required by marketers or affected by marketing activities.

Why its information is useful for business:- Identify and forecasting natural based

business. To know raw material capacity. To know supplier.

The Political/Legal Environment The political/legal environment encompasses factors

and trends related to governmental activities and specific laws and regulations that affect marketing practice.

Political Political LegalLegal

EnvironmentEnvironment

GlobalGlobalTrendsTrends

LegislationLegislationRegulationRegulation

Global Political Trends In today’s world economy, international

political events greatly affect marketing activities. For example the impact of the war on terrorism on the travel and security industries.

A second important political trend is movement toward free trade and away from protectionism. Studies show that countries with the free trade have the highest GDP growth.

Legislation

Regulations and Regulatory Agencies Most legislation in the United States is enforced

through regulations developed by a variety of agencies, and marketers must often work with regulatory authorities at the federal, state, and local levels.

Cultural EnvironmentThe cultural environment includes

institutions and other forces that affect society’s basic values, perceptions, Attitudes, Attitudes, and behaviors.

Why its information is useful for business :- To know lifestyle of people. To know changing structure of family. Fashion awareness. EG: Incredible India ( tourism)

IFETCE/MBA/2012/III/BA9253/unit-II/SRM/PPT/Version1.075

Economical environment The economic environment consists of

factors that affect consumer purchasing power and spending patterns.

Why its information is useful for business:- In price making . To know spending capacity . To help future expenses Income of people. Identity target customer according to

economical level.

The Economic Environment The economic environment includes

factors and trends related to income levels and the production of goods and services.

Economic trends in different parts of the world can affect marketing activities in other parts of the world.

The gross domestic product (GDP) represents the total size of a country’s economy measured in the amount of goods and services produced.

Technological Environment Information technology has made it possible to

plan truly global supply chains.

Why its information is useful for business:- To make product and services on based of new

technology. To counter inflation and recession.(decline) To enhance personal efficiency and

effectiveness of business. Affective promotion

The Technological Environment The technological environment

includes factors and trends related to innovations that affect the development of new products or the marketing process.

These technological trends can provide opportunities for new product development, affect how marketing activities are performed, or both.

The Competitive Environment The competitive environment consists

of all the organizations that attempt to serve similar customers.

Product Product CompetitorsCompetitors

Offer different types of products to satisfy the same general need. Domino’s Pizza, McDonald’s, and Kentucky Fried Chicken are product competitors.

Brand CompetitorsBrand Competitors

The most direct competition, offering the same types of products as competing firms. For example, Nike is a brand competitor of Reebok as both companies manufacture shoes.

The Institutional Environment The institutional environment consists of all the organizations involved in marketing products and services.

Market Market Research FirmsResearch Firms

AdvertisingAdvertising

WholesalersWholesalers

RetailersRetailers

SuppliersSuppliers

CustomersCustomers

Trends in Segmentation, Targeting and Trends in Segmentation, Targeting and PositioningPositioning From Mass, Anonymous( unsigned) , Aggregated and

Sample Data to Names, Individual and Specific !

In addition to segmenting the customers in the marketplace, and designing campaigns for each segment, marketers will be asked to go further and, for each segment, provide a way to personalize the campaign for each person in the segment … the beginning of PARTICLE MARKETING.

Trends in Segmentation, Targeting and Positioning Syncographics(Syncographics: Market researchers actively attempt

to discern what is the most likely time for individuals to buy something. Called syncographics, this investigative tool presupposes that when consumers are anticipating an event—from a marriage or baby to a vacation or graduation—they must buy certain things)

Motigraphics( Consumer decisions are based on emotion, not reason)

Direct Marketing Technology. Persona Technologies Cyber segmentation. CLIP (A Classification of Internet

People) Demography. DBS (Direct Broadcasting Satellite Systems) RFID (Radio Frequency Identification) Particle marketing (Physics) and Neurolinguistics (Genetics) “Solutions” positioning vs. Fuzzy Value Propositions and/or

confusion marketing83

Services Unit-2.ppt

Documents

Unit 5 PPT

Unit 4 PPT

Services Ppt

unit 3.ppt

Unit 28.ppt

Ppt unit 4

Chemistry Unit 2 PPT

Mbt201 Unit 15 Ppt

Differentiated unit ppt

ppt (unit 3)

Unit 8.ppt

Unit ii-ppt

Chemistry Unit 4 PPT

Unit ii ppt

Unit 1,2,3 LO ppt

Unit 38.ppt

Ppt unit d

Unit 4.ppt

unit 3 ppt

Ppt unit 8