MBA Semester 4 MK0015 Service Marketing And Customer Relationship Management ASSIGNMENT- Set 1 Q1.

Explain briefly the differences between services and tangible products Ans:- There are several differences between services and tangible products, let us discuss some of them, which include: Intangibility: We studied that services are intangible and it is something that you cannot see. It is an activity that you can experience or feel after its execution. For example, a friendly treatment or service makes the guest feel special and affects their experience, during their stay in the hotel. Where as the goods are tangible. Mass production of services: Services cannot be produced in mass quantities and stored for consumption in the later stages. Let us take the example of a travel industry. Holidays are the peak season in the travel industry when buses, cars, aeroplanes, trains, and crew members will be utilised to the maximum. For lean months when people travel very less, the travel industry will have the same number of aeroplanes, cars, buses, trains and so on. This example exemplifies the fact that the services cannot be produced and stored for future usage unlike goods. Perishable nature of services: Tangible products contain expiry dates and carry labels with best before tags. Where as, services will not have expiry dates because it is an action that is carried out and is consumed immediately or as soon as possible. Moreover, the organisation will not be able to resell or return the services when compared to the manufactured goods. Difficulty in standardising services: It is easy for a manufacturer of soap to produce millions of soap bars with the same size, scent and quality. The execution of services by an employee towards the client will be influenced by several factors. For example, a receiving clerk in an office will be very friendly and welcome you pleasantly in the morning, but might turn cranky by afternoon. Another example is in banks the client who is in hurry might be nasty to a bank teller, when compared to the client who has ample time to spend. Hence, we can conclude that in service marketing you cannot provide the same type of services to all your clients. Pricing difficulty: Marketing practitioners address major challenges like deciding and

putting the price tags. Some customers have a perception that low priced service is a low quality service. There must be a good co-ordination between the price and the kind of service the company provide. For example a low budget airline might not serve snacks or drinks during the journey. But the traveller might turn unsatisfactory for an airline that charges, but does not offer free in-flight meals. Services cannot be patented: Owners of the newly invented tangible products protect their products secret ingredients and designs against their competitors by registering and obtaining patents for their products against a government agency. In case of services, the methods and models can be easily copied. To be in the market, the service oriented companies constantly find different ways by designing new service models and by copying the models of their competitors. It is clear that the services and products are different. In the next section we will learn the meaning of service sector and how it is different from services.

Q 2. List the unique characteristics of services. Ans:- There are four unique characteristics for services, let us discuss them in detail, these four characteristics are: Intangibility: This forms the biggest constituent of service that cannot be presented in a concrete way before purchasing. As services are intangible, you cannot feel, smell, hear, see, taste, and experience the service before you purchase it. The company can conduct promotional programs that focus on the advantages that are derived from the service rather than exhibiting the service itself. Organisations use four promotional strategies to suggest the advantages of the service and helps in reducing the effect. They are: Visualisation: This can be explained with an example. Consider the amusement parks, they depict the benefits of their park with ads that show people enjoying various rides, dancing, dining, and experiencing some amazing things provided in the amusement park. Consider another example of a student taking classes on an instrument like guitar. The student can make an assessment of the guitar class not only by attending it, but also by trying it once the class is over. But, the student will not be able to play the guitar perfectly unless he or she goes through the complete course.

Association: an image of the service can be created by connecting the service with tangible object, person or a thing. Physical representation: Organisations such as American Express use colours such as gold or platinum to represent wealth and prestige for its credit card services. While advertising, an auto rental firm known as Enterprise shows a car covered in package, to stress its unique delivery features. Thus, organisations adopt various symbols to communicate their unique delivery features. Documentation: This is of two types past performance and future capability. For example, hospital staff can record its past performance by showing the number of babies born and can stress on its future capability by showing the images of special equipments available during an emergency situation. Website is considered as a valuable tool in minimising the intangibility of a specific service. They enable the marketers to give useful information containing animations and sound. They also provide a site where the marketers can answer to the queries of the clients via emails. Inseparability: This means the simultaneous involvement of the service providers in the production and marketing efforts. Services are inseparable from the creator and the seller of the service. In other words, services are crated, allotted, and consumed at the same time. As per marketing standards, inseparability means the possibility of direct sale only through a proper channel of distribution. Heterogeneity: It is not possible for a service organisation or a seller to standardise the output. Due to the human factor in production and delivery, each unit of service is different from the other units of the same service. As a buyer is concerned, it is difficult to understand the quality of a product before consumption. To avoid this confusion, companies must focus more on the product planning and implementation of the programs. For example, Air India flight provides high quality service for passengers travelling in executive class, compared to the quality of service provided for passengers travelling in economical class. The passengers cannot be sure of its quality before the completion of the journey. Perishability: One of the distinct features of services is perish ability as it cannot be stored for future usage. This creates disparity in the supply and demand. Moreover, the demand for more services varies based on the season. For example the air tickets, railway tickets and bus tickets are completely booked during long vacations. The service firms have adopted new methods to attract consumers during off seasons. They make use of advertisements to increase demand during relaxed periods. During peak seasons, when the

prices will be high, they offer discounts and holiday packages.

Q 3. Describe the challenges during the transition of economics in the services growth sector. Ans- The organisations can build up more human capital that helps to make global development more sustainable. As industrial and agricultural growth is essential to meet the requirements of the growing population, the growth in the service sector will not give an immediate solution to the sustainability problem. Challenges for transition economics: Earlier in some countrys economies, the service sector was under development as the supply was under the control of the government that had failed to respond to the growing demand for the services. Moreover, the present services like financial, business, and real estate services was not required during the time of socialism. The countries transition to market economy resulted in the rapid growth of the service sector, to meet the unfulfilled demands and the requirements of the growing private sector. Moreover, the continuing support for the health and education growth of services helps the socialist countries to preserve the human capital stock that is crucial to the post industrial development. Q 4. Briefly explain the 7Ps of marketing mix. Ans:- The 7Ps of service marketing mix are: Product: This should provide value to the customer though it need not be a tangible product. Every good is associated with a service component as is every service with a physical good. However, the degree of association may vary. For example, when a person goes to a beauty saloon, the expertise of beauticians is a service where as the instruments, cosmetics and tools used would be goods. When the person comes out, ideally he/she should be satisfied with his/her transformed appearance. A product as a whole is a combination of service element as well as physical product element. For the product to be successful in the market it must be of a good quality, have a brand name, must have guarantee, features and so on.

Price: In service marketing, price is fixed for services and depends on the service provider and service delivery. Pricing needs to o be competitive and must necessitate profit. The cost strategy includes discounts and offers. Service rates are often variable and depend on the nature and type of service as well as on customers who may either not entirely use the service or pay only for the service rendered to him/her. For example, if a person buys a movie ticket, he may not wait till the whole movie is complete to come out. Usually, product prices include recommended prices to end-user customers, distributors trade prices, cash/seasonal/festival discounts, bulk discounts, combo offers, credit terms, payment modes and so on. Place: This means where and when the customer buys and consumes the product or service. It is the place where the customer purchases the product and the manner in which product reaches out to the particular place. This happens through various channels like internet, wholesale, and retail traders. In service marketing, it depends on where and how service is delivered to the customer. Mot often, customer goes to the service provider or service provider delivers service to customers location. For example, services provided by satellite TV packages is at customers home where as a tour package requires customer to make the travel effort. In service marketing, distributors are better known as service providers. Promotion: This includes adopting various ways to communicate to the customer regarding the product offers of the company. This also includes communicating about the advantages of a product or a service than speaking about its features. Usually adopted promotion techniques include advertising, sales promotions, publicity, direct marketing, exhibitions, displays, packaging, and word-of-mouth. Service marketing even caters to individual customers and designs offers that are tailor made. This is called as personalised or privileged or customised services. For example, matrimonial agencies and sites provide personalised services to their customers. People: People include the customers, employees, and management. An essential ingredient to any service provision is the use of appropriate staff and people. In service marketing, customers also have an active role in the service delivery. A good service provider should ensure that the service as well as its experience delights the customers and not just satisfies him/her. Customers should look forward for such experience and benefit from service. For example, home delivery of restaurant food requires the involvement of people order takers, cooks, parcel handlers, delivery boys and of course the customer who has to provide correct details about his address, dishes ordered and pay the bill

immediately at delivery. Process: Process refers to the systems used to assist the organisation in delivering the service. Any process whether it is electronic, mechanical or manual, service providers should ensure that it helps in providing efficient service to the customers without causing any disturbance or delays. A service delivery process must assist in raising service quality/standards and reduce service gaps or customer wait. For example, Travel operators should establish a proper process or a system for advance bookings, cancellation, pickups, drop, and emergencies during travel so on. Physical evidence: In service marketing, physical evidence serves as a proof of service experienced. Since services are basically intangible, certain things can add to the experience of service such as complimentary items offered during service, Pamphlets and brochures that create product awareness. Consumers will make perceptions based on their sensory abilities of the service provision, which will have an impact on the organisations perceptual plan of the service. For example, if you walk into a fine restaurant your expectations are of a clean, comfortable and friendly environment that may give aromatic smell of specialised cuisine

Q 5. List are the advantages of Rater model of service quality Ans:- This model explains the main criteria, which the clients make use of to measure the service quality. Rater model was produced by Zeithami in 1990 and performs a complementary examination of the perception gap. Rater model recognise five important areas, which form the quality of a service offering from a customer point of view. Here, the model describes the manner in which provider reduces the perception gap and also concentrates on the dimensions of client expectations. As per the research, it suggests the importance of each factor which is shown in the Table 3.1 that explains the RATER dimensions developed by Zeithami in 1990. Table 3.1: RATER dimensions sorted by relative importance (Zeithami 1990) Dimension Description Relative importance Dependability Capability to perform the ensured service in a dependable and accurate manner 32%

Responsiveness Readiness to help the customers and offer quick service 22% Assurance Information and courtesy from staff and their capability to convey faith and self-assurance 19% Empathy The attention and service the services organisation provides to its clients 16% Tangibles Appearance of physical facilities, equipment, personal and communica-tion materials 11%

Q 6. Describe the various positioning strategies for services Ans:- Various positioning strategies are: Attribute positioning: This strategy gives importance to one or two of the attributes of the service. Benefit positioning: Gives importance to one or two of the benefits to the customer. User positioning: Declare the service as useful for a group of users like children, women, working women and so on. Competitor positioning: Assure that you are going to provide the service that is better than a competitor service. Service category positioning: Assure your service to be the best in a service category Example: The way the Mumbai dabbawalas provide service is different from the way Pizza hut delivers the services to its customers. Quality/Price positioning: Declare an affordable price for the service. MBA Semester 4 MK0015 - Service Marketing And Customer Relationship Managemnet ASSIGNMENT- Set 2 Q 1. List the importance of advertising and sales promotion. Ans;- Positioning Through Sales Promotion and Advertising After learning how positioning can be achieved thought distribution strategies, we shall now see how sales promotion and advertising helps to bring in positioning. Advertising helps the marketer to sell their products/services and improves the relation between wholesalers and retailers. A free trail of a service stimulates customer to buy that service. A free management advisory service

builds a strong relationship with a retailer. Advertising motivates quicker and/or greater purchase of a particular service by consumers or the trade. Adverting is a part of promotion mix. Promotion can be defined as the co-ordination of all seller initiated efforts to set up channels of information and persuasion to facilitate the scale of a good or service. There are four basic components of promotion mix. They are: Advertising. Personal selling. Sales promotion. Publicity. Advertising is the circulation of information about a service by non-personal means through paid media where the source is the sponsoring organisation. Personal selling is the circulation of information about a service by non-personal methods. It can be through face-to-face meetings, meeting between audience and workers of the sponsoring organisation. Here also the source of information is the sponsoring organisation. Sales promotion can be any programme handled by an organisation to encourage an increase in sales, usage or trial of a product or service. Example: Buy-one get-one-free, bonus points or money off coupons, free gifts, free samples, competitions and prize draws, and so on. Publicity is the circulation of information about a service by personal or non-personal means and here sponsoring organisation is not the source. Q 2. What are the various levels of customer satisfaction? Ans:- Services are actions that are produced and consumed at the same time. The role of the customer is important in the production and delivery of a service. There are many cases when the employees and customers interact with each other to produce a successful product. Even in a simple service such as retail mail order, customers active participation will have a great impact on the service delivery. There are various levels of customer satisfaction and they are low, medium, and high. In low level of customer satisfaction, the physical presence of the customer is required. For example, in a symphony concert, the employees of the firm will be doing all the production work. There are very

less work for the symphony goers. In medium level or moderate level of customer satisfaction, the inputs of the customer are required in helping the organisation in creating the service. The inputs here, means information, effort or physical possession. These are required to prepare the tax return of the client in an effective manner. In high level of customer satisfaction customers are the active participators in the creation of the service. These services require high level of participation from the customer. In these services, lack of active participation from the client will affect the successful delivery of the service. The examples are marriage counselling and personal training centres. At all levels, the effectiveness of the client satisfaction will make a positive impact on the organisational efficiency, services quality, and the client satisfaction. Table 6.1 explains the various levels of customer satisfaction across various services Table 6.1: Level of Client Expectations Low Moderate High The presence of the customer is required during service delivery. Consumer inputs are required for creation of the service. Customer co-creates the service product. Standardised products The inputs from client modify a standard service. Active client participation guides the customised service. Service is provided irrespective of any individual purchase. Provision of service need customer purchase Lack of customers participation makes it difficult to create the service. Payment will be the only output in this case. The inputs from the client are essential to get adequate

income, but the service will be provided by the service organisation. The inputs from the customer are essential and the outcome is cocreated with an active participation from the client. Q3. Describe the importance of a plan or methodology to initiate customer responses? Ans:- Most organisations undervalue the importance of good customer response and the harmful effects of bad customer response. Customer response is very crucial as a profitable customer response strategy is very much valuable. Before developing the customer response master plan, each organisation must have a clear distinction between the customers and consumers of its services and products. Irrespective of the people who consume the product, one should develop a good relationship with the customer. Every services organisation must have a well-written plan or methodology to ensure that customer response is initiated. Irrespective of the size of the organisation, there must be a customer response initiative to make sure that questions raised, issues, complaints, problems, and suggestions are resolved in a quick and timely manner. Even if you provide the best service in the world, the response that you give to your customers determines your durability in the market. A wellplanned customer initiative ensures the presence of someone, for resolving customer issues. For example, you will feel good when someone greets you once you walk into a store. Let us examine the framework used to produce a feasible customer response initiative: Develop a customer response policy: This can be considered as a business plan to satisfy the customers. It should begin with a mission statement that summarise the objectives, goals, and procedures to improve the customer service experience. Develop a customer response centre: This is regarded as the infrastructure to carry on with the customer response policy. There should always be a person in the centre to resolve the customer issues.

Develop a customer response service team: Those people who provide services are the most important aspects in customer satisfaction. You can divide the teams into various functional areas such as hardware, software, and services. The team members must be allowed to take the ownership and be creative. They must also be given adequate training in solving and dealing with the clients. Provide a customer response reward program: The organisations can increase the client loyalty by being pro-active. Organisations can announce incentives and discounts for loyal customers. Q 4. Briefly explain the five factors that influence the level of adequate service Ans:There are five factors that influence adequate service. They are: Temporary service intensifiers. Perceived service alternatives. Customer self perceived service role. Situational factors. Predicted service. Temporary service intensifiers are individual factors that create awareness in the customer regarding the need for service. Emergency situations in which there is an urgent need for service raise the adequate level of expectation. For example, a mail order company that depends more on toll-free lines to receive the customer orders will be more demanding during the peak periods of the month and the year. Perceived services alternatives are providers from whom the customers obtain the service. If the clients have multiple customers to choose from or are capable of providing services to themselves, their adequate service level will be higher than those customers who have lesser options. The third factor that influences the level of adequate service is the self-perceived service role of the customer. To an extent, this can be described as customer perceptions, to which clients exercise an influence on the service which they receive. Here, the customer too has a responsibility to specify the service level, which he expects. The active participation of the customer plays an important role in delivering the service successfully. If the customer realises that they have

specified their role well, but the services personal are not playing their part, level of adequate service will get heightened and narrows the zone of tolerance. Level of adequate service is also influenced by situational factors. They are conditions, which the customer view the performance or service quality as beyond the control of the service provider. Another factor that influences the level of adequate service is the predicted service. This is the prediction made by the customers about the things that are likely to happen during a transaction or a service. If the customers predict good service, their level of adequate service will be higher than when they predict bad service. Q 5. Describe the various service quality dimensions with the help of relevant examples. Ans:- The service quality and customer satisfaction is measured by comparing expectations and perceptions. Service quality is the comparison of perception with the expectations of customers from an organisation that delivers high quality services. The SERVQUAL scale is used to measure service quality. The SERVQUAL is a diagnostic tool, and this is based on the five service quality dimensions. The five dimensions are tangibles, reliability, responsiveness, assurance, and empathy. The SERVQUAL is a 44 item scale that measures customer expectations and perceptions regarding five service quality dimensions. Let us now discuss the five dimensions of service quality. Tangibles : The representation of service physically is known as tangibles. The physical facilities, equipment, personnel, and communication material involved in service are known as tangibles. Customers can evaluate quality by the picture presented by these tangibles. Tangibles are associated with those services in which the customer visits the establishment. Examples of these establishments are hospitals, restaurants, and retail stores. Reliability : Reliability is considered as the most important service quality dimension. Reliability is defined as the ability to perform the promised service dependably and accurately. In simple terms reliability means that a firm delivers the promises made to customers. Customers prefer to be associated with firms that keep their promise especially with respect service outcomes.

Responsiveness : Providing prompt service and the willingness to help customers is known as responsiveness. Customer requests, questions, complaints and problems need to be solved promptly. Responsiveness can also be defined as the time taken to respond to customer problems, answers to questions, or attention to problems. Assurance : Assurance is defined as instilling trust and confidence in the customers. Services that are of high risk, perceive the dimension of assurance with a lot of importance. Examples of these services are banking, insurance, medical and legal service. Empathy : Companies need to provide customers with individualised attention and this is known as empathy. Customers need to be treated as unique and special this has to be done by offering them customised services. Companies need to understand customer needs and ensure that the customer feels valued. Q 6. List the differences between flexible services and standard services. Ans:- Service Flexibility Versus Standards As we have seen how we can meet the customer defined service standards in the previous section, now we shall understand the difference between service flexibility and service standards. Services need to be flexible to meet the needs of a heterogeneous market. Service providing firms cannot have a standard service process or procedures for all customers as the requirements of customers are varied. Heterogeneous markets are the ones which have different market maturity levels, demand patterns, local skills available, and differences in human attitudes. In simple terms we can say that one size does not fit all and this can be applied in the context of services also. A standard model for delivering services is not practical. Firms prefer to have some form of standardisation in order to achieve some form of consistency and profitability. Highly individualised services are not cost effective for the service companies to provide Flexibility and standardisation needs to be maintained at optimum levels. The level of flexibility of service must be determined by the firm that provides the services. For example, consider the case of a beauty salon; here, it is important for the service provider to provide unique and individualised attention to each of the customers.