Services are economic activities or benefits offered by one party to another that are intangible, cannot result in ownership, and are consumed at the time of production.
Thank you for reading this post, don't forget to subscribe!- These include actions, processes, or performances like medical care, education, banking, tourism, etc.
- They differ from goods because they cannot be touched, stored, or owned, and their quality often depends on the provider and the situation in which they are delivered.
Service Product Strategies refer to the planned decisions and actions taken by a company to design, price, distribute, promote, and deliver services effectively.
Features (Characteristics) of Services:
Services are different from physical goods. They have four key characteristics:
1.) Intangibility:
- Services cannot be seen, touched, tasted, heard, or smelled before they are purchased.
- Example: When visiting a doctor, patients cannot see the outcome of the service beforehand.
2.) Inseparability:
- Services are produced and consumed at the same time, and cannot be separated from their providers.
- Example: A doctor must be physically present to treat a patient. The service and the provider are linked.
3.) Variability (Heterogeneity):
- The quality of services varies depending on who provides them, when, where, and how.
- Example: The experience at a restaurant may vary depending on the staff, day, or location.
4.) Perishability:
- Services cannot be stored for later use or sale.
- Example: A missed hotel booking for one night is a lost opportunity and cannot be sold the next day.
Strategies for Service Products (The 7 Ps of Service Marketing Mix):
To manage service marketing effectively, businesses use an extended marketing mix, commonly known as the 7 Ps, which include both the traditional and service-specific elements:
1.) Product Mix:
- Design the service offering to meet customer needs and expectations.
- Ensure it is clearly defined and delivers value (e.g., a spa service menu).
2.) Price Mix:
- Set prices based on factors like costs, competition, and perceived value.
- Pricing may include bundling, tiered pricing, or discounts.
3.) Place Mix (Distribution):
- Ensure convenient access to the service by choosing suitable locations and delivery channels (e.g., online booking, service centers).
4.) Promotion Mix:
- Use advertising, personal selling, sales promotion, and public relations to create awareness and attract customers.
- Focus on communicating the benefits and value of the service.
5.) People Mix:
- Service providers and staff play a vital role. Well-trained, motivated, and customer-focused employees enhance service quality and customer satisfaction.
6.) Physical Evidence Mix:
- Since services are intangible, customers rely on physical cues like ambience, cleanliness, brochures, uniforms, or online reviews to assess service quality.
7.) Process Mix:
- Refers to the workflow, procedures, and systems used to deliver the service. A smooth and customer-friendly process improves service experience.