Introduction to Service Marketing

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BABS 3 Services Marketing Semester 2 2012
Introduction to Services Marketing

Assessment
• 40% individual assignment- see assignment overview • 60% end of semester exam (6Q’s do 4) • Core Text: Zeithaml, Bitner & Gremler (2009) Services Marketing: Integrating Customer Focus Across the Firm 5th Ed. • Plus readings as assigned in class.

Introduction to Services
• What are services? • Why services marketing? • Characteristics of Services Compared to Goods • Services Marketing Mix • Staying Focused on the Customer

What do we mean by Services?
• “Services include all economic activities whose output is not a physical product or construction, is generally consumed at the time it is produced, and provides added value in forms (such as convenience, amusement, timeliness, comfort or health) that are essentially intangible concerns of its first purchaser” (Quinn, Baruch and Paquette, 1987).

What is a service?
• Services marketing is all about PEOPLE
▫ People as CUSTOMERS ▫ People as EMPLOYEES

• A service is about the EXPERIENCE not ownership • Services are generally the dominant sector in most countries but stage of economic development has an impact.

Examples of Service Industries
• • • • • Transportation services Communication services Wholesale and trade Retailing Financial services (banking, insurance, real estate etc.) • Tourism services • • • • • • Health services Auto repair services Business services Legal services Government services Education

BUT- Service or Product?

The reality is BOTH are present in most businesses

Why study Services Marketing?
• Service-based economies • Service as a business imperative in manufacturing and IT • Deregulated industries and professional service needs • Services marketing is different • Service equals profits

The Development of Services Marketing
• The life of services marketing has undergone three stages: ▫ The Crawling Out stage (Pre-1980) ▫ The Scurrying About stage (1980-1985) ▫ The Walking Erect stage (1986-today)

The Crawling Out Phase- Pre-1980
• A period of high risk: • If services marketing proved to have a case, the sub-discipline would grow • If it was shown that services marketing was a mere extension of goods marketing, the discipline would have no solid base and would disappear • The objective: ▫ To prove the right of services marketing to exist

The Crawling Out Phase- Pre-1980
• Views of goods focused marketing academics: • “If services marketing becomes a sub-discipline with its own stance, this could challenge the universality of marketing theory and the coherence of marketing as a separate discipline” • “Why do we need to pay special attention to the marketing of services, when they are just an aid (an important though) to the production and marketing of goods? (Converse, 1921)

The Crawling Out Phase- Pre-1980
• Views of service practitioners: • “You cannot market a bank account by applying same rules that are used for the marketing of a can of Campbell’s soup” • The logic that services are just like goods resembles the logic that apples are like oranges except for their ‘appleness’” (Shostack, 1977)

The Scurrying About Stage (19801985)
• The characteristics: • A notable increase in the interest of practitioners and academics in the case of services marketing • The debate on the uniqueness of services marketing was partly won • The objectives:  To reinforce, even further, the argument that, despite similarities, the marketing of services necessitated a different management approach  To prove empirically the necessity mentioned above

The Scurrying About Stage (19801985)
• The outcome: • A significant growth of the empirically based knowledge on the special nature of services ▫ Service quality ▫ Service encounters (the customer-seller interaction at the point of sale) ▫ Service design ▫ New service development

The Walking Erect Stage (1986Now)
• The characteristics: • Very little, is any, further...
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