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Classifying Services to Gain Strategic Marketing Insights

Classifying Services to Gain Strategic Marketing Insights. Christopher H. Lovelock (Paper No. 1). Background of Our Economy. As the service industry continues to grow it is necessary to “segment services into clusters” 1 to gain marketing advantages.

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Classifying Services to Gain Strategic Marketing Insights

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  1. Classifying Services to Gain Strategic Marketing Insights Christopher H. Lovelock (Paper No. 1)

  2. Background of Our Economy As the service industry continues to grow it is necessary to “segment services into clusters”1 to gain marketing advantages. Our industrial/manufacturing background has hinder the evolution of the service industry because most managers come from manufacturing or are heavily influenced by the manufacturing industry and its practices. A better classification will allow marketing to find better practices to satisfy customers and make the service industry a more mature one. Agricultural Industrial Service

  3. Previous Analysis • 1923 – Copeland2 • 1963 – Bucklin3 • 1976 – Hunt4 • Convenience • Shopping • Specialty goods • Durable goods • Non-durable goods • Consumers goods • Industrial goods

  4. Classifications • What is the nature of the service act? • What type of relationship does the service organization have with its customers? • How much is there for customization and judgment on the part of the service provider? • What is the nature of demand and supply for the service? • How is the service delivered?

  5. Understanding the Nature of the ServiceAct? • Does the customer needs to be physically present? • Does the customer need to be mentally present during the delivery of the service?

  6. Customization and Judgment in Service Delivery • Some services come standardized, others with some sort of customization, and others are fully customized.

  7. What Type of Relationship Does the Service Organization has with its Customers? • Does the service organization enter into a ”membership” with its customers or is there a no formal relationship?

  8. What is the Nature of Demand for the Service Relative to Supply • What is the common cycle or recurring demand of the service? • What are the fundamental causes that create the demand fluctuations of the service?

  9. How is the Service Delivered? • What method is used to deliver the service?

  10. Conclusion • To help managers of service business to do a better job of developing and marketing their products. • Help managers understand the nature of their service businesses. • The faster we get to master the service industry, the faster we can move on to the next type of industry: experience.

  11. References • Knisely 1979, Lovelock 1981, Shostack 1977 - 1983, Journal of Marketing, summer. • Copeland, Melvin T. (1923), “The Relation of Consumers’ Buying Habits to Marketing Methods,” Harvard Business Review, 1 (April), 282-9. • Bucklin, Louis (19630, “Retail Strategy and the Classification of Consumer Goods,” Journal of Marketing, 27 (January), 50. • Hunt, Shelby D. (1976) Marketing Theory

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