Business Services:

Services Marketing

Objectives
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insights from marketing community

how are services marketed?
what are important features of services?
how can services of different providers be compared?

what is to be modelled and what functions can be supported

by information systems?

Business Services:
Services Marketing

Content
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marketing
services marketing
service-dominant logic
benchmarking of services

Business Services:
Services Marketing

Marketing
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a process to determine which products/service may be of

interest for customers

4 Ps

Business Services:
Services Marketing

Services Marketing
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similar to goods (product) marketing

special features of services
" a service is not storable
" consequence if offered, the service is not yet produced
" can not be checked by the customer
" trust into the competence of the provider required
" many services cannot be transported
" a service cannot be owned
" a provided service cannot be returned
" availability of customer required
" often co-production

Business Services:
Services Marketing

Marketing Mix
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7/8 Ps
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Product (design of the value offering)

Pricing (also indirect costs of customer)
Promotion (communication of the value offering to the customer)
Placement (location and distribution channels)
Process (effective for provider and consumer)
People (polite employees)
Physical appearance (managing physical evidence for invisible
services)
Productivity and Quality (quality is essential for service
differentiation)

Business Services:
Services Marketing

Service Marketing Strategy Framework

from Lovelock & Wirtz 2004

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Business Services:
Services Marketing

Understanding Customer Needs

Three-stage Model of Service Consumption

" Prepurchase Stage:
search, evaluation of alternatives, decision
" Service encounter Stage:
Role in high-contact versus low-contact delivery
" Post-Encounter Stage:
Evaluation against expectations, future intentions

Business Services:
Services Marketing

Building the Service Model

from Lovelock & Wirtz 2004

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Business Services:
Services Marketing

Managing the Customer Interface

from Lovelock & Wirtz 2004

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Business Services:
Services Marketing

Implementing Profitable Service Strategies

from Lovelock & Wirtz 2004

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Gaps in Service Design

Business Services:
Services Marketing

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Business Services:
Services Marketing

Service Quality
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difference (gap) between

" expected service and
" perceived service

Word of
Mouth

Personal
Needs

Expected
Service

Past
Experience

External
Communication
to Customers
Perceived
Service
Quality

Service
Quality
Gap
Perceived
Service

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Business Services:
Services Marketing

SERVQUAL Framework
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system by Zeithaml et al 1990

questionnaire regarding following aspects
" credibility
" security
" access
" communication
" understanding the customer
" tangibles
" reliability
" responsiveness
" competence
" Courtesy
RATER (reduced questionnaire)
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Business Services:
Services Marketing

Extension for Online Environments

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E-S-QUAL by Zeithaml et al. 2005

Standard Dimensions
" efficiency
" system availability
" fulfillment
" privacy
Recovery Dimensions (E-RecS-QUAL)
" Responsiveness
" Compensation
" Contact
Technical Readiness
" Technical Readiness Index
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Business Services:
Services Marketing

Benchmarking
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comparing the outcome of different actors

originally process benchmarking to improve ones own
process by copying best practices from others
product benchmarking well known in automotive industry
service benchmarking
" comparing service portfolio (to detect new services)
" comparing one service with a service of competitor (e.g.
in mobile communication)
" comparing with similar services (bank and assurance
company)
what features of a service are important for a customer
(quality, price, competence, time, friendliness, )

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Business Services:
Services Marketing

Service Profile
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defining measurement values and units

service features

importance

high

price

+++

P1

reliability

+++

delivery time

competence

++

low

med

P2
P2

P1

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Business Services:
Services Marketing

Service-Dominant (SD) Logic

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proposed by Vargo and Lusch (2004)

new interpretation of services as the concept containing
goods (products)
services (value entities) in contrast to service (process)
services are exchanged against other services
two kinds of resources
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operand resources (traditional resources such as material)

operant resources (competences of humans and organizations)

goods are transmitters of services

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Business Services:
Services Marketing

Foundational Premises of SD Logic

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service is the fundamental basis of exchange

indirect exchange masks the fundamental basis of exchange
goods are a distribution mechanism for service provision
operant resources are the fundamental source of
competitive advantage
all economies are service economies
the customer is always a cocreator of value
the enterprise cannot deliver value, but only offer value
propositions
a service-centered view is inherently customer oriented and
relational
all social and economic actors are resource integrators
value is always uniquely and phenomenologically
determined by the beneficiary
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Business Services:
Services Marketing

Exercise
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each group chooses a service from their service sector

Identify the five areas of the RATER model (you will find the
model in the Internet)
evaluate the service
" what features are important
#
#
#

"
"
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quality
electronic quality
recovery features

how good are these features

describe a typical customer
make a questionnaire with at least two questions
concerning each area of the RATER model

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