Services marketing

In exchange for money, time, and effort, service customers expect value from access to goods, labor, professional skills, facilities , networks, and systems; but they do not normally take ownership of any of the physical elements involved.

[citation needed] But unproductive labor, however "honourable, ...useful, or... necessary" created services that perished at the time of production and therefore didn't contribute to wealth.

The classification scheme is based on the ease or difficulty of consumer evaluation activities and identifies three broad classes of goods.

Consumers are constantly weighing up uncertainty and consequences to reach subjective evaluations of the overall risk attached to various purchase decisions.

Heightened risk perception may become a barrier to the natural progression of the purchase decision process and prevent customers from making a final brand choice.

[34] This refers to the finite carrying capacity for most service operators and the lack of inventory which serves as a buffer against unexpected or peak demand.

There are two components to capacity (i.e., supply) in service operations: The factors contributing to uneven demand are more complex and difficult to predict.

Over-crowding and lengthy waiting lines potentially erode the customer experience and place stresses on employees and the service system.

Employees may compensate by minimizing the time spent with each customer in an effort to serve more people, but such responses have the potential to introduce human error into service delivery.

In addition, routine maintenance tasks or planned refurbishment activities, which involve downtime, should be carried out during off peak periods to minimize disruption to patrons.

It is possible to identify three broad scenarios:[47] In situations where the service is subject to some type of public regulation, government departments may establish ceiling prices which effectively limit the amount that can be charged.

[57] Theorists identify two types of physical evidence, namely;[58] A number of different theoretical traditions can be used to inform the study of service environments including stimulus-organism-response (SOR) models; environmental psychology; semiotics and Servicescapes.

It is an applied model, specifically developed to inform the analysis of service environments, and was influenced by both stimulus-response theory and environmental psychology.

When consumers enter a servicescape, they scan the ambient conditions, layout, furnishings and artefacts and aggregate them to derive an overall impression of the environment.

These types of global judgments represent the summation of processing multiple stimuli to form a single, overall impression in the consumer's mind.

[72] However, since its inception it has been used extensively as a diagnostic tool, used to detect operational inefficiencies and potential trouble spots including fail points and bottlenecks.

Divergence refers to the degree of latitude, freedom, judgment, discretion, variability or situational adaptation permitted within any step of the process.

On the other hand, reducing divergence, by standardizing each step, often adds to complexity, but can result in a production-line approach to service process design.

By manipulating complexity and divergence, it is possible to envisage four different positioning strategies:[78] Subway sandwich bars provide an excellent example of how a business can integrate both process design and the servicescape into the customer's in-store experience.

Customers can peruse an overhead backlit menu while they are waiting in line which speeds up the order-taking process and reduces opportunities for bottlenecks.

The arrangement of food behind the glass counter not only displays the choice of sandwich fillings, but supports the process since customers must select their preferences in a specific sequence, as they inch their way towards the cash register.

[79][80] Every aspect of Subway's store design and layout reinforces the core objectives of customization, volume-operations (i.e. rapid turnover) and operational efficiency.

Studies have shown that emotional labour can lead to undesirable consequences for employees including job-related stress, burnout, job dissatisfaction and withdrawal.

In such an analogy, service personnel are the actors, customers are the audience; uniforms are costumes; the work setting is the stage (front-stage for areas where interaction occurs and back-stage for areas off limits to customers); discrete steps in the service process are scenes and finally the words and actions that occur represent the performance.

[89][90] A dramaturgical perspective may be appropriate in specific service contexts: Managerial insights generated by a dramaturgical perspective include:[93] When asked to perform emotional labour, employees can adopt one of two approaches:[94] Some evidence suggests that employees who are able to fully immerse themselves in the role and engage in deep acting are more resilient to role-related stress.

[104][105][106] The model's developers also devised a research instrument, called SERVQUAL, to measure the size and direction of service quality problems (i.e. gap 5).

Vargo and Lusch did not intend for service-dominant logic to be published as a workable theory that offers solutions to everyday marketing problems and issues.

Some efforts have been made to get product accepted as a joint term for goods and services and to use offering, package or solution as all inclusive, concepts for what consumers the buys, but this has not been successful.

Compete Through Innovative Co-production and Co-creation: Some theorists point out that, thanks largely to the Internet, consumers have been actively engaging themselves in explicit dialogue with manufacturers and service providers.

[118] Other research priorities include: the personalized customer experience,[119] resource integration,[120] improved use of IT to map processes and activities in order to increase productivity and standardize service.

Services include a wide range of commercial and not-for-profit transactions including personal services, professional services, entertainment and leisure services.
Classical economists believed that service work, no matter how honourable, was 'unproductive'.
Search goods possess qualities that can be evaluated prior to consumption through direct inspection of the merchandise.
Consumers are often nervous about air travel. Although the risk of a negative outcome is low, the severity of consequences is high in the event of a service failure.
Standardisation, sometimes called the McDonald's approach, helps to reduce perceived risk because consumers can rely on a known product and quality.
Using customers' labour to clean tables and dispose of rubbish, as in this McDonald's restaurant, reduces pressures on the operating system by freeing up employees to focus on core service activities.
Hotels and restaurants use computerized reservations systems to manage demand and supply.
Different types of queues
The seven Ps of services marketing
Visualization of the total service product concept
Credit cards have no independent value unless backed by the service. Credit cards are a type of peripheral evidence.
Crowded, disorganised, unpredictable environments are said to be high load.
Simplified servicescapes model
The seminar room at the Savoy Hotel clearly signals an up-market positioning. Spacious room, high backed covered chairs, timber surfaces and a complementary bar combine to communicate that this in intended for corporate use.
The seminar room at Singapore University clearly signals an institutional application. Functional seating, ceiling mounted projectors, whiteboard, fluorescent lighting and schoolroom layout combine to suggest that the space is part of a practical educational environment.
Kiosks are lean servicescapes - simple, orderly, few employees, few spaces and familiar environments.
Department stores offer an elaborate servicescape with multiple levels and spaces, rich in physical elements and symbolism.
A service blueprint for a hypothetical fast food outlet
Customers doing the 'Subway shuffle' as they move along the race selecting their fillings. Subway has designed the store to facilitate a streamlined process.
A waiter adds a touch of theatre to the service delivery.
The model of service quality
The five dimensions of service quality