MARKETING OF SERVICES
Ing. Veronika Braciníková, Ph.D.
INTRODUCTION
NATURE OF SERVICES
MARKETING MIX IN SERVICES
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• What is the marketing?
• Delivering value to the customer at a profit.
• What is value?
BASICS
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Do the product deliver
value?
Does management
know what delivers
value?
Market
research
Marketing
communica
tion
YESNO
Create
product
NO
YES
Are customers
satisfied?
Delivering
the product
NO
YES
Pricing
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• What is need?
• What is wish?
BASICS
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“If I’d asked my customers
what they wanted,
they’d have said
a faster horse.”
Henry Ford
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Production
Product
Promotion
Marketing
EVOLUTION OF MARKETING THOUGHTS
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• Profit driver – Production methods
• 1950s
• Economies of scale
PRODUCTION FOCUS
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• Profit driver – Quality of the product
• 1960s
• A chiefly concerned with the quality of its own
product.
PRODUCT FOCUS
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• Profit driver – Selling methods
• 1960s
• Simply selling an already existing product.
PROMOTION FOCUS
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• Profit driver – Needs and wants of customers
• 1970s
• Supplying products to suit new consumer tastes.
MARKETING FOCUS
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• Relationship marketing
• Building and keeping good customer relations
• 1960s to present
• Social marketing
• Benefit to society
• 1990s to present
• Green/Eco marketing
• Benefit to environment
• End of 1990s to present
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NEW APPROACHES
• Globalization
• Advances in technology
• Countries have different tempo of development (rich x poor)
• Environmental responsibility
• Attitude of customers
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TRENDS CHANGING MARKETING
What type of markets do we know?
B2C (Consumer Market)
B2B (Industrial Market)
B2G (Public Services)
What type of products do we know?
Goods vs. Services
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Goods Services
A physical commodity A process or activity
Tangible Intangible
Homogenous Heterogeneous
Production and distribution are
separated from the consumption
Production, distribution and
consumption are simultaneous processes
Can be stored Cannot be stored
Transfer of ownership is possible Transfer of ownership is not possible
DIFFERENCES
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• Health care – hospital, medical practice, dentistry, eye care.
• Professional services – accounting, legal, architectural.
• Financial services – banking, investment advising, insurance.
• Hospitality – restaurant, hotel, bed & breakfast, ski resort, rafting.
• Travel – air lines, travel agencies, theme park
• Others – hair styling, pest control, lawn maintenance, counseling
services.
EXAMPLES OF SERVICES
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• Definition
• History of services
• Services nowadays
• Alternative view
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SERVICES
• Rented goods services.
• Defined space and place rentals.
• Labor and expertise rental.
• Access to shared physical environments.
• Access to and usage of systems and networks.
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ALTERNATIVE VIEW
• Recognition of special characteristics will provide insights
for enlightened and innovative management.
• Managers – solving service marketing problems with tools
for tangible products.
• Ability to deal with the characteristics of services grows.
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NATURE OF SERVICES
• Intangibility
• Inseparability
• Heterogeneity/Variability
• Perishability
• No transfer of ownership
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CHARACTERISTICS OF SERVICES
• Services do not have a physical existence.
• Services cannot be touched, held, tasted or smelt.
• The is most defining feature of a service and that
which primarily differentiates it from a product.
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INTANGIBILITY
• Services are typically produced and consumed at
the same time.
• The right place, the right time and the right way.
• The customer is involved in the production process,
and thus may affect its outcome.
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INSEPARABILITY
• The heterogeneity connected with services is largely
the result of human interaction.
• Each service offering is unique and cannot be exactly
repeated even by the same service provider.
• Reducing variability by training the service providers
in appropriate responses to each customer situation.
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HETEROGENEITY
• The services cannot be saved, stored, resold, or returned.
• Once rendered to a customer the service is completely
consumed and cannot be delivered to another customer.
• The services are generated and consumed within the
same time frame.
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PERISHABILITY
• The payment is not for purchase, but only for the
use or access to or for hire of items or facilities.
• The previous cited characteristics of services make
them unique.
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NO TRANSFER OF OWNERSHIP
• Core Services
• Supplementary Services
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TYPES OF SERVICES
What is marketing mix?
• Old one: 4P
• Product, Price, Place, Promotion
• New one: 4C
• Customer, Costs, Convenience, Communication
• Extension for services: + 3P
• Physical Evidence, People, Processes
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THANK YOU
FOR YOUR ATTENTION☺
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