managing services ● professor chip besio ● cox school of business ● southern methodist...
TRANSCRIPT
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Managing Services
●Professor Chip Besio●Cox School of Business●Southern Methodist University
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CONSUMER WANT AUTHENTIC EXPERIENCES!
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Services are now a larger part of the U.S. gross domestic product (GDP)
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THE UNIQENESS OF SERVICESTHE FOUR I’S OF SERVICES
Four I’s of Services• Intangibility – Cannot perceive with 5 senses
• Inseparability – cannot separate from provider
• Inconsistency – can vary with each occasion
• Inventory – in people based services, inventory goes home each night
The result - Idle Production Capacity
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Singapore Airlines, American Express, and AllstateWhat 4 I’s of services element?
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Inventory carrying costs of services depend on the cost of employees and equipment
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THE UNIQENESS OF SERVICESTHE CONTINUUM & CLASSIFICATION OF SERVICES
Service Continuum
Classifying Services
• Delivery by People or Equipment
• Profit or Nonprofit Organizations
• Government Sponsored
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The service continuum shows how offerings can vary in their balance of goods and services
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Services can be classified as equipment-based or people-based
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Red Cross, Unicef, andSusan G. Komen Race for the Cure
What is the classification of each service?
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HOW CONSUMERSPURCHASE SERVICES
The Purchase Process
• Search Properties
• Experience Properties
• Credence Properties
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Consumers use search, experience, and credence properties to evaluate services
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The five dimensions of service quality
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HOW CONSUMERSPURCHASE SERVICES
Customer Contact andRelationship Management
• Customer Contact Audit
• Service Encounters
• A Customer’s Car Rental Activities
• Relationship Marketing
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Customer contact audit for a car rental agency (green boxes = customer activity; orange boxes = employee activity)
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MANAGING THE MARKETING OF SERVICESTHE EIGHT Ps OF SERVICES
Eight Ps of Services Marketing
Product (Service)
• Branding
Price
• Off-Peak Pricing
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MANAGING THE MARKETING OF SERVICESTHE EIGHT Ps OF SERVICES
Place (Distribution)
Promotion
• Publicity
• Public Service Announcements (PSAs)
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MANAGING THE MARKETINGOF SERVICES
People• Internal Marketing
• Customer Experience Management (CEM)
Physical Environment
Process
Productivity
• Capacity Management
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Different prices and packages help match demand to capacity
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● Price plays two essential roles regarding
the pricing of services: 1. To affect consumer perceptions and 2. To be used in capacity management.
● Off-peak pricing consists of charging different prices during different times of the day or days of the week to reflect variations in demand for the service.
MANAGING THE MARKETINGOF SERVICES -PRICING
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●Place or distribution is a major factor in developing a service marketing strategy because of the inseparability of services from the producer.
●As competition grows, the value of convenient location becomes more important.
●The availability of electronic distribution through the World Wide Web now provides global coverage for travel services, banking, entertainment, and many other information-based services.
MANAGING THE MARKETINGOF SERVICES -PLACE
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●In most cases promotional concerns of services are similar to those of products.
●The value of promotion (advertising) is to stress:●availability●location●consistent quality●and efficient, courteous ●service
Heart by-pass Surgery
20% discount forweekend
procedures
MANAGING THE MARKETINGOF SERVICES -PROMOTION
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MANAGING THE MARKETINGOF SERVICES -PROMOTION
PROFESSIONAL SERVICES●A Supreme Court case in 1976 struck down
constraints by professional organizations to constrain the advertising of professional services, specifically the American Medical Association and the American Bar Association.
●Although opposition to advertising still remains in some professional groups, the barriers to promotion are being broken down, mostly in response to competitive pressures.
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MANAGING THE MARKETINGOF SERVICES -PROMOTION
●Publicity has played a major role in the promotional strategies of nonprofit services and some professional services.
●Many nonprofit groups have relied on Public Service Announcements (PSAs) as the foundation of their media plan because they are free.
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USING MARKETING DASHBOARDSAre JetBlue’s Flights Profitably Loaded?
Airline Operating Income (Loss) per Available Seat Flown One Mile (ASM)
Operating Income (Loss)Flown ASM
= Yield Load Factor Š Operating Expense
LO6
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Technological Advances
• Mobility
• Convergence
Expanding Global Economy
SERVICES IN THE FUTURE
• Personalization
• Collaboration