1 / 27

The ‘Services’ Sector

Explore the nature of services, challenges faced by service industries, and the significant growth of the service sector. Learn about the Services Marketing Triangle and its applications in strategic assessment and service implementation.

rhondao
Download Presentation

The ‘Services’ Sector

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. The ‘Services’ Sector

  2. What Are Services? • Services are deeds, processes, and performances. • Nature of product. • Greater involvement of customers in the production process. • People as part of the product. • Greater difficulties in maintaining quality control standards.

  3. A Different Context for Services Marketing • Narrow definition of marketing by other managers. • Limited appreciation for marketing skills. • Different organizational structure. • A relative lack of competitive data. • Problems determining costs. • Constraints and opportunities facing marketers of public and nonprofits.

  4. Examples of Service Industries • Health Care • hospital, medical practice, dentistry, eye care • Professional Services • accounting, legal, architectural • Financial Services • banking, investment advising, insurance • Hospitality • restaurant, hotel/motel, bed & breakfast, • ski resort, rafting • Travel • airlines, travel agencies, theme park • Others: • hair styling, pest control, plumbing, lawn maintenance, counseling services, health club

  5. Percent of U.S. Gross Domestic Product by Industry 80 70 60 Percent of GDP 50 40 30 20 10 0 • Services • Manufacturing • Mining & Agriculture 1948 1959 1967 1977 1987 1996 Year Source: Survey of Current Business, August 1996, Table 11, April 1998, Table B.3; Eli Ginzberg and George J. Vojta, “The Service Sector of the U.S. Economy,” Scientific American, 244,3 (1981): 31-39.

  6. Importance of Service Sector Services • $3.52 trillion of U.S. GDP • 53.2% of U.S. GDP • 71% of total employment • 91% of new jobs from 1992 to 2005 Fast growing services for the next decade Health services Business services Finance, insurance, real estate Residential care Computer & data processing Child day-care Social services Transportation services

  7. Factors Contributing to Growth • Movement to information age • Shift to knowledge-based economy • Aging population • Longer life expectancies • Increase leisure time • High per capita income • Changing social and cultural values • Advances in technology

  8. Challenges for Services • Defining and improving quality • Communicating and testing new services • Communicating and maintaining a consistent image • Motivating and sustaining employee commitment • Coordinating marketing, operations and human resource efforts • Setting prices • Standardization versus personalization

  9. Differences Between Goods and Services Intangibility Heterogeneity Simultaneous Production and Consumption Perishability

  10. Figure 1-1Tangibility Spectrum Salt  Soft Drinks  Detergents  Automobiles  Cosmetics  Fast-food Outlets Intangible Dominant  Tangible Dominant   Fast-food Outlets  Advertising Agencies  Airlines  Investment Management  Consulting Teaching

  11. Table 1-2 Services are Different Source: Adapted from Valarie A. Zeithaml, A. Parasuraman, and Leonard L. Berry, “Problems and Strategies in Services Marketing,” Journal of Marketing 49 (Spring 1985): 33-46.

  12. Figure 1-5The Services Marketing Triangle Company (Management) External Marketing Internal Marketing “setting the promise” “enabling the promise” Employees Customers Interactive Marketing “delivering the promise” Source: Adapted from Mary Jo Bitner, Christian Gronroos, and Philip Kotler

  13. Services Marketing Triangle Applications Exercise • Focus on a service organization. In the context you are focusing on, who occupies each of the three points of the triangle? • How is each type of marketing being carried out currently? • Are the three sides of the triangle well aligned? • Are there specific challenges or barriers in any of the three areas?

  14. Ways to Use the Services Marketing Triangle Overall Strategic Assessment • How is the service organization doing on all three sides of the triangle? • Where are the weaknesses? • What are the strengths? Specific Service Implementation • What is being promoted and by whom? • How will it be delivered and by whom? • Are the supporting systems in place to deliver the promised service?

  15. The Services Triangle and Technology Company Technology Customers Providers Source: Adapted from A. Parasuraman

More Related