Buyers Evaluate Services Differently from Tangible Products
Inseparability of the provider from consumption of an intangible service makes it difficult for customers to make objective pre-purchase evaluations because experience properties can only be judged during or after consumption.
Prospects are influenced by word-of-mouth communications, personal needs, past experiences and promotional activities. To reduce uncertainty, they turn to early adopters, opinion leaders and reference groups.
Expectations include reliability, tangibles (facilities, equipment, personnel and collateral), responsiveness, assurance, and empathy. They place a great deal of faith in the service provider's integrity and competence. |
Internal Marketing: A Difference Maker in Service Organizations
Employees play a central role in attracting, building and maintaining relationships. Therefore, aim marketing-like campaigns at employees and channel partners so that they will be motivated to develop their own customer-centricity. Recruit, train, communicate and administer to ensure that employees have the satisfaction, attitude, skills, and commitment needed to sustain customer loyalty. | |
| Greetings!
In our last issue you read about the importance of matching your business development strategy with your product's lifecycle stage (development, introduction, growth, maturation and decline).
This month's newsletter identifies four independent variables (Intangibility, Inconsistency, Inseparability and Idle time) associated with services marketing.
IBM sells computers and IT outsourcing services. Dow Jones delivers The Wall Street Journal and online news. Stop & Shop delivers groceries to homeowners through its Pea Pod service. Where does your company lie on the goods-to-services continuum? |
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Construct your Services Marketing Equation
Include the "Four I's"
- Intangibility
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Inconsistency
- Inseparability
- Idle Capacity
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(Product) Service Design
Create an advantage at each touch point identified by a contact audit that charts interactions between a customer and your service.
Reduce inconsistency through standardization and training.
Modify a high-contact service into a low-contact service without reducing customer satisfaction e.g. ATM.
Use supplementary services to distinguish the core service package.
Get bad experiences out of the way ASAP e.g. assessing the brutal facts.
Pay attention to personalization needs and allow customers to participate in decisions.
Develop rituals and stick to them.
Finish strong. |
| Promotion
Create buzz by asking satisfied clients to tell others and provide incentives for doing so.
Assure that your brand image helps prospects discover your service through reasonable expected outcomes.
Your logo should communicate the intangible attributes of your service.
Use tangible cues such as high quality collateral, availability, location, consistent quality and performance, certifications, and efficient, courteous service.
Use "StorySelling" to help customers visualize the benefits through specific language and photos of facilities, equipment and personnel. |
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Pricing (Fees, Rates...)
Balance prestige pricing with customary "going rate" pricing.
Bundle or unbundle features for financial advantage.
Use pricing to prevent perishable idle capacity. |
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Place (Distribution)
Manage expectations by informing customers that their service has been performed successfully through examples of good and poor results as a basis of comparison.
Fine tune the appearance of your site and service delivery person.
Balance capacity by adjusting your marketing mix for demand that fluctuates according to day of week, time of day or season.
Use idle time for training. |
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INTAgLIO's Business Development Services
- Launching new products or services
- Penetrating new markets
- Improving results from selling existing products and services to existing markets
Please forward this newsletter to someone who would be interested.
John J. Bernardi
Owner
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Business Solutions