MKT 337 Lecture Notes - Lecture 12: Internal Communications, Capacity Management, Flowchart

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4 Jan 2017
Chapter 12: Service Marketing
The uniqueness of service
Service: intangible activities or benefits that an organization provides to satisfy
consumers needs in exchange for money or something else of value
The four I’s of service:
Intangibility: services are intangible, that is, they cant be held, touched or seen
before the purchase decisions. To help consumers assess and compare
services, marketers try to make them tangible or show the benefits of using the
Inconsistency: developing, pricing, promoting, and delivering services is
challenging because the quality of service is often inconsistent.
Inseparability: difference between services and goods, and related to problems
of consistency. The amount of interaction between the consumer and the
service provider depends on the extent to which the consumer must be
physically present to receive the service.
Inventory: Inventory problems exist with goods because many items are
perishable and because there are costs with handling inventory. The inventory
cost of a service is the cost of paying the person used to provide the service
along with any needed equipment.
o Idle production capacity: when the service provider is available but there is
no demand.
Service Continuum
Service continuum: what companies bring to the market ranges from the tangible to
the intangible or good-domain to service-domain offerings.
For many businesses it is useful to distinguish between their core producteither
good or serviceand supplementary services.
Classifying Services
Delivery by People or Equipment
Profit or Non Profit organizations
Government Sponsored
How consumers purchase services
The purchase process
Tangible goods have search properties, such as color, size and style, which can be
determined before purchase.
Experience properties- can be discerned only after purchase or during consumption
Credence properties- characteristics that the consumer may find impossible to evaluate
even after purchase and consumption
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