Services Flashcards
Service
exchange of human/mechanical effort (skill/expertise) to provide to people/objects without ownership
Nature of services
tangible and intangible but dominated by intangibility, found everywhere (ubiquitous)
Importance in NZ
73.9% employees in service sector, 70% of GDP
Examples
childcare, air travel, legal advice, insurance, repairs
4 service characteristics
intangibility, perishability, variability, inseparability
Intangibility
cannot be perceived by the senses, cannot be physically possesed. creates uncertainty
Reducing customer uncertainty with intangibility
tangible cues (logos, uniform), guarantees, testimonials, word of mouth, servicescape
Intangibility marketing challenges
difficult for customer to evaluate, no physical possession, difficult to advertise and display and set and adjust prices, process not protectable
Inseparability
production and consumption happens at the same time. shared responsibility (co creation)
Implications of inseparability
direct sale only, limited operation, customisable
Inseparability marketing challenges
can’t mass produce, customer participates in production, other consumers affect experience, difficult to distribute
Perishability
inability of unused service capacity to be stored for later use. balancing supply and demand
Balancing supply and demand to reduce pershability
production scheduling, inventory techniques, stimulating/restricting demand, increase/decrease capacity, special offerings, reservations, flexible pricing
Perishability marketing challenges
can’t be stored, difficult to balance supply and demand, unused capacity is lost, time sensitive
Variability
heterogeneity - variation in quality. caused by nature of human behaviour. unable to consistently deliver value
Overcoming heterogeneity
service delivery systems, automate, manage customer expectation, staff training, quality control (mystery shoppers)
Variability marketing challenges
quality difficult to control, delivery difficult to standardize
Marketing mix for services
product, price, promotion, place, physical evidence, people, processes
Product
standardising and tangibilizing services and grouping core and supplementary products to give ownership
Price
variables: performance, time and demand. indicated quality
Promotion
tangible cues that symbolise service. visualisation, association, physical representation, documentation
Place
short and direct distribution (inseparability), high or low contact, provider present
People
actors and participants involved while service is occuring. Personnel (staff) and other customers (C2C interaction, co-creation)
Co-creation
customer takes active role in service experience, hugely effects the outcome
Personnel
employees, face of company. right staff and training enhances customer experience. bad experiences can be saved by sympathetic staff. aesthetic/emotional labour
C2C interaction
presence of other customers affects experience. direct/indirect, positive/negative impact
Minimising negative interactions
positioning, staff training and layout, minimum standards, staff monitoring
Physical evidence
tangible and intangible clues customer observes that represents and validates the service. Atmospherics
Atmospherics
compelling and engaging atmosphere communicates brand. music, scent, lighting
Processes
flow and progress of customers when engaging with product. result in performance that exceeds expectations. queuing, sensitivity, digital technology
Mapping customer experience
customer journey - full product experience. visual tool helps company understand consumer behaviour. each touch point influences perception
Service quality dimensions
reliability, responsiveness, empathy, assurances, tangibles
Moment of truth
interaction between staff member and a customer
