ASSIGNMENT

Name Roll No Course Sem Subject

: : : : :

Dhvani k. Suthar 521115094 MBA (Marketing) 4th SEM Service Markting and Customer Relationship

Management. Sub. Code L.C L.C. Code : : : MK0015 Divs Academy 02798

Q.1 Discuss briefly about customer retention strategies in customer relation management. Ans: Customer retention rate is the number of clients that a company has lost in a predefined time span.this is calculated by existing customer times the rate of customers lost in certain period, be it annual or quarterly, without including the newly acquired customers. Many companies are struggling over retaining the customers, they always try to find the best customer retention strategies to keep their sales up. Out of all these efforts, there is one thing that seems so obvious & may be considered as the only answer to this entire solution and that is doing a good job. There will be good service, good products, & naturally customer will see & feel this & ultimately, keep coming back. A failure in customer retention strategy, then we need to analyse the reason s for losing the customer to succeed in business Analysing reasons for losing the customers: to know the reason of losing customer is to understand the customer behavioural process. This includes the outside factors, for example, promotion of the competitors & the difference in customer satisfaction. Morgan & hunt (1994) considered that customer behaviour is led by customer satisfaction, service quality, trust, provisions, and the willingness to cooperate on the future. That is to lower the defection rate organization must focus on the strong CRM programmes & relationship marketing. The possible reason for customer defection would include: Price related reasons: if the price of service for any reason goes beyond his /her reach, he/she would switch over to an an affordable service. Product related reasons: if technological advancement, innovative system & new development in product do not aid service design, then even good service providers cant perform the service in the desired manner Service related reasons: Any dissatisfaction as regards to services would cause the customer to move away from the whole service product. Benefit related reason: customer may attract by various augmented benefits offered by the competitors. Competitor related reasons: Technological advancements, attractive offers, value added services offered by the competitors may also draw the attention of the customers. Personal reasons: on personal front customer ,organization can consider a customer as lost due to ; influence of other members of the family ; moved away from market area or shifted to the new location etc.

Q.2 Explain briefly the 7 P s of marketing mix. Ans: The 7P.s of service marketing mix are: 1} 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 salon, the expertise of beauticians is a service whereas 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. 2} 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. 3} 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. Most 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. 4} 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. 5} 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. 6} 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, pick-ups, drop, and emergencies during travel so on. 7} 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.3 Explain the stages in new service development & its implementation. Ans : The new service development system Must have four basic characteristics because of the intangible nature of services. The four basic characteristics are: Service must not be subjective, it should be objective. It should be well defined not vague or ambiguous. It must be based on facts rather than opinions. It should be step wise procedure rather than a philosophical one. STAGES IN NEW SERVICE DEVELOPMENT A} FRONT END PLANNING 1. Business strategy development or review : every organization has an unique vision & mission. The new service development should align itself with strategic vision & mission of the organization. The growth efforts of the organization must also be considered while developing the new service. 2. New service strategy development: a product portfolio strategy & defined organizational structure of a new product or service development is critical for the success of an organization. A new service strategy could be defined in terms of markets, types of services, time horizon for development, profit criteria or other factors. 3. Idea generation: brainstorming ideas from employees, and customers, lead user research, learning about competitors are the methods used for idea generation. 4. Service concept development & evaluation : the development phase begins once the idea is regarded to fit both the business & new service strategies; for both tangible and intangible services 5. Business analysis: estimating the economic feasibility & potential profit implications from a part of the next step after development. Demand analysis , revenue projection, cost analysis,& operational feasibility are assessed at this stage. B} IMPLIMENTATION 1. Service development & testing: this is the step where the product prototypes are constructed and customers acceptance is tested.it is in this step that the service is refined and service blue print is drawn out. 2. Market testing: this is the stage where market acceptance is evaluated by introducing the new service in test market. The new services might be offered to employees and

their families for time to assess their responsiveness to the variation in the market mix. 3. Commercialization: the service goes live and is introduce in the market place in this stage of process. 4. Post introduction evaluation : at this point the information gathered during commercialization of the service can be reviewed & changes can be made Q.4 Discuss the GAP model briefly. Ans : This model offers an incorporated view of the relationship between the customer and the company. This model is based on a substantial research performed by several service providers. Most of the organizations fail to meet the client expectation due to their lack of understanding of those aspirations. The provider gaps include GAP 1, GAP2, GAP3, GAP 4, & GAP 5. Each gap occurs due to the inconsistencies & discrepancies in the quality management process. Let us see the provider gaps. GAP 1: this known as the management perception gap. This occurs mainly due to the differences between the service expected by the customers & the perception the management have regarding the customer expectations. Failure in understanding the client expectation leads the services organizations into trouble. GAP 2: This is known as the quality specification gap. This occurs due to the difference between the management perception of client expectation, design & the standards of customer driven service. GAP 2 is the second test the firms need to cross. they can achieve this by implementing excellence in performance. Translation of service quality is a complex procedure the service providers need to manage. GAP 3: this means service delivery gap & occurs due to the difference between the client driven service design & service delivery & standards. The standards should be supported by adequate & suitable resources like systems, people & technology. GAP 4: This is the market communication gap & refers to the service delivery & external communications to the customers. These promises to make an impact on the customer expectations. These expectations will serve as standards against which the client assesses the quality of the delivered service or product. GAP 5: This means perceived quality gap & occurs due to the difference between organizations perceived service & the expected service. It is difficult to evaluate the reason for this gap. If the perceived quality surpass the accepted quality, the clients will be happy, which in turn will be beneficial for the organization. The GAP model helps the management to identify the real reasons for quality problem & to determine different ways to avoid those gaps.

Q.5 Discuss about the marketing of service in banking sector, airline industry and hospitality sector. Ans: MARKETING OF SERVICE IN BANKING SECTOR

Marketing banks is a combination of functions for providing service to satisfy customers financial needs & wants, more effectively & efficiently keeping in view the objective of the banks. Banking services is the creation & delivery of financial services appropriate to meet customers needs. The Reserve Bank of India (RBI) is the apex body in banking sector. Then there are three main categories of banks as shown below: Commercial banks: It consists of all those banks that provide banking services to the people & normally charge for the services that they provide. They are further categorised as nationalized banks & private banks. Co-operative banks: These banks are also formed with the help of the government. They provide the long term & short term credits to customers. Development banks: the role of these banks is to provide the capital raising services to the industries. The main focus is to help the industries to develop by lending them money. The target customer change based on the sector on which the bank offers services. These days every bank offers the services like ATMs, internet banking, mobile banking to attract the customers. The automation of services in banks gives equal opportunity for all customers to seek services the bank provides. Many banks have also provided customer service, help desk & door services for senior citizens who cant visit the bank. MARKETING OF SERVICES IN AIR LINE INDUSTRY The Indian aviation sector is the one of the fastest growing aviation industries in the world. It can be broadly divided in to the following main categories: Scheduled air transport service includes domestic & international flights. Non-scheduled transport service includes charter operators & air taxi operators. Cargo service includes air transportation of cargo mail.

Marketing strategies employed by the aviation industry are: Marketing planning: marketing analysis, benchmarking, & the competitive analysis are the techniques used for the marketing planning. Branding: Branding plays important role in the marketing of the company & ots products or service. It differentiates the company & its services from the competitors. Communication strategies: communication strategies to the customer should be clear & with motive. Online marketing: Online marketing is one of the premier marketing media for every organization for its marketing needs. The reach of internet is very large & deep & most of the banking services are online which helps the customer.

For instance most airlines provide online booking & status check. Some companies like go indigo & spice jet have targeted the budget traveller providing them cheap flying option , whereas like kingfishers always target the high end users & provide them luxurious facilities.

MARKETING OF SERVICES IN HOSPITALITY SECTOR Hospitality includes all those services related to the hotels, restaurants, lodges & bars. The growing economy of India also helping the hospitality sector to grow at rapid pace. The main reasons for the growth of the Indian hospitality are due to: Increase in foreign direct investment. Increase in numbers of foreign visitors. Increase in the income of the Indian family. Emergence of brand incredible India.

Earlier, hospitality sectors were keener on building brand recognition that attracts those customers who are willing to pay. Now a days they are toying up with leading corporate houses to provide them the hospitality services to them. Hotels are socializing in quality of the services they are offering. The hospitality club is the internet based hospitality that provides the guidance for the travellers from all over the world. Q.6 Write a short notes on 1] pricing strategies of services. 2] Roles played by the customer during the delivery. Ans: 1] PRICING STRATEGIES There are several pricing strategies adopted by the services organizations based on the customer perception. Some of them are : Discounting: discounts or price cuts are offered by the service providers in order to communicate to the price sensitive buyers. Odd pricing: This approach is pricing the services just below the exact amount to create an impression on the buyers that they are selling at a much lower price. Synchro pricing: this is a price strategy to increase demand for a product by utilizing customer sensitivity to prices. Penetration pricing: This is an approach in which fresh services are introduce to stimulate demand for the services. Prestige pricing: This is a form of demand pricing by the organizations who offer high quality services. Some of the customer who views this approach might value the higher price as it stands for the quality image. Value pricing: In the current scenario, this is used to mean giving more for less. It refers to a group of services that are desirable to a wide group of customer. Result based pricing: In services organizations where outcome is very important & understanding is high, the most important aspect of value is the result of the service

2] ROLES PLAYED BY THE CUSTOMER DURING THE DELIVERY. Services are the actions that are produced and consumed at the same time.the role of a 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. There are three major roles played by the customers: As productive resource. As contributors to satisfaction and quality of service. As competitors. 1] As productive resource: The customers of the services are referred to as partial employees of the services organization. They are the effective human resources who contribute to the productive efficiency of the organization. They can make both positive and negative impact on the productivity an organization through the quality of their contribution and the quality of generated output. 2] As contributors to satisfaction and quality of service: Another major role played by the customer is that of a contributor to their own satisfaction and quality of the service which they receive. Those customers who contribute the delivery of quality service frequently ask questions and report once there is a failure. They enjoy their own participation in service delivery. 3] As competitors: Another major role played by the service customer is that of competitor. There are organizations that outsource certain service activities such as data processing, pay roll, accounting maintenance & facility management.