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Unit 1: Introduction to Services Marketing
The fourth myth about the services sector is that service businesses are cottage industries Notes
and service jobs are low paying. If you check the list of Fortune 500 companies you will be
surprised to see the number of service companies figuring in this list.
The other myth about the service sector is that services are only offered by the government
sector. The fact is that on the one hand public services, like telephones, health care, power
generation and distribution, etc., are being privatised and on the other hand large enterprises
are entering into services sector. Take the example of Escorts into health care, Tatas in
power distribution, etc. In fact the service organisations are quite varied and different
from each other.
First category includes the public agency sector for example post offices, police and fire
departments, water and electricity authorities, etc. The second group is made up of the
private non-profit sector running charities, foundations, old age homes or various societies
involved in issues related to women, literacy, family welfare, etc. Next comes the business
sector comprising banks, hotels, airlines, travel agencies, tour operators, courier services,
insurance, consultancy legal management or medical. Lastly, it is the sector which provides
services to those involved in manufacturing. This includes those firms providing security
personnel, accountants and auditors, computer operators and software consultants which
help manufacturing firms in their operations.
In addition, there are a number of other types of services which are emerging in the
western society. These range from, on a charge, the availability of a baby sitter to a group
of hippies making the party colourful. In India also such services are emerging whether
they are a troupe of young boys and girls doing a music-cum-dance show on a birthday or
wedding, house maintenance services, real estate brokers, security, etc.
This definition takes into account the following important features of services:
Services are by and large activities or they are series of activities rather than things.
As a result services are intangible.
They take place in the interaction between the customer and the service provider, which
means that services are produced and consumed simultaneously.
Customer has a role to play in the production process as the services are provided in
response to the problems of customers as solution.
Self Assessment
State whether the following statements are true or false:
1. Services are offered only as complementary or in a package with sale of goods.
2. Services can be both tangible and intangible.
3. Customers play an important role in delivery of services.
1.2 Understanding Service Characteristics
As our knowledge of the characteristics of services grows, so does our ability to deal with them
from both an economic and marketing perspective. Services are intangible, inseparable, variable,
and perishable. Each characteristic poses problems and requires strategies to deal with those
problems.
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