Service Marketing

Since services are very competitive and there is a very high level of replication of products, consumers do not perceive a drastic fall in quality with falling price. For highly intangible service offerings in particular, organisation-wide factors, such as the level of functional service quality, may be emphasised when adding value (Gronroos, 1984; Parasuraman et al, 1991). Zeithaml, Parasuraman and Berry (1985) also highlighted the uniqueness of service offerings in terms of their intangibility, non-standardisation, perishability and inseparability of production and consumption. In addition, contributions from Bharadwaj et al (1993), and Zeithaml (1988) suggest that extrinsic cues such as image and reputation may be particularly important in adding value in cases where consumer understanding of service offerings is limited. This is likely to be the case, in particular, where service offerings are complex and, as a result, highly ‘mentally intangible’ to the average consumer. Leonard L Berry, in his model shown above, highlights the importance of the customer’s experience, which in turn is based on the service performance.

The presented brand is the company’s controlled communication of its identity through advertisement while the external brand communication refers to the information customers absorb about the company that essentially is uncontrolled by the company. These factors, combined with the customer’s experience, lead to increased brand awareness and brand meaning. Brand meaning refers to the customer’s dominant perceptions of the brand and hence differs from awareness. Both these factors put together lead to development of brand equity. In services marketing, unlike in product marketing, it is the customer’s experience that plays a very important role and even if his services experience differs from the advertising message, he will go more by his experience. Thus, the main differentiating role is played by the service performance. [continues]

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