CHAPTER 13 - SERVICES: THE INTANGIBLE PRODUCT

intangible

a characteristic of a service; it cannot be touched, tasted, or seen like a pure product can

inseparable

A characteristic of a service: it is produced and consumed at the same time; that is, service and consumption are inseparable.

heterogeneity

as it refers to the differences between the marketing of products and services, the delivery of services is more variable

perishable

a characteristic of a service: it cannot be stored for use in the future

distributive fairness

pertains to a customer's perception of the benefits he or she received compared with the costs (inconvenience or loss) that resulted from a service failure

procedural fairness

refers to the customer's perception of the fairness of the process used to resolve complaints about service

services marketing

Any activity or benefit that one party can offer to another that is essentially intangible and does not result in the ownership of anything

Service Product Continuum

Most offerings lie somewhere in the middle

economic importance of service offerings

- production is cheaper in other countries

- high value placed on convenience and leisure

- services become more specialized

services marketing differs from product marketing

1) Services are intangible

2) Services are inseparable from consumption

3) Services are variable and heterogeneous

4) Services are perishable

service gaps model

A managerial tool designed to encourage the systematic examination of all aspects of the service delivery process and prescribes the steps needed to develop an optimal service strategy.

knowledge gap

Customer's expectations are not accurately understood by firm

- Use research to understand consumers' needs

- Do not assume customers are happy

- A type of service gap; reflects the difference between customer's expectations and the firm's perception of those expectations

standards gap

management perceptions of customer expectations vs. standards specifying service to be delivered

- Established policies, performance standards

- Based upon consumer needs

Educate employees

- A type of service gap; pertains to the difference between the firm's perceptions of customers' expectations and the service standards it sets

delivery gap

standards specifying service to be delivered vs. actual service delivered

- Employees do not perform correctly

- Hire well, train, monitor, and reward

- A type of service gap; the difference between the firm's service standards and the actual service it provides to customers

communication gap

actual service delivered vs service provider communications about service quality

- Commercials, comments from salespeople

- Must reflect actual service

- A type of service gap; refers to the difference between the actual service provided to customers and the service that the firm's promotion program promises

what are the 5 dimensions of quality?

1. Reliability

2. Responsiveness

3. Assurance

4. Empathy

5. Tangibles

reliability

- The ability to perform the service dependably and accurately

- Performed correctly

responsiveness

- The willingness to help customers and provide prompt service

- Performed on time

assurance

- The ability of employees to convey trust and confidence

- Performed "like you know what you are doing"

empathy

- The caring, individualized attention provided to customers

- Performed with caring

tangibles

- The appearance of physical facilities, equipment, personnel, and communication materials

- Performed in a nice environment

What are the 7 P's?

1. Product

2. Price

3. Place

4. Promotion

5. Process

6. Personnel

7. Presentation

process

describe the actions require to get the good or service to the customer

personnel

In person-to-person transactions, more important for services than for goods

presentation

can have an impact on consumers' judgments of the service quality

3 factors that can increase service recovery

provide a fair solution, resolve problems quickly, listen to the customer