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MKT 346: Marketing of Services Dr. Houston. Chapter 1: Introduction to Services Marketing. Why Study Services?. Services Dominate the Economy in Most Nations Most New Jobs are Generated by Services. Transforming the Service Economy. Government Policies. Business Trends. Social - PowerPoint PPT Presentation
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MKT 346: Marketing of ServicesDr. Houston
Chapter 1:Introduction toServices Marketing
Why Study Services?
Services Dominate the Economy in Most Nations
Most New Jobs are Generated by Services
Government
Policies
Business
TrendsSocial
Changes
Advances in
IT
Globalization
Transforming the Service Economy
Five Major Forces
Are
Transforming
The Service Economy
Government
Policies
Business
Trends
Social
Changes
Advances in
IT
Globalization
Innovation in service products & delivery systems, stimulated by better technology
Customers have more choices and exercise more power
Success hinges on:● Understanding customers and competitors
● Viable business models
● Creation of value for customers and firm
● New markets and product categories
● Increase in demand for services
● More intense competition
Transforming the Service Economy
What Do Services Involve?
Services involve:
A form of rental Benefits without transfer of ownership
Customers pay for the temporary right to:
Hire the labor and expertise of personnel Obtain access to facilities and networks
Five Broad Categories of Non-Ownership Framework
Rented goods and services
Defined space and place rentals
Labor and expertise rentals
Access to shared physical environments
Systems and networks (access and usage)
Four Categories Of Services (Fig 1.10)
Defining Services
Activities, processes, and performances offered by one party to another
In exchange for money, time, and/or effort
Eight Distinctive Challenges of Marketing Services
Intangibility
Difficult to visualize and understand
Cannot be stored (perishability)
Co-produced with customers
Service personnel and customers play key role
Service experience varies widely
Time factor is very important
Distribution can be through non-physical channels
Services Require An Expanded Marketing Mix
●Marketing can be viewed as: A strategic and competitive direction A set of functional activities A customer-driven orientation
●Marketing is the only function that brings operating revenues into a business
All other functions are cost centers
Expanded Services Marketing Mix:The Seven Ps of Services Marketing
●Product elements (Chapter 4)
●Place and time (Chapter 5)
●Price and other user outlays (Chapter 6)
●Promotion and education (Chapter 7)
●Process (Chapter 8)
●Physical environment (Chapter 10)
●People (Chapter 11)
Framework For Developing Effective Service Marketing Strategies
Managing the Customer Interface
Part III: Chapters 8 - 11
Understanding Service Products, Consumers & Markets
Part I: Chapters 1 - 3
Applying the 4 Ps to Services
Part II: Chapters 4 - 7
Implementing Profitable Service Strategies
Part IV: Chapters 12 - 15
MKT 346 Chapter 1 Key Concepts
Why study services?
Eight common differences/special challenges of services (versus products)
Seven Ps of services marketing
Defining services
Five major forces transforming service economy
What are services?
Five broad categories within service non-ownership framework
Four broad categories of service