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Chapter 10

ADM2320 Chapter 10

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Marzena Cedzynski

Chapter 10 The Intangible Product Service Marketing Differs from Product Marketing Intangible  Intangible: a characteristic of a service; it cannot be touched, tasted, or seen like a pure product can.  Difficult to market because: o Difficult to convey the benefits and services o Difficult to promote because it can’t be shown directly  The images marketers use reinforce the benefit or value that a service provides. Inseparable Production and Consumption  Inseparable: a characteristic of a service; it is produced and consumed at the same time – that is, service and consumption are inseparable.  Because the service is inseparable from its consumption, customers rarely have the opportunity to try the service before they purchase it. Inconsistent  Inconsistent: a characteristic of a service; its quality may vary because it is provided by humans.  Some marketers of service strive to reduce service inconsistency through training and standardization.  A micromarketing segmentation strategy can customize a service to meet customers’ needs exactly. Inventory  Inventory: a characteristic of a service; it is perishable and cannot be stored for future use.  Excess demand results in having to turn customers away in peak periods, while excess capacity may mean less desirable expense to revenue ratios. Providing Great Service: The Gaps Model  Service Gap: Results when a service fails to meet the expectations that customers have about how it should be delivered.  The four service gaps: o Knowledge gap: reflects the difference between customers’ expectations and the firm’s perception of those expectations. o Standards gap: pertains to the difference between the firm’s perceptions of customers’ expectations and the service standards it sets. o Delivery gap: the difference between the firm’s service standards and the actual service it provides to customers. o Communication gap: refers to the difference between the actual service provided to customers and the service that the firm’s promotion program promises. The Knowledge Gap: Knowing What Customers Want Understanding Customer Expectations  Customers’ expectations are based on their knowledge and experiences.  Expectations vary depending on o The type of service o Depending on the situation Evaluating Service Quality by Using Well-Established Marketing Metrics  Service quality: customers’ perceptions of how well a service meets or exceeds their expectations.  Customers generally use five distinct service dimensions to determine over- all service quality: o Reliability o Empathy o Responsiveness o Tangibles o Assurance  Marketing research provides a means to better understand expectations  Voice-of-customer (VOC) progra
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