Different contexts of Marketing Flashcards
What is the significance of the services industry worldwide?
- Services account for more than 60 percent of GDP worldwide
- Almost all economies have a substantial service sector
- Strongest growth area for marketing
- Government, private non-profit, business & manufacturing sectors
What is a definition of service marketing?
an act or performance one party can offer to another that essentially intangible and does not result in the ownership of anything (Kotler and Keller 2012).
Why has the service industry grown?
- increased disposable incomes
* The trend of companies to move towards outsourcing
What are some service industry sectors?
- Government
- Private
- Not-for-profit
- Financial
What are the service characteristics?
- Intangibility
- Variability/heterogeneity
- Inseparability
- Perishability
Explain the intangible characteristic of a service industry
- Services cannot be seen, tasted, felt, heard or smelled before purchase
- Buyers will look for evidence of quality- physical evidence, presentation
- Job of service marketeers is to “ make Tangible the intangible” through tangible cues
What tangible/physical cues will marketers use to make services less intangible?
- Place
- People
- Equipment-spurs new stadium
- Communication material
- Symbols
- Price
Explain the variability/heterogeneity characteristic of services?
Services are variable - depend on who, when & where they are provided making standardisation hard
Variability in production and delivery, service environment, and service personnel (skills and personality) e.g. ski holiday with no snow
How can variability of services be reduced to improve standardisation?
- Invest in good hiring & training procedures
* Offer alternatives if full service cannot be offered e.g. walking routes/guide if no snow
Explain the inseparability of services/
- Service produced + consumed same time
- Sales before production
- Customers involved in the production e.g. atmosphere
- In entertainment, professional services, buyers interested only in the provider
Explain the perishability of services ?
- Services cannot be saved, stored, resold or returned
- If demand steady - no problem but If not - service firms have problems
- Several strategies - better match between demand & supply in service business
What are some demand-side policies to reduce impact of the perishability of services?
- Differential pricing – shift some demand from peak to off-peak periods
- Non-peak demand – can be cultivated. For example, Night Safari in Singapore
- Complementary services – to provide alternatives to waiting customers, such as cocktail lounges in restaurants
- Reservation system – a way to manage demand, employed by restaurants, airlines, season tickets.
What are some supply-side policies to reduce the impact of the perishability of services?
- Part-time employees – can be hired to serve peak demand
- Peak-time efficiency – employees only perform essential tasks during peak hours
- Increased consumer participation – Consumers pack their own shopping bags
- Shared services developed – Hospitals can share medical equipment
- Facilities for future expansion – companies can buy surrounding land
What is relationship marketing?
Marketing strategies that companies need to apply to retain customers over a long period of time.
What is loyalty?
Is more than behaviour and includes preference, liking, and future intentions
