mkt 346 chap 5 concepts

8/12/2019 MKT 346 Chap 5 Concepts

1/17

MKT 346: Marketing of ServicesDr. Houston

Chapter 5:Distributing ServicesThrough Physical

and Electronic Channels


2/17

Distribution in a Services Context

In a services context, we often do not move anything

Experiences, performances and solutions are not beingphysically shipped and stored

More and more informational transactions areconducted through electronic rather than physicalchannels


3/17

Distribution Options forServing Customers

Customers visit service site

Service providers go to customers

Service transaction is conducted remotely


4/17

Six Options For Service Delivery(Table 5.1)


5/17

Channel Preferences Vary Among Customers

Personal channels

Impersonal and self-service channels

Convenience is a key driver of channel choice


6/17

Places of Service Delivery

Key customer concerns

Key back stage concerns

Constraints

Operational

Geographic

Need for economies of scale


7/17

Time of Service Delivery

Traditional schedules were/are restrictedDay time only

40-50 hours a week

Contemporary schedules must be flexible andresponsive

24/7/365 service


8/17

Distribution of Supplementary Servicesin Cyberspace

Five of the supplementary services are information-based

These services can all be distributed electronically:

Information

Consultation

Order-taking

Billing

Payment

Distribution of information, consultation and order-taking hasreached very sophisticated levels in global service industries(e.g., hotels, airlines, car rental companies)

f d h l


9/17

Information and Physical Processesof Augmented Service Product (Fig 5.11)


10/17

Service Delivery InnovationsFacilitated by Technology

Technological Innovations

Mobile smart phones and WiFi

Voice-recognition technology

(Interactive) web sitesSmart cards


11/17

E-Commerce: Move to Cyberspace

Key factors luring customers to virtual stores:

Convenience

Ease of search

Broader selectionPotential for better prices

24-hour service with prompt delivery


12/17

E-Commerce: Recent Developments

Integration of service delivery infrastructure:websites

customer relationship management (CRM) systems

mobile telephony

Integration of mobile devices:Improves access to services

Alert customers to opportunities/problemsUpdates information in real time

D It M k S t O t


13/17

Does It Make Sense to OutsourceSupplementary Services?

Is it cost-effective?What new challenges does it present?

Splitting Responsibilities


14/17

Splitting ResponsibilitiesFor Supplementary Service Elements (Fig. 5.16)

Chal leng es for or iginal supp l ier : Act as guardian of overal l process

Ensu re that each e lement offered b y interm ediar ies f i t s overal l service conc ept


15/17

Franchising

Popular way to expand delivery of service concept

Smaller monetary investment

Franchisor provides:

trainingequipment

support marketing activities

Franchisees:invest time and finance

follow copy and media guidelines of franchisor


16/17

Franchising

Disadvantages of franchising

Some loss of control over delivery system

Some loss of control over how customers experienceactual service

Effective quality control is important but yet difficult

Conflict between franchisees may arise


17/17

MKT 346 Key Concepts: Chapter 5

Distribution in services often involve moving nothing and many

information-based services can be distributed electronicallyOptions for service delivery include:

Customers visit the service site

Service providers go to their customers

Service transaction is conducted remotely

Channel preferences vary among customers

Place and time decisions include where and when services should bedelivered in bricks-and-mortar context

Delivery in cyberspace is facilitated by technology and e-commerce

Intermediaries play roles in distributing servicesFranchising brings both advantages and disadvantages to the firm

mkt 346 chap 5 concepts

Documents