Service Marketing Opportunities and Mix

Service Marketing Opportunities
Unit -2
IFETCE/MBA/2012/III/BA9253/unitII/SRM/PPT/Version1.0 1
What is marketing
Marketing is the process of planning and executing the conception ,pricing, promotion and distribution of ideas, goods and services to create exchanges that satisfying individual and organizational goals. Marketing consists of activities designed to generate and facilitate exchanges intended to satisfy human or organizational needs or wants.
IFETCE/MBA/2012/III/BA9253/unitII/SRM/PPT/Version1.0
What is market assessment
Definition: The evaluation of the market for a product or services, including the analysis of market trend assessing the competition and conducting market studies is known as a Market assessment.
Concept: The term market assessment concept holds

that achieving organizational goals depends on knowing the needs and wants of target market and delivering the desired satisfactions. It purposes that in order to satisfy its organizational objectives, an organizational should anticipate the needs and wants of consumers and satisfy these more effectively than competitors.
Importance of service marketing.
Personally - in daily life, in career aspiration, in better informed consumer purchases. Organizationally - only marketing directly produces revenue; marketing success depends on customer satisfaction Domestically - employment and costs, creation of utility
Globally - closed, national markets no longer exist and companies compete in markets worldwide.
Marketing management process for services

Organizing marketing planning
Assessing service market potential
Selection of Target markets
Developing marketing mix
Managing marketing efforts

The key to success in business is planning. And the key to successful planning is using a proven format to analyze your service marketability . Market potential assessment is helping to determine the expectation of success for conceptual products, services or programs. As you look to the future, what potential is there in the market? Test your product and service concepts before they reach the market.
Market analysis services help you know the economic opportunity available to you in any geographic market. Whether you sell to consumers, to businesses, or both, market sizing provides intelligence you need to deploy sales and marketing resources effectively.
Classification of Services pg33-37

Based on Degree Of Customer Involvement ( Lovelock) People Processing Possession Processing Mental Stimulus Processing Information Processing
Four Categories of Services Employing Different Underlying Processes

What is the Nature of the Service Act?
TANGIBLE ACTS Who or What is the Direct Recipient of the Service? DIRECTED AT PEOPLE DIRECTED AT POSSESSIONS
People Processing(services directed at peoples body)

e.g., airlines, hospitals, haircutting, restaurants hotels, fitness centers, beauty salon
Possession Processing(services directed at physical possessions)

e.g., freight, repair, cleaning, landscaping, retailing, recycling
INTANGIBLE ACTS
mental Stimulus Processing (

Services directed at peoples mind)
e.g., News, Education, consulting, education, psychotherapy
Information Processing
(directed at intangible assets)
e.g., accounting, banking, insurance, legal, research
Marketing mix is term used to describe the combination
of the four inputs which constitute the core of a companys marketing system product, the price structure, the promotional activities and the distribution system. __ Stanton
Traditional marketing mix / 4ps of marketing mix Product Price Place Promotion
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Marketing mix
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Product: Anything that can be offered to a market for

attention, acquisition, use, or consumption and that might satisfy a want or need.

Physical good features Quality level Accessories Packaging Warranties Product lines Branding
Price
The price of the service is the value attached to it, by the service provider and it must correspond with the customers perception of value.
Flexibility Price levels
Negotiation
Differentiation Discounts Allowances
Place

Channel type Exposure Intermediaries Outlet locations Transportation Storage Managing channels
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Promotion

Sales promotion Sales people Selection Training Incentives Advertising Media types Types of ads Publicity
Expanded Marketing mix/Augmented service mix (pg: 21 to 24)
Expanded Marketing mix/Augmented service mix

This concept was developed by Booms and Bitner. The elements of the marketing mix provided a useful structure for marketing implementation, there is a need to strengthen the approach through the inclusion of four other elements: People, Physical evidence, Process and productivity & quality.
1) People:
All human actors who play a part in service delivery and thus influence the buyer perceptions namely , the firm personnel, the customer and other customer in the service environment.
Employees : Recruiting Training Motivation Rewards Teamwork Customers: Education Training Communicating Culture ad Values Employee Research
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2) Physical evidence / physical environment: ( the appearance)
The environment in which the service is delivered and where the firm and the customer interact and any tangible components that facilitates performance or communication of the service. (e.g. Brochures, letterhead, signage etc)
Atmosphere, dcor, music etc. Equipment Facilities Uniforms Staff Building
Facility design: Equipment Signage Employee dress Aesthetics ( work of Art) Other Tangibles: Reports Business cards Statement Guarantees
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3) Process: The actual procedure, mechanism and flow of activities by which the service is delivered the service delivery and the operating system. Creating & delivering product elements requires design and implementation of effective service. service delivery systems

back stage front stage
Procedures Policies 4) Productivity and quality: The employees are well trained in service recovery procedures in case things do go wrong.
Signage e.g.:
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Service Marketing Mix :The 7 Ps of service marketing mix are
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What is physical evidence? Physical evidence is everything that a company physically exhibits to the customer. It includes the physical environment of the service outlet, the exterior, the interior, all tangibles like machinery, furniture, vehicles, stationery, sign boards, etc., Physical evidence is the element of the service mix which allows the consumer again to make judgment on the organization.
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Elements of physical evidence
Servicescape: used to position a service

organization or positioning and differentiating.
Facility exterior Exterior design Signage Parking Landscape Facility interior Interior design Air quality/temperature Layout Equipment
Other tangibles:

Business cards Billing statement Stationery Reports Uniforms Brochures Web pages
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Types of services cape

Services cape usage: Self service environment ( theaters) Remote(far off) service - Telephone company
Insurance company ( little no customer involment)
Interpersonal service Hotel, Restaurant
Hospital( both customers and employees are actively present).
Services capes complexity: Elaborate ( theatre, insurance, hotel) Lean (bend) ATM, internet
Sporting event
Services capes: Parking Stadium exterior Entrance Seating Restrooms Playing fields
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Continue
Other tangibles: Tickets Programs Uniforms websites
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Strategic roles of the services capes:
Package: wrap the service and convey to customers an external image of what is inside Facilitator: In aiding the performances of person in the environment
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Strategic roles of the services capes:

Socialize: the design of the services capes aids in the socialization of both employees and customers in the sense that it helps convey expected roles ,behaviors and relationship Differentiator: can differentiate a firm from its competitors.
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Positioning service in competitive Market Opportunity Analysis:
The factors that influence feasibility analyses, including external considerations (market size, competition, technology, inflation and the economy, government regulations, political conditions, social change), internal factors (purpose, corporate objectives, resources), and financial considerations (revenue estimates, cost estimates, return on investment).
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Market positioning
The essence of choosing to perform activities differently than rivals do. Positioning strategy is concerned with creating, communicating and maintaining distinctive differences that will be noticed and valued by customers with whom the firm would most like to develop a long-term relationship. Distinguish yourself on the basis of the needs you fill ,the service you provide and distribution channel you use, the pricing strategy you employ.
Benefits of Market Potential Analysis

selecting products or services that can be sold. Understand market potential for a single store, network of stores or a new market . Deploy (arrange) resources effectively by ranking markets in priority order. Find a profitable market. To plan a realistic target. Forecast total opportunity in terms of number of customers and revenue potential.
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Benefits of Market Potential Analysis
Identify changes in consumer behavior. Improve marketing techniques. Estimate your market share Forecast for the future. Understand your customers' future needs Research and develop proactively instead of reactively Expand your company's offerings
Service positioning
The essence of positioning based upon the following principles A company must establish a position in the minds of its target customers The position should be singular, providing one simple and consistent message The position must set a company apart from it competitors A company cannot be all things to all people it must focus its efforts
Positioning maps
It is used to represent Customer perception of alternative products graphically.
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Product positioning versus copy positioning Copy positioning: Create images and association for broadly similar branded products so as to give special distinction in the customer minds Co branding : The imaginary associated with one brand has the potential to influence customer perception of the others.
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Focus underlies the search for competitive advantage
Four focus strategies: Focus: providing a relatively narrow product mix for a particular market segment Fully focused organization: A limited range of services to a narrow specific market segment
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Continue
Market focused company concentrates on a narrow range of segment but offers a wide ranges of services. Service focused firms offer a narrow range of services to a fairly broad market. Unfocused category try to serve broad markets and provide a wide range of services
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Definitions of market segmentation
Market segmentation is the sub-dividing of customers into homogeneous sub-set of customers where any sub-set may conceivably selected as market target to be reached with distinct marketing mix--- Philip kotler.
Market segmentation consist of taking total heterogeneous (diverse) market for a product and dividing into several submarket of segments, each of which tends to homogenous in full significant aspects __ William Stanton
Benefits and limitations

Benefits:
1.
2.
3. 4.
The organization gets to know its customers better. Provides guidelines for resource allocation. It helps focus the strategy of the organization. Positioning Targeting multiple segment increases marketing costs. Segmentation can lead to Proliferation of products. Narrowly segmenting a market can hamper the development of broad-brand equity.
Limitations:
1.
2. 3.
Steps in segmentation, targeting and positioning .

6. Develop Marketing Mix for Each Target Segment 5. Develop Positioning for Each Target Segment 4. Select Target Segment(s) 3. Develop Measures of Segment Attractiveness 2. Develop Profiles of Resulting Segments 1. Identify Bases for Segmenting the Market
Market Positioning Market Targeting
Market Segmentation
Bases of market segmentation 180- 199chirstoper 6th

Geographic
Nations, states, Regions, cities, towns e.g.: Bank new branch, tourism Pg: 123 -129 S.M. JHA
Demographic
Age, gender, family size and life cycle, income eg: executive banking Drs, a/c, & professionals , tourism at old
age museums.
Psychographic
Social class, lifestyle, personality fast track young people, bank 5 years scheme deposit
Behavioral
Occasions, benefits, uses, or responses
Steps of markets segmentation
Identify bases for market segmentation Develop profile of segments( relevant) Develop measures of segment attractiveness Select the target segments Ensure the segments are compatible( well watched)
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Stage I: Identify Segmentation Process
Marketers follow two methods to determine the bases on which to identify markets:
Segments are predefined by managers based on their observation of the behavioral and demographic characteristics of likely users Segments are defined by asking customers which attributes are important and then clustering the responses
Stage II: Develop Relevant Profile
Next, marketers seek further understanding of the consumer in each promising segment Must develop a profile of the typical consumer and each segment Helps to accurately match consumer needs with the firms marketing offers
Stage III: Forecast Market Potential
Market segmentation and market opportunity analysis combine to produce a forecast of market potential within each segment Defines a preliminary go or no-go decision since the sales potential in each segment must justify resources devoted to further analysis
Stage IV: Forecast Market Share
The next step is to forecast the firms probable market share Competitors positions in targeted segments must be analyzed A specific marketing strategy must be designed to serve the targeted segments The firm determines the expected level of resources it must commit to tap the potential demand in each segment
Stage V: Select Specific Segment
The preceding information, analysis, and forecasts allow management to assess the potential for achieving company goals and to justify committing resources in developing one or more segments Marketers also weigh more than monetary costs and benefits at this stage
Requirements for effective segmentation

Measurability: The degree to which the size and purchasing power of the degree can be measured. Accessibility: The degree to which the segment can be reached and served (communication & distribution channels) Sustainability: The degree to which the segment are large or profitable enough Actionable: The degree to which the effective programs can be designed for attracting and serving the segments. Differentiable: The segments are conceptually distinguishable and respond differently to different marketing mix elements and programs.
IFETCE/MBA/2012/III/BA9253/unit-II/SRM/PPT/Version1.0
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Criteria for evaluating market segments and targeting
Segment size and growth Segment structural attractiveness Company objective and resources
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Service positioning strategies
Market analysis Internal analysis Competitive analysis Position statement Anticipating competitive response Evolutionary positioning
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Environment and Trends The Marketing Environment
Marketing Environment: The actors and forces outside marketing that affect marketing managements ability to build and maintain successful relationships with target customers Microenvironment Includes the actors close to the company Macro environment Involves larger societal forces
Microenvironment
Actors
1. The company 2. Suppliers 3. Marketing intermediaries 4. Customers 5. Competitors 6. Publics
Marketing must consider other parts of the organization including finance, R&D, purchasing, operations and accounting Marketing decisions must relate to broader company goals and strategies
Marketing Environment The actors and forces outside marketing that affect marketing management ability to develop and successful transactions with its target customers. Types of Marketing environment Micro environment Macro environment
Micro Environment Company s Microenvironment Forces close to the company that affect its ability to serve its customer
Micro Environment
Company: Its internal environment functional areas such as top management, finance and manufacturing etc. Supplier : Suppliers are firms and individuals that provide the resources needed by the company to produce its goods and services . Intermediaries: Marketing intermediaries help the company promote, sell, and distribute its goods to the final buyers.
Micro Environment
Public: Any group that perceives itself having an interest in a company ability to achieve its objectives. Competitors: Those who serve a target market with similar product and services. Customer : They purchases goods and services .
Macro Environment: The macro environment consist

of broader forces that not only affect the company and the industry but also other actors in the microenvironment.
Demographic Environment
Demography is the study of human populations in terms of size, density, location, age, gender, race, occupation, and other statistics. Why its information useful for business: To know consumer capacity. Identify Focus area. To know Human resources.
The demographic environment refers to the size, distribution, and growth rate of groups of people with different characteristics. The demographic characteristics of interest to marketers relate in some way to purchasing behavior, because people from different countries, cultures, age groups, or household arrangements often exhibit different purchasing behaviors. A global perspective requires that marketers be familiar with important demographic trends around the world as well as within the United States.
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Population Estimate Year 2025
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Demographic Trends
World and country population statistics are important, but most marketers target subgroups. Trends in population subgroups are typically the most useful to marketers, for example, the growth of the urban population.
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Demographic Trends
Another interesting trend is the is especially evident in Italy, Japan aging of the population. The aging of the population, Britain, and the United States.
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Natural Environment
The natural environment consists of natural resources required by marketers or affected by marketing activities. Why its information is useful for business: Identify and forecasting natural based business. To know raw material capacity. To know supplier.
The Political/Legal Environment
The political/legal environment encompasses factors and trends related to governmental activities and specific laws and regulations that affect marketing practice.
Global Trends
Political Legal Environment

Regulation Legislation
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Global Political Trends
In todays world economy, international political events greatly affect marketing activities. For example the impact of the war on terrorism on the travel and security industries. A second important political trend is movement toward free trade and away from protectionism. Studies show that countries with the free trade have the highest GDP growth.
Legislation
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Regulations and Regulatory Agencies
Most legislation in the United States is enforced through regulations developed by a variety of agencies, and marketers must often work with regulatory authorities at the federal, state, and local levels.
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Cultural Environment
The cultural environment includes institutions and other forces that affect societys basic values, perceptions, Attitudes, and behaviors.
Why its information is useful for business :

To know lifestyle of people. To know changing structure of family. Fashion awareness. EG: Incredible India ( tourism)
IFETCE/MBA/2012/III/BA9253/unit-II/SRM/PPT/Version1.0
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Economical environment
The economic environment consists of factors that affect consumer purchasing power and spending patterns. Why its information is useful for business: In price making . To know spending capacity . To help future expenses Income of people. Identity target customer according to economical level.
The Economic Environment
The economic environment includes factors and trends related to income levels and the production of goods and services. Economic trends in different parts of the world can affect marketing activities in other parts of the world. The gross domestic product (GDP) represents the total size of a countrys economy measured in the amount of goods and services produced.
Technological Environment
Information technology has made it possible to plan truly global supply chains. Why its information is useful for business: To make product and services on based of new technology. To counter inflation and recession.(decline) To enhance personal efficiency and effectiveness of business. Affective promotion
The Technological Environment
The technological environment includes factors and trends related to innovations that affect the development of new products or the marketing process. These technological trends can provide opportunities for new product development, affect how marketing activities are performed, or both.
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The Competitive Environment
The competitive environment consists of all the organizations that attempt to serve similar customers.
The most direct competition, offering the same types of products as competing firms. For example, Nike is a brand competitor of Reebok as both companies manufacture shoes. Offer different types of products to satisfy the same general need. Dominos Pizza, McDonalds, and Kentucky Fried Chicken are product competitors.
Brand Competitors
Product Competitors
The Institutional Environment
The institutional environment consists of all the organizations involved in marketing products and services. Market Research Firms Advertising Retailers
Suppliers
Wholesalers
Customers
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Trends in Segmentation, Targeting and Positioning
From Mass, Anonymous( unsigned) , Aggregated and Sample Data to Names, Individual and Specific ! In addition to segmenting the customers in the marketplace, and designing campaigns for each segment, marketers will be asked to go further and, for each segment, provide a way to personalize the campaign for each person in the segment the beginning of PARTICLE MARKETING.
Trends in Segmentation, Targeting and Positioning
Syncographics(Syncographics: Market researchers actively attempt to discern what is the most likely time for individuals to buy something. Called syncographics, this investigative tool presupposes that when consumers are anticipating an eventfrom a marriage or baby to a vacation or graduationthey must buy certain things)
Motigraphics( Consumer decisions are based on emotion, not reason) Direct Marketing Technology. Persona Technologies Cyber segmentation. CLIP (A Classification of Internet People) Demography. DBS (Direct Broadcasting Satellite Systems) RFID (Radio Frequency Identification) Particle marketing (Physics) and Neurolinguistics (Genetics) Solutions positioning vs. Fuzzy Value Propositions and/or confusion marketing
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Service Marketing Opportunities and Mix

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Service Marketing Opportunities

What is market assessment

Concept: The term market assessment concept holds

Importance of service marketing.

Marketing management process for services

Assessing service market potential

Selection of Target markets

Developing marketing mix

Managing marketing efforts

Classification of Services pg33-37

Four Categories of Services Employing Different Underlying Processes

People Processing(services directed at peoples body)

Possession Processing(services directed at physical possessions)

mental Stimulus Processing (

e.g., accounting, banking, insurance, legal, research

Marketing mix is term used to describe the combination

Product: Anything that can be offered to a market for

Expanded Marketing mix/Augmented service mix (pg: 21 to 24)

Expanded Marketing mix/Augmented service mix

2) Physical evidence / physical environment: ( the appearance)

back stage front stage

Service Marketing Mix :The 7 Ps of service marketing mix are

Elements of physical evidence

Servicescape: used to position a service

Types of services cape

Interpersonal service Hotel, Restaurant

Hospital( both customers and employees are actively present).

Other tangibles: Tickets Programs Uniforms websites

Strategic roles of the services capes:

Strategic roles of the services capes:

Positioning service in competitive Market Opportunity Analysis:

Benefits of Market Potential Analysis

Benefits of Market Potential Analysis

It is used to represent Customer perception of alternative products graphically.

Focus underlies the search for competitive advantage

Definitions of market segmentation

Benefits and limitations

Steps in segmentation, targeting and positioning .

Market Positioning Market Targeting

Bases of market segmentation 180- 199chirstoper 6th

Steps of markets segmentation

Stage I: Identify Segmentation Process

Stage II: Develop Relevant Profile

Stage III: Forecast Market Potential

Stage IV: Forecast Market Share

Stage V: Select Specific Segment

Requirements for effective segmentation

Criteria for evaluating market segments and targeting

Service positioning strategies

Environment and Trends The Marketing Environment

Macro Environment: The macro environment consist

Population Estimate Year 2025

The Political/Legal Environment

Political Legal Environment

Global Political Trends

Regulations and Regulatory Agencies

The Economic Environment

The Technological Environment

The Competitive Environment

The Institutional Environment

Trends in Segmentation, Targeting and Positioning

Trends in Segmentation, Targeting and Positioning

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