Services Marketing

Marketing
Marketing as per Peter Drucker the aim of marketing is to know and understand the customer so well that the product or service fits him and sells itself. Chartered institute of marketing marketing as the process of discovering, expecting and suiting the customer needs and at the same time making profits.

Services
When u build a manufacturing plant, it starts depreciating on the day it opens. The well served customer, on the other hand, is an appreciating asset. Every small act on his or her behalf ups the odds for repeat business and priceless word of mouth referral

Services

Services
Traditionally difficult to define. Which services are created and delivered to customer are difficult to define because many inputs & outputs are intangible.

Service definition

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 result to any owner ship of any factor of production. Services are economic activities that create value and provide benefits for customers at specific times, place. Philip Kotler ---service is any activity of 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
6

Service sector.
Comprises of bulk of todays economy. US 73% & Canada 67% of GDP. Consists of vide variety of industries that sell to individual customers , business customers , government customers , NGOs. Change in economy boom in agriculture, manufacturing increased demand for brand new services and traditional services. Japan -- is it still known for being a manufacturing country ?????? India too is following the footsteps..
7

Service organizations
Large international corporations airlines , banking, telecom, hotel chains, freight transportation.. Locally owned small business restaurants, laundries, taxi services, internet services, courier etc., B-2- B services Franchised service outlets--- food , education

Gats Classification.
General agreement on trade in services classifies 155 activates as service. Major 11 categories are
1. Business services. 2. Communication. 3. Construction & Engg. 4. Distribution. 5. Education. 6. Environment. 7. Finance. 8. Health. 9. Tourism. 10.Recreation. 11.Transport

12.
9

Classification of services..

10

11

Reasons for growth of services industry

Reason Affluence Leisure time Health Consciousness Working Couples Product complexity Life complexity Resource scarcity & Ecology New Products Effect Per capita income Travel & Holiday Awareness Working wives Variety available Lack of time Need of conservation IT Service effected Pest control, personal security, Interior design. beauty parlors, event Travel agencies, Hotels, management etc.. entertainment, career prospects Health clubs, Spas, Old age homes , gyms, yoga, meditation Day care centers, home delivery, packed food Water purifiers, Microwaves, PC, (= AMC) Tax consultants, legal service, property advisors, Investment Car pools, advisors.. water management, high rise apartments .. PCO, pager, e- commerce , Internet service provider, mobile service providers, cyber caf

12

Tangibility -- The quality of being perceivable by touch. Intangibility--The quality of being intangible and not perceptible by touch

13

Tangibility Spectrum

14

Differentiating services from goods

Pure tangible goods Tangible good Accompanied service

Wheat ,sugar, soap, cosmetic etc. Computer, cars air conditioners, machineryafter sales service

Major service accompanying Beauty saloon providing minor goods & service cosmetics Child care centers providing baby food. Pure service Surgery, consultancy teaching
15

Goods vs. services

Unique characteristics that distinguish goods from service

Services are performance , deeds efforts. Services cant be felt, seen ,tasted or touched as goods. Example movie tickets vs. shoes.

16

Characteristics of services

Intangibility Heterogeneity Inseparability. Perishability

17

Intangibility
Product is physical.--- Can be felt ,seen , smelt, tested.. Service is not tangible till it is experienced or consumed. Different people have different expectations with regard to the same service Quality of service not strictly measurable..

18

Problems with intangibility Lack of ability to be stored. Lack of protection of patents. Difficulty in displaying or communicating services. Difficulty in pricing services.

19

Solutions to intangibility problems.

Use of tangible clues. assist customer in making service evaluation. ( insurance advt. in media) ( ICICI bank --- strong ATM network.) Use of personal source of information. ( due to lack of objective means of evaluation customer looks to wards friends , family ) offering incentive to existing customers for roping in new customers) Creation of strong organizational brand. ( results in loyalty i.e. Maruti , Sony) In separatibility 1.Service provider physical connection to service being provided. 2.Customers involvement in the service process. 20 3.Involvement of other customer in

Problems caused by inseparability

Physical presence of the service provider ---like dentist. Evaluation of the service provider done by language, clothing, personal hygiene, IP communication skills. Face to face interaction with customer make employee satisfied. Involvement of customer in the service production process a) customer to be physically present to receive service. b) Customer need to be present to start the service dry cleaning, auto repair etc.. c) Need of the customer to be mentally present -- thru internet..

21

Unlike goods which are first produced ,sold , consumed services are first sold, produced and consumed.

22

Involvement of other customers

Restaurants --- Smoking in non smoking areas.. Parking full means better service / food.

23

Challenge in mass production of service

How to successfully mass produce service

24

Solutions to inseparable problems..

Emphasis on selection ,training public contact personnel. Consumer management. ( reservation in restaurant) Use of multi site locations (ATM , McDonald's..)

25

Heterogeneity

Heterogeneous is an adjective used to describe an object or system consisting of multiple items having a large number of structural variations. It is the opposite of homogneous.

26

Heterogeneity
Goods & services Another difference- un ability to control the service quality before it reaches the customer. Service offered by one employee may differ from the other Example - McDonald's franchise moods swings of individuals before service.

27

Solutions to heterogeneity

28

Perish ability..

Service cant be inventoried. ( Like movie tickets , airline tickets etc..) Matching the demand & supply in service is a challenge

29

Solution to perish ability..

Creative pricing(early bird incentive , happy hours ) Demand strategy (reservation system, complimentary system, development of non peak demand) Supply strategy. - Part time utilization. capacity sharing (Doctors sharing cost of equipment), advance preparation of expansion, utilisation of third party, Increase in customer participation.

30

Service marketing -- system

S e rvi m a rke ti g ce n tri n g l a e

31

Issues before a service organization

Services premises. Packaging. Service personnel. Tools & equipment used. Customers. Convenience. Nature of service establishment. Managing productivity. Managing service quality.

32

Nature of service marketing.

Narrow definition of marketing. By service providers. Had only Advt, sales promotion, segmentation rare, --differentiation , new product development, service quality???? Lack of appreciation of marketing. Skills in service org. Difference of org. structure of service firms. Problems in determining the cost of services.

33

c . s. --- Fe d e ra l exp re ss..

34

Service marketing system for high contact service

35

Service marketing system for Low contact service

36

Tangible elements & communication components in SM

37

Customer expectation & perception of service

38

Desired service --- Adequate service

1. It is the level of service the customer hopes to receive // the level of performance wished for. 2. 3. Lower level of service expectation that the customer is willing to accept.based on past experience, lack of remuneration to the service provider , socio -economic background of the service provider etc 4. 5. 6. 7.

39

Zone of tolerance

40

41

42

Diff. Between characteristics of goods and service Different goods and services have varying magnitudes of search, experience & credence qualities search qualities of goods can be estimated before purchase -- experience quality can be estimated only after purchase. Qualities that can`t be assessed completely are called Credence qualities.

43

Dimensions of S.E.C. qualities

Search qualities Tangibility Credibility

Experience qualities Credence qualities Access Competence Courtesy Security Reliability Responsiveness Understanding customer communications

44

Search quality
For services include.. Price, Convenience. Mannerisms of service personnel. Promptness of service.

45

Experience qualities
Taste of home delivered food. Wear ability of dress bought from boutique etc.
Service have higher experience characteristics than goods.

E.g. air line travelcourtesy of cabin crew, departure & arrival, quality of food, seating comfort etc..
46

Credence qualities
Customer often lack the knowledge & experience to judge the credence qualities of the service. E.g.. Bread may claim to have nutrition's..difficult for the customer to ascertain.. Services of professionals doc, consultants,services are accepted on faith.

47

Customer
Decision Making Process

& implications on service provider.

48

Customer decision making process..

Need perception.difference in actual state & desired (Hungry need to buy food-remove hunger) Search for info.-need felt-decides to purchase- search for info. To full fill needs (from personal ,commercial ,public source, experimental) & perceived risks.(financial risk, functional ,physical, psychological, social, time risk) Evaluation of alternatives.compare & evaluate services of alternatives. (Well defined attributes )e.g interior decoration different from home to home & customer to customer.( emotions- influence on customer-evaluation ability) Purchase & consumption.- trail purchase, repeat purchase, long term commitment purchase) Post purchase evaluation. compares performance vs. expectations. satisfied customer becomes loyal,

49

Implications for service providers

Customer gather info. From personal source marketer needs to be careful in satisfying existing customers. Services are intangible- customer needs assistance to assess value of high credence qualities.

50

51

Customer expectations
SATISFACTION IS THE LEVEL OF A CUSTOMER`S FELT STATE RESULTING FROM COMPARING A PRODUCT`S OR SERVICE`S PERCEIVED PERFORMANCE STANDARD AGAINST THE CUSTOMER`S EXPECTATION

..

KOTLER

52

Customer expectation
Five dimensions to measure service quality Assurance --- to use knowledge & courteous behavior to instill trust and confidence in customer regarding service. Empathy ability to show concern for customers and devote individual attention to each customer. Reliabilityability of service provider to accurately perform promised service.( efficiency , handling of customer complaints, pricing etc). Responsiveness prompt & service. Tangibles -- physical facilities- equipment of service, dress & appearance of service personnel.

53

Service level expectation

a d e q u a te

d e si d re

lw o

Z o n e o f to l ra n ce e

hi h g

54

Factors influencing desired service adequate service

factors influencing

Customer needs Maslow's hierarchy of needs. customer hungry wants food immediately customer thirsty wants water immediately. Enduring service intensifiers

D e ri d ve se rvi ce exp e cta ti on

C o n d u cte d to u r e xp e ct fo o d & tra ve l a rra n g e m e nt

C u sto m e r p h i o so p h l y
A tti d e & tu se rvi ce p ro vi e rs d co n d u ct

Transitory service intensifiers pizza does not come in 20 minutes or C.C. not accepted when buying medicines in emergency. Perceived service alternatives -- housing loans form different sources. Self perceived service role dress designer find dress as per expectations. Situational factors power failure interupts service of cable. Predicted service expectations. flight will be delayed due to weather 55

Customers criteria for service evaluation

Speed. Certainty. Ease Personal recognition.

56

Customer perceptions
Service encounter customer estimates the quality of service during encounter e.g. banks.

Service evidence personnel , process & physical environment. E.g.- hotels

Image perceived image in the mind of the customer. a +ve image can ignore some poor service, however repeated bad service will change the same.

Price tangible nature of service customer assume the quality of service

57

Strategies to influence customer satisfaction

Enhance customer satisfaction thru service encounters.- recover from service failure, flexibility in delivering service, assistance in handling difficult customers. Reflect evidence of service- behavior & physical evidence. Communicate & create realistic image.- make promises & keep them. Enhance customer perception of quality & value thru price.

58

Market research in service

Post transactional survey- immediately after servicequestioner after dinner or questioner just before aircraft lands. Customer complaints comments & inquiry survey use feedback and analyzing comments and taking remedial actions helps improve service. Total market survey take opinion from all customers existing, lost , potential customers. find out customers needs.-take suitable actions. Employee survey opinion of front line employees who come in direct contact with the customer.

59

Service Quality -- Dimensions

Reliability Ability to perform promised service dependably &
accurately. e.g FedEx..

Responsively Willingness to help customers & provide prompt service. Assurance Employees ability to inspire trust & confidence. E.g.Insurance , brokerage, legal services Empathy Caring , Individual attention to customers. E..g. customized services..E.g.-- Hotel Tangibles Appearance of physical facilities equipment, personnel & written materials. E.g. travel agents putting attractive pictures..

60

Servqual scale

Measures five dimensions on a scale of 7 points.

Generic dimensions used by customer to evaluate services

Credibility, Security, Access, Communication, Understanding customer, Tangible, Reliability, Responsiveness, Competence, Courtesy..

61

Gap Analysis

Gap 1- Not knowing what the customer expects. Gap 2 Not selecting the write service designs & standards. Gap 3 - Not delivering to service standards. Gap 4 - Not matching performance to promises.
62

Gap model service quality

63

Process of market research

D e fi e th e p ro b l m & re se a rch o b j cti s n e e ve

D e ve l p sca l s o f m e a su re m e n t o e

D e ve l p & i p l m e n t th e re se a rch p ro g ra m . o m e

C o d i g & ta b u l ti g d a ta . n a n

I te rp re ti g . a n d a n a l n g fi d i g s n n yzi n n R e p o rti g fi d i g s n n n

64

Approach to upward communication

65

Customer analysis
Analysis customer needs. There buying pattern. Ways in which they can be satisfied. Analysis helps in :: Identify the competition in the market. To identify ,why customer choose one product/service over the other. To analysis the present strategies of the co. vis. Competition.

66

Strategic issues in service marketing

67

Market segmentation & targeting

Mkt. Segment- a group of customers who respond in a similar way to a given set of market stimuli Mkt. segmentation- the process of dividing a market into distinct groups of buyers with different needs/ characteristics / behavior, who might require separate products or marketing mix.. Targeting .. A process of estimation & comparison previously identified segments for selecting one or more segments that fetch best result for business. 68

Mkt. Segments
Undifferentiated Mkt. approach mass marketing. Approach aimed at all consumers by offering single product / service.

Differentiated Mkt. approach.targeting various customers segments with different products & services.

(Nokia Hi flyers, Trendsetters, Social contact, Assured)

Concentrated mkt. approach.single segment strategy to serve limited segments in a total market.
69

Targeting

Basis of targeting Segment size & growth potential. Structural attractiveness Companies objectives & resources.

70

Targeting strategies Single segment strategies.- target single segment, develop single marketing mix & gain specialization. e.g. software firm catering to logistic solutions only Selective specialization targeting more than one segments. e.g. financial firm target retired persons & working women. Product specialization single product or service to various segments e.g. conference halls in hotels used for
corporate meetings, birthday kitty parties etc.. parties, get together,

Market specialization- target segment remains same , company tries to cater to different needs by offering products / services e.g your institution various 71 courses.

72

Positioning

Positioning is not what u do to the product, Positioning is what u do to the mind of the prospect

by unknown Positioning is defined as the process of establishing & maintaining a distinctive place in the market for an organization or for its individual; products/ services in offering.

73

Positioning strategies by potter

Product differentiator Low cost leader. Nicher. Company should concentrate in one strategy rather than trying to be good in all and failing subsequently.

74

Specific positioning strategies.

Attribute positioning service provider positions on attributes / feature e.g.- Allahabad bank positions as oldest bank in India however Positioning service strategy based on feature does not work too well. Benefit positioning offer add on benefits as customer pschye is to analyze the benefits e.g ICICI bank , Citi Bank ATMs & internet banking, bill payments etc.. Use / application positioning.positioned as best for a certain application SBI positioned best for education loans. User positioning positioned for specific target users India as destination for tourists

75

Specific positioning strategies.cont. Competitor positioning strategy positioned against competition ..e.g. IIPM positioned against IIMsdare to think beyond IIMs.

Category positioning category leader & becomes synonymous with the service e.g. Essel world for entertainment.

Quality & price positioning-service is positioned as possessing a certain standard, at a particular price Taj Hotels high quality service at high price.

76

Differentiation

A company is said to have achieved differentiated competitive advantage when its customers perceive the service offered as different from competition based on elements of marketing mix product / service , price, promotion , distribution etc DELL , AMWAY

77

Differentiating attributes
To meet the following criteria Important customers in the target group view the difference offered by the firm as very important & high value to it. Distinctive service offered is not offered by its competitor or unique service offered. Superior the firms makes it an obvious choice for customers to opt for.. Communicable difference offered by firm should be easily explained & communicated to customers.

78

Differentiating attributescont
Preemptive- Difference offered in service is not easily copied by competitors. Affordable customer should be able to pay for the difference in price. profitable. Firm should be able to offer difference to customer with out losing out on profitability.

79

Managing demand & capacity

80

Managing demand

Contraction & recession. economy contracts in recession . Economy is said to have hit recession when the growth rate is substantially lower than normal for 6 continuous months Depression is a serious form of depression. Demand of goods & services decreases.

81

Managing demandcont

Expansion or Boomincrease in overall activity & growth. Demand of goods & services increases.

82

Managing demandcont
Technological developments..e mail, internet, CAD(compute aided designs) Demographicsdemand has increase since independence. ( for goods & services) Natural & other disasters increase or decrease the demand of goods & services

83

Demand patterns
Sketching demand patterns Co. has to track & sketch the demand level. (Done by maintaining
customer data base & monitoring the varying demand over a period of time)Demand

of services can be easily predicted. Foreseeable cycles-- demand of financial services increases around financial year close. Random demand variation some demands cycles are variable healthcare & insurance? Demand pattern by Mkt. segment- Maintain data base tour operators , insurance ,tax saving schemes.

84

Capacity constraints

C a p a ci ty co n stra i n t

85

Strategies to match demand & capacity

Demand shift .. Shift customers to a time when demand is low e.g. cell phone call rates. Varying the original service offer catering during non marriage season economical. Communicating with customers Banks talk to customers when salaries etc are been handled..some customers choose to come at another time.. Altering the time of service delivery Banks worked 6 days now 7 days Price differentiation price variations between high demand vs. low demandhappy hours

86

Adjusting capacity to meet demand..

Time extended hours to meet excess demand. Labour- employed on contract basis - get as per demand Facilities increase capacity restaurant putting extra tables, more seats in theatre, airlines adding more flights Equipmenthire additional when needed ( owen , computers etc) Cross training of employees to meet extra demand.

87

Marketing mix for services

88

Traditional marketing. mix

4 P`sproduct- place- price promotion Adequate for product marketing. however they are inadequate for services .. because ___________
89

Inadequacy of 4 Ps
Product are tangible Services are intangible in nature. Part of promotion of services takes place at the time of consumption itself. PSU producing services partly subsidized, standardized Mkt.mix ignores this aspect. Dual role of service customers co- producers and end consumers- unnoticed by 4Ps. 4ps fails to capture distribution services.

90

Ex pa nd in g th P e s tra di tio

na l

91

The extended Ps

People-

Co. invest in People(attracting, Training, retaining best talent reduce human intervention / errors/ increase customer satisfaction.
TV commercial / brochures etc

Process ATMs-

Physical evidence for holiday destination..

92

Product :: service packaging

Product can be defined as an idea, a service or a good that involves a mix of tangible or intangible elements, with an aim to satisfying customers. Packaging a service is a critical component of mkt. mix. E.g.--burger at McDonald's viz. road side burger. British airways vs. other cheaper airlines. Difference is the quality and the service packed along for a price.

93

Service product level

94

Service product level..cont

Core product core benefit of any product is to satisfy the basic needs of a customer. Example a tax consultant- core service is to
calculate tax to be paid- also files return, sell some financial instrument, advises on investments.

95

Actual product
Tangible aspect attached to a service ,along with the service is the product itself. This facilitates the delivery of core product to the customer. Marketers develop the actual product after the core benefits are decided. Characteristics of actual product are features, design , quality level, packing & brand name.

96

A ctu a l p ro d u ct

Actual product level

D e si n g

Q u a l ty l ve l i e C o re p ro d u ct

B ra n d nam e

Fe a tu re s

p a cka g i n g

97

Augmented product

The intangible aspects that support a service constitute the augmented product along with the actual product. Warranty , installation support, delivery, customer service etc are augmented products. E.g. caterer hired for wedding,-core product food .if decoration ,inviting guests, serving them is also done by caterer then these are

98

Potential product
Features or benefits that can be added & which would be of value to the customer . Hair styling computer aided pictures to help decide a suitable hair style..

99

Service product decisions growth strategies

Existing products
Existin g markets

New products

Market penetration Market development

Product/service development Diversification

New markets

Ansoffs product growth matrix

Mkt. penetration Sell more of existing product for bigger mkt. share Product /service development New product /service in existing mkts. Market development New markets with existing services diversification New market with new products

100

PLC

D e ve l p stra te g y o Tu rn a ro u n d stra te g y S ta b i i stra te g y l ze H a rve sti g stra te g y n

101

Pricing services

102

 The key to making the sale is to communicate VALUE ! Do it so strongly that the price seems reasonable in relation to the product or service you are offering A customer perception of what is a reasonable price is important than what you want to charge for your product or service . And the customer decides what s reasonable based on perceived value for money , not price . it s creating this perception of value that tells the customer the price is right Noel Peebles author Sell your business the easy way

103

Key characteristics of pricing in service

Customers perceptions are different for goods & services. Customer finds easy to pay for a home theatre than flying by a particular airline or choosing a holiday destination. Price is a measure of quality of service::Customer turns to pricing to assess the quality of service , in absence of info from other source. E.g. a beauty parlor charges 250/- instead of 150 for the same service & is considered to offer better quality service Non monetary cost & pricing:: Non monetary cost perceived as time cost, search cost , psychological cost & convenience cost. Difficulty in comparing prices of services::

104

Pricing objectives
Survival Present profit maximization. Present revenue maximization. Prestige. Product quality leadership.

105

Other options

Pricing can be done to make market unattractive for competition. How would co. like to position its services. How do the competition react to price changes. What is the duration of life cycle of services. How does the elasticity of demand fluctuate. Is the service capability over utilized or underutilized.

106

Approaches to pricing services.

107

Promotion of services

Many attempts to communicate are mollified by saying too much

108

Promotion thru communication

109

M o d e s o f co m m u n i ti n ca o 1 . O ra l 2 . W ri n tte 3 . Fa ce to fa ce 4 . O n l n e co m m u n i ti n i ca o 5 .M e d i . a Typ e o f co m m u n i ti n ca o I te rn a l n exte rn a l

110

Elements of promotion mix

Sales promotion

Direct marketing

Pro m o ti n e l m e n ts m i o e x Personal selling

Publicity &

public relations advertising

111

Promotional mix cont Personal selling :: -develop rapport with customer- expensive sales training to offer good service needed- relationship building with customer. Advertising :: cinemas, print, broadcast, outdoor & retail. Sales promotion :: used to encourage existing customers to use service more frequently, or attract new customers. Publicity & PR:: publicity-used to bring awareness in existing & new customers on offers. PR maintain good relations with employees, customers , share holders, govt. etc. Direct marketing:: contact with customers telemarketing, direct mail , on line marketing.,

112

Promotional strategies for services.

Services cant be inventoried..decrease use in peak & increase during lean times. Reduce role of intermediaries :: Role of service personnel:: Service delivery location Customer as a co- product.:: chef cooks food in front of customer, as per requirement.

113

Strategies for effective promotion

Effective planning. Focused objective. Perfect timing. Value added thru tie-ups & promotions. Employee motivation. Well differentiated campaign. Regular evaluation of campaign .

114

Promotional techniques

Sampling. Premium Prize promotion. Price /quantity promotion Refunds & future discounts. Coupons

115

Design of a service promotion

Which service to promote. Who would be the target customer. What value addition be there to the brand. Is the timing right for promotion Duration of promotion. Who is benefited from promotion.
116

Relationship marketing --definitions

1. Relationship mkt. is attracting, maintaining & (in multiservice organizations) enhancing customer relationship. 2. An integrated & coordinated effort to identify, maintain & build up a network with individual customers & employees & continuously strengthen the network for mutual benefits of both sides , through interactive, individualized & value added contacts continiously over a longer period of time. 3. Relationship mkt. is to identify , establish, maintain & enhance,& when necessary terminate relationships with customers so that the objective regarding economic & other variables of all parties are met. This is achieved thru exchange & fulfillment of promises. 4.
117

Benefits of R.M.

Long term relationship for both customer & organization. Lower cost & increased profitability. Requirements & expectations of customer base. Reliable service provider.

118

R.M.---Benefits to Co. Customers will continue to avail the services.. Increase revenue from existing customers. Existing customers will provide FREE word of mouth publicity. By establishing & strengthening relationship easy to retain customers. With relationship & quality of services very few customers will go to competition.

119

R.M.---Benefits to customers Customer opts for service repeatedlySaves on time & effort on choosing new S.P. Personalized services Special services.

120

e ar k 6m

l ode m

. r R s fo

121

Customers markets
Efforts required to maintain existing customers. Satisfied customer will come again & avail the services. Employees & managers to work as a team to make the experience more pleasant. Co. should work on complaints & suggestions update the customer about the steps taken. Service experience to go beyond expectations leads to actively recommendations of service to others.

122

Internal markets
Employees internal customers internal markets Better facilities & good atmosphere leads to satisfies employeesbetter services to customers. Cos. Strive to win employee loyalty & commitment. Helps in retaining employees- better service to customers with complete commitment.

123

Suppliers Mkt.
Cos need basic infrastructure & facilities to provide service. Cos. Depend on suppliers to provide them. Good relations with suppliers. E.g.--Courier & airlines

124

Referral Mkt.
Referral Mkt existing customers , intermediaries , consultants etc. Good relations helps in better service & more business for Co. Reward referrals..

125

Recruitment market Attracting talent from institutes Cos. need to maintain contacts with institute heads etc . Sponsor student events , conduct work shops etc.. Placement agencies, head hunters

126

Influence markets Share holders , financers, consumer protection groups, environmentalists, government, media, trade unions, general public

127

Services Blue print

128

Internal marketing Viewing employees as customers viewing jobs as internal products that satisfies the needs of internal customers while addressing the objectives of organization.

129

Role of Internal marketing

Customer attraction & retention. Employee retention & motivation. Corporate image. Change management. Cos. Performance & continuity.

130

Components of internal marketing. Recruitment & selection Motivation. Education & training. Coordination. Empowerment. Rewards. Communication. Knowledge sharing.

131

SERVICES FUNCTIONS BLUEPRINT

AND

132

New service development process

G e n e ra ti n o f i e a o d S cre e n i g n S e rvi l u n ch ce a

Te sti g th e co n ce p t n

I fra stru ctu re n d e ve l p m e n t o

B u si e ss n anal s ysi & D e si n o f g se rvi ce

Te st m a rke ti g n

Customer Service Management Cycle

C u sto m e r S e rvi ce W h e re yo u w a n t i t to b e S ta g e 5 Pro vi e p ro a cti d ve Pro b l m so l n g e vi S ta g e 4 C h e ck u p re g u l rl a y S ta g e 3 B u id a l w i ni g n n Te a m

C u sto m e r S e rvi ce W h e re i i n o w t s S ta g e 1 U n d e rsta n d th e se rvi ce S e e ke rs S ta g e 2 S e t cu sto m e r se rvi ce S ta n d a rd s

134

STAGE 1: UNDERSTAND THE CUSTOMER

Specific service niche : Determined by the targeted services and the service seekers Characteristics
People/Things orientation High/Low tech Personal Interaction : Physical, Mental, Emotional Time involvement Location Complexity: Actual, Visual 135 Flexibility

Developing the Service seeker profile

Values and beliefs Attitudes Social habits and norms Preferences Expectations

136

Customer Perception of the service and service provider

The service profile:

requisite characteristics

Service characteristics, Service seekers wants and needs and perceptions of

Characteristics include
The service purpose The degree of necessity The magnitude of importance View of results Relative cost and benefits Perceived risks

137

STAGE 2::SET CUSTOMER STANDARDS Establish a target Communicate expectations Create a valuable management tool Dimensions in strong customer service: Procedural and personal Standard areas of procedural dimension: Timing, Flow, Flexibility, Anticipation, Communication, Customer Feedback, Organization and Supervision Standard Areas of personal dimension : Appearance, body language and tone of voice, attentiveness, tact, guidance, selling skills, gracious problem solving
138

Writing customer service standards

Timeliness Anticipation Attitude Customer Feedback Appearance Guidelines for developing customer service standards

139

STAGE 3: BUIDING A WINNING TEAM

Design customer service jobs Writing job specifications Screening job applicants Training for customer service Practice leadership skills Supportive organizational environment
140

STAGE 4: CHECK UP REGULARLY

Service Audit system Service seeker feedback system Employee feedback system

141

STAGE 5: PROACTIVE PROBLEM SOLVING

Create supportive climate for solving problems Appoint teams to identify problem areas Select teams to improve through brainstorming Transferring team problems and complaints into opportunities
142

COMPONENTS OF SERVICE BLUEPRINT

C u sto m e r A cti n s o O n sta g e C o n ta ct E m p l ye e o a cti n o Li e o f E xte rn a l A cti n n o

Li e o f vi b i i n si l ty

B a cksta g e C o n ta ct E m p l ye e o A cti n o S u p p o rt Pro ce ss

Li e o f n i te rn a l n a cti n o

143

Components..
Line of External Interaction:

Line above which all customer interactions take place e.g. Interactive Marketing Area up to which the customer knows of organizational processes.Influenced by visible interactions Not Visible; helps in effective service delivery; Customer is ignorant

Line of Visibility:

Line of Internal Interaction:

144

Components.
Contact Employee Actions:
Onstage contact employee action between the lines of interaction and visibility Backstage contact Employee actions taking place between lines of visibility and internal interaction

Support Processes:
Support contact
145

STEPS IN SERVICE BLUEPRINTING

Identification of service to blueprinted: Purpose and goals
identified for inside and outside customers

Service blueprinted from customers point of view:

Customers steps in purchase, consumption and delivery to be mapped /eliminate unnecessary activities and backstage actions/linkages between customers and contact personnel and between employee be identified and blueprinted

Identification of employee actions: Identify Both onstage

Identification of support activities: Support activities also to Giving physical evidence to each customer action step:
Customer needs to undergo experience; hence to reduce perceived risk will decide based upon the tangibility of physical evidence

Identification of employee actions: Identify Both onstage

and backstage actions/linkages between customers and contact 146 personnel and between employees

CLASSIFICATION OF EMPLOYEES
Contactors
Frequent/regular customer contact Well Trained/motivated to serve customers on day to day basis Recruitment based on responsiveness E.g. Zenith and Eureka Forbes, Outbound Call centers

Modifier
Not directly involved 147 Frequent customer contact

Classification
Influencers
Sparse/No Customer contact Implementation of organizational marketing strategy Evaluated according to customer oriented Performance standards/opportunities E.g. Product development firms,Market Research Firms(Automotive research centers, Harris Interactive)
148

Classification.
High Contact Services: Low Contact Services:
Long duration contact.E.g. Educational institutions, hospitals and restaurants Interaction for shorter time with systems E.g.banks,post offices and retailing High qualifications and perceived status

Professional Service Employees: Consumer Service Professionals:

Relatively standardized services;high on task based skills

149

STRATEGIES FOR CUSTOMER ORIENTED SERVICE DELIVERY

Hiring the right people:
Competing for the best people,hiring for service competence and inclination,being the preferred employer

Developing employees to deliver service and quality: Training for technical and interactive
skills, empowering employees, promoting team work

Providing needed support to employees Retaining the best employees:Including

employees in the customers vision, treating employees as customers, measuring and rewarding best performers

150

DEVELOPING

MARKETING ORIENTED SERVICE ORGANIZATION

Shared values
We will become a fully customer-driven organization. Customer comes first Marketing expenditure are an investment. Services paramount. Share d Value s Strate gy

Strategy:

Style

Integrated plan for development of marketing orientation. Formulized definitions of markets and mission. Detailed specification of marketing objectives. Commitment to implementation.

Style

Top management support for marketing through symbolic actions and commitment of time to marketing and customer related activities. Open communications between all functional groups and marketing staff. Recognition and reward of customer/market oriented behavior.

Systems

Customer intelligence reports. Competitor intelligence reports. Marketing planning and control systems. Remuneration and performance appraisal systems geared to support marketing orientation.

Syste ms Skills / Staffing

Struct ure

Structure

Skills / Staffing

Recruitment of an adequate number of people with requisite marketing skills Marketing training programs and facilities. Knowledge of market. Analytical skills in segmenting markets and identifying decision-making units.

Simple structure based on markets/geography. Key account sales structure to service most important customers Decentralized marketing staff to provide close and fast support to customers. Staff rotation to non marketing staff through customer contact positions
151