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We can now look more closely at how the marketing mix may be applied to service products. We shall look first at what is a marketing mix and conventional 4P’s of marketing and then at more additional mix elements in service marketing.
The Service Product
The “product” element of the marketing mix for service products requires that decisions be made on the following:
- The type and range of services.
- The quality and attributes of the services.
- Warranties, after-sale facilities, etc.
As regards product life cycle management and new product development, all the tools and concepts of physical-product marketing apply, although, given the intangible nature of services, concept testing of new ideas for services takes on particular significance and can be extremely difficult to conduct.
Pricing of Services
Again the basic methods of price determination and alternative pricing strategies, such as market skimming versus market penetration, apply equally to services.
It should be noted that the perishability of services means that the careful matching of demand and supply is crucial. Because of this, we should expect to find that a much more flexible approach to pricing and margins is appropriate for services.
Equally, note that the intangible nature of service products also tends to heighten the use by customers of price as an indicator of quality.
Place and Services
Remember that the perishable nature of service products stems from the fact that they cannot be stored. This means that with one or two exceptions, physical distribution is not a key problem.
As regards channels, we have also noted that inseparability demands’ that many services are sold directly by a producer to consumer.
However, some type of agent or broker is often used to market financial or travel services, for example, and increasingly franchising has become an important method of widening the distribution and market spread of many types of service, particularly in the fast-food market.
Promoting Services
Once again we find that the intangible nature of service products raises special consideration for their marketing. The marketer of service products needs to stress the benefits rather than the features of his service.
So, for example, a college needs to promote, say, the job prospects for its graduates as much as the details of the courses it offers.
Personal selling is particularly important in the promotional mix for services. Often the customer is purchasing the personal qualities and skills of the service provider so that an ability to develop close relationships and win customer confidence is crucial.
Analyzing other Marketing Mix Elements in Service Marketing
In addition to the conventional “4Ps” of the marketing mix discussed in our last post, there are in the case of service marketing, additional three Ps, namely;
- People
- Physical evidence
- Process
People
Owing primarily to the intangible and inseparable characteristics of service products, a key factor is how the customer perceives the service and the degree of satisfaction received by the customer.
Often, the extent to which a customer is happy with a service is due to the attitude, skills, and appearance of the people the customer comes into contact with when consuming the service. In fact, very often a customer will purchase a service primarily because of the people they deal with.
For example, many people will use a particular hair salon primarily because of the hairdresser. Similarly, although one might be able to have one’s teeth filled by any dentist, we usually go back because we are happy with a particular dentist.
The importance of the people element of the marketing mix for services cannot be overestimated. Because of this, it is important that this element of the mix is well planned. Time and resources should be spent on factors such as staff training, appearance, selling skills, and so on.
Physical Evidence
A somewhat unusual term relates to those factors that can help to shape the customer’s perception and image of the service provider. For example, many hotels these days provide writing paper, pens, entertainment information, and so on in their hotel bedrooms – thus producing an image of caring and quality.
Similarly, many of the fast-food outlets take great care over the design and layout of the outlets and how they are furnished. Many of the third generation banks in Nigeria for instance, spend liberally to ensure the aesthetic internal and external outlook of their buildings.
Increasingly service marketers are focusing their attention on the design and provision of a total service concept designed to create a pre-planned atmosphere or image.
Process
The final element of the marketing mix for services is based on the idea that the ways in which the service is provided, e.g. systems of delivery are also important. Coordination of activities and concern that customers must be fully satisfied must underpin the firm’s systems and procedures.
Again, this is a design issue since unless the needed processes are identified and designed; they will be incomplete and/or unsatisfactory.
Both sides of an organization must show genuine concern for the customer but unfortunately, they often do not. The sales side is usually sweetness and light. It is the credit control and claims people who can destroy a relationship.
Photo by Edu Carvalho from Pexels
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