Pure Tangible Good (Commodity):
Description: This is like a basic product you can touch and see. It's tough to tell
the difference between the same products from different suppliers because they
all look the same. There's no extra service or intangible (hard to describe or
touch) stuff involved.
Example: Imagine a pack of batteries. You can buy them from different brands,
but they all pretty much do the same thing, and it's hard to tell one from another
just by looking.
Tangible Good with Accompanying Service:
Description: Here, you're buying a product, but the company tries to stand out by
offering some extra service with it. They want you to choose their product not just
because of what it is, but also because they provide some helpful service.
Example: Think about buying a laptop. Many companies not only sell you the
computer but also offer customer support, warranty, and maybe even software
installation help. They want to make your experience better than just getting a
laptop.
Major Service with Minor Goods or Service:
Description: In this case, a company is mainly selling a service, and they might
throw in a few small things along with it. These extras might not be the main
focus, but they're there to make the service better or more attractive.
Example: Picture a landscaping service. They're in the business of making your
yard look great. Along with the main service of lawn care, they might also offer to
trim a few bushes or provide some basic gardening tips.
Pure Service:
Description: Here, what's being offered is not something you can touch or hold.
It's all about a service—something done for you or to help you.
Example: Consider a counseling service. They're not selling you a physical item.
Instead, they're offering their expertise and time to help you work through
personal challenges or issues.
PS of marketing:
Product Elements:
Description: When a company is planning to sell something, they need to think about what
exactly they're offering. For services, this involves not just the main thing they're selling (like a
haircut) but also extra things that make the service better (like a friendly staff or a comfortable
waiting area).
Example: Think about getting a haircut. The actual haircut is the main thing (the core product),
but a clean and inviting salon, friendly staff, and maybe some complimentary coffee or
magazines are the extra things (supplementary services) that enhance the experience.
Place and Time (Distribution):
Description: This is about where and when customers can get the service. It includes both
physical locations (like a store or office) and online options. For services, getting the right
information or assistance when you need it is crucial.
Example: Ordering pizza online is a good example. You can do it from the comfort of your home
(place) and whenever you're hungry (time). The website or app, where you place the order, is
part of the distribution strategy.
Pricing:
Description: This is about deciding how much to charge for the service. It's not just about the
cost but also about how much customers are willing to pay based on factors like convenience or
extra features.
Example: Consider a ride-sharing service. The price might go up during busy hours because
that's when more people need rides. It's a dynamic pricing strategy that considers demand and
time of delivery.
Promotion and Education:
Description: This is about letting people know about the service and convincing them to give it a
try. It involves providing information, persuading them it's worth it, and encouraging them to
use the service.
Example: Think about a new fitness app. The company needs to tell people what it does
(provide information), convince them it's the best way to get fit (persuasion), and maybe offer a
special discount for the first month to get them to sign up (encouraging action).
Now, let's look at the additional elements in the extended services marketing mix:
Process:
Description: This is about how the service is delivered—the steps and procedures. For example,
the process of checking in at a hotel or the steps involved in getting a loan.
Physical Environment:
Description: This refers to the surroundings where the service is provided. It could be the
ambiance of a restaurant or the cleanliness of a hospital.
People:
Description: This involves the individuals who deliver the service. It's not just about their skills
but also their attitude and friendliness.
Marketing Research and the Service Firm
Keeping in Touch:
Explanation: As service companies grow and expand into new areas, they may start working
with agents, franchisees, retailers, or BPOs (business process outsourcing). This can lead to a
loss of direct contact with customers.
Example: A company that initially served customers directly may now have intermediaries
handling customer interactions. Marketing research helps them stay connected and understand
what customers really want.
Perceptual Veil:
Explanation: Success can sometimes make a service company overconfident and lose sight of
what customers truly need. This can happen when there are many layers of management,
causing distortion in understanding customer needs.
Example: A successful service company might become so focused on its achievements that it
overlooks changing customer preferences. Marketing research helps to remove this "perceptual
veil" and see the market clearly.
Minimizing Risks:
Explanation: Due to increased competition, service firms often invest heavily in marketing
activities. However, without proper research, these efforts may not yield the desired results
and can be costly.
Example: If a service company launches a new product without understanding customer
preferences, it might not succeed in the market. Marketing research minimizes the risk by
providing insights into what customers really want.
Scope of Marketing Research in Services:
Research of Services Environment:
Explanation: Understanding factors like politics, economics, socio-culture, legalities, and
technology helps service firms adapt to changes in their operating environment.
Example: A ride-sharing service needs to consider the legal and technological landscape to
ensure compliance and to introduce new features that customers may expect.
Research into Customer Needs:
Explanation: Researching customer needs helps service marketers create services that meet
those needs, even the ones customers might not explicitly express.
Example: An online streaming service might conduct research to understand what features
users desire, leading to the introduction of personalized playlists based on listening habits.
Customer Perception Studies:
Explanation: Understanding how customers perceive the quality of service is crucial. This
perception affects customer satisfaction.
Example: A hotel might conduct perception studies to ensure that the services it offers align
with what customers expect, preventing dissatisfaction.
Service Distribution Studies:
Explanation: Researching distribution systems helps service firms understand how effectively
they are reaching their customers.
Example: An e-commerce platform might analyze different delivery methods to ensure products
reach customers on time and in good condition.
Pricing Research:
Explanation: Researching pricing methods helps service marketers set prices that match
customer expectations and align with the organization's objectives.
Example: A subscription-based software service might research different pricing models to
determine the best balance between affordability for customers and profitability for the
company.
Promotion Research:
Explanation: Understanding the effectiveness of various promotional tools (advertising, public
relations, sales promotions, personal selling) helps service firms communicate with customers
in the most impactful way.
Example: A travel agency might research the effectiveness of different advertising channels to
promote its vacation packages.
Communication Research:
Explanation: This involves comprehensive research into how the company communicates with
customers, ensuring that the messaging is clear and resonates effectively.
Example: A telecommunications company might conduct communication research to
understand how customers respond to their advertising messages and adjust them accordingly.
Factors Influencing Customer Perceptions:
1. Service Encounters:
Explanation: This is all about how a customer feels about the
service during their interaction with the provider. It includes
things like how much care is shown, how quickly issues are
addressed, and how flexible the service delivery is.
Example: If you call a customer service hotline, your perception
of the service will be influenced by how well they listen, respond,
and address your concerns.
2. Types of Service Encounters:
Explanation: Encounters can be remote (no direct human
contact, like online services), phone-based (using
telecommunication), or face-to-face (direct interaction with a
person). Each type has its challenges in evaluating service
quality.
Example: Ordering food online is a remote encounter, and your
satisfaction depends on the accuracy of your order and the ease
of the process.
3. Satisfaction or Dissatisfaction in Service Encounters:
Explanation: After a service encounter, you either feel satisfied
or dissatisfied. Factors like recovery (handling service failures),
adaptability (dealing with special requests), spontaneity
(voluntary actions of employees), and coping (managing problem
situations) play a role.
Example: If a restaurant makes a mistake in your order but
quickly corrects it, their recovery process affects whether you
leave satisfied or not.
Specific Factors Affecting Customer Satisfaction/Dissatisfaction:
1. Recovery:
Explanation: How well a service provider handles a situation
where something goes wrong. It involves listening to the
customer, accepting the mistake, apologizing, and offering
solutions.
Example: If a flight is delayed, how the airline responds,
apologizes, and provides solutions (like compensation or
alternative arrangements) affects customer satisfaction.
2. Adaptability:
Explanation: How well a service provider can deal with special
requests or needs from customers. It's about flexibility in
delivering the service.
Example: A hotel that can accommodate a last-minute room
preference change demonstrates adaptability, influencing the
customer's perception positively.
3. Spontaneity:
Explanation: Employees taking unsought or voluntary actions
to improve the customer experience, such as responding quickly
to emergencies or bending rules to accommodate special needs.
Example: In a hotel, if staff members go out of their way to
assist a guest with unexpected needs, it shows spontaneity and
enhances customer satisfaction.
4. Coping:
Explanation: How employees effectively manage difficult
customers or challenging situations.
Example: In a retail setting, an employee who calmly handles a
customer complaint and finds a solution demonstrates effective
coping, positively impacting customer perception.
