Week 1 Flashcards

1
Q

Define services

A

Any act, performance or experience that one party can offer to another.

o Essentially intangible and does not result in the ownership of anything

o	Processes (economic activities) that provide time, place, form (e.g. personal – hairdresser), problem solving (e.g. doctor) or experiential value (pleasure related – experiences e.g. holiday) to the receiver
o	Something that may be bought or sold, but cannot be dropped on your foot
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2
Q

explain value creation

A

o Customers expect to obtain value from their service purchase in exchange for their money, time and effort
o Value comes from a variety of value-creating elements rather than transfer of ownership
o Firms must create and deliver services that are perceived (by customers) to provide value
o Choose the value è Create the value è Communicate value
o Service-dominant logic (S-D logic): customers of services are co-creators of value

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3
Q

forces transforming the service industry

A

o The ‘hollowing out’ effect – outsource particular work e.g call centers to India
o Deregulation (removal of rules and restrictions) and privatization, e.g., banking, airline (e.g. Virgin airlines entering Aus’t market) and telecommunications industries (increasing competition)
o Social changes, e.g., aging population (financial services, curses, retirement villages) dual income families (e.g. eating out)
o Professional services and franchises (e.g. Boost)

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4
Q

5 differences between goods and services (povii)

A
intangibility
perishability
ownership
variability 
inseparability
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5
Q

explain the 5 major difference between goods and services

A

Intangibility: Difficult for consumers to evaluate quality because they cannot touch, taste or smell, or even see and hear, a service. Intangibility introduces an element of perceived risk.

Prevented by:
o Free first trial
o Introduce key staff members
o Provide a client list
o Provide examples of work undertaken
o Seek third party support and recommendations
o Ensure suitable surroundings (office, furniture etc.)

Inseparability: The service provider and the consumer co-produce the service (customer must be involved in some stage with service worker).

o Convenient locations
o Staff with high interpersonal skills
o Implement a service recovery programe

Variability: Difficult to maintain a uniform standard of service quality.

o	Hire qualified and experienced staff
o	Ongoing staff training
o	Excellent product knowledge
o	Efficient backstage support
o	Standardise tasks where possible

Perishability: Services are performances or experiences, which means that they cannot be stored after production to be used later to satisfy customer demand. (e.g. Airline seat)
o Bookings and schedules (e.g. marketing consultancy)

Ownership: Service personnel and their performance cannot be ‘owned’ by the customer.

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6
Q

look at table of managerial implications surrounding differences between services and goods

A

:)

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7
Q

how services differ from one another

A

o The degree of tangibility/intangibility of service processes
o Who or what is the direct recipient of service processes?
o The place of service delivery
o Customisation versus standardisation (Maccas, Ikea etc)
o Relationships with customers (goods harder to hold relationships, service relationships commonly held through ‘loyalty’ and ‘customer attention’
o Discrete versus continuous services
o High contact versus low contact (quickly dropping off a computer to be fixed)

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8
Q

explain service operations system

A

can be divided into those involving the actors (or service personnel) and those involving the stage set (or physical facilities, equipment and other tangibles).

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9
Q

define service delivery system

A

concerned with where, when and how the service product is delivered to the customer.

look at graphs pr low and high contact examples

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10
Q

define service marketing system

A

all the different ways in which the customer may encounter or learn about the service organisation.

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11
Q

explain ‘managing the evidence’ tangible elements and communication components in service marketing system

A
  1. service personnel - contact with customers face to face, over the phone, over computer may include sales staff, customer service, billing and accounts
  2. service facilities and equipment:
    building exteriors, parking areas, landscaping
    vehicles
3. non personal communications:
letters/proposals 
advertising
single
websites
  1. other people
    fellow customers, strangers
    word of mouth
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12
Q

extended marketing mix for services

A
people
processes
physical evidence 
product (service)
price
promotion 
place (cyberplace and time)
  • People: direct, personal interaction between customers and the firm’s personnel or employees for the service to be ‘manufactured’ and delivered.
  • Physical evidence (tangible cues): services cape - such as physical layout of the service facility, ambience, furnishings, background music and seating comfort.
  • Process of service production: required to manufacture and deliver the service. The actual procedures, mechanisms, and flow of activities through which the service is delivered
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13
Q

what is the ‘service management trinity’

A

The marketing function: segmentation, targeting, positioning, loyalty programs, etc.

The operations function: creation and delivery of the service product

The human resource function: recruitment, training, developing work systems, rewarding, empowering etc.

Are all inter connected in serving customers

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