Lovelock Srvcmktg Ce Ppt 03

7/26/2019 Lovelock Srvcmktg Ce Ppt 03

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Copyright 2008 Pearson Education Canada Services Marketing, Canadian Edition Chapter 3- 1

Chapter 3

DevelopingServiceConcepts: Core

andSupplementaryElements


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Planning and Creating Services


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Planning and Creating Services

A service product comprises all elements of serviceperformance, both tangible and intangible, that createvalue for customers

The service concept is represented by:

A core product

Accompanied by supplementary services facilitate and enhanceuse of the core product and add value and differentiation


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Core Products andSupplementary Services

In mature industries, core products often becomecommodities

Supplementary services help to differentiate core productsand create competitive advantage by:

Facilitating use of core product (a service or a good

!nhancing the value and appeal of the core product


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Designing a Service Concept

"ore #roduct

"entral component that supplies the principal, problem$solvingbenefits customers see%

Supplementary Services Augment the core product, facilitating its use and enhancing its

value and appeal

&elivery #rocesses

'sed to deliver both the core product and each of thesupplementary services


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Core and Supplementary Services at Luxury Hotel(Offering Much More than Cheap Motel!

ReservationValet

Parking

Reception

BaggageService

CocktailBar

Restaurant

Entertainment/ Sports/Exercise

Internet

Wake-upCall

RoomService

Business

Centre

Cashier

A Room


7/27 Copyright 2008 Pearson Education Canada Services Marketing, Canadian Edition Chapter 3- 7

lo"charting Service DeliveryHelps to Clarify Product #lements

elps management visuali)e the customer*s totalservice e+perience

'seful for distinguishing beteen core product itselfand service elements that supplement core

-estaurants: Food and beverage (core -eservations (supplementary services

.ature of customer involvement ith serviceorgani)ations varies by type of service:

#eople processing

#ossession processing

/ental Stimulus processing

Information processing



Simple lo"chart for Delivery of aPeople$Processing Service (Fig 012

Park Car Check In

Room

BreakfastCheck

Out

BreakfastPrepared

Maid Makesup Room

People Processing Stay at Motel



%he lo"er of Service (Fig 013

Core

Inormation

Consultation

!r"er #aking

$ospitalit%

Pa%ment

Billing

Exceptions

Saekeeping

Facilitating elements

Enhancing elements

KEY:



Ho" to Determine &hat SupplementaryServices Should 'e Offered

.ot every core product is surrounded by all eight supplementaryelements

.ature of product helps to determine:

4hich supplementary services must be offered

4hich might usefully be added to enhance value and ease of use

#eople$processing and high$contact services have more supplementaryservices

/ar%et positioning strategy determines hich supplementary services

should be included

Firms ith different levels of service often add e+tra supplementaryservices for each upgrade in service level



%he lo"er of Serviceacilitating Services)nformation

Core

Customers often requireinformation about how to obtainand use a product or service.

Exampes of eements!

"irections to service site#chedue$service hoursPrices

Conditions of sae%sa&e instructions



%he lo"er of Serviceacilitating ServicesOrder %a*ing

Core

Customers need to know whatis avaiabe and ma' want tosecure commitment todeiver'. (he process shoudbe fast and smooth.

Exampes of eements!

)ppicationsOrder entr'

Reservations and check*in



%he lo"er of Serviceacilitating Services'illing

Core

++ow much do I owe 'ou,,Bis shoud be cear-)ccurate- and intei&ibe.

Exampes of eements!

Periodic statements ofaccount activit'

Machine dispa' of amount

due



%he lo"er of Serviceacilitating ServicesPayment

Core

Customers ma' pa' fasterand more cheerfu' if 'oumake transactions simpe

and convenient for them.

Exampes of eements!

#ef service pa'ment"irect to pa'ee or intermediar')utomatic deduction



Core

%he lo"er of Service#nhancing ServicesConsultation

aue can be added to &oodsand services b' offerin& adviceand consutation taiored toeach customer-s needs andsituation.

Exampes of eements!

Customi/ed advicePersona counsein&

Mana&ement consutin&



%he lo"er of Service#nhancing ServicesHospitality

Customers who invest time andeffort in visitin& a business andusin& its services deserve to betreated as wecome &uests0after a- marketin& invited them1

Exampes of eements!

2reetin&3aitin& faciities and amenities4ood and bevera&es(oiets and washrooms

#ecurit'

Core



Core

%he lo"er of Service#nhancing ServicesSafe*eeping

Customers prefer not to worr'about ookin& after the personapossessions that the' brin&with them to a service site.

Exampes of eements!

5ookin& after possessionscustomers brin& with them

Carin& for &oods purchased

6or rented7 b' customers



Core

%he lo"er of Service#nhancing Services#xceptions

Customers appreciate somefexibiit' when the' makespecia requests and expectresponsiveness when thin&s

don-t &o accordin& to pan.

Exampes of eements!

#pecia requests in advanceCompaints or compimentsProbem sovin&Restitution



Managerial )mplications

To develop product policy and pricing strategy, managersneed to determine:

4hich supplementary services should be offered as a standardpac%age or as fee based options

Firms that compete on a lo$cost, no$frills basis needsfeer supplementary elements than those mar%etinge+pensive, high$value$added services

!ach floer petal must receive consistent care and concernto remain fresh and appealing



Planning and 'randing ServiceProducts



'randing .lternatives

#urpose of branding is to establish a mental picture of theservice and clarify the value proposition

Service mar%eters need to be their brand champions

5randing alternatives are:

5randed ouse brand name to multiple offerings in unrelatedfields e1g1 6irgin 7roup

Sub 5rands master brand is primary frame of reference but

product has a distinctive name e1g1 Singapore Airlines -affles "lass !ndorsed 5rands #roduct brand dominates the corporate name

e1g1 hotels

ouse of 5rands corporation ith a number of products, eachpromoted under its on brand name e1g1 #roctor 8 7amble


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Developing /e" Services


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. Hierarchy of/e" Service Categories (0

-ange from ma9or innovations to simple style changes:

1 /a9or service innovations

.e core products for previously undefined mar%ets

;1 /a9or process innovations

'sing ne processes to deliver e+isting products ith addedbenefits

01 #roduct$line e+tensions Additions to current product lines

21 #rocess$line e+tensions

Alternative delivery procedures


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. Hierarchy of/e" Service Categories (1


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2eengineering Service Processes

-eengineering involves analy)ing and redesigningprocesses to achieve faster and better performance

-unning tas%s in parallel instead of se>uence canreduce?eliminate dead time

!+amination of processes can lead to creation ofalternative delivery methods that constitute ne serviceconcepts

Add?eliminate supplementary services

-ese>uence delivery of service elements @ffer self$service options


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Services as Su3stitutes for 4oods O"nershipand %as* Performance (Fig 01;


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Summary 5 Chapter 6

The service concept consists of the core product, thesupplementary services and the delivery processes

Flocharting differentiates the core and supplementaryservices providing a total vie of the customer*s

e+perience

The petals of the Floer of Service shos hosupplementary services can enhance and facilitate

5randing provides a mental picture of the value proposition

There are = different categories of ne service designranging from ma9or innovations to style changes

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Lovelock Srvcmktg Ce Ppt 03