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Distributing Services

Tom Chapmanwww.marketing101.co.ukTwitter @idlehans

SERVICESMARKETING

+Introduction

Influencing factors on Service Delivery

Impacts of Service Characteristics

The Role of Intermediaries

The Impact of Technology

Strength & Weaknesses of Delivery Models

+Different Services Places

Characteristics

Service delivery at

Customer’s Place

Provider’s Place Third Party’s Place

Service Types Services with immovable external factors

Services with immovable internal factorsServices with high process standardisation

Services with immovable external factor at third party’s place.Services where third party determines place

Examples House KeepingElderly Care

HairdresserBankRestaurant

AirportLegal Services (Court)

+Location & Customer Behaviour

Characteristics

Service delivery at

Customer’s Place

Provider’s Place Third Party’s Place

Quality Dimensions

Less control over atmospherics. Empathy, employee relationship more important.

Tangibles (equipment & employees)

Responsiveness

Greater Variability

Atmospherics have a greater effect on buying decision

Customer recruitment

+Deciding on a Location

+Timing of Service Delivery

+Timing of Service Delivery

+Timing of Service Delivery

+Channels of Service Delivery

+Differences between electronic delivery channels

Characteristics

Electronic Delivery Channels

Service Machine

Telephone Internet Mobile Channel

Customer Location Flexibility

Low High Medium High

Breadth of Modalities

Medium (Visual)

Medium (Voice)

Medium (Visual)

High (Voice, Visual)

Interactivity High High Medium High

Responsiveness

Low High Medium High

“for mobile service delivery, consumers are most concerned with the time-related gains they can obtain.” Kleijnen, De Ruyter, & Wetzels (2007, 42)

+Employees & Customers

Employees Customers They are the service

They are the organisation

They are the Brand

They are the marketers

Productive Resources (Bitner, 1997)

Contributors (Bitner, 1997)

Competitors (Bitner, 1997)

temporary employees (Bettencourt,1997)

Promoter (Bettencourt,1997)

+Customer Characteristics

Physical proximity

Verbal interaction

Varied activities

Heterogeneous customer mix

Core service is compatibility

Waiting times

Share time, space or facilities

+Intermediaries

Core Core Core+ =

Originating Firm

IntermediaryCustomer

Experience

+Franchising Benefits

Franchisers Franchisees Leveraged business format

Consistency in outlets

Knowledge of local markets

Shared risk

Established business format

Brand marketing

Minimal start up risks

+Franchising Challenges

Franchisers Franchisees Maintaining & Motivating

franchisees

Disputes and conflict management

Quality control

Ownership of customer

Encroachment

Reduced profits and revenues

Lack of control

High fees

+Agents & Brokers

Benefits Challenges Reduced selling &

distribution costs

Intermediary skill & knowledge

Wide representation

Knowledge of local markets

Customer choice

Loss of control over pricing and other aspects of marketing

Representation of multiple service principles

+Channel Conflict

Objectives and performance

Costs and rewards

Quality and consistency

Empowerment and control

Channel ambiguity

+Technology

Benefits Challenges Consistent delivery for

standardised services

Low cost (marginal)

Customer convenience

Wider distribution

Customer choice and ability to customise

Customer feedback / interaction

Customers are active not passive

Lack of control in electronic environment

Price competition Inability to customise Lack of consistency with

customer involvement Requires changes in

customer behaviour Security Geographic competition

+Technology - Meuter, et al (2005)

“For many firms, often the challenge is not managing the technology but rather getting consumers to try the technology.”

“Managers can use tactical strategies to influence role clarity, motivation, and ability either before or after an SST has been introduced.” Meuter, et al (2005, 78) Education Hand Holding Communicate benefits Learning from other consumers

+References Bettencourt, L. A. (1997). Customer voluntary performance:

customers as partners in service delivery. Journal of Retailing, 73(3), 383-406.

Bitner, M. J., Faranda, W. T., Hubbert, A. R., & Zeithaml, V. A. (1997). Customer contributions and roles in service delivery. International Journal of Service Industry Management, 8(3), 193-205.

Bruhn, D. M. (2005). Services Marketing: Managing the Service Value Chain. Financial Times/ Prentice Hall.

Kleijnen, M., De Ruyter, K., & Wetzels, M. (2007). An assessment of value creation in mobile service delivery and the moderating role of time consciousness. Journal of Retailing, 83(1), 33-46.

Lovelock, C. H. W., Jochen. (2004). Services marketing (5th ed. ed. Vol. xviii, 652 p. ill. 25 cm.). Upper Saddle River, N.J.: Pearson Education International/Prentice Hall.

Palmer, A. (2007). Principles of Services Marketing. McGraw-Hill Higher Education.

Meuter, M. L., Bitner, M. J., Ostrom, A. L., & Brown, S. W. (2005). Choosing among alternative service delivery modes: An investigation of customer trial of self-service technologies. Journal of Marketing, 69(2), 61-83.