Week 1: Chapter 1 Flashcards
What are the 5 powerful forces transforming services marketing?
- Government Policies
- Social Changes
- Business Trends
- Advances in IT
- Globalisation
What do the 5 powerful forces transforming services marketing do?
- New markets and product categories
- Increase demand for services
- More intense competition
Which leads to; - Innovation in service products and delivery systems, stimulated by improve technology
What does success hinge on?
- Understanding customers and competitiors
- Viable business models
- Creation of value for customers and firms
- Increased focus on services marketing and management
Transforming Force 1: Government Policies consists of?
- Changes in regulations
- New rules to protect customers, employees and the environment
- Privatization
- New agreement on trade in services
Transforming Force 2: Social Changes consists of?
- Rising consumer expectation
- Greater affluence
- Personal outsourcing
- Increased desire for buying experiences vs. things
- Rising consumer ownership of high tech equipment
- Easier access to more information
- Migration
- Growing but aging population
Transforming Force 3: Business Trends consists of?
- Push to increase shareholder value
- Emphasis on productivity and cost savings
- Manufacturers add value through service and sell services
- More strategic alliances
- Focus on quality and customer satisfaction
- Growth of franchising
- Marketing emphasis by nonprofits
Transforming Force 4: Advances in IT consists of?
- Growth of Internet
- Greater bandwidth
- Compact mobile equipment
- Wireless networking
- Faster, more powerful software
- Digitization of text, graphics, audio, video
Transforming Force 5: Globalisation consists of?
- More companies operating on transnational basis
- Increased international travel
- International mergers and alliances
- “Offshoring” of customer service
- Foreign competitors invade domestic markets
Does the service sector dominate the global economy?
Yes
Are most new jobs generated by services?
Yes
Define Services?
- Services are economic activities offered by one party to another
- Most commonly employ time-based performances to bring about desired results
Service customers expect to obtain value from ?
- Access to goods labor, facilities, environment, professional skills, networks and systems… However, they do not normally take ownership of any of the physical elements involved
Name 9 types of services?
- Personal skill services (hairdressing)
- Health Services (Doctor)
- Professional services (Solicitor)
- Social services (kids help line)
- Communication Services (social media)
- Utilities (electricity)
- Simple convenience Services (cleaning)
- Transport Services (Trains)
- Leisure Services (online games)
What are the four broad categories of services based on?
- Differences in nature of service act (tangible or intangible); and
- Who or what is direct recipient of service (people or possessions)
What are the four broad categories of services? (PIMPS)
- People Processing
- Information Processing
- Mental Stimulus Processing
- Possession Processing
People Processing? Customers Must? Managers should?
Customers must:
- Physically enter the service factory
- Co-operate actively with the service operation
Managers should think about process and output from customer perspective to identify benefits created and non-financial costs such as time, mental effort and physical effort
Possession Processing?
- customers are less involved compared to people processing services
- Involvement may be limited to just dropping off the possession
- Product and consumption are separable
People processing is services directed at? example (Tangible)
Services directed at people’s bodies.
Example; Hairstylist, Passage transportation, health care…
Possession Processing is services directed at? examples (Tangible)
Services directed at physical possession.
Example; Freight transportation, laundry and dry cleaning, repair and maintenance.
Mental Stimulus Processing
- Physical presence of recipients not required
- Core content of services is information based that can be “inventoried”
- Ethical standards are important
Information Processing
- Information is the most intangible form of service output
- May be transformed into enduring forms of service output
- Line between information processing and mental stimulus processing may be blurred
Mental Stimulus Processing is services directed at? intangible examples
Services directed at peoples mind.
Example; Education, Psychology, Advertising PR
Information Processing is services directed at? intangible examples
Services directed at intangible assets.
Example; Accounting, Banking, Legal services
Goods Vs Services
Goods are items that are tangible, such as pens, salt etc. and services are activities provided by other people, such as airline flights etc.
Marketing through services…
When service increases the value of a core physical good
Marketing of services…
When service is the core product
8 Challenges Posed by Services
- Most service products can not be inventoried
- Intangible elements usually dominate value creation
- Services are often difficult to visualise and understand
- Customers may be involved in co-production
- People may be part of the service experience
- Operational inputs and outputs ten to vary more widely
- The time factor often assumes great importance
- Distribution may take place through nonphysical channels
Services 7 P’s
- Product
- Price
- Place
- Promotion
- Proccesses
- People
- Physical evidence
Processes (P5)
The order and/or system of service delivery
People (P6)
Direct contact between customers and service personnel
Physical Evidence (P7)
An actual physical component or a cue to indicate the existence quality (referred to as servicescape)
