Getting Started on Services Marketing

1. Getting Started on Services Marketing http://rubybuccat.wikispaces.com/MKTMAN5

2. Services Dominate the Modern Economy • Around the world, the service sector is experiencing near revolutionary change. Innovators constantly launch new ways to satisfy existing needs and to meet needs that we did not even know we had.

3. HSBC Holdings, one of the world’s largest banking groups, is turning to its own backyard, Asia, in search of profit and growth after two decades of expansion in the US and Europe. • This policy shift is sharply focused on expanding the personal or retail business of HSBC (bank) in major Asia markets because sustained high growth in many Asian economies has increased the demand for banking services.

4. NBC Asia, a subsidiary of the National Broadcasting Company, has launched CNBC Asia, a 24-hour business and financial news network offering news coverage from three continents. Its service includes round-the-clock information for the world’s leading stock markets comprising a constant stream of news, trading updates, market indications, etc.

5. Contribution to GDP agriculture: 12.3% industry: 32.6% services: 55.1% (2010 est.) agriculture: 3.9% industry: 25.5% services: 70.6% (2010 est.)

6. agriculture: 1.2% industry: 22.2% services: 76.6% (2010 est.) agriculture: 1.3% industry: 27.2% services: 71.5% (2010 est.)

7. agriculture: 10.2% industry: 46.9% services: 43% (2010 est.) agriculture: 0.9% industry: 55.5% services: 43.6% (2010 est.)

8. Most New Jobs are Generated by Services • Employment is predicted to continue shrinking in manufacturing, mining, and agriculture in many different countries. • Some of the fastest growth is expected in knowledge-based industries such as professional and business services, education, and health services.

9. Powerful Forces are Transforming Service Markets • Service markets are shaped by government policies, social changes, business trends, advances in information technology, and internationalization. Collectively, these forces are reshaping demand, supply, the competitive landscape, and even customers’ styles and decision making.

10. Transforming the Service Economy Social Changes Government Policies Business Trends Globalization • New markets and product categories • Increase in demand for services • More intense competition Advances in IT Innovation in service products & delivery systems, stimulated by better technology Customers have more choices and exercise more power Success hinges on: • Understanding customers and competitors • Viable business models • Creation of value for customers and firm

11. Customer needs and behavior are evolving, in response to changing demographics and lifestyles. Thus, managers of service organizations need to focus more sharply on marketing strategy if they hope to meet – or even anticipate – these needs with services that customers see as offering value.

12. Customers are a vital source of ideas, not only for new products but also for improvements to existing ones. • By working with R&D experts, and with operations and HR managers, marketers may be able to create new service features that customers will value.

13. What is Service? A type of economic activity that is intangible, is not stored and does not result in ownership. A service is consumed at the point of sale. Services are one of the two key components of economics, the other being goods. http://www.investorwords.com/6664/service.html A service is an act or performance offered by one party to another. Although the process may be tied to a physical product, the performance is essentially intangible and does not usually result in ownership of any of the factors of production. (Lovelock)

14. How Services Differ from Goods • Customers do to obtain ownership of services • Service products are intangible performances • Greater involvement of customers in the production process • Other people may form part of the product • More variability in operational inputs and outputs • Many services are difficult for customers to evaluate • Absence of inventories after production • Time factor is relatively more important • Delivery systems may involve both electronic and physical channels

15. Services Pose Distinctive Marketing Challenges

16. Services Pose Distinctive Marketing Challenges

17. Services Pose Distinctive Marketing Challenges

18. Services Pose Distinctive Marketing Challenges

19. Building the Service Business Model Managing the Customer Interface Implementing Profitable Service Strategies A Framework For Developing Effective Service Marketing Strategies Understanding Customer Needs, Decision Making, and Behavior in Service Encounters

20. Framework Building The Service Model The Value Proposition Develop service concept: core & supplementary elements Select physical & electronic channels for service delivery Value Exchange Set prices with reference to costs, competition & value The Business Model Position the value proposition against competing alternatives Educate customers & promote the value proposition

21. Design and manage service processes Balance demand against productivity capacity Plan the service environment Manage service employees for competitive advantage Framework Managing the Customer Interface

22. Implementing Profitable Service Strategies Create customer relationship and build loyalty Plan for service recovery and create customer feedback systems Continuously improve service quality and productivity Organize for change management and service leadership Framework

23. 8P’s of Service Marketing Product Elements Process Place and Time Physical Environment Price and Other User Outlays People Promotion and Education Productivity and Quality