There are characteristics of services that differentiate it from a product (tangible good). 1) Intangibility – Services are intangible offerings. A buyer cannot see, hear, feel or taste a service unless it is bought. A person who pays for a massage will not see the effects of massage till the time the massage is done on his/ her body. Similarly, a person who wants to travel to a foreign country by air will have to buy a ticket for an airline as well as board the plane to travel and experience the flight. As a buyer cannot feel the service beforehand, they look for indications and evidence of quality of service. The decision making is done basis the information derived from presentation, tools or equipment, place, message (communication content and material), symbols, people, and price. McDonald’s tries to influence buyers by given an experience of • Place – quality ambience, • People – courteous and helpful staff, • Message – clear message highlighting quality through pamphlets, ads, etc., • Equipment – the counters, table and chairs, cola machines, etc. properly arranged and are of high quality, • Symbols – proper symbols guiding buyers, etc. • Price – competitive pricing in the target market. The marketers constantly strive to add tangible element to services because services are abstract and not a physical material. Advertisements 2) Inseparability – There is inseparability of the service provided and the buyer. This doesn’t holds true for products as they are produced, stored at a different place, and delivered when needed. A product like a sandwich can be bought and consumed later after an hour or so but a service is generated and consumed at the same time. For example, a barber needs to be present to provide his service of a haircut. Similarly, a doctor provides his/ her services only on meeting the patient. There exists limitations because of this. A product can be bought in large numbers from different places like retail stores. But a service provider and the service buyer both need to be present for the sale of service. To overcome this limitations, service providers meet large number of clients at the same time or train their representatives to provide the same service to a number of people. For example, a Yoga teacher can conduct group sessions instead of meeting only one client. Similarly, the Yoga teacher can train individuals to take Yoga classes in his/ her name or brand at different centres. 3) Heterogeneity/ Variability – This is another characteristic of services that differs from the tangible products. The way a service is provided differs depending on the service provider, it’s time as well as location. For example, an entertainment program by two different performers will be different. Also, the service provided by the same provider cannot be standardized. For example, an air travel for the second time from the same airline will not give the same experience that a person received during the first flight. A barber may not provide a consistent haircut to all individuals depending on time constraints by the clients, etc. Most of the service providers take steps to standardize the service provided to increase sales and customer satisfaction. Big service providers, like an airline company invests in training staff and recruiting the right people. There are certain standards set on quality that are expected from the staff. Similarly, customer satisfaction surveys are done to constantly improve the service. 4) Perishability – A service cannot be stored, returned, or resold like a tangible product. A buyer cannot save the massage experience bought from a service provider. To experience it again, the service will have to be bought again. Similarly, in case of a bad experience, he/ she cannot return the service if dissatisfied. A service if unutilised results in losses for the service provider. Unsold airline tickets, a hotel with vacant rooms, a movie show with empty seats are services lost forever. The service provider will generally do good business during high demand. To overcome this, the prices can be reduced during low demand and complementary services can be provided. Besides the best efforts to standardise a service by a service provider, there are always subtle differences in the level of service given. 5) Lack of ownership and transferability – A physical product like a Television can be owned and transferred to another owner. But a haircut service bought from a barber cannot be owned and transferred to another buyer. Advertisements 6) Difficult to measure quality attributes – The quality attributes of a service are very difficult to put in data form for analysis as compared to a product. A quality specialist can inspect a physical attributes of a product in a laboratory and make observations. But in case of service which is intangible in nature, quantifying the attributes to rate its quality is complex. Take an example of quality assessment of a recorded phone call of a customer service agent talking to a customer. Two different quality analysts will rate the customer representative differently unless they are trained professionals with good experience. Organisations strive to set standards to maintain the quality of service to ensure business success. The service sector is growing rapidly worldwide. Majority of developed and developing countries experience the development of many service industries, which participate significantly in the national economies. P. Kotler suggested that ”service is an activity or benefit that one party can offer to another that is essentially intangible and does not result in the ownership of anything. Its production may or may not be tied to a physical product”. There are four characteristics of service: Intangibility, Inseparability, Variability, and Perishability (Kotler and Keller, 2007).
In order to deliver the overall service offer to a target market, the marketing mix elements should be coherent, coordinated, integrated and consistent with each other to produce the synergistic effect of them. (Lovelock, 2001). The main objective of service marketers is to create and provide service that satisfies consumer needs and expectations, therefore achieving organizational goals. Consequently, marketers should work on understanding how people make their buying decisions and what determines their satisfaction during the service consumption stages: pre-purchase, service encounter, and post-encounter. To gain a competitive advantage in the global market, successful organization should adopt the marketing strategy (overall cost leadership / differentiation / focus) that is based on the marketing concept which holds that the key to achieving company’s organizational goals is being more effective than competitors in creating, delivering, and communicating superior customer value to target customers, and therefore ensuring profits through customer satisfaction. The positioning of services is even more important than the positioning of goods because services tend to be intangible, so differentiation becomes a key issue in making the service distinctive in the perception of the customer's mind. Positioning is concerned with the identification, development, and communication of the attributes which a service company intends to use to make its market offering recognizable and superior to the competing services. A customer-focused organization requires improving service quality as a critical element of differentiation. It's related to the long-term evaluation of the service performance and is crucial to customer satisfaction which is the difference between perception and expectation, moreover, customer satisfaction will become a key factor for business success in the future. In order to develop long-term relationships, it is necessary to build customer involvement, commitment, and trust. In service companies focused on building loyalty, customer service plays an important role in their marketing strategies and is an essential element in creating service quality and customer satisfaction. An organization which strategy focuses on delivering service excellence was more successful. This era is the era of customers and for the success and survival in this competitive market, organizations should emphasize on quality service and this should be integrated into the strategy (Chowdhary and Prakash, 2007). Author: Hend Hassan, lecturer at LIGS University References Chowdhary, Prakash, (2007) "Prioritizing service quality dimensions", Managing Service Quality: An International Journal, Vol. 17 Issue: 5, pp.493-509, https://doi.org/10.1108/09604520710817325 Kotler, P., and Keller (2007) A Framework for Marketing Management 3rd ed. New Jersey: Prentice Hall. Lovelock, C.H., Patterson, P.G. and R.H. Walker, (2001). “Services Marketing: An Asia-Pacific Perspective”, 2nd edition, Prentice Hall, NSW. |
What are the characteristics of services in Service Marketing?
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