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Services Marketing Unit-6

Services Marketing Unit-6. Service Marketing Strategies MBA-3 rd Sem-2009-2011. Formulating service marketing strategies Designing communications mix for promoting services Role of information technology in marketing of services. Learning Objectives.

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Services Marketing Unit-6

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  1. Services MarketingUnit-6 Service Marketing Strategies MBA-3rd Sem-2009-2011

  2. Formulating service marketing strategies Designing communications mix for promoting services Role of information technology in marketing of services

  3. Learning Objectives • To understand the general role of communications in services marketing • Understand the effective use of communications channels • To understand the role of corporate design/brand within marketing communication strategy • To understand the use of Internet in communicating services

  4. Issues in communicating services Intangible Performance not the object Provide tangible clues Information helps to reduce risk Intermediaries In some services Can be very important But not all Service Characteristics Inseparable Use personnel to educate customers “how it works” Poor information = Nasty surprises Personal information = important Perishable Promote specific periods when necessary

  5. Use analogy: Accenture Performance / golf • http://www.youtube.com/watch?v=w3NKMUOc7PA • Tarpon • http://www.youtube.com/watch?v=4hv_V_Af19M

  6. Communications Challenges in Services Marketing • Facilitate customer involvement in production • prepare customers for service experience and demonstrate roles • teach customers about new technologies, new features • Help customers to evaluate service offerings • provide tangible or statistical clues to service performance • highlight quality of equipment and facilities • emphasize employee qualifications, experience, professionalism • Stimulate or dampen demand to match capacity • provide information about timing of peak, off-peak periods • offer promotions to stimulate off-peak demand • Promote contribution of service personnel • help customers understand service encounter • highlight expertise and commitment of backstage personnel

  7. People as communication platform Virgin Atlantic vs. Singapore airlines • http://www.youtube.com/watch?v=EPIjCS9YRw4 • Singapore Airlines http://www.youtube.com/watch?v=ykSBMqffuQ8

  8. Goods v ServicesImplications for communications strategy • Provide tangible clue/evidence • Educate and train customers to use and to evaluate services • Help manage demand levels to match firm’s capacity • Reduced communication role for intermediaries • Importance of contact personnel requires internal communication to inform, motivate and create role models

  9. Education as part of communications Educate employees to deliver all/part communications Inform what the company does Educate how it’s done Develop WOM support Maintain contact Updates Further education Remind Renewable service Persuade that the best solution is offered

  10. Common educational and promotional objectives Create tangible, memorable images Build awareness and interest to stimulate trial Communicate brand’s strength and benefits Counter competitive claims Reposition service relative to competition Teach customers how to use the service Manage demand levels Reduce uncertainty by providing useful information and advice Provide reassurance (eg service guarantees) Recognise and reward valued customers

  11. SMART objectives Specific Measurable Achievable Relevant Time-related

  12. The 5W’s model for communication plan • Who is our target audience? • What do we need to communicate and achieve? • hoWshould we communicate this? • Where should we communicate this? • Whendo the communications need to take place?

  13. Messages originating within the organization Front-line staff Production Channels Service outlets Marketing Channels Advertising Sales promotions Direct marketing Personal selling Public relations E-comms. Word of mouth Media editorial Messages originating outside the organization The integrated services communications mix A U D I E N C E

  14. Word of Mouth • Perceived as more credible than firm-initiated promotional activities • Have a powerful influence on people’s purchasing decision • The higher the risk the more important for WoM • Less knowledgeable customers rely more on WoM • Dissatisfied customers are more likely to pass negative WoM than satisfied customers • Indicator for profitability (Reichheld, 2003)

  15. WoM (con.) • Stimulate positive and persuasive comments from existing customers by: • Referencing other purchasers and knowledgeable individuals • Create Buzz – exciting promotion, events • Developing referral incentive scheme • Publicising testimonials that simulate WoM • Internet is ubiquitous & openly accessible, it has accelerated the spread of personal influence which evolves into a “viral marketing” phenomenon. e.g. blogs • http://blogs.ebay.com/ • http://www.suspendedfromebay.com/

  16. What is Brand Equity and Why Does It Matter?(From Berry, “Cultivating Brand Equity”) Definition: A set of assets and liabilities linked to a brand’s name and symbol that adds to (or subtracts from) the perceived value of the product • Brand equity can be positive or negative • Positive brand equity creates marketing advantage for firm plus value for customer • Perceived value generates preference and loyalty • Management of brand equity involves investment to create and enhance assets, remove liabilities

  17. Corporate design, name, colour, image -recognizable symbols

  18. Firm’s Presented Brand (Sales, Advertising, PR) Awareness of Firm’s Brand Uncontrolled brand communications Firm’s Brand Equity What Media, Intermediaries, Word-of-Mouth Say re: Firm Meaning Attached To Firm’s Brand Customer’s Experience with Firm A Service Branding Model: How Communications + Experience Create Brand Equity Marketer-controlled communications Source: Adapted from L. L. Berry ( 2000) Cultivating Services Brand Equity, Journal of the Academy of marketing Science, 28(1), 128-137

  19. SERVICE BRAND IDENTITY Integrated communications Corporate Design Elements Servicescape Design Brand Name And Positioning Marketing Communications Mix Interactive Marketing

  20. Marketing Communication and the Internet • International in Scope • Accessible from almost anywhere in the world • Simplest form of international market entry • Internet Applications • Promote consumer awareness and interest • Provide information and consultation • Facilitate 2-way communications through e-mail and chat rooms • Stimulate product trial • Enable customers to place orders • Measure effectiveness of specific advertising/promotional campaigns

  21. Marketing Communications and the Internet • Web Site design considerations • Memorable address that is actively promoted • Relevant, up-to-date content (text, graphics, photos) • Contain information that target users will perceive as useful/interesting • Easy navigation • Fast download • http://www.youtube.com/watch?v=9EQeFq2he4U&feature=related • Internet advertising • Banners and buttons on portals and other websites seek to draw online traffic to own site • Limits to effectiveness—exposure may not lead to increases in awareness/preference/sales • Hence, advertising contracts may tie fees to marketing relevant behavior (e.g., giving personal info or making purchase)

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