8PS

The First P: Service Product or Service Package: A service is a bundle of features and benefits. However these benefits have relevance to a specific target market. Hence while developing a service package it is important that the package of benefits in the service offer must have a customer perspective. Gronroos constructed that the services are product offers consists of 3 levels. The first level is that of basic service package which includes core service, facilitating services and supporting services. The 2nd level is that of an augmented service offering where accessibility interaction and customer participation is given equal importance in delivering the service product . the third level is that of the market communication of the service offering as in its absence the augmentation service package doesnt have any relevance to the customer. The service package: The package concept of service product suggests that what you offer to the market is a bundle of different services, tangible and intangible, but there is a main or substantive or core service and around it are built the auxiliary or peripheral or facilitator services. It is important to note that facilitating services are mandatory and if these were left out, the entire service would collapse. In the service package there are yet other type of services called supporting services. The basic difference between the 2 is that supporting services dont facilitate the consumption of core services but are used to increase the value and thus differentiate it from competition e.g. in a 500 room hotel the core service is lodging and room service, bellboy services are facilitating services and health club , car rental are support services. However it may not always be possible to draw a line of distinction between facilitating and support services. For e.g. in a typical city hotel business center might be the support service but in a business and convention hotel the same service would be facilitating service The augmented service offering: The basic service package is not equivalent to the service product the customer perceives, which is infact based on customer experience and evaluation. Therefor there is a need to involve the customer in the

production of service offering and thereby reinforcing that the basic service package has to be expanded to a more holistic model of augmented service offering. The issues related to the accessibility of the service interaction with the service organisation and consumer participation are also integral elements of the service product. Market communication of the service offering: A favorable image enhances the service experience and a bad image may even destroy it. In such a scenario the issue of management of image through communication becomes a integral part of developing the service product but the important point to note here is that apart from the conventional methods of promotion corporate image and word of mouth are, if not more, equally important. A negative comment from a fellow customer is more than adequate to neutralize the effect of your efforts of mass media advertising, media blitz and direct promotion. Developing a service offering: The first step in developing a new service offering is to assess the customer benefits, which is done through market research and available appropriate information. In the second step , these consumer benefits have to be translated into core, facilitating and support services, with a view to defining what general benefits these service organizations would offer to its customers. The third stage is that of developing the augmented service offer. A careful planning at the fourth stage is essential because of the right service in the right form and in the right quality and quantity is not delivered, the entire customer oriented plan would collapse. Finally the appropriate market communication strategy should be prepared and its implementation plan should be defined not only to inform and persuade the customers but also to enhance the desired image. 1.Price The amount of money needed to buy products 2.Product The actual product 3.Promotion (advertising)- Getting the product known 4.Placement Where the product is located 5.People Represent the business 6.Physical environment The ambiance, mood, or tone of the environment 7.Process How do people obtain your product 8.Packaging How the product will be protected

Service Marketing Mix The service marketing mix is also known as an extended marketing mix and is an integral part of a service blueprint design. The service marketing mix consists of 7 Ps as compared to the 4 Ps of a product marketing mix. Simply said, the service marketing mix assumes the service as a product itself. However it adds 3 more Ps which are required for optimum service delivery. The product marketing mix consists of the 4 Ps which are Product, Pricing , Promotions and Placement. These are discussed in my article on product marketing mix the 4 Ps. The extended service marketing mix places 3 further Ps which include People, Process and Physical evidence. All of these factors are necessary for optimum service delivery. Let us discuss the same in further detail. Product The product in service marketing mix is intangible in nature. Like physical products such as a soap or a detergent, service products cannot be measured. Tourism industry or the education industry can be an excellent example. At the same time service products are heterogenous , perishable and cannot be owned . The service product thus has to be designed with care. Generally service blue printing is done to define the service product. For example a restaurant blue print will be prepared before establishing a restaurant business. This service blue print defines exactly how the product (in this case the restaurant) is going to be. Place Place in case of services determine where is the service product going to be located. The best place to open up a petrol pump is on the highway or in the city. A place where there is minimum traffic is a wrong location to start a petrol pump. Similarly a software company will be better placed in a business hub with a lot of companies nearby rather than being placed in a town or rural area.

Promotion Promotions have become a critical factor in the service marketing mix. Services are easy to be duplicated and hence it is generally the brand which sets a service apart from its counterpart. You will find a lot of banks and telecom companies promoting themselves rigorously. Why is that? It is because competition in this service sector is generally high and promotions is necessary to survive. Thus banks, IT companies, and dotcoms place themselves above the rest by advertising or promotions. Pricing Pricing in case of services is rather more difficult than in case of products. If you were a restaurant owner, you can price people only for the food you are serving. But then who will pay for the nice ambience you have built up for your customers? Who will pay for the band you have for music? Thus these elements have to be taken into consideration while costing. Generally service pricing involves taking into consideration labor, material cost and overhead costs. By adding a profit mark up you get your final service pricing. You can also read about pricing strategies . Here on we start towards the extended service marketing mix.