Page 138 - DMGT408DMGT203_Marketing Management

Unit 6: Products, Services and Brands

6.2 Services Notes

Services as products are widely used today by ultimate consumers, businesses, and non-profit
organisations and are usually provided through the application of human and/or mechanical
efforts directed at people or objects.
Several definitions of services have been proposed. According to Berry and Parasuraman, “A
service is an intangible product involving a deed, a performance, or an effort that cannot be
physically possessed”.
Christian Gronroos has proposed a more comprehensive definition of services:
“A service is an activity or series of activities of more or less intangible nature that normally,
not necessarily, takes place in interactions between the customer and service employees and/or
physical resources or goods and/or system of the service provider, which are provided as
solutions to customer problems.”
—Christian Gronroos, Service Management and Marketing, (Lexington Books, 1990)

6.2.1 Characteristics of Services

The issues associated with marketing of services are somewhat different than goods marketing.
This is because of typical characteristics of services. According to Christopher H. Lovelock, typical
characteristics of services include: (1) Intangibility (2) Inseparability of production and consumption
(3) Heterogeneity (4) Perishability (5) Client-based relationship, (6) Customer contact.

Table 6.2: Services – Characteristics

Intangibility Difficult to evaluate, Marketer sells a promise, Difficult to advertise, Difficult to
justify prices, Goods augmented with intangible services.
Inseparability Activities of service production and consumption are simultaneous, Consumers
must participate in production. Consumer does not take physical possession of
service, Role of service provider critical.
Perishability Services cannot be stored. Very difficult to balance supply and demand, Unused
capacity lost for ever, Considerable variation in demand.
Client-Based Success depends on satisfied customers in the long-run, Customer relationship
Relationship maintenance is critical. Retaining a group of satisfied customers essential.
Customer Service providers’ commitment critical to delivery, High-level of employee training
Contant and motivation essential to success, Service marketers try to change high-contact
services into low-contact services without affecting customer satisfaction.

Intangibility

Unlike most physical products, where a prospective buyer can examine the physical dimensions,
aesthetic looks, and other aspects, a pure service cannot be assessed using any of the physical
senses. Many promotional claims about tangible aspects of a product can be verified by examining
the product before buying. Intangibility of services means there are no such aspects and a
service cannot be seen, touched, tasted, or smelled.

Example: It is not possible for an aspiring student to see, touch, taste, or smell education
that students get in a management institution from attending classroom lectures and completing
a variety of assignments. Similarly, a lady going to a beauty parlour for a facial cannot know how
would she look afterwards unless the service is performed. It is not possible to examine a sample
of surgery before buying and consuming it. The consumer experiences the reliability, expertise,
attentiveness, and personal care of staff etc., only when a service has been bought and consumed.

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