Marketing Management 314 A1 Summary

Important theory as pointed out in class:

Lovelock’s 4 broad categories (classification of services)

*Case study*

1. Services directed at people
2. Services directed at people’s tangible possessions
3. Services directed at people’s minds
4. Services directed at people’s intangible possessions

1. Services directed at people:
• Require the recipient to be physically present within the service system
• Needs to be attractive and inviting for customers
• E.g. going to the dentist

2. Services directed at people’s tangible possessions:
• Customer needs to be there at the start and end of the service
• Can be less attractive and convenient location
• E.g. dropping and collecting car from repairs

3. Services directed at people’s minds:
• Includes: education, the arts, professional advice
• Physical premises may not be needed as technology can broadcast it
• Technology also allows services to be produced and then stored for later use, so
service provider and customer do not need to be active at the same time

4. Services directed at people’s intangible possessions:
• Includes: banking, insurance and accountancy
• Delivered with little interaction between customer and organization

Service and Technology

1. Potential for new service offerings

2. New ways to deliver service:
• Technology provides systems for delivering existing services in more accessible,
convenient and productive ways
• Technology facilitates transactions by offering a direct system for making purchases
• Technology is an easy way for customers to learn and research

3. Enabling both customers and employees:
• Tech enables customers and employees to be more effective in getting and providing
service
• Self-service tech = customers can serve themselves more effectively
• Employees have access to info about the product and the customer ∴ better service


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, 4. Extending the global reach of services:
• Businesses can reach more customers around the globe
• Employees can communicate easily to share info or ask questions

5. The dark side of tech:
• Customers are concerned about privacy and confidentiality
• More tech use means less human interaction which many people believe is
detrimental
• The payback in tech investments is often uncertain

Characteristics of services and their impact on marketing
activities:

Characteristics of services:
1. Intangibility
2. Heterogeneity
3. Inseparability
4. Perishability

1. Impact of intangibility on marketing activities:
• No inventory
• Not easily patented
• Cannot be displayed or communicated
• Difficult to price

2. Impact of heterogeneity on marketing activities:
• Employee & customer interaction leads to customer satisfaction
• Uncontrollable factors influence service quality
• Service delivery is not equal to what was planned or expected

3. Impact of inseparability on marketing activities:
• Customer participation affect transaction
• Employees affect outcome
• Decentralization = essential
• Difficult to mass produce

4. Impact of perishability on marketing activities:
• Difficult to synchronize supply and demand
• Services cannot be returned or resold

Services marketing mix:

Marketing mix: used to satisfy or communicate with customers

Difference: service delivery people are involved in real-time promotion of the service (e.g.
nurse / cashier)



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