Service Markets and How to Promote Services

As the world moves rapidly towards services economy, so the marketers need to know about services marketing and more professional approaches to promote services. Services are essentially intangible which may be act, performance, benefits or activities that one party can offer to another and it does not result in the exchange of goods or ownership of anything.

Examples of service Industries

  • Financial services include banking, insurance and investment advising
  • Health care services include hospitals and other medical practices
  • Hospitality services include hotels, restaurants, and resorts
  • Professional services include legal, accounting and architectural
  • Travel services include travel agencies, airlines
  • Other services include beauty parlors, spa, hair styling, plumbing, pest control, gardening, lawn maintenance, counseling services, teaching, house maintenance, security, telecommunications etc.
  • Public sector services include post offices, police and electricity authorities, police, etc.
  • The nonprofit service sector includes old age homes, charities, family welfare, and orphanages, etc.

Here service marketing involves the promotion of economic activities which are offered by an organization or a business to the clients.

Characteristics of services

Intangibility

Services cannot be tasted, touched or examined before buying; here buyers have to believe the service providers or marketers. Services do not have physical existence hence, consumers have to experience services but they never result in any ownership.

Promoting services is more complicated than promoting products due to the absence of physical evidence or tangibility. In order to create strong service image marketers can create awareness through word of mouth. Trained service promoters can help the customers in evaluating services before purchases.

Nowadays marketers are using tangible tools such as providing physical facilities, gift, and benefits in order to promote the intangible services.

For example

  • Offering fruit juice at beauty parlors and spas.
  • Kids play areas at hospitals

Inseparability

Here inseparability stresses the inseparability of production and consumption. The result of the consumption may be the customer satisfaction or dissatisfaction. In the case of goods its tangibility facilitates production and offering are possible without the presence of customers, they can buy and consume later. But services are inseparable in nature so that the production and consumption are done simultaneously. The consumers should be present and should play an active role while services are delivering. For example medical treatment, teaching and training etc. Customer’s presence is not compulsory for other services such as lawn maintenance and house maintenance, etc.

Hence the marketers are using advanced communication tools to maintain a better interaction between service providers and customers. Nowadays almost all the taxi or cabs services are providing better communication; prompt customer service, location tracking and sharing details, etc. Such strategies can maximize the customer’s confidence before experiencing the services and helps in achieving high standards.

Inseparability nature of services demands on the spot results, it can be achieved by selecting qualified service providers, providing better training and rewards to them can maximize the employee motivation and efficiency in delivering better services.

Heterogeneity

The output delivered by all the services may not be equally qualitative, whether the service provider is same or not. It shows a high degree of heterogeneity due to the factors such as time, experience, place or ambiance, variations in the skills of the service providers, etc. It causes difficulty in achieving standardization and quality control in services. Variability in the output of services can create negative perceptions and confusions in the minds of the customers, this is the main reason customers take more time and the opinions of others while selecting a service provider.

Hence the marketers should give assurance of quality services to the customer while promoting services; it can help the customers in better interpretation and decision making.

Customer feedback can help in knowing the gap between achieved standards and expected standards. Hence providing better training and adopting uniformity in delivering services lead to greater consistency which promotes service quality. Sophisticated technology and reliable equipment are also necessary in order to compete with the competitors in the service industry successfully.

Perishability

Another most important character of services is perishability, due to this nature customers have to consume services when they are produced; it is not possible to save for the future purpose. Here supply and demand go hand in hand. In the case of products, it is possible to produce products by expecting future demand, but it is not possible in the case of services.

For example non-occupied hotel rooms after booking.

Here the problem arises due to the mismatch of demand and supply hence marketers or service providers can use few strategies in order to find a better solution.

If the demand is more, then in such cases service providers divides the complete job into smaller tasks. If these tasks are assigned to experts then it facilitates achieving quality as well as demand. Following different pricing strategies for different slots can balance the mismatch of supply and demand problems.

Expecting demand and utilizing part-time employees can maximize the efficiency in delivering better services to the customers.

If the supply exceeds demand then the service providers may have to face loss, in order to overcome such imbalances many hotels, beauty parlors, amusement parks and resorts charge lower prices during off season.