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Services Marketing Unit-6. Service Marketing Strategies MBA-3 rd Sem-2009-2011. Formulating service marketing strategies Designing communications mix for promoting services Role of information technology in marketing of services. Learning Objectives. - PowerPoint PPT Presentation
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Services Marketing
Unit-6
Service Marketing Strategies
MBA-3rd Sem-2009-2011
• Formulating service marketing strategies
• Designing communications mix for promoting services
• Role of information technology in marketing of services
Learning Objectives
• To understand the general role of communications in services marketing
• Understand the effective use of communications channels
• To understand the role of corporate design/brand within marketing communication strategy
• To understand the use of Internet in communicating services
ServiceCharacteristics
IntangiblePerformance not the object
Provide tangible cluesInformation helps to
reduce risk
InseparableUse personnel to
educate customers“how it works”
Poor information = Nasty surprises
Personal information = important
IntermediariesIn some services
Can be very importantBut not all
PerishablePromote specific periods when
necessary
Issues in communicating services
• Use analogy: Accenture Performance / golf
• http://www.youtube.com/watch?v=w3NKMUOc7PA
• Tarpon
• http://www.youtube.com/watch?v=4hv_V_Af19M
Communications Challenges in Services Marketing
• Facilitate customer involvement in production – prepare customers for service experience and demonstrate roles– teach customers about new technologies, new features
• Help customers to evaluate service offerings– provide tangible or statistical clues to service performance– highlight quality of equipment and facilities– emphasize employee qualifications, experience, professionalism
• Stimulate or dampen demand to match capacity– provide information about timing of peak, off-peak periods– offer promotions to stimulate off-peak demand
• Promote contribution of service personnel – help customers understand service encounter– highlight expertise and commitment of backstage
personnel
People as communication platform Virgin Atlantic vs. Singapore airlines
• http://www.youtube.com/watch?v=EPIjCS9YRw4
• Singapore Airlines
http://www.youtube.com/watch?v=ykSBMqffuQ8
Goods v Services Implications for communications strategy
• Provide tangible clue/evidence• Educate and train customers to use and to
evaluate services• Help manage demand levels to match firm’s
capacity• Reduced communication role for intermediaries• Importance of contact personnel requires
internal communication to inform, motivate and create role models
Education as part of communications
Informwhat the
company does
Educatehow it’s done
Persuadethat the best solution is
offered
RemindRenewable service
Maintain contactUpdates
Further education
Educate employeesto deliver
all/partcommunications
Develop WOM support
Teach customers how to use the serviceManage demand levels
Reduce uncertainty by providing usefulinformation and advice
Provide reassurance (eg service guarantees)Recognise and reward valued customers
Common educational and promotional objectives
Create tangible, memorable imagesBuild awareness and interest to stimulate trialCommunicate brand’s strength and benefits
Counter competitive claimsReposition service relative to competition
SMART objectives
The 5W’s model for communication plan
• Who is our target audience?
• What do we need to communicate and achieve?
• hoW should we communicate this?
• Where should we communicate this?
• When do the communications need to take place?
The integrated services communications mix
Messages originating within the organization
Messages originating outside the organization
Production
Channels
MarketingChannels
Front-line staff
Service outlets
AdvertisingSales promotionsDirect marketingPersonal sellingPublic relationsE-comms.
Word of mouth
Media editorial
AUD IENCE
Word of Mouth• Perceived as more credible than firm-initiated
promotional activities• Have a powerful influence on people’s
purchasing decision • The higher the risk the more important for WoM• Less knowledgeable customers rely more on
WoM• Dissatisfied customers are more likely to pass
negative WoM than satisfied customers• Indicator for profitability (Reichheld, 2003)
WoM (con.)
• Stimulate positive and persuasive comments from existing customers by:– Referencing other purchasers and knowledgeable individuals– Create Buzz – exciting promotion, events – Developing referral incentive scheme– Publicising testimonials that simulate WoM
• Internet is ubiquitous & openly accessible, it has accelerated the spread of personal influence which evolves into a “viral marketing” phenomenon. e.g. blogs
• http://blogs.ebay.com/
• http://www.suspendedfromebay.com/
What is Brand Equity and Why Does It Matter?(From Berry, “Cultivating Brand Equity”)
Definition: A set of assets and liabilities linked to a brand’s name and symbol that adds to (or subtracts from) the perceived value of the product
• Brand equity can be positive or negative
• Positive brand equity creates marketing advantage for firm plus value for customer
• Perceived value generates preference and loyalty
• Management of brand equity involves investment to create and enhance assets, remove liabilities
Corporate design, name, colour, image -recognizable symbols
A Service Branding Model: How Communications + Experience Create Brand Equity
Source: Adapted from L. L. Berry ( 2000) Cultivating Services Brand Equity, Journal of the Academy of marketing Science, 28(1), 128-137
Marketer-controlled communications
Firm’s Presented Brand (Sales, Advertising, PR)
What Media, Intermediaries,Word-of-Mouth Say re: Firm
Customer’s Experience with Firm
Awareness of Firm’s Brand
Meaning Attached To Firm’s Brand
Firm’sBrand Equity
Uncontrolled brand communications
Integrated communications
SERVICEBRAND
IDENTITY
ServicescapeDesign
Brand NameAnd Positioning
MarketingCommunications
Mix
CorporateDesign Elements
InteractiveMarketing
Marketing Communication and the Internet
• International in Scope– Accessible from almost anywhere in the world– Simplest form of international market entry
• Internet Applications– Promote consumer awareness and interest– Provide information and consultation– Facilitate 2-way communications through e-mail and chat
rooms– Stimulate product trial– Enable customers to place orders– Measure effectiveness of specific advertising/promotional
campaigns
Marketing Communications and the Internet
• Web Site design considerations – Memorable address that is actively promoted – Relevant, up-to-date content (text, graphics, photos)– Contain information that target users will perceive as useful/interesting– Easy navigation– Fast download– http://www.youtube.com/watch?v=9EQeFq2he4U&feature=related
• Internet advertising– Banners and buttons on portals and other websites seek to draw online
traffic to own site– Limits to effectiveness—exposure may not lead to increases in
awareness/preference/sales– Hence, advertising contracts may tie fees to marketing relevant behavior
(e.g., giving personal info or making purchase)