Service refers to any act/performance that one party offers to another that is essentially intangible and does not result in the ownership of anything.
SPECIAL CHARACTERISTICS OF SERVICES.
- Intangibility-services can not be seen, tasted, felt, heard or smelt.
- Inseparability-services are produced and consumed simultaneously.
Heterogeneity(heterogeneous)-services are variable since they depend on the provider.
- Perishability-services can not be stored e.g. medical care.
- Ownership-services do not result in ownership of anything.
- Should have support services ie it should augment the actual product.
- Should be well labelled.
- Should be well packaged.
- Should have a brand that identifies it with the maker.
This is based on the idea that actual service offering can be broken down into a number of levels relating to customer need satisfaction, benefits and features. Three levels can be identified.
- Core benefit service-This relates specifically to the customers needs. The core benefit satisfies the need or solves the problem.
- Expected service-this relates to customers’ expectations of what kinds of services are available to satisfy their need. The expected service reflects standards required or expected by customers to satisfy their needs.eg in a bank one expects that polite language is used,professional knowledge is applied by the staff etc.
- Augmented service-this means making the service better in some way and it is the means by which service providers differentiate their offering in an attempt to influence customer choice. Extra features over and above the expected service can be added to make the service more attractive to prospective customers. Innovation is the key to make a service stand out from the competition.eg in the banking sector,we have the corporate section where we have corporate customers who are usually served differently according to class.
- Service-this involves superior quality, a well known and trusted brand image, unique features and extended guarantees.
- Price-involves added value, special discounts and preferential credit terms(free for a new customer brought).
- Promotion-this involves innovative advertising campaigns, loyalty promotions(points) added, special offer, public relations e.g. sponsorship e.g K.CB in terms of safari rally, safaricom, equity etc.
- Place-This involves extensive availability(in many parts g. equity bank),innovative methods e.g. telephone banking, agents and careful selection of quality channels(mpesa).
- People-This involves highly trained staff, better customer care, greater efficiency, personal attention and specialized skills.
- Process-This involves advanced technology e.g. for counting money, efficiency systems e.g. introduction of ATMs to avoid queing in banks and fast response
- Physical evidence-This involves comfortable surrounding, superior décor(decoration) e.g. for wedding organizers they gather in hotels, schools, banks. Qualifications and evidence of professional standing(e.g. certificates being placed on walls) and a strong recognizable corporate image(similar uniform) and supporting documentation.
- Line extension(existing brand, existing service category)-this is using a successful brand name to introduce additional items in a given service category under the same brand name such as new flavours, forms, colours, added ingredients as well as different packaging sizes in respect to a product.
- Brand extension(existing brand, new service category)-using a successful brand name to launch a new service in a new category.
- Multibrands-(new brand, existing product category) ie offering new band in same category.
- New brands-(new brand, new service category) may be appropriate if none of the existing brands is appropriate for a new service entering new market.
- Mega brand strategies-this focuses on marketing dollars only in brand that can achieve number one or number two market share in their categories.
- Training the current employees/hiring new ones.
- Increasing the quantity of service by giving up some quality.
Industrialise the service by adding equipment and standardized production.
- Harnessing technology ie data mining, cloud computing etc.