Download Service Quality Model

Chapter 12
Designing and
Managing
Services
PowerPoint by Karen E. James
Louisiana State University - Shreveport
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 0 in Chapter 12
Objectives
 Learn how services are defined and
classified.
 Understand how service firms improve
their competitive differentiation,
service quality, and productivity.
 Identify how goods-producing
companies can improve their customer
support services.
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 1 in Chapter 12
Nature of Services
Government
Sector
Private
Nonprofit
Sector
Service
Industry
Sectors
Manufacturing
Sector
Business
Sector
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 2 in Chapter 12
Nature of Services
eLibrary.com is
an example of a
service in which
industry sector?
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 3 in Chapter 12
Nature of Services
Service Mix Categories
Pure
tangible
good; no
service
Milk
©2003 Prentice Hall, Inc.
Hybrid:
Tangible equal part
goods with goods and
service
some
services
Computer
Meal at
& Warranty Restaurant
Major
service
with
minor
good
Hair
Styling
To accompany A Framework for Marketing Management, 2nd Edition
Pure
service;
no tangible
good
Legal
Advice
Slide 4 in Chapter 12
Nature of Services
Characteristics
 Cannot be touched,
seen, tasted, heard, or
smelled before purchase
 Intangibility
 Lack of trial means
higher consumer risk
 Inseparability
 Consumers rely on cues
to draw quality
inferences
 Variability
 Perishability
©2003 Prentice Hall, Inc.
 Marketers must try to
“tangibilize the
intangible”
To accompany A Framework for Marketing Management, 2nd Edition
Slide 5 in Chapter 12
Nature of Services
Characteristics
 Intangibility
 Inseparability
 Variability
 Perishability
©2003 Prentice Hall, Inc.
 Services are produced
and consumed at the
same time (air travel)
 Service providers and
sometimes other
customers become part
of the service
(restaurant)
 Strong preferences for
service providers exist
To accompany A Framework for Marketing Management, 2nd Edition
Slide 6 in Chapter 12
Nature of Services
Characteristics
 Intangibility
 Inseparability
 Quality control is critical:
 Variability
 Perishability
©2003 Prentice Hall, Inc.
 Service providers vary
with respect to attitudes,
skills, mood, etc. Even
the same provider may
give different service on
a different day.
– Hiring the right people
– Standardizing service
– Monitoring satisfaction
To accompany A Framework for Marketing Management, 2nd Edition
Slide 7 in Chapter 12
Nature of Services
Characteristics
 Intangibility
 Inseparability
 Variability
 Perishability
©2003 Prentice Hall, Inc.
 Services can not be
inventoried or
otherwise stored
 Capacity / demand
management is
critical:
– Demand side
strategies
– Supply side strategies
To accompany A Framework for Marketing Management, 2nd Edition
Slide 8 in Chapter 12
Nature of Services
Demand-Side Strategies
Develop Complimentary
Services
Cultivate Nonpeak Demand
Use Differential Pricing
Install Reservation System
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 9 in Chapter 12
Nature of Services
Supply-Side Strategies
Plan facilities for
future expansion
Hire
part-time
employees
Introduce peak-time
efficiency routines
Important
Characteristics
Increase
consumer
participation
Share services
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 10 in Chapter 12
Discussion Scenario
Susie Campbell offers “pet-sitting”
services to people in the local area.
Susie often turns away business
during holidays, while other times of
the year find her with little work to do.
Suggest specific demand-side and supply
side strategies that may help Susie to
increase business and stabilize revenue
throughout the year.
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 11 in Chapter 12
Marketing Strategies
Figure 12-1:
Elements in
a Service
Encounter
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 12 in Chapter 12
Marketing Strategies
 People, physical evidence, and
process must be considered in
addition to the 4 “P’s” when creating
external marketing plans.
 Successfully delivering a service
often depends on staff being trained
via internal marketing efforts.
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 13 in Chapter 12
Marketing Strategies
Figure 12-2:
Three Types of Marketing
in Service Industries
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 14 in Chapter 12
Marketing Strategies
Figure 12-3: Continuum of Evaluation for Different
Types of Products
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 15 in Chapter 12
Marketing Strategies
Marketing Tasks
 Managing
differentiation
 Managing service
quality
 Managing
productivity
©2003 Prentice Hall, Inc.
 Can not differentiate
on price alone
 Innovative features
 Delivery system
– Reliability
– Resilience
– Innovativeness
 Image and branding
To accompany A Framework for Marketing Management, 2nd Edition
Slide 16 in Chapter 12
Marketing Strategies
Marketing Tasks
 Managing
differentiation
 Managing service
quality
 Managing
productivity
©2003 Prentice Hall, Inc.
 The service quality
model identifies
five gaps that can
cause service
delivery failure
 Service companies
that successfully
address these gaps
follow common
practices
To accompany A Framework for Marketing Management, 2nd Edition
Slide 17 in Chapter 12
Marketing Strategies
Figure 12-4:
Service Quality Model
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 18 in Chapter 12
Marketing Strategies
Mystery
shoppers can
be used to ID
service quality
gaps. Which
one(s)?
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 19 in Chapter 12
Discussion Scenario
Universities – whether private or
non-profit institutions – provide
services to various publics.
What “consumer” groups do
Universities serve? Using the Service
Quality Model as your guide, discuss
specific examples of different service
gaps for a particular type of consumer.
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 20 in Chapter 12
Marketing Strategies
Characteristics of Well-Managed Service Firms
Commitment from
top management
Firm and customer
monitoring system
Important
Characteristics
A strategic
concept
Satisfaction
of employees
and customers
High standards
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 21 in Chapter 12
Marketing Strategies
Marketing Tasks
 Managing
differentiation
 Managing service
quality
 Managing
productivity
©2003 Prentice Hall, Inc.
 Have service providers
work more skillfully
 Decrease service quality,
increase service quantity
 Industrialize the service
 Reduce need for service
 Design a more effective
service
 Give customers incentives
to serve themselves
 Use technology
To accompany A Framework for Marketing Management, 2nd Edition
Slide 22 in Chapter 12
Managing Product Support Services
 Product support services are often
sources of competitive advantage
 When designing service support
programs, marketers must consider
key customer concerns:
– Failure frequency
– Downtime duration
– Out-of-pocket expenses
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 23 in Chapter 12
Managing Product Support Services
Optional
Service
Contracts
Facilitating
Services
Components
Value-Augmenting
Services
Designing Service Offerings
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 24 in Chapter 12
Discussion Scenario
Hotels catering to a business clientele
often maintain a business center for
the convenience of their guests.
Assume that your copier company is
targeting hotels with business centers.
What service offerings would best
minimize key customer concerns and
facilitate copier sales?
©2003 Prentice Hall, Inc.
To accompany A Framework for Marketing Management, 2nd Edition
Slide 25 in Chapter 12