Marketing can be described in various ways. It can be viewed as a strategic drive to which top management aspires, as a series of functional activities performed by line managers (such as product policy, pricing, delivery, and communications), or as a customer-driven orientation for the entire organization. organization.

This book seeks to integrate all three perspectives, while also recognizing that the service marketing function is much broader than the activities and performance of the traditional marketing department, requiring closer cooperation between salespeople and those managers responsible for the services. operations and human resources.

The service sector of the economy can best be characterized by its diversity. Service organizations vary in size, from large international corporations to fields such as airlines and banks. Insurance. Telecommunications hotel chains and freight forwarders, to a wide variety of locally owned and operated small businesses. Including restaurants, laundromats, taxis, opticians, and numerous business-to-business services. The facilities that operate with franchises.

Many services are concerned with the distribution, installation, and maintenance of physical objects, including operations as diverse as retail and warehousing, computer installations, auto repair, office cleaning, and lawn and garden maintenance. Governments and non-profit organizations are also in the business of providing service, although the degree of this commitment can vary greatly from country to country, reflecting both tradition and political values, in many countries, schools, hospitals, and museums are publicly owned or operate on a non-profit basis, but there are also for-profit versions of each type of institution.

A better understanding of service marketing has not only led to greater marketing sophistication in traditional service industries but has also had a significant impact on management practices in service-oriented manufacturing industries, at the same time. , most service salespeople would readily recognize that they have also learned a lot from the experts in service operations and human resource management.

 

Privatization

The term privatization was created in Britain to describe the policy of making nationalized industries return to private ownership. The transformation of service operations such as national airlines, telecommunications services, and natural gas facilities to private utility companies has led to restructuring, cost reduction, and a more market-focused stance, when privatization is combined with a relaxation of regulatory barriers, to allow the entry of new competitors, as in the case of the telecommunications industry in Great Britain the implications for marketing can be extremely considerable.

Government agencies have often achieved similar results at the local level when they have outsourced certain services (such as garbage removal) to private companies, another type of change occurs when non-profit organizations, especially hospitals in the United States, switch to a profit-making position.

 Computerization and technological innovation

New technology is radically altering how many service organizations do business with their customers, as well as what goes on behind the scenes. Today, perhaps the most powerful force for change comes from the integration of computers and telecommunications. Companies that operate information-based services, such as financial services companies, are seeing the nature and scope of their business being transformed by the advent of national (or even global) electronic transfer systems including the World Wide Web.

Technology makes it easy to create new or improved services. It enables the reengineering of activities like taking orders and making payments, encourages companies to maintain more consistent standards through centralized customer service departments, encourages companies to replace staff with machines for repetitive tasks, and encourages greater customer engagement. in operations, through self-service.

 

Manufacturers as service providers.

Service centers within manufacturing companies are transforming many well-known companies, in fields such as computers, automobiles, and electrical and mechanical equipment. Supplementary services are designed to assist in the sale of equipment. Including consulting, credit, transportation and delivery, installation, training, and maintenance, they are now offered as services that try to make a profit in their own right, including with customers who have decided to purchase competitive equipment.

Implications and Opportunities for service marketers

In many industries, especially transportation and financial services, there is a convergence of various elements, such as a windstorm, a new moon, or heavy rain, to produce a tidal wave that will shatter organizations whose management is trying to maintain status. quo.

 

Marketing opportunities in franchises.

 The creation of franchise chains is transforming industries that were previously characterized by small unit sizes, a local orientation, and a lack of professional management skills. Even though franchises retain some of the characteristics of sole proprietorships, many of which Key marketing tasks are now in the hands of professional staff at the chain’s headquarters. Certain activities previously unnecessary and out of the reach of an individual entrepreneur have become important, as well as feasible.

 

The need for a focus on competitive strategy.

Sellers define a market as the set of all current or potential buyers of a fundamentally particular product. However, it is usually unrealistic for a company to try to attract all the buyers in that market. Or at least to all buyers in the same way. In most cases, buyers, whether they are individuals or corporations, are too numerous, too spread out, and too varied in their needs, buying behaviors, and consumption patterns. Furthermore, different service companies vary widely in their abilities to serve different types of customers, so instead of trying to compete in an entire market, perhaps against superior competitors,

 

Identification and selection of target segments.

A market segment is made up of a group of buyers who share common characteristics, needs, purchasing behaviors, or consumption patterns. Effective segmentation should group buyers into segments in ways that result in as much similarity as possible in relevant characteristics within each segment, but differences in those same characteristics between each segment.

A target segment is a segment that a company has chosen from among all those in the broader market. Frequently, the segments that constitute the target segments that constitute the objects are defined based on several variables. For example, a department store in a specific city might target residents of the metropolitan area (geographic targeting) who have incomes within a certain range (demographic targeting) who value the personal service of knowledgeable employees, and who are not very price sensitive (both reflect segmentation according to expressed behavioral attitudes and intentions) because competing retailers in town would also likely be targeting the same customers, department stores would have to be positioned to create a distinct appeal; Appropriate features that should be highlighted might include a wide variety of merchandise categories, breadth of selection within each product category, and the availability of ancillary services such as advice and home delivery.

An important aspect of marketing for any business is recognizing that some market segments offer better opportunities than others. Targeted segments should be selected not only based on their sales and profit potential but also on the company’s ability to match or exceed competing offerings targeting the same segments.

To select target segments and design effective positioning strategies, managers need insights into how current and potential customers within different market segments value the various components (or attributes) of a service. For example, what level of quality and performance is required for customers to give different attributes? How well do competing products meet customer requirements? Is it possible to redesign an existing product so that it better meets customer needs and is superior to competing offerings?

Nature and importance of services.

Product marketing and service marketing are essentially the same. In each case, marketing personnel must select and analyze their target markets and go on to create a marketing program around their marketing mix variables; the product (or services), the pricing structure, the distribution system, and the promotional program. The tactics and strategies used in the marketing of a conventional product are frequently inadequate for the marketing of services.

Definition and scope of service areas.

Services are separately identifiable and intangible activities that satisfy needs and are not necessarily linked to the sale of a product or service. To produce a service may not……. the use of a tangible product. However, when required, there is no transfer of rights (permanent ownership of those tangible products).

Example:

  • Product marketing: when we see an ad that says house for sale.
  • Marketing of services: when we see an advertisement where it says rooms for sale.

Some statistics about services can be misleading because it is increasingly difficult to find products and services in our economy.

Seldom do you find situations in which the implication of products whatever they may be. Most services need support products. This product-service mix is ​​what increases its importance in the economy.

 

Importance of services

The US industrial economy is evolving to the point where it is becoming the world’s leading service economy. Almost three-quarters of the non-agricultural labor force is employed in promoting services. The work in the services already. Characteristically, they hold up better during a crisis than jobs in commodity-producing industries. Almost half of consumer spending goes to the purchase of services, characteristically, it remains higher during a crisis, than jobs in merchandise-producing industries. Nearly half of the consumer spending goes toward the purchase of services, a booming aspect of the service economy that is increasing its pace considerably more than the prices of most products.

Examples:

  • By taking the car or television to review when it is said that services account for almost half of the consumer spending, the economic importance of services is understood. This figure does not include the vast amounts spent on industrial and business services. However, spending on business services has risen faster than spending on consumer services. The growth of business services can be attributed to the fact that businesses are increasingly complex, specialized, and competitive. As a consequence, management has been forced to call upon experts who provide services such as investigation, tax, advertising, labor relations, and many more. more areas.
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The pace of growth has not been consistent across all categories of consumer services. As incomes have risen and lifestyles have changed, the demand for certain services has grown relatively quickly than for others.

Example:

  • Cinema attendance decreased when individuals opted for television.
  • Expenses for public transport services increased relatively as people used their private cars less.

To capitalize on a growing service economy, many product manufacturers have diversified into services. Some retailers have done the same.

Example:

Sears, Roebuck now has 40 non-merchandise offerings, including an insurance company (allstates), a sales tax accessory company, car sales management, a finance agent (Dean Witter), and a real estate agency. Some other apartment shops for dental, and legal consultants provide services to clients. Another apartment store also carries house cleaning, accessory insurance, sales tax, and driving class.

 

Characteristic of the services.

The spatial nature of the services derives from several distinctive features. These produce special marketing opportunities and needs and often result in strategic marketing programs that are substantially different from those found in product marketing.

INTANGIBILITY: since the services are essentially intangible, customers can’t sample (taste, feel, see, hear, or smell) the services before buying them. This feature of the services presents certain restrictions in a marketing organization. The burden falls mainly on a company’s promotional program. The sales forces and the advertising department should concentrate on the advantages that will be obtained from services, rather than highlighting the service itself.

An insurance company can promote the advantages of the service, such as the guaranteed payment of a child’s higher education expenses, or a retirement pension of a certain amount of money per month. Telephone companies explain how users can eliminate costs of sales and inventory through long-distance calls.

INVISIBILITY: frequently, services cannot be separated from the seller, in addition, some services must be created and promoted simultaneously.

Example:

Dentists can create and promote almost all of their services at the same time From a marketing standpoint, invisibility often means that direct selling is the only possible channel of distribution and a vendor’s services cannot be sold. in too many markets. This feature also limits the scale of a company’s operation, someone can only repair a certain number of cars in a day or treat a certain number of medical patients. As an exception to the invisibility feature, the service may be sold by a representative of the creator. Seller.

Example:

A travel agent, a rental agent, or an insurance agent, in other words, can represent and help promote the service that will be sold by the institution that produces it.

HETEROGENED: It is possible for a service industry, and even for a seller of services, to stabilize total output, each “unit” of service is different in some way from other “units” of it.

Example:

An airline does not give the same quality of service on every trip.

Another complication is the fact that it is often difficult to judge the quality of service / of course, the same can be said of some products. It is particularly difficult to predict the quality before purchasing the service. Therefore service companies should pay particular attention to the “product-planning” stage of their marketing programs. From the outset, management should do everything it can to ensure continuity of quality by maintaining high levels of quality control.

EXPIRATION AND OSCILLATING DEMAND: the services have a high expiration date and can be stored.

Example:

  • Unused electrical energy.
  • The empty seats of a stadium.
  • Jobless mechanics in a workshop
  • It represents businesses that are lost forever.

In addition, the services market fluctuates considerably by season, by day of the week, and by time of day.

There are some notable experiences with this generalization.

In life and health insurance, for example, the purchase service, but is retained by the insurance company (the seller), until it is needed by the buyer or the beneficiary. This retention constitutes a type of storage. The communication of expiration and oscillating demand presents difficulties in promotion, price, and product.

Planning of service company executives. In some companies, they can look for new uses for the idle capacity of the plant out of season. Through advertising and reduced fares for public transportation executives, they can show consumers the advantages of using the city’s transportation facilities during off-peak hours. In an attempt to even out demand the phone company offers lower rates at night and on weekends.

The concept of marketing and marketing of services.

The growth of services has generally not been due to the development of marketing in the service industries, but rather, to the maturation of our economy, and our recent standards of living. Traditionally, the executives of our service companies have not been oriented into marketing.

The marketing profits of service companies have not highlighted service marketing innovations to the stretch of the imagination, they come, more often than not, from companies associated with the product. Some reasons for this lack of orientation can be identified. Undoubtedly, the intangibility of services creates more marketing difficulties for sellers of services than for products. In many service industries (particularly professional services) sellers see themselves as producers or creators, not marketers of services. Another reason is that the general managers do not understand yet

  1. what is marketing
  2. Its importance in the success of a company.

These executives seem to equate marketing with sales and fail to consider another part of the market system.

They also do not effectively coordinate their marketing activities. Many service companies lack an executive whose sole responsibility will be marketing; the counterpart of the vice president of marketing at a product manufacturing company, there are exceptions to these negative generalities, as some extremely successful service companies have adopted moderate marketing techniques, such as the holiday lnn, avis, pacific southwest, airlines organizations, and national liberty.

A strategic program for the marketing of services.

Due to the characteristics of services (intangibility), for example, the task of developing a complete marketing program for a service industry is often difficult, however, as in product marketing, management must first define its objectives. marketing goals and selecting its target markets quickly, management must design and implement marketing mix strategies to reach its markets and meet its stated goals.

Analysis of target markets. 

The task of analyzing a company’s target markets is essentially the same whether the company sells a product or a service. Marketers of services must understand population and income components (demographic factors) as they affect the market for services Increases in disposable income and discretionary purchasing power mean a growing market for health care, insurance, and transportation services.

Planning and development of services.

New services are just as important to a service company as new products are to a product marketing company. Product development and planning have their counterparts in the marketing program of a service industry. Some service companies have effectively increased their mixes by working in coordination with companies that sell related services on some services that for products packaging, color, labeling, and styling are almost non-existent in services marketing.

The price of services.

 Nowhere in the marketing of services is there greater need, imagination, and managerial skill than in the area of ​​pricing. It was previously noted that services are extremely expiry, generally cannot be stored, and demand varies greatly with frequency. All the characteristics influence prices to complicate the situation even more, the client can postpone the purchase or even carry out some services himself (car and home repairs, in some service industries the private seller will establish a price, but must be authorized by a regulatory agency, however, this price regulation must not remove the opportunity for imaginative and skillful pricing to increase profits.

Distribution channels for services.

 Traditionally, most services have been sold directly from the product to the consumer or industrial user. Intermediaries are not used when the services cannot be separated from the seller. Or when the service is created and marketed simultaneously.

There is only one other frequently used channel, which includes an intermediary agent. Some type of agent or broker is often employed in marketing finance, travel arrangements, hobbies, and home rentals, sometimes retailers are trained in producing the service and then franchised to sell it. Using intermediaries is another way to apply the distribution. Some banks have arranged for companies to deposit employees’ paychecks directly into their bank accounts. In this way, the employer becomes an intermediary when distributing the services of a bank.

Promotion of services.

 Personal selling, advertising, and other forms of promotion are used extensively in the marketing of services. However, it is very difficult to create a promotional program around the intangible benefits of services.

For many years, advertising has been used extensively in many service areas, eg, housing, home operation, transportation, recreation, and insurance. What is new is the use of advertising by professional service industries including other lawyers, accountants, and doctors. Previously, professional associations in this area had banned advertising based on a lack of ethics.

As an indirect type of promotion, doctors, lawyers, and insurance agents can actively participate in community affairs to get their names out there.

A utility company’s promotional program should have three goals:

  1. Provide the advantages of services in the most attractive way possible.
  2. distinguish what is offered from what competitors offer.
  3. create prestige, since the company is marketing, reputation is vital
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A service company’s promotional effort can even be more efficient if the seller can tie it to something tangible. Maybe with a different color like Hertz does or a symbol like the Banamex ones.

The future of services marketing and the changing environment of services.

The rise of the service company in the 1980s was accompanied by a significant increase in competition in many service industries.

This competition is encouraged by several factors.

Chain store types of organizations are replacing independent or small-scale types of organizations in many areas including health care, auto repair, beauty salons, dental services, and real estate brokers.

Need for higher productivity.

The boom is also accompanied by a deterioration in the quality of many services in general. Service industries have been plagued by mismanagement, inefficiency, and low productivity. This inefficiency (and the need to increase productivity also reduced the health of the economy as a whole). Perhaps the key to increasing efficiency in service industries is for management to adopt a manufacturer attitude. The concept of better service delivery has traditionally been associated with the effort to help others. The four manufacturing strategies applied to service industries to increase productivity are mechanization, assembly line standardization, specialization, and consolidation in manufacturing. organization.

  1. Fast food retail sales. Various service companies have made labor more productive through specialization of effort. The medical field contains a large number of specialists. Consolidation as a means of improving productivity is practiced when the main carrier (TWA, United, Continental) adds hotels to its mix of services.

Growth prospects.

Services certainly continued to increase their share of the consumer market, as they have for the last 410 years. This prediction seems reasonable in a period of economic decline. Demand for business services must also continue to expand as business becomes more complicated and as management recognizes the need for service or business specialists. These optimistic predictions should be viewed with some caution, as both internal and external forces in the service industries could limit growth in these areas.

The search for a competitive advantage.

In the service sector every day more portal competitions are why organizations or companies try to differentiate their products from others.

In consumer-oriented industries such as banking, insurance, hospitality, and education, growth is slowing.

Companies must be selective between attention to their customers and distinctive in the way they present themselves to them.

The need for a competitive strategic approach.

 Each company must adopt a market segmentation strategy by identifying those parts of the market that they can best serve.

Each buyer is a separate segment since they have different needs and characteristics, therefore their objectives for each buyer.

Most service industries don’t make micro-segmentation worthwhile.

That is why they try to achieve an economy with all their customers in a single market.

Mass adaptation: this is what is achieved by offering a standardized product but adopting supplementary services to adjust to buyers.

Identification of a target segment:

 A target segment is the one that a company chooses from the entire market n important aspect of marketing is knowing that some service sectors create greater opportunities than others.

The markets that are taken as objectives are selected not only based on sales but also on the ability of a company to fight against the competition.

Development of a service concept:

For a specific segment:

  • An investigation is necessary to identify an attribute of a service indicated for the segment.
  • It is not possible to generalize so much, the personnel that provide the services that the same individuals can establish different priorities such as:
  • To use the service.
  • someone makes decisions
  • At the time of employment
  • Whether you are using the product alone or with a group and who makes up that group.

Importance versus determining attributes.

Consumers make their choices between optional service offerings based on perceived differences, but the attributes that distinguish competing services are not always the most important.

It must be determined which are the determining attributes, when this is known, a positioning campaign must be developed.

This strategy is quantified and another is qualitative for the price (it is somewhat quantitative)

Creation of a competitive position.

Positioning: It is the process of establishing and maintaining a distinctive place in the market.

The positioning does not only apply to businesses or companies but also to public and non-profit organizations that you want to share to find clients.

Repositioning: involves changing the existing position. Allows you to review some features of the service.

Positioning of advertising content VS product positioning.

The position reflects how consumers perceive the product’s performance on specific attributes relative to that of one or more competitors.

  • When consumers sand frames, they recognize which ones are preferred, which ones they remember, and how they are positioned.
  • Many vendors associate positioning with communication elements, eg, advertisements, promotions, and publicity.
  • It consists of gaining images and associations for products of similar brands to distinguish them in the mind of the consumer.

The role of positioning in the marketing strategy.

This is of great importance since it mixes the analysis of the market and the corporate analysis and the competition.

The development of a positioning strategy can take place at different levels depending on the nature of the organization if it is:

  • A multi-service, multi-location branch.
  • A specific service branch
  • For a specific service offered at that branch.

Steps in developing a positioning strategy.

  1. Market analysis:

It is important to know what the amount of demand is and where it is located.

On the other hand, the market can be segmented and an evaluation of the demand of each segment can be made.

With research, we can find not only the needs of consumers but also their position against the competition.

  1. Corporate analysis:

 This discusses human resources. Like manpower and knowledge. The physical assets of the organization.

In addition to the limitations, restrictions, values, ​​and goals such as profits, growth, preferences, and professionals.

  1. Competitive analysis:

 Here the competition is analyzed which can give an idea of ​​its weak and strong points and the opportunities that it has before those weaknesses.

Development of positioning maps.

It is a graphical way of representing consumer perceptions about optional products. Where a map is usually limited to two attributes, when more than three dimensions are required to determine product performance, it is necessary to plot a series of separate graphs for visual presentation.

portfolio concept

It can be said that it is the set of financial instruments that an investor has for the series of loans that a bank has made.

In financial services, the goal of portfolio analysis is to determine the mix of proprietary resources or risk needs and preferences.

Applying it to service businesses with an established customer base. If managers know the annual value of each customer category as well as the representative ratios for each category within the customer base, they can project the ongoing value of all those customers concerning future revenue streams.

Paths leading to growth.

Service businesses can grow in one or more of the following categories:

  1. attract new customers
  2. Get regular customers to buy more.
  3. Get customers to buy at a higher price.
  4. Reduce the degree of rotation.
  5. Put an end to relationships that do not leave profits, or that are unsatisfactory and replace them with new clients that are better adapted to the demands of the company.

Customers as part of the product

The segmentation strategy is not only framed in the services that are consumed individually but also in groups, eg: theaters, hotels, airlines, and stores.

Customers influence both the image of the organization and the services themselves.

performance management

Performance management is concerned with getting the best possible performance out of each long-term available capacity unit while trying to get some utility out of perishable capacity units.

(the efficiency in generating returns)

The role of marketing

  1. Identify the main market segments
  2. Forecast the business volumes that could be obtained from each segment at a specific price level. (offer and demand)
  3. Recommend business mix; at each specific point in time, in terms of maximum revenue.
  4. Provide the objective sales force, specific sales, at a certain time for each segment.
  5. set guidelines for the prices to be charged in each segment at specific points in a certain time.
  6. Monitor performance over the time evaluated, the reasons for having achieved higher or lower performance than what was predicted.

Demand management.

Most services are unable to inventory their finished products. This absence of inventories does not matter when demand levels are relatively stable and predictable.

However, restricted service companies have problems as they face swings in demand.

Services that involve tangible actions with your possessions are more likely to be subject to capacity constraints than information-based services.

However, in the latter case, similar capacity problems can occur when customers are forced to go to a location for the delivery of a service as in the case of live entertainment.

There are actions that managers can take to adjust capacity and balance demand levels.

  1. Schedule downtime during periods of low demand.
  2. hire hourly employees
  3. Rent or share extra equipment facilities.
  4. Provide employees with Inter training. functional.

Strategies for demand management.

You must face four conclusions

  • demand exceeds the maximum available capacity with the result that potential business may be lost
  • demand exceeds the optimal capacity level
  • demand and supply are well balanced at the level of optimum capacity
  • demand is below optimum capacity and available resources are not used to their full capacity
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Demand Information

is required to know:

  • historical data on the level of demand including variations example: prices and other variables
  • demand forecast for each segment
  • segment by segment data
  • Robust cost data, to distinguish fixed and variable expenses
  • in multi-location organizations and the demand of each location
  • consumer attitudes
  • Customer feedback on service quality

Excellent service is the foundation of excellent marketing. When the service is excellent, business management is easier, and price increases are better tolerated because customers see that the service is valuable. Advertising is more by the reality of the service that is provided and benefits from the reinforcement of positive word-of-mouth communication. Salespeople have confidence in the services and therefore sell them more easily.

To vigorously market a low-quality service is to undermine the future of a firm; More customers are tempted to try the service, but then find out for themselves that they were wrong. So what does the company do? The thesis of this book is that excellent service marketing begins and ends with excellent service.

The fundamental role of the marketing director.

In service businesses, the most effective marketing managers turn this activity into a line function. His philosophy is to help the organization become a marketing institution, rather than marketing the organization.

Don’t try to create a large independent marketing department. A service business only needs a few marketers who understand the culture of operations and keep the organization customer-focused.

The marketing manager has three key leadership roles to play in helping to build and sustain a marketing institution. These roles are permanent: they may change in degree but not in essence as the firm’s marketing mindset evolves.

First role: architect of change.

The fundamental idea of ​​marketing is to make a good match between the organization to its markets. As the markets change, the organization must also change. Nothing is eternal in the marketing environment: not cultural values, not demographic structure, not the economy, not technology, not competition, not the political climate.

A key role for service firm marketing managers is to help redefine the strategic direction of their business in response to changing market conditions. Market-sensitive strategic change is critical to institutional renewal. Good examples of this are the Girl Scouts of the United States, who changed their approach from preparing girls to be homemakers and now preparing them for careers.

The second facilitating role of marketing.

Marketing managers of service firms have to take advantage of the fact that the employees who provide the services are the ones closest to the customer and therefore are in the best position to be business managers. The primary role of the marketing manager is to facilitate the service marketing process from provider to consumer on the ground.

Marketing managers can facilitate this activity throughout their organization in at least three ways:

First, they can continually work to educate administrative and non-managerial staff about the nature, purpose, and applications of marketing.

Second:  the marketing manager has to strive to make it easier for employees to practice this function, the best marketing managers focus on giving employees the tools they need to be effective business managers. For example, these executives help create:

  • customer insights function, which employees can use to better understand customer needs.
  • Operating systems that speed up routine transactions and free up employees to sell other services.
  • internal training and communication services so that employees are more competent and customers feel more confident.

Third, the marketing manager has to be a visible and indefatigable champion of quality service in the organization. Other than the CEO, no one in the company has as much stake in service quality as the marketing manager. As we already stressed, excellent service makes all other aspects of service marketing more powerful, and more service makes them less powerful.

The marketing director has

  • Being within the company the lawyer of an excellent service.
  • Help show the way to improve the service.
  • Evaluate the impact of service quality on all marketing decisions and ensure that those decisions support the enhancement of quality, not undermine it.

Third role: image manager.

A third critical role for marketing managers is corporate image management. Helping the company adapt to its environment and facilitating marketing efficiency at the point of contact with customers contribute directly to building a positive image of the company. But the intangibility of services forces the service vendor to use all possible means to establish a distinctive and enduring company identity.

 The quality imperative.

Service quality is the foundation of service marketing. High-quality service from credibility to the sales force and advertising stimulates word-of-mouth communications, enhances customer value perception, raises morale, and builds loyalty among employees and customers alike. Service quality is not a separate discipline from service marketing; is the central part of it. Companies that do not provide good service cannot be successful in the commercial environment, no matter how attractive their advertising may be, and no matter how many visits their sellers make. The offers from their advertising and their vendors only serve to persuade more people to experience poor service and teach themselves to avoid that firm in the future.

The essential of the quality of a service is its reliability that what was promised is fulfilled. A company that routinely fails to deliver what it promises, that is unreliable, and that frequently makes mistakes, loses the trust of its clients, and the trust of the clientele is the most valuable asset of a service company.

Think big, act small.

THINK BIG:

In the 1990s, the best-run service organizations will think big but acted small. Thinking big is partly having a global vision, partly learning without borders, and partly moving forward. Globalization affects all service firms, even when the company’s management has no intention of competing abroad. In reality, the free movement of goods, services and ideals around the world influences customers’ expectations, tastes, and options today more than ever. Furniture stores in Philadelphia are affected by IKEA entering the market and popularizing Scandinavian design furniture that you assemble yourself. Domestic airlines in the United States are affected by high levels of service from foreign carriers such as Singapore Airlines and SAS.

ACT SMALL.

Acting small is just as important as thinking big. It is the opposite of acting in bureaucratic ways. Carolyn Bursteins of the Federal Quality Institute lists four characteristics of bureaucracies.

  • Administration by rules.
  • Functional structure of the organization.
  • internal focus
  • I treat customers deliberately and impersonally.

Instead, acting small implies a very small rulebook, an undivided organizational structure that encourages quick responses, an external focus on customer needs, and both internationally personal customers. This means taking advantage of the opportunity of direct communication with the final client and providing him with creative, sincere, and personal service. Acting small does not mean artificial or programmed customization. Indeed, the research carried out by Surprenal and Solomon revealed that stereotyped personalization reduces customers’ confidence in the ability of employees.

Modernized service.

Friendly computers can modernize services by eliminating or automating manual functions. Combining machines with human energy can speed up the provision of a service and facilitate access to it. Servers are freed from boring and repetitive functions that are better performed by computers, thus improving productivity in the provision of routine services and allowing a wider range of personal services.

The Chemical Bank has developed a retail banking system based on the Genesis personal computer that serves the various groups of employees who have direct contact with customers. As a result of Genesis, it is possible to make personal decisions about loans (and even write checks) in five minutes.

Personalized service.

Service marketing in the 1990s is characterized not only by a high-tech, high-touch strategy but also by high-touch through high-tech. Computer-based systems that give necessary information about customers (or their assets) to the right service providers at the right time provide the opportunity to customize service cost-effectively. Information technology is the primary weapon for creating tier-three relationship marketing strategies.

The technology will allow large service companies to offer their customers a seamless experience, even though their service employees will have millions of pieces of data at their fingertips. It will enable companies to provide their clients with the personal service that was once the key to success in quality operations carried out by service entrepreneurs.

High aspirations for quality services and habits.

The process of improving quality is difficult to start and sustain. There is a lot of talk about quality improvements but it is not so easy to find real changes. In all industries, there are progressive companies, but most companies are still in the “talk about improvement” stage rather than the “culture change” stage. Many observers of the service quality scenario in the United States are skeptics. One of them said:

While there is now a renaissance of emphasis on service quality, I don’t expect most firms to make any real improvements. It is too much commitment for them. I compare the process of improving the quality of services with the problem of going on a diet. There are many books on dietetics there are perhaps more books on diet than on any other subject. Out of the money. At any given time, 25 percent of adults in the United States are on a diet, and yet. We are not losing weight as a nation. Fundamental change will have to take place, perhaps starting with a crisis for US companies to change.