xime / pgdm-b2b –rs–1302-march-2010 b2b marketing managing services pgdm–b2b–rs–13...
TRANSCRIPT
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XIME / PGDM-B2B –RS–1302-March-2010
B2B Marketing
Managing Services
PGDM–B2B–RS–13
Amarnath Krishnaswamy
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XIME / PGDM-B2B –RS–1302-March-2010
Plan for this Session
• Managing Innovation– Management of Innovation– Innovation & Technology– Innovation & the Development of New Products
• Quality Function Deployment
• Managing Business Services– Role & Importance– Buying Services– The Marketing Mix
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XIME / PGDM-B2B –RS–1302-March-2010
Quality Function Deployment (QFD)
• QFD – for identifying:• The attributes the customer wants in the product • Establish link between these attributes and the
product design
• Process involves understanding, and then marrying:• The Voice of the Customer• The Voice of the Engineer
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XIME / PGDM-B2B –RS–1302-March-2010
Voice of the Customer
• Identify customer needs
– The benefits the product should deliver
– Necessary to identify, and focus, on the main ones
– Relatively easy to do if the market is homogenous
– Weight each attribute: enables QFD to balance it with cost
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XIME / PGDM-B2B –RS–1302-March-2010
Voice of the Engineer
• Translate customer needs into product design
• Put onto a matrix against what the customer wants, and compared with competition
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XIME / PGDM-B2B –RS–1302-March-2010
QFD Matrix
WeightProd. Attr.
1
Prod. Attr.
2
Rating
1 2 3 4 5
Cust. Attr. 1
Cust. Attr. 2
Cust. Attr. 3
Cust. Attr. 4
Cust. Attr. 5
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XIME / PGDM-B2B –RS–1302-March-2010
New Product Success / Failure - Factors
Success• Product Uniqueness / Superiority• Market Knowledge• Marketing Proficiency• Technical & Production Proficiency
Failure• Price, with no economic benefit• Obsolete in terms of what’s available• Customers satisfied with existing product
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XIME / PGDM-B2B –RS–1302-March-2010
Can’t forget the law!
Wood’s First Law Of Procrastination
NOW is the time to do things later!
Wood’s Second Law Of Procrastination
Procrastinate today! (Tomorrow may be too late.)
Wood’s Third Law Of ProcrastinationNever put off till tomorrow what you can do the day after tomorrow!
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XIME / PGDM-B2B –RS–1302-March-2010
Managing Business Services
Look at the following products:
1. Water purifier
2. UPS
3. Computer network in an organization
What is common to all of them?
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XIME / PGDM-B2B –RS–1302-March-2010
Business Services – Role & Importance
• In India, “Services” sector has grown – 1990-91 44% of GDP– 2000-01 53% of GDP– 2007-08 63% of GDP
• 2006-07 11% growth in “Services” vs. 9% in GDP
• Employment – “Services” 34%, second only to “Agriculture”
(52%)
• Growth in other sectors (Manufacturing, Agriculture, etc) will spur growth in “Services”
• New “Services”
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XIME / PGDM-B2B –RS–1302-March-2010
Services – Broad Categories
• Products supported by Services– Repairs & Maintenance– Training on use of Equipment / Services– Distribution & Delivery
• Pure Services– Consulting– Banking– Training– Recruitment
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XIME / PGDM-B2B –RS–1302-March-2010
Defining Services - Services vs. Products
Services Products
Intangible Tangible1.
2. “Consumed” when produced
Lag between “Production” & “Consumption
Can be storedCan’t be stored3.
4. StandardizedHighly variable
5. Buyers are not owners
Buyers are owners
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XIME / PGDM-B2B –RS–1302-March-2010
Buying Services
• Services are mostly – Intangible– Non-standard
Hence more difficult to evaluate.• Important for the service provider to look at:
1. Attributes that are important to the buying segment
2. Variance of these attributes amongst buyers in the segment
3. How all service providers rate on these attributes
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XIME / PGDM-B2B –RS–1302-March-2010
Services - Attributes
• Types of attributes vary from objective to highly subjective
• Attributes can broadly be classified as:– People related– Equipment related
• Examples of industries and the attributes they look for are:
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XIME / PGDM-B2B –RS–1302-March-2010
Services – Importance of Attributes
Extent To Which Equipment (Facility)-Related Attributes Form Part Of The Service Package
Extent To Which People-Related Attributes Form Part Of The Service Package
High Medium Low
HighRented storage, Conferences in hotels
Airline, Car rentals
Data mining & analysis services
MediumSeminars Maintenance
contracts, AV rentals
Freight movement, waste disposal
LowBanking, Consulting, Advertising
Equipment repairs,
Newspaper clipping
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XIME / PGDM-B2B –RS–1302-March-2010
Services – Selection
• Prime factor, besides “Cost”, is “Perceived Quality”
• Selection can be looked at on:
– Determinant Attributes
Differences between suppliers apparent enough for customer to decide
– Minimizing Risk
Differences in attributes enough, so customer minimizes risk (Market reputation etc)
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XIME / PGDM-B2B –RS–1302-March-2010
Services – Quality
• “Quality” has 3 components:
– Corporate Image• Most vague!
– Technical Quality (What the customer gets)• Can be measured• Rational
– Functional Quality (How the customer is served)• Difficult to measure objectively (compared to
“Technical”)
• Weights decided by the customer
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XIME / PGDM-B2B –RS–1302-March-2010
Services – Marketing Mix
Involves
1. Identifying Market Segments • Service segments are usually narrower• Focus on what buyers expect vs. what they need
2. Development of the Service Package• Defining customer benefits• Articulating the benefits• Service specifications• Defining employee roles
3. Pricing
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XIME / PGDM-B2B –RS–1302-March-2010
Service Package
Translated into
Level 1 Buyer Benefit Benefits sought by Buyer
Level 2 Service Benefits offered by Seller
Level 3 Service Specs What the Seller will deliver
Delivery to Buyer Service + Processes + PeopleLevel 4
At time of “delivery”, make sure “physical evidence is available!
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XIME / PGDM-B2B –RS–1302-March-2010
Pricing the Service Package
• Unique nature of “Services” creates opportunities and problems
• Pricing depends on many factors”– Demand:
• Difficult to forecast.
• What ‘capacity’ does one plan for?
• What does one do with “idle” capacity?
– Bundling• Pure
• Mixed
– New Business• Cross selling
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XIME / PGDM-B2B –RS–1302-March-2010
Promoting Services
• Communicating through employees– Front line assets
• Word of mouth
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XIME / PGDM-B2B –RS–1302-March-2010
Services - Distribution
• Direct
• Intermediaries
• Franchising
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XIME / PGDM-B2B –RS–1302-March-2010
Services - Failure
• Reasons for failure arise from:
– Wrong segmentation
– Wrong choice of “Marketing Mix”
• Defining buyer benefits and matching it with the “service”
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XIME / PGDM-B2B –RS–1302-March-2010
A bonus?
Table A Resolution
1. Place it for discussion … &
2. Remove it from discussion!
Bag Of Snakes
A business situation with many unexpected problems
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XIME / PGDM-B2B –RS–1302-March-2010
Moving Forward
Next Session: PGDM-RS-14
Date: Thursday, Mar 04, 2010
Subject: Managing Channels
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XIME / PGDM-B2B –RS–1302-March-2010