chapter 10 services and other tangibles: marketing the product that isn’t there
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TRANSCRIPT
Chapter 10
Services and Other Tangibles:Marketing the Product
That Isn’t There
Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall10-2
Chapter Objectives
Describe the characteristics of services and the ways marketers classify services
Appreciate the importance of service quality to marketers
Explain the marketing of people, places, and ideas
Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall10-3
Real People, Real Choices: Decision Time at the Philadelphia 76ers
What is the best way to compile more detailed information on the 76ers customer base? – Option 1: Phase in a CRM database– Option 2: Send out surveys to season ticket
holders annually– Option 3: Analyze the lifetime value of
customers
Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall10-4
Marketing What Isn’t There
Intangibles: Services and other experience-based products that cannot be touched– Example: concerts, tax preparation, haircuts,
medical diagnosis, etc.
Does marketing work for intangibles? Yes!
Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall10-5
What Is a Service?
Services:– Are acts, efforts, or performances exchanged
from producer to user without ownership rights
Services share several characteristics:– Intangibility– Perishability– Variability– Inseparability
Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall10-6
Characteristics of Services
Intangibility: – Can’t see, touch, or smell a service
Perishability: – Services can’t be stored for later sale or
consumption • Capacity management allows firms to adjust
their services to match supply with demand
Variability: – Even the same service performed
by the same person will vary
Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall10-7
Characteristics of Services
Inseparability: – It is impossible to separate the production of
a service from its consumption– Service encounter:
The interaction between the customer and the service provider
– Disintermediation: Eliminating the interaction between customers and salespeople
Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall10-8
Classifying Services
Services can be classified by:– Whether the service is performed directly on
the customer or on some possession that the customer owns
– Whether the service consists of tangible or intangible actions
Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall10-9
The Services Continuum
Most products are a combination of goods and services
Products vary in their level of tangibility– Tangible: salt, necktie, dog food– Intangible: teaching, nursing, theater– Balanced products: fast food, television
Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall10-10
The Services Continuum
Goods-dominated products– Firms that sell tangible products still provide
support services, such as warranties, Web sites with FAQs, and 1-800 numbers
Equipment- or facility-based services– Operational factors, locational factors, and
environmental factors are important
People-based services
Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall10-11
Core and Augmented Services
Core service: – The benefit a customer gets from the service
• Example: Airline transportation from Dallas to Chicago
Augmented service: – Core service plus additional services that
enhance value • Example: Frequent flyer miles, in-flight movie
Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall10-12
Services on the Internet
Anything that can be delivered can be sold on the Web– Banking and brokerage services– Software– Music– Travel services– Dating sites– Career-related services– Medical care
Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall10-13
The Service Encounter
Several elements of the service encounter are important:– Social elements, including employees and
customers• Service quality is only as good as the employee
– Physical elements, including the servicescape, or actual physical facility where the service is performed, delivered, or consumed
• Servicescapes influence quality perceptions
Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall10-14
Providing Quality Service: Service Quality Attributes
Search qualities: – Product characteristics that the consumer can
examine before purchase Experience qualities:
– Product characteristics that buyers can determine during or after consumption
Credence qualities: – Product characteristics that are difficult to
evaluate even after experiencing them
Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall10-15
Providing Quality Service: Measuring Service Quality
Several methods of measuring service quality exist:– SERVQUAL scale (questionnaire) measures
customer perceptions of five key dimensions• Tangibles• Reliability• Responsiveness• Assurance• Empathy
Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall10-16
Providing Quality Service: Measuring Service Quality
Several methods of measuring service quality exist:– Gap analysis measures the difference
between actual and expected service quality– Critical incident technique uses customers
complaints to identify problems that lead to dissatisfaction
Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall10-17
The Future of Services
Services will continue to grow in the United States and global economies due to several factors:– Changing demographics – Globalization– Technological advances – Shift to flow of information
Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall10-18
The Future of Services
New dominant logic for marketing:– Argues that service is the central core
deliverable, while actual physical products are relatively incidental to the value proposition
Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall10-19
Marketing People, Places, and Ideas:
Marketing People Politicians and celebrities are
commonly marketed by agents or others– Celebrities often rename themselves to craft
a “brand identity”– Other techniques for selling celebrities:
• The pure selling approach• The product improvement approach• The market fulfillment approach
Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall10-20
Marketing Places
Marketing places– Attempting to position a city, state, country,
or other locale so consumers choose the brand over competing destinations
• Example: Shreveport-Bossier shares more characteristics with East Texas than it does with New Orleans, and now markets itself using the “Louisiana’s Other Side" campaign
Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall10-21
Marketing Ideas
Marketing ideas– Gaining market share for a concept,
philosophy, belief, or issue• Example: Religious institutions market ideas
about faith• Example: Not-for-profit organizations or
governmental agencies market ideas about proper or improper behavior, such as drinking and driving
Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall10-22
Real People, Real Choices: Decision Made at the Philadelphia 76ers
Lara chose option 1 and implemented a CRM database– Implementation: A web-based firm was hired
to provide a data warehouse and to develop CRM software. The 76ers realized a 150-to-1 ROI due to more targeted marketing efforts
– Measuring success: The 76ers used click-through and other e-mail metrics, and compared these rates to industry standards
Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall10-23
Keeping It Real: Fast-Forward to Next Class Decision Time at Taco Bell
Meet Danielle Blugrind, Director of Consumer and Brand Insights at Taco Bell
Taco Bell is a national fast-food firm The decision to be made:
What price points should Taco Bell use in pricing Taco Bells items?
Copyright 2009 Pearson Education, Inc. Publishing as Prentice Hall10-24
Copyright © 2009 Pearson Education, Inc. Copyright © 2009 Pearson Education, Inc. Publishing as Prentice HallPublishing as Prentice Hall
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