Study Notes for Chapter 12

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Published on 14 Dec 2010
School
UTSC
Department
Management (MGM)
Course
MGMA01H3
Chapter 12: Services
SERVICES VS. GOODS
Services
- a product without physical characteristics -- a bundle of performance and symbolic
attributes designed to produce consumer want satisfaction
Tangible Attributes
- attributes that can be experienced y the physical senses, such as sight, touch, and
smell
Intangible Attributes
- attributes that cannot be experienced by the physical senses
- goods sell things and services sell performances
Buying Promises
3 Types of Product Properties for Goods/Services...
1. Search
- physical qualities that enable products to be examined and compared, thus easing
the task of choosing
2. Experience
- characteristics of products that can be asssessed mainly through using them
3. Credence
- qualities for which, even after purchasing, the buyer must simply trust tha tthe
supplier has performed the correct service
4 CHARACTERISTIC OF SERVICES
1. Intangibility
- no physical substance
Creates a number of marketing problems...
a) cannot be stored (ie. revenue from empty seats)
b) cannot be protected through patents
c) hard to display or communicate
d) prices difficult to set
- fixed costs
Solution Strategies
- stress tangible cues in advertising and selling
- use personal resources rather than non-personal sources
- stimulate word-of-mouth communications
- engage in post-purchase communications
- create a strong image of their organization
- develop a strong cost accounting system
2. Inseparability of Production and Consumption
- a characteristic of services in which the product is produced and consumed
simultaneously
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Document Summary

A product without physical characteristics -- a bundle of performance and symbolic attributes designed to produce consumer want satisfaction. Attributes that can be experienced y the physical senses, such as sight, touch, and smell. Attributes that cannot be experienced by the physical senses. Goods sell things and services sell performances. 3 types of product properties for goods/services: search. Physical qualities that enable products to be examined and compared, thus easing the task of choosing: experience. Characteristics of products that can be asssessed mainly through using them: credence. Qualities for which, even after purchasing, the buyer must simply trust tha tthe supplier has performed the correct service. Creates a number of marketing problems: cannot be stored (ie. revenue from empty seats, cannot be protected through patents, hard to display or communicate, prices difficult to set. Stress tangible cues in advertising and selling. Use personal resources rather than non-personal sources. Create a strong image of their organization.