SERVICE MARKETING
INTRODUCTION TO SERVICE
MARKETING
DEFINITION
• Service marketing is simply Activities, benefits, and satisfactions that
are offered for sale or are provided in connection with the sale of goods according to the American Marketing
Association.
DEFINITION
• A service is an act or performance 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. Philip Kotler
• Understanding services is fundamental in service marketing
and business overall. Services are intangible, providing
benefits, experiences, or solutions. Key aspects include non-
ownership, customer involvement, variability, backstage
activities, service ecosystems, and customer experience.
IMPORTANCE OF SERVICE MARKETING
• Service marketing is crucial for relationship building, revenue
generation, employment impact, innovation, globalization,
digital transformation, measurement, improvement,
sustainability, and meeting customer needs and expectations.
CUSTOMER NEEDS AND EXPECTATIONS
• Research and Analysis:
• Conduct market research and analyze customer data to identify needs, preferences, and
expectations.
• Understand customer pain points, desires, and behavior.
• Segmentation:
• Recognize varying needs and expectations among different customer segments.
• Tailor services to meet the specific requirements of each segment .
• Clear Communication:
• Communicate service offerings clearly, including features, benefits, and limitations.
• Transparency is essential to set accurate expectations.
• Managing Expectations:
• Set realistic expectations with customers to avoid dissatisfaction.
• Avoid over-promising and under-delivering; aim for exceeding expectations to achieve
customer delight.
• Continuous Feedback:
• Establish mechanisms for gathering customer feedback.
• Feedback helps in understanding evolving needs and areas for improvement.
• Adaptation:
• Be flexible and responsive to changing customer needs and market dynamics.
• Continuously refine and adapt services to stay relevant in the evolving business landscape.
BUILDING CUSTOMER RELATIONSHIPS:
• Personalization:
• Personalize interactions by using customers' names and remembering preferences.
• Offer tailored solutions to demonstrate value for individuals.
• Excellent Customer Service:
• Provide exceptional service at all touchpoints.
• Ensure staff is well-trained, empathetic, and responsive to customer inquiries and issues.
• Consistency:
• Maintain consistent service quality across all interactions and channels.
• Customers should experience a similar level of service every time, regardless of location or channel.
• Loyalty Programs:
• Implement loyalty programs or rewards to encourage repeat business.
• Incentivize customers to stick with your services through loyalty initiatives
• Engagement:
• Engage with customers through various channels (email, social media, feedback surveys).
• Keep customers informed about new services, promotions, or relevant information.
• Feedback Loop:
• Act promptly on customer feedback, addressing concerns or suggestions.
• Demonstrate that you value customer input and are committed to improvement.
BRANDING AND POSITIONING IN SERVICES:
• Branding:
• Develop a strong brand identity that reflects values and promises to customers.
• A compelling brand can differentiate services, instill trust, and set them apart from competitors.
• Positioning:
• Define the service's position in the market.
• Identify unique selling points (USPs) and compare them to competitors, guiding marketing strategy and
messaging.
• Brand Consistency:
• Ensure consistent brand identity across all touchpoints (website, social media, physical locations,
interactions).
• Consistency reinforces brand image and customer perception.
• Brand Personality:
• Define the personality and voice of the brand.
• Influence communication and connection with the target audience, enhancing brand affinity.
ADVERTISING AND PROMOTION:
• Advertising Campaigns:
• Content Marketing:
• Public Relations:
• Partnerships or Sponsorships
SOCIAL MEDIA AND ONLINE MARKETING:
• Social Media Strategy:
• Develop a strategy to engage with the audience on platforms like Facebook, Twitter, Instagram, and
LinkedIn.
• Share valuable content, respond to inquiries, and build connections.
• Email Marketing:
• Utilize email campaigns to stay in touch with customers, share updates, and offer exclusive deals.
• Personalize email content for specific customer segments.
• Online Advertising:
• Use paid online advertising methods (PPC, display, social media ads) to reach a broader online
audience.
• Influencer Marketing:
• Collaborate with industry influencers to promote services.
• Leverage influencers for credibility and extended brand reach.
PRICING CONSIDERATIONS IN SERVICE
MARKETING:
• Cost Analysis:
• Competitive Analysis:
• Value Perception:
• Pricing Psychology:
• Customer Segmentation:
• Price Discrimination:
VALUE-BASED PRICING:
• Customer Value Assessment:
• Pricing at the Perceived Value:
• Tiered Pricing:
• Value Communication:
DYNAMIC PRICING AND BUNDLING:
• Dynamic Pricing:
• Adjust prices based on real-time factors like demand, supply, and market conditions.
• Bundling:
• Bundle services at discounted prices to encourage package purchases.
• Price Promotions:
• Use limited-time promotions to attract new customers or boost sales during specific
periods.
• Customer Feedback:
• Listen to customer feedback on pricing to refine strategies based on market response
CHANNELS OF DISTRIBUTION IN SERVICE
MARKETING:
• Direct vs. Indirect Channels.
• Physical Channels.
• Online Channels.
• Intermediaries and Aggregators.
• Franchise and Partner Networks.
• Self-Service Kiosks and ATMs:
• Mobile Services:
• Customer Service Centers:
SERVICE RECOVERY AND HANDLING
CUSTOMER COMPLAINTS:
• Prompt Response:
• Empathy and Understanding:
• Apology and Accountability:
• Active Listening:
• Empower Frontline Staff:
• Problem Resolution:
• Compensation or Recovery Actions:
• Follow-Up:
• Learning and Improvement:
• Transparency:
EMPLOYEE TRAINING AND DEVELOPMENT:
• Orientation and Onboarding:
• Job-Specific Training:
• Soft Skills Development:
• Customer Service Training:
• Continuous Learning:
• Cross-Training:
• Leadership Development:
ETHICAL ISSUES IN SERVICE MARKETING:
• Truth in Advertising:
• Transparency and Disclosures:
• Privacy and Data Security:
• Fair Pricing Practices:
• Quality of Service:
• Customer Exploitation:
• Social Responsibility:
• Informed Consent:
APPLICATION OF EXPANDED MARKETING MIX
FOR SERVICES
• Four Traditional Elements:
• Price
• Place
• Promotion
• Product
• Expanded Three Elements:
• People:
• Employees define a service.
• People skills and customer service training are crucial in service marketing.
• Process:
• The service process is crucial for delivering a product.
• Efficient processes are vital for maintaining service quality and meeting high demand.
.
• Physical Evidence:
• Tangible cues that help customers evaluate service quality.
• Important for building trust and confidence in intangible services.
• Types of Marketing:
• External Service Marketing
• Internal Service Marketing
• Interactive Marketing
TECHNOLOGY & SERVICE PRODUCTIVITY:
• Hard Technology:
• Substitutes machinery and engineering devices for labor-intensive service work.
• Examples include automatic car washes, airport x-ray equipment, and bank balance checking
machines.
• Soft Technology:
• Substitute pre-planned systems for individual service operations.
• Examples include fast-food restaurants using rationale division of labor for efficient
• Hybrid Technology:
• Combines hardware with carefully engineered systems for greater efficiency.
• Example: Cost savings in transportation through careful programming for road types and
congestion.
