Marketing of services is a new phenomenon in the area of marketing, but only towards the end of the 20th century it gained more importance as a practice. According to the Management Study Guide (2016), Services marketing first appeared in the 1980’s when the debate started on whether marketing of services was significantly different from that of products so as to be classified as a separate discipline. Before this, services were considered just a support to the production and marketing of goods and for that reason were not deemed as having separate relevance of their own.
The American Marketing Association defines services as activities, benefits, or satisfactions that are offered for sale or provided with sale of goods to the customer, that is, pre-sale and after-sales services. Berry states ‘while a product is an object, devise or physical thing, a service is a deed, performance, or an effort’. Another similar definition is the one that says that: “a service is any act or function that one part can offer other one, which is essentially intangible and does not give as a result any property. Its production can or cannot be linked to a physical product.” Nevertheless, a definition universally acceptable of the services up to now has not been achieved.
-Retrieved from marketingservices.org
According to Ana Cristina (2007), there are six factors, among others, that promote the growth of the services:
- Change in family structures: the higher number of women who work and the smaller size of the houses has caused an increase of nurseries, take away meals and laundry services between others.
- Change of expectations: the increase in expectations has resulted in a greater demand for holidays and all forms of entertainment.
- Increase in free time: the holiday periods are bigger andthe working hours have been reduced. As a consequence, the demand for travel, education, sports and leisure have increase significantly.
- Greater number and complexity of products: this has meant an increase in requirements of specialists for repair, consulting, and maintenance.
- Unemployment levels: high levels of unemployment have meant a continuos growth in the amount of independent employees, most of whom work in the service sector.
- Greater complexity of the requirements of information and communication.
Marketing services is different from marketing goods because of the unique characteristics of services namely, intangibility, heterogeneity, perishability and inseparability. As Rafael Muñiz (2016) these are the services marketing features:
A physical product is visible and concrete. Services are intangible. The service cannot be touched or viewed, so it is difficult for clients to tell in advance what they will be getting. For example, banks promote the sale of credit cards by emphasizing the conveniences and advantages derived from possessing a credit card.
Personal services cannot be separated from the individual. Services are created and consumed simultaneously. The service is being produced at the same time that the client is receiving it; for example, during an online search or a legal consultation. Dentist, musicians, dancers, etc. create and offer services at the same time.
- Heterogeneity (or variability):
Services involve people, and people are all different. There is a strong possibility that the same enquiry would be answered slightly differently by different people (or even by the same person at different times). It is important to minimize the differences in performance (through training, standard setting and quality assurance). The quality of services offered by firms can never be standardized.
Services have a high degree of perishability. Unused capacity cannot be stored for future use. If services are not used today, it is lost forever. For example, spare seats in an aeroplane cannot be transferred to the next flight. Similarly, empty rooms in five-star hotels and credits not utilized are examples of services leading to economic losses. As services are activities performed for simultaneous consumption, they perish unless consumed.
- Changing demand:
The demand for services has wide fluctuations and may be seasonal. Demand for tourism is seasonal, other services such as demand for public transport, cricket field and golf courses have fluctuations in demand.
- Pricing of services:
Quality of services cannot be standardized. The pricing of services are usually determined on the basis of demand and competition. For example, room rents in tourist spots fluctuate as per demand and season and many of the service providers give off-season discounts.
- Direct channel:
Usually, services are directly provided to the customer. The customer goes directly to the service provider to get services such as bank, hotel, doctor, and so on. A wider market is reached through franchising such as McDonald’s and Monginis.
What is the Services Marketing Triangle?
-Retrieved from slideshare.net
“Viewing employees as internal customers, viewing jobs as internal products and then endeavoring to offer products that satisfy the needs and wants of these internal customers while addressing the objectivves of the organization” L.L. Berry (1981)
Dr. Rahul, (2012), an assistant professor of marketing explains the three marketing component in Services Marketing:
- Internal Marketing, “Enabling the Promise”: involves training, motivational and teamwork programs, and all communication with employees. It is performed to enable employees to perform the service effectively, and keep up the promise made to the customer.
- External Marketing, “Setting the Promise”: Involves pricing strategy,promotional activities, and all communication with customers. It is performed to capture the attention of the market, and interest in the service.
- Interactive Marketing, “Moment of Truth, Service Encounter”: This refers to the decisive moment of interaction between the front-office employees and customers. This step is one of the most importance, because if the employee falters at this level, al prior efforts made towards establishing a relationship with the customer, would be wasted.
These approaches will lead to a comprehensive and egalitarian vision of products and services. The marketing professional should be aware that the use of the different tools must be commensurate with the market and sector in which they operate. Consequently, the marketing of services should be understood as an extension of the traditional concept. There are examples of it in the areas of training, insurance, tourism, consulting, game, etc., markets that are as advanced as the consume of goods.
- American Marketing Association. (2010). Dictionary. 2016, de American Marketing Association. Retrieved from https://www.ama.org/resources/Pages/Dictionary.aspx?dLetter=I
- Berry, L. L. (1981), “The Employee as Customers”, Journal of Retail Banking, 3
- Pratap, D. R. (17, December, 2012). Services Marketing Triangle. Retrieved from http://www.slideshare.net/RahulKaurav/services-marketing-triangle
- Cristina, A. (15,Jaunary, 2007). Marketing De Servicios. Obtenido de http://marketingdeservicios.blogspot.com.es/
Muñiz, R. (2016). Marketing XXI. Obtenido de http://www.marketing-xxi.com/marketing-de-servicios-11.htm