How Do Services Differ from the Physical Good? Why Are They So Important?

How do services differ from the physical good? Why are they so important?

According to Kotler and Keller, “a service is any act or performance one party can offer to another that is essentially intangible and does not result in the ownership of anything.” A physical good is anything tangible that you can feel, taste, own, etc. Like physical goods, services are everywhere and services have characteristics that make them distinctive from goods; intangibility, inseparability, variability, perishability, and word-of-mouth.

Like the definition of service states, it is intangible, meaning that if you sell computers and warranties, you cannot see the warranty before you purchase the computer. When marketing services you have to be able to leave a lasting impression and that is why services have to be paired up with goods in order to successfully market it.

Services are also inseparable, meaning that they are “produced and consumed simultaneously” (Kotler and Keller, 2012).

Variability-Every person experiences a service differently and marketers must keep this mind. Since services are subjective, marketers can come up with ways for a customer to really enjoy an experience by educating them through the internet, television, etc. Doing this goes beyond what the service will actually offer (Kotler and Keller, 2012).

Perishability-Like physical goods, services do not have a shelf life, nor can they be stored or inventoried. It is essential that marketers to figure out different ways to keep up with demand by looking at shifts in the market. A good example would be a restaurant-they still pay their rent and bills even if they do not have any customers.

Word-of-mouth-This is very important for any service that is being marketed because it can make or break any business. This is the most influential