Services Marketing Lecture Notes

SERVICES MARKETING LECTURES

Course Convenor: Sarah Slogan

Consultation – Tuesdays G40 level 7 marketing

s.sloan@griffith.edu.au

Week 1

Sullivan Ford Auto World Case Study

Q1: How does marketing cars differ from marketing services for those same vehicles?

Q2: Conduct a SWOT analysis for Sullivan Ford Auto World. What opportunities exist for their future expansion?

Q3: What ways could a car dealership further integrate customer into the co-delivery of the service?

Q4: What advice would you give to Carol Sullivan-Diaz?

Unique Characteristics of services (comparing to goods)

• Heterogeneity (variability)
• Inseparability of production and consumption
• Perishability of output
• Inseparability of production and consumption
• Perishability of output

Five categories within the non-ownership framework

1. Labour skills, and expertise rentals (other people are hired to perform work that customers either cannot or choose not to do themselves e.g. car repair, medical check up)
2. Rented goods services (e.g. boats, construction equipment)
3. Defined space and facility rentals (e.g. a seat in an aircraft, a suite in an office building)
4. Access to shared facilities (e.g. theme parks, toll roads)
5. Access and use of networks and systems (telecommunications, banking)

Week 2

High contact service – active contact between customers and service personnel

Low contact service – little or no face-to-face interaction with service personnel

Stages of service consumption

1. Pre-purchase stage (decision-making process)

1. Need awareness (need or want)

• Unconscious minds (personal identity & aspirations)
• Physical conditions (Susan’s hunger drove her to burger king)
• External sources (service firm’s marketing activities- advertising pamphlet in mail)

1. Information search

• Clarify needs
• Explore solutions
• Identify alternative service products and suppliers

1. Evaluation of alternatives

• How do customers evaluate different service brands/providers? (e.g. Sheraton vs. Hilton)
• Multiple attributes – price, quality, convenience …..
• Perceived risks

1. Purchase decision

1. Service encounter stage  -> (marketers have most control over)

• When the customer interacts directly with the service firm
• Servuction system – service and production, factors that influence service experience, including those that are visible and invisible to consumer

• Front stage (visible)
• Back stage (invisible)

1. Post- purchase stage

• Customers evaluate the service performance they have experienced during service encounter and compare it with their prior experience
• Marketers try to measure customer satisfaction in the post-purchase stage -> a benchmark feedback to the company (doing well or badly)
• The confirmation or disconfirmation of customers expectation is key determinant of satisfaction

• Positively confirm, confirm, negatively disconfirm

Week 3

• 3 C’S – Customer, Competitor and company
• How they 3C’s link with STP (segmentation, targeting, positioning)

Customer-driven services marketing strategy

• To develop an effective positioning for a company

• A systematic way to do this typically starts with an analysis of 3Cs

Customer analysis

• Understanding your market segments

• Dissect it into smaller groups -> identify size, growth & trend
• Identify consumer behaviour in each group (different & similarity)

Competitor & company analysis

• Determine the target market (who you can serve best)
• Identify points of differentiation & select customer benefits to emphasize
• Decide on focus strategy

Achieve Competitive advantage through focus

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Positioning Strategy

• Successful positioning requires managers to understand their target customers’ preferences, their conception of value, and the characteristics of their competitors’ offerings.

• Positioning strategy is concerned with creating, communicating, and maintaining distinctive differences.

Week 4

The flower of service