Prezentace předmětu: Marketing of Sevices Vyučující: Ing. Michal Stoklasa, Ph.D. Ing. Martin Klepek, Ph.D. Název prezentace Název projektu Rozvoj vzdělávání na Slezské univerzitě v Opavě Registrační číslo projektu CZ.02.2.69/0.0./0.0/16_015/0002400 Logolink_OP_VVV_hor_barva_cz MARKETING MIX: PROCESSES . The aim of the lecture is to explain and overview processes which deliver value to the customer in a service business Michal Stoklasa Garant předmětu Martin Klepek Přednášející MARKETING MIX: PROCESSES . Why is process essential in services Internal and external marketing Customer experiences Perception of services Lecture content •The most important difference between services and goods, is the fact that a service is like beauty, more in the eye of the beholder. •It is primarily an experience for the customer and those around them – and this means that it must be seen as a performance by those who are providing the service. Introduction 4 Ruskin-Brown (2005) •As it is performed rather than ‘produced’, the service marketer must ensure it is well managed. •This management is addressed in that element of the service marketing mix referred to as ‘PROCESS’. Introduction 5 Ruskin-Brown (2005) •Process in services refers to the actual procedures, mechanisms, and flow of activities by which the service is delivered the service delivery and operating systems. •In a service organisation, the system by which customer receives delivery of the service constitutes the process. In fast food outlets the process comprises buying the coupons at one counter and picking up the food against that at another counter. Introduction 6 Urbánek (2014) •The process of a delivery function which can be compared with that of operations management implies the conversion of input into the finished product. But, in a service organisation, there is no clear cut input or output. •Rather, it is the process of adding value or utility to system inputs to create outputs which are useful for the customers. Introduction 7 Urbánek (2014) •It is said that this aspect of the marketing of any service is a major contributor to building customer loyalty, i.e. turning customers into ‘friends and advocates’ and as such is so important that it should be allocated a minimum of 50% of the marketer’s time effort and budget. Introduction 8 Ruskin-Brown (2005) Types of „marketing“ in services 9 Source: Kolter & Keller (2016) •Internal marketing is a term commonly used to describe the programmes necessary to instill and maintain a strong service mentality throughout the organisation. For every service, employees remain the primary ingredient of success. Internal Marketing 10 •Internal marketing is a management strategy that focuses on how to develop customer conscious employees. Employees must be skilled, have customer orientation and be service minded so that they can influence customer perceptions positively in interactions during production, delivery, client handling, technical service, and other related activities. Internal Marketing 11 •The objective of external marketing is to attract every customer to participate in the service process. •Service companies should design an effective promotional campaign to inform, educate, persuade, train, and encourage buying and experiencing the service offered. External Marketing 12 •Developments of promotional mix strategies are vital to the success of external marketing. •The most powerful media in services is word of mouth communication. •Service organisation should be careful of negative word-of-mouth. In the absence of relevant and effective communication, consumers may have doubts and suspicions about the service offering. External Marketing 13 •Interactive marketing describes the employees’ skill in serving the client. •Clients judge service not only by its technical quality (Was the surgery successful?), but also by its functional quality (Did the surgeon show concern and inspire confidence?). •In interactive marketing, teamwork is often key. Interactive Marketing 14 •Delegating authority to frontline employees can allow for greater service flexibility and adaptability because it promotes better problem solving, closer employee cooperation, and more efficient knowledge transfer. •Top service companies are “customer obsessed.” •They have a clear sense of their target customers and their needs and have developed a distinctive strategy for satisfying them. Interactive Marketing 15 Case study 16 Source: Kolter & Keller (2016) Ruskin-Brown (2005) •Marketers of goods (e.g. motor vehicles) have very little control over how a customer experiences the use of their product, try as they might to influence this via badging, branding and advertising of the aspirational lifestyle of the stereotypical customer for that model. •The marketer’s influence is always at several removes from the actuality of the product’s use. Focus on the experience 17 Ruskin-Brown (2005) •The customer of a good is almost invariably out of direct contact with the firm producing and/or supplying that good when it is used. Whereas: •A service product IS the experience that a customer has when the service is being delivered to them. •A service is no more, and no less than this experience. •A customer’s perception of this experience is THE MOST CRITICAL aspect of its marketing. Focus on the experience 18 Ruskin-Brown (2005) •The customer’s favorable experience of the delivery of that service, confirms that they made the right choice of supplier, and promotes the possibility that they will return to this supplier when next they are in the market. Focus on the experience 19 Ruskin-Brown (2005) •Favorable perceptions will create and build relationships, unfavourable ones will destroy them. •So important is this ‘experiential’ aspect of a service that it has been rightly named ‘The Moment of Truth’. •During this ‘Moment of Truth’ all the effort taken to deliver the service either comes to fruition, or is wasted. Focus on the experience 20 Ruskin-Brown (2005) •The customer’s perception will be formed from their perspective, not ours. •All marketers must strive to manage the perceptions of their customers and prospects. •However, for the service marketer this issue is vital to the extent that a major part of the service marketer’s job has been described (by Tom Peters) as ‘the strategic management of perception’. Perception of services 21 Ruskin-Brown (2005) •The process by which services are created and delivered to the customer is a major factor within the services marketing mix, as services customers will often perceive the service delivery system as part of the service itself. •Thus, decisions on operations management are of great importance to the success of the marketing of the service. Perception of services 22 Urbánek (2014) • • •It is the perceptions of the ‘prospects’ and ‘customers’, not our perception, that will drive their behavior! Perception of services 23 Ruskin-Brown (2005) •The wise service marketers will therefore devote at least half of their energy, attention and budget to ensuring that the performance of their service delivers the optimum experience to the customer and turn as many of them as possible into ‘friends’ and ‘advocates’ and thus grow their business. •The element of the services marketing mix that covers this aspect, the performance, is process. Perception of services 24 Ruskin-Brown (2005) Service process form customer perspective 25 Kolter & Keller (2016) •Reliability, the service is consistent, dependable and perhaps backed by guarantees. •Accessibility, provided at convenient times and locations with little waiting. What a customer may want from a service 26 Ruskin-Brown (2005) •Credibility, the firm and its staff are seen to be trustworthy in terms of delivering what they promise, and with a respectable track-record in their business. What a customer may want from a service 27 Ruskin-Brown (2005) •Prestige, the source/supplier is well respected by the customer’s peers, and at least there will be no disrepute to the customer’s image, at best this will confer status by association. What a customer may want from a service 28 Ruskin-Brown (2005) •Security, there will be no financial or other risk to the customer. •Privacy, the customer’s confidentiality, and/or person will be respected. What a customer may want from a service 29 Ruskin-Brown (2005) •Responsiveness, the speed and attention given to the customer’s needs, requests, questions and/or problems. •Competence, the service deliverers’ level of relevant skills, know-how, expertise. What a customer may want from a service 30 Ruskin-Brown (2005) •Communication, how well do the service deliverers interface with the customer, how accurately and clearly is the service described? •How well do they feel that the service deliverer(s) listened to them? What a customer may want from a service 31 Ruskin-Brown (2005) •Courtesy, the pleasantness/friendliness of the service deliverers toward the customer. •Stress free, i.e. freedom from physical and/or mental stress, the customer feels welcome, feels ‘at home’ when dealing with the service provider. What a customer may want from a service 32 Ruskin-Brown (2005) Classification of service encounter types 33 Source: Ruskin-Brown (2005) Ruskin-Brown (2005) Conclusion •The process by which services are created and delivered to the customer is a major factor within the services marketing mix, as services customers will often perceive the service delivery system as part of the service itself. •Thus, decisions on operations management are of great importance to the success of the marketing of the service. In fact, continuous coordination between marketing and operations is essential to success in most services businesses. Identification of process management as a separate activity is a prerequisite of service quality improvement. •The importance of this element is especially highlighted in service businesses where inventories cannot be stored.