Professional Documents
Culture Documents
Fundamental
Differences Between
Goods and Services
2006 Thomson Learning, Inc. Sout
Chapter Objectives
Understand the characteristics of intangibility,
inseparability, heterogeneity, and perishability.
Discuss the marketing problems associated
with intangibility and their possible solutions.
Describe the marketing problems associated
with inseparability and their possible solutions.
Explain the marketing problems associated with
heterogeneity and their possible solutions.
Identify the marketing problems associated
with perishability and their possible solutions.
Consider the impact of intangibility,
inseparability, heterogeneity, and perishability
on marketings relationship to other functions
within the service organization.
Intangibility
VS.
Entitles the
consumer to an
experience
Subjectively
evaluated
Marketing Problems
caused by Intangibility
Lack of service
inventories
Not protected
by patents
Not easily
displayed or
communicated
Pricing is
difficult
Possible Solutions
Use of tangible clues
Lack of patent
protection
Use of personal
sources of
information
Marketing Problems
caused by Inseparability
Service provider is involved in
the production process
Customer is involved in the p
roduction process
Other customers are involved in
the production process (shared
experience)
The mass production of services
presents special challenges
2006 Thomson Learning, Inc. Sout
Customer is involved in
the production process
involvement may
vary
impact on the type
of service desired
cycle of service
demand
length of the
delivery process
service factory
must be built with
the customers
presence in mind
Possible Solutions
Physical connection of
the service provide to
the service
Involvement of the
customer in the
production process
Consumer
management
Involvement of other
customers in the
production process
Use of multisite
location
Special challenges in
mass production of
services
2006 Thomson Learning, Inc. Sout
Marketing Problems
caused by Heterogeneity
Standardization
and quality
control are
difficult to
achieve
Possible Solutions
Customization
Standardization
Marketing Problems
caused by Perishability
Matching supply and demand
Demand exceeds maximum available
supply
Demand exceeds optimum supply level
Demand is below optimal levels of supply
Demand and supply are at optimal levels
Creative pricing
Reservation systems
Complementary services
Developing nonpeak demand
utilizing nonpeak periods to prepare for
peak periods
appeal to different market segments
with different demand patterns
Possible Solutions
Demand strategy:
Creative pricing
Reservation
systems
Development of
complementary
services
Development of
nonpeak demand
All 5 Supply
strategies