Consumers Rule

1
Services and Other Intangibles Marketing the
Product That Isnt There
2
Chapter Objectives

• 4 characteristics of services
• service continuum
• core and augmented services,
• marketing of services
• on the Internet,
• service encounter

3
Chapter Objectives

• service quality to marketers
• search qualities,
• experience qualities,
• credence qualities
• SERVQUAL
• Gap Analysis
• marketing of people, places, and ideas

4
Marketing What Isnt There

• Intangibles
• services and other experience-based products that
  cannot be touched
• Does marketing work for intangibles?
• Yes!

5
What Are Services?

• Services are
• acts, efforts, or performances
• exchanged from producer to user
• without ownership rights.

6
Characteristics of Services

• Intangibility
• cant see, touch, or smell good service
• Perishability
• cant store a service for later sale or
  consumption
• Capacity management
• firms adjust their services to match supply with
  demand

7
Characteristics of Services (contd)

• Variability
• cant standardize
• the same service
• performed by the same individual

8
Characteristics of Services (contd)

• Inseparability
• cant separate production from consumption
• Service encounter
• the interaction between the customer and the
  service provider
• Disintermediation
• eliminating the interaction between customers and
  salespeople
• How???

9
Services by Inputs Tangibility
Figure 10.1
10
The Services Continuum

Figure 10.2
11
The Services Continuum (contd)

• Goods-dominated products
• Equipment- or facility-based services
• People-based services

12
Core and Augmented Services

• Core service
• the benefit a customer gets from the service
• Augmented service
• core service added services that enhance value

13
Services on the Internet

• Anything that can be delivered
• can be sold on the Web
• --Banking and brokerage services
• --Software
• --Music
• --Travel services
• --Dating services
• --Career-related services
• --Medical care

14
The Service Encounter

• Social elements
• employees and customers
• Physical elements
• Service-scapes
• other intangibles

15
Providing Quality Service Service Quality
Attributes

• Search qualities
• examine before purchase
• Experience qualities
• determine during or after consumption
• Credence qualities
• evaluate after experiencing them (difficult to do)

16
Measuring Service Quality

• SERVQUAL
• Gap analysis
• Critical incident technique

17
Strategies for Developing and Managing Services

• Act fast
• to resolve a service failure.
• Identify potential failures
• make recovery plans ahead of time.

18
Strategies for Developing and Managing Services

• Train employees
• to listen for complaints
• empower them
• to take action.

19
The Future of Services

• New dominant logic for marketing
• Changing demographics
• Globalization
• Technological advances
• Shift to flow of information

20
Marketing People

• Marketing people
• Politicians
• Celebrities

21
Marketing Places

• Marketing places
• Attempting to position a city, state, country, or
  other locale
• so consumers choose the brand over competing
  destinations

22
Marketing Ideas

• Marketing ideas
• Gaining market share
• for a concept, philosophy, belief, or issue

23
Then end
24
Real People, Real Choices

• Universals Theme Parks in Orlando (Robyn
  Eichenholz)
• How to plan for anticipated record-breaking
  attendance at Donna Summer in concert
• Option 1 dont make any special plans for the
  event
• Option 2 create a plan to accommodate extremely
  large crowds
• Option 3 publicize the big expected turnout to
  let guests know the event might be exceptionally
  crowded

25
Real People, Real Choices

• Universals Theme Parks in Orlando (Robyn
  Eichenholz)
• Robyn selected a combination of options 2 and 3
  to alleviate crowding concerns and enhance the
  guest experience.
• In addition to enjoying themselves in the concert
  area, guests partied in the streets and had a
  great evening.

26
Group Activity

• Pick a sport and define the core service its
  sporting event provides at your
  university/college.

27
Discussion

• Why are first impressions formed about a service
  on the Internet so important?
• What can a service firm do to ensure a favorable
  first impression online?

28
Discussion

• Internet dating services, while popular, may
  present some dangers for those who use them.
• --Who do you think uses Internet dating services?
• --What, if anything, should these services do to
  protect their clients?

29
Discussion

• Sometimes service quality may not meet customers
  expectations.
• --What problems have you experienced with quality
  in the delivery of the following services?
• A restaurant meal
• An airline flight
• Automobile repairs
• Your college education

30
Discussion

• What service do providers such as MySpace.com
  convey?
• What core and augmented services do they offer?
• How should users evaluate the quality of
  MySpace.coms service?

31
Individual Activity/Discussion

• You are a customer for a college education, a
  very expensive service product.
• --Develop a list of recommendations for your
  school for improving the delivery of its service.

32
Discussion

• There has been much recent criticism about the
  way politicians are marketed.
• --What are some ways such marketing has helped
  our political process?
• --What are some ways it might have an adverse
  effect on our government?

33
Discussion

• Many not-for-profit and religious organizations
  have found they can become more successful by
  marketing their ideas.
• --What are some ways these organizations market
  themselves that are similar to, and different
  from, marketing by for-profit businesses?

34
Marketing Plan Exercise

• Select a familiar service such as a bank, an
  airline, or even your university.
• Develop strategies for creating a servicescape
  that will be a positive influence on customers
  purchase decisions, their evaluations of service
  quality, and their ultimate satisfaction with the
  service.

35
Marketing in Action CaseYou Make the Call

• What is the decision facing XM Satellite Radio?
• What factors are important in understanding this
  decision situation?
• What are the alternatives?
• What decision(s) do you recommend?
• What are some ways to implement your
  recommendation?

36
Keeping It Real Fast-Forward to Next Class
Decision Time at Taco Bell

• Meet Danielle Blugrind, Director of Consumer and
  Brand Insights for Taco Bell.
• Competitors claimed they provided better
  fast-food value.
• The decision How to update the Taco Bell value
  menu pricing.