service marketing (7).ppt

8/19/2019 Service marketing (7).ppt

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Slide ©2004 by Christopher Lovelock and Jochen Wirtz Services Marketing 5/E 7 - 1

Chapter 7

Distributing Services


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Information and Physical Processes of theAugmented Service Product (Fig. 7.1)

Exceptions

Billing

Payme

nt

InformationProcesses

InformationConsultation

Safekeeping

Physical

Processes

Order-Taking

Core

Hospitality


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Using Websites for Service Delivery

SafeeepingTrack package movements

Check repair status

CORE: Use Web to deliver information-based core services

!ore

!onsultationConduct e-mail dialog

Use epert s!stems

"rder#$aing"ake#confirm reservations

$ubmit applications

Order goods% check status

%ospitalityRecord preferences

&illingReceive bill

"ake auction bid

Check account status

'(ceptions"ake special re&uestsResolve problems

Payment'a! b! bank card

(irect debit

InformationRead brochure#)*+, get schedules# directions, check prices


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"ptions for Service Delivery

Customer goes to the service provider (or intermediary)

ervice provider goes to the customer Interaction at arm!s length (via the Internet" telephone" fa#"

mail" etc.)

There are 3 types of interactions between customers andservice firms


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Method of Service Delivery ($a%le 7.1)

*vailabilit! of $ervice Outlets

Nature of Interactionbetween Customerand Service

Organization

Single Site ultiple Sites

Customer goes to serviceorgani&ation

$heater

'ar%ershop

'us service

Fastfood chain

ervice organi&ation goesto customer

ouse painting

*o%ile car wash

*ail delivery

+uto clu% road serviceCustomer and serviceorgani&ation transact atarm!s length

Credit card company

,ocal $- station

'roadcast networ

$elephone company


7/18Slide ©2004 by Christopher Lovelock and Jochen Wirtz Services Marketing 5/E 7 - 7

Place vs) !yberspace

'lace customers andsuppliers meet in a physicalenvironment

C!berspace ! customersand suppliers do %usinesselectronically in virtualenvironment created %yphone/internet linages

0euired for people processingservices

2ffers live e#periences" socialinteraction" e.g." food services

*ore emphasis on eyecatchingservicescape" entertainment

Ideal for info%ased services

aves time

Facilitates information gathering

*ay use e#press logisticsservice to deliver physical coreproducts



*+,-./ # Factors 'ncouraging'(tended "perating %ours (*gt *emo 7.1)

3conomic pressure fromconsumers

Changes in legislation

3conomic incentives toimprove asset utili&ation

+vaila%ility of employeesto wor nights" weeends

+utomated selfservice


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'#!ommerce2Factors that Attract !ustomers to 3irtual Stores

Convenience (8hour availa%ility" save time" effort)

3ase of o%taining information online and searching for

desired items

'etter prices than in %ricsandmortar stores

'road selection



Splitting 0esponsibilities for DeliveringSupplementary Services (Fig. 7.)

As created byoriginating firm

As enhancedby distributor

As exeriencedby customer

+Core = Core



Franchising

0esources are limited

,ongterm commitment of store managers is crucial

,ocal nowledge is important

Fast growth is necessary to preempt competition

"ranchising is a fast growth strategy# when



Service Process and Maret 'ntry

People Processing ervices 3#port the service concept Import customers $ransport customers to new locations

Possession Processing ervices*ost reuire an ongoing local presence" whether it is the

customers dropping off items or personnel visiting customer sites

Information 'ased ervices 3#port the service to a local service factory Import customers 3#port the information via telecommunications and transform it

locally



&arriers to International $rade in Services

2perating successfully in international marets remainsdifficult for certain services despite efforts of the 4$2 and

control rela#ations

'arriers include0efusal %y immigration offices to issue wor permitseavy ta#es on foreign firms9omestic preference policies,egal restrictions

,ac of %roadlyagreed accounting standardsCultural differences (esp. for entertainment industry)



Forces for Internationali1ation

Maret drivers

!ompetition drivers

$echnology drivers!ost drivers

4overnment drivers

Impact will vary by servicetype $people# possessions#information%



Modes of Internationali1ation

&'port information!based services transmit via electronic channels store in physical media" ship as merchandise

(se third parties to mar)et*deliver service concept licensing agents %roers franchising alliance partnersminority :oint ventures

Control service enterprise abroad direct investment in new %usiness %uyout of e#isting %usiness



Impact of 4lobali1ation Drivers on DifferentService !ategories ($a%le 7.)

lobali.ation(rivers

'eople'rocessing

'ossession'rocessing

/nformation0ased

Competition imultaneity ofproduction and

consumption limitsleverage of foreigncompetitive advantage"%ut managementsystems can %eglo%ali&ed

$echnology drivesglo%ali&ation of

competitors withtechnical edge.

ighly vulnera%le toglo%al dominance %y

competitors withmonopoly orcompetitiveadvantage ininformation.

ar)et People differeconomically andculturally" so needs forservice and a%ility topay may vary.

,evel of economic

developmentsimpacts demand forservices toindividually ownedgoods

9emand for many

services is derived toa significant degreefrom economic andeducational levels.


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Impact of 4lobali1ation Drivers on DifferentService !ategories ($a%le 7." cont!d)

lobali.ation(rivers

'eople'rocessing

'ossession'rocessing

/nformation0ased

Technology ;se of I$ for delivery ofsupplementary servicesmay %e a function ofownership and familiaritywith technology.

Need for technology%ased service deliverysystems depends onpossessions reuiringservice and the costtradeoffs in la%orsu%stitution

+%ility to delivercore servicesthrough remoteterminals may %e afunction ofinvestment incomputeri&ation etc.

Cost -aria%le la%or rates mayimpact on pricing inla%orsensitive services.

-aria%le la%or ratesmay favor lowcostlocations.

*a:or cost elementscan %e centrali&ed <minor cost elements

locali&ed.

+overnment ocial policies (e.g."health) vary widely andmay affect la%or cost etc.

Policies maydecrease/increasecost <encourage/discouragecertain activities

Policies may impactdemand and supplyand distort pricing

service marketing (7).ppt

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