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MKT 723 (71)
Chapter 9

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MKT 723
Armand Gervais

Chapter 9 – Service Development and Design Failures of a new product/service can be caused by: No unique benefits, insufficient demand, unrealistic goals, poor fit within the organization’s portfolio, poor location, poor financial backing, low quality product/marketing. Most reliable predictors of success relate to product/service characteristics (meeting customer needs, advantage over competition, technological sophistication), strategy characteristics (dedicated HR and R&D), process characteristics (marketing, predevelopment, technological and launch proficiencies), and market potential. Challenges of Service Design The longer a service, the hard to explain. Especially as the service is intangible. Furthermore, services are variable as they are delivered employee to customer. Two services are rarely the same.  Oversimplification – Words are inadequate to explain a service  Incompleteness – In describing service, people tend to omit detains or elements of the service which they’re not familiar with.  Subjectivity – People are biased.  Biased Interpretation – No two people will define “quick, responsive, flexible” the same way. New Service Development Products designed via the steps of structured planning framework have a greater likelihood of success. Four basic characteristics for a development system are: 1) It must be objective, not subjective, 2) Must be precise, not vague, 3) Must be fact-driven, not opinion-driven, 4) Must be methodological, not philosophical. Types of New Services  Major or Radical Innovations – New services for markets as yet undefined.  Startup Businesses – New services for a market already served by an existing product.  New Services for the Currently Served Market – Existing customers a service not previously available from the company  Service Line Extensions – Augmentations of existing service lines  Ser
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