2. Key Elements of Services Marketing Product Pricing -
Communication Mix Distribution People Physical Evidence Process
Positioning Market Segmentation Balancing of Demand & Capacity
Branding of Services Problems &Solutions 3. Marketing Mix a set
of variables for achieving marketing and strategic goals of an
organization Standard Product Price Promotion Place Extended People
Physical Evidence Process (Productivity) (Professionalism)
(Proactiveness) 4. Product Place PromotionPrice Standard Marketing
Mixes 4Ps C 5. PRODUCT 6. Product Product is an object which is
developed, produced, delivered and consumed (Goods) Product is a
bundle of features and benefits related to a specific target market
(Services) 7. Total Product Concept - Core or Genetic
(Communication) - Basic (Features & Design, Quality, Brand
Name, Packaging) - Expected (Look, Light Weight, Battery, Colour
Display, Polyphonic Ringtones etc., ) (Normal Expectation) -
Augmented (FM, MP3, BlueTooth, Camera, Voice Dialing) (beyond
normal expectation) - Potential (Internet, E-Mail, TV, GPS)
(Possible Evolution) 8. Product Life Cycle - Introductory Phase -
Growth Phase - Maturity Phase - (Saturation Phase) - Decline Phase
- (Rejuvenation Phase) - (High Growth Phase) 9. Service Package The
core Service Facilitating Services Supporting Services The Service
Concept Consumer Participation InteractionAccessibility of the
Services 10. Developing New Service Offer Consumer Benefit Concept
What benefits consumers seek Service Concept What benefits the
organization should offer Service Offer Elements Tangibles and
Intangible Form What way/ How Levels Quality Image Quantity -
Volume Service Delivery Processes People Facilities Managing Image
Support Perceptions Go beyond 11. New Service Development Idea
Generation Idea Screening Concept Development Concept Testing
Business Analysis Pilot Development Pilot Testing Commercialization
Review 12. PRICE 13. Price Price alone brings the revenue. Pricing
translates potential business into reality 14. Profit Maximization
Revenue Maximization , Prestige. Survival , Product Quality
Leadership PRICE 15. Penetration pricing Here the organisation sets
a low price to increase sales and market share. Once market share
has been captured the firm may well then increase their price. FOR
EG: A television satellite company sets a low price to get
subscribers then increases the price as their customer base
increases. 16. Skimming pricing. . Skimming pricing: The
organisation sets an initial high price and then slowly lowers the
price to make the product available to a wider market. The
objective is to skim profits of the market layer by layer. For eg:
A games console company reduces the price of their console over 5
years, charging a premium at launch and lowest price near the end
of its life cycle. 17. Competition pricing. Setting a price in
comparison with competitors. Really a firm has three options and
these are to price lower, price the same or price higher For eg;
Some firms offer a price matching service to match what their
competitors are offering. 18. Bundle Pricing The organisation
bundles a group of products at a reduced price. Common methods are
buy one and get one free promotions or BOGOF's as they are now
known. For eg:Health clubs offer a range of facilities at a single
price. 19. Psychological pricing The seller here will consider the
psychology of price and the positioning of price within the market
place The seller will therefore charge 99p instead 1 or $199
instead of $200. The reason why this methods work, is because
buyers will still say they purchased their product under 200 pounds
or dollars, even thought it was a pound or dollar. 20. Differential
pricing. Different price will be charged for different customer
segments. For eg: children below ten charged less in amusement
parks. 21. Psychological pricing The seller here will consider the
psychology of price and the positioning of price within the market
place The seller will therefore charge 99p instead 1 or $199
instead of $200. The reason why this methods work, is because
buyers will still say they purchased their product under 200 pounds
or dollars, even thought it was a pound or dollar. 22. Frame work
for Pricing Decisions Cost Considerations Profit Considerations
Demand Considerations Competitive Considerations Legal
Considerations (Govt. Policies) Customer Considerations Product
Considerations (Technology) 23. PROMOTION 24. Objectives Promotion
Mix Salespeople Kind Number Selection Training Motivation
Evaluation Advertising Targets Kinds of ads Media type Copy thrust
Prepared by whom Sales promotion PR Publicity PROMOTION 25.
Promotion Promotion is the communication tool of the service to
target the Customers. Promovere (Greek Word) means to shift the
attention of people from one end of the spectrum to another. 26.
Promotion Objective Communication related to the Service Develop
Personal Relations Create the Image of the Organization. 27.
Promotion Tools Advertising Public Relations Sales Promotion
Personal Selling Word of Mouth Direct marketing. 28. Paid form of
non personal communication. To build awareness,add knowledgeof the
service. To differentiate the service and persuade the customer to
buy the service. 29. PLACE / DISTRIBUTION Objectives Channel type
Market Exposure Kinds of Intermediaries Kinds and locations of
Outlets How to handle transporting and storing Service levels
Recruiting Intermediaries Managing Channels 30. Place or
Distribution Place Gives customers access and availability to its
services. 31. Key Issues Channel Options Agents/ Brokers Sellers /
Buyers Agents Electronic Channels Franchisees Channel Design
Location and Logistics. 32. Answer How to deliver the service to
the customer? Where and when should the delivery of service take
place? What roles do intermediaries or middlemen have to play in
the service delivery process? How can a marketer juggle the
delivery of the tangible and intangible components of a service
offer? How can the location be made to positively affect service
encounter? 33. Christopher Lovelocks approach to classification of
Services The Customer goes to the Service Provider. Eg.
Restaurants, Health Clubs, Beauty Clinics The Service Provider goes
to the Customer. Eg. Home Delivery The Service Provider and the
Customer transact from a distance. Eg. Internet Banking, Mobile
Banking, Online Reservation. 34. Flexibility Location &
Consumer LOCATION DECISIONS ORIENTED TOWARDS PRODUCERS e.g.
Visiting Ganapatipule, Maharashtra for a beach holiday TRADE OFF
BETWEEN EASE OF ACCESS AND COST OF THAT ACCESS e.g. Mobile banking
CAN THE SERVICE ACTUALLY TAKE PLACE? e.g. Hospital trauma centers
LOCATION DECISIONS ORIENTED TOWARDS CONSUMERS. e.g. Home appliance
and building maintenance. Low High High 35. Design of a
Distribution Channel Specify the role of Distribution within the
Marketing mix Select type of distribution Channel Determine
appropriate Intensity of Distribution Choose specific Channel
members A well designed Distribution Channel Ch 1 Ch 2 Ch 3 Ch 4 Ch
5 36. Channel Option for Service Companies Service Provider
Customer ZERO LEVEL ONE LEVEL TWO LEVEL ONE LEVEL Agent or Broker
Sellers Agent Buyers Agent Franchised or Contracted Service
deliverer 37. Factors affecting choice of location. Nature of
interaction Nature of service 38. Nature of customers demand
Competitive positioning Natural geographic location 39.
Technological advancements Dependance on other services
Infrastructural facilities 40. Product Place Promotion Price
Objectives Physical Chars. Prod. Class Service Features Benefits
Quality Accessories Installation Instructions Warranty Product
Line(s) Packaging Branding NPD? &/or Elimination? PLC Implics.
An Extended Product Concept Objectives Channel type Market Exposure
Kinds of Intermediaries Kinds and locations of Outlets How to
handle transporting and storing Service levels Recruiting
Intermediaries Managing Channels Channel Co-op (Not Conflict) is
Goal Who Has Power? Objectives Initial Pricing -Penentration
-Skimming -Combo P Flexibility P Sensitivity P Level over PLC
Geographic terms Discounts Allowances Legal Implics. Factors Infl.
Basic P Det. Strategic Decision Areas Objectives Promotion Mix
Salespeople Kind Number Selection Training Motivation Evaluation
Advertising Targets Kinds of ads Media type Copy thrust Prepared by
whom Sales promotion PR Publicity 41. PEOPLE 42. People Most
important resource which represents the organization to the
customers. Useful tool in Internal and Interactive Marketing. An
employee should be Service minded and Customer oriented.
Performance cannot be separated from the people. 43. Service
Personnel Low Contact Services High Contact Services Consumer
Service Employees Professional Service Employees Back Office Staff
Support Staff Management 44. Planning for People Select Right
Person Provide Adequate Training Offer a Vision Continuously impart
Skills & Knowledge. Develop their Creativity. Enforce
Performance Appraisal. Offer Promotion & Rewards. Give
Feedback. 45. Objectives of Internal Marketing Strategic Level
Objective Create an Internal Supportive Environment. Choose
Management Methods Adopt Transparent Personnel Policy. Have an
Internal Trading Policy. Built a System of Planning and
Controlling. Tactical Level Objectives Make People understand why
they are expected People are the First Market. to Perform. Support
the Service Systems. Built a Customer Friendly Environment. Built
Internal Information / Communication Channels. 46. Managing the
Internal Environment Competence and Skills related to the Job.
Clear Knowledge of Product Features and Benefits. Physical
Appearance of People. Positive Attitude of People. Presence of Mind
and Speed of Response. 47. Managing the External Environment
Understand the Customer (and his Family) Understand his Needs and
Expectations. Blend Differentiations. Be a Psychologist. Under
Promise, Over Deliver 48. PHYSICAL EVIDENCE 49. Physical Evidence A
Physical Object is self defining; a Service is not. Key is to Offer
Tangible Clues for Intangible Service. Think about an Advertisement
offering tangible clue of a pure Service (Assignment) 50. Tools for
Physical Evidence Services capes Business Cards Employee Dress
Reports Signage Equipment Statements Facility Design Other
Tangibles 51. 3 D of Physical Environment PHYSICAL ENVIRONMENT
SOCIAL FACTORS Appearance, behaviour, number of employees etc.
-Quality and quantity of other customers. DESIGN FACTORS Aesthetics
- Architecture, colour scheme etc. -Functional dimensions of Design
in terms of layouts, comfort etc. AMBIENT FACTORS -Air equality
(temperature, humidity etc.) -Quality of scent - Degree of
circulation 52. Role of Evidence in Service Marketing Shaping First
Impressions. Managing Trust Facilitating Quality of Service
Changing the Image Providing Sensory Stimuli Socializing Employees
53. Frame work for Environmental User Relationship Physical
Environmental Dimensions Holistic Environmental Internal Responses
Behavior Cognitive Emotional Physiological Employee Responses
Cognitive Emotional Physiological Customer Responses Perceived
Services cape Individual Behavior Individual Behavior Social
Interaction Signs, Symbols And Artefacts Ambient Conditions Space /
Function 54. PROCESS MANAGEMENT 55. Process The actual procedures,
mechanisms, and flow of activities by which the service is
deliveredthe service delivery and operating systems. Service
delivery systems Back stage Front stage Procedures Policies 56.
Characteristics of Process Divergence Services vary from customer
to customer Complexity Many activities in a single service Service
Location - Customer Participation and Interaction Service Itself
Process Based or Technology Based. Types of Process Line or Flow
Operations Job Shop Operations 57. Issues in Process Management No
Area of Operations Explanation 1 Process Planning and Control
Operation specification to achieve service output in terms of
quantity, quality, delivery and cost. 2 Operations Planning
Detailed specification of each sub system. 3 Facilities Design
Design, layout, locations, materials handling and maintenance 4
Scheduling Detailing the timings at which service operations should
be completed by agreed delivery promises within available resources
and with their economic utilization. 5 Inventory Planning and
Control Planning and controlling the inventory of people and
capacity. 6 Quality Control Quality standards are attained in each
service system. 7 Operations Control Information flows into and out
of service systems and ensures that operations are undertaken at
specific times as per schedule. 8 Forecasting and Long term
planning Anticipating demands and forecasting capabilities that
need to be inducted in the system. 58. Attributes of Process
Service Design and Development Design of Flow of Activities
Standardized Process Customized Process Number of Steps in the
Process Simple Complex Customer Involvement Blueprints. 59. PROCESS
Process is the way of undertaking transaction , supplying
information and providing services in a way which is acceptable to
the customer and effective to the organization. Services are
rendered and experienced simultaneously.(Inseparability). It is the
process through which consumers interact with service provider. E.g
Tourism : booking systems for travel and accommodation., use of
credit cards for payments, design of queuing system at visitor
attraction. While designing a process , the process designer has to
maintain a balance between functionality, security , aesthetics and
ease of use by customer.. 60. Critical Moments : Customer remains
an integral part from pre- consumption stage through to post-visit
feedback. By monitoring service encounters it is possible to design
service delivery systems which guide the interaction between
1)front-line staff and customers 2)front-line and support staff
3)pre-delivery, delivery, post delivery 4)staff and suppliers. The
above concept is called service blueprinting . 61. SERVICE Blue
Print it is a visual portrayal of a service plan. It is a detailed
map or flow chart. This is a technique which is used when planning
a new or revised process and prescribing how it ought to function.
62. Preparation of service blueprint. Represent the service in the
form of its molecular structure. Break down the process into
logical steps. Recognize the variability in the process Identify
the back stage elements in the process 63. Blue Printing - Elements
Customers Action (Line of Interaction) Onstage Employee Actions
(Line of Visibility) Backstage Employee Actions (Line of Internal
Interaction) Invisible Support Actions & Processes 64. Why Blue
Printing? Marketing & Operations personnel can interact with
each other. Provides a check on the logical flow of the whole
process. Identification of Bottlenecks. Balanced Production line
Effective tool to recognize the changing system to process To have
targets based on customers expected level of service. 65. Steps in
Blue Printing 1. Identify the Process: 2. Map process from
Customers point of View 3. Draw Line of Interaction 4. Draw line of
Visibility 5. Map process from Contact Personnels view 6. Draw line
of Internal Interaction 7. Link Customer and Contact person
activities to support functions. 66. Physical - - - - - - - - - - -
- - - - Evidence - - - - - - - - - - - - - - - Customer Action Line
of Interaction Onstage Contact Employee Actions Line of Visibility
Backstage Contact Employee Actions Line of internal Interaction
Support Process 67. Service BluePrint Template 68. Service Blue
Print for Check In to Check-Out for overnight Hotel Stay 69.
Airlines BluePrint 70. conclusion The marketing mix for a service
has additional elements because the characteristics of a service
are different to the characteristics of a product Firms marketing a
service need to get each of these elements correct.
