Marketing Services: How Marketing Services is Different Than Marketing Products

Summary

In this video, Professor Wolters explains the key differences between service marketing and product marketing. He outlines four main aspects: the intangible nature of services, which cannot be physically held; the inseparable nature, requiring customers to be present for the service; the perishable nature, where services can't be stored or resold; and the variability of services, which can differ each time. He emphasizes the importance of reducing these differences using strategies like technology, guarantees, and training to ensure consistent and high-quality service delivery. The video offers insights for marketers to effectively tackle these challenges in service-based industries.

Takeaways

• 😀 Services are intangible: Unlike products, services cannot be physically held or touched, such as education or experiences.
• 😀 Services are inseparable: The consumer must be present to receive the service, such as a haircut or consultation.
• 😀 Services are perishable: They cannot be stored or reused once time has passed, like hotel rooms or flight tickets.
• 😀 Services are variable: The quality of a service can differ each time, making it unpredictable, unlike standardized products.
• 😀 Marketing services requires making the intangible tangible: Marketers use cues like imagery, atmosphere, and customer experiences to highlight the value of services.
• 😀 Inseparability makes it hard to trial services beforehand: Marketers often offer free trials or guarantees, like a free first month, to encourage initial use.
• 😀 Reviews and testimonials are crucial in service marketing: Consumers often rely on others' experiences to assess service quality, especially in services like hotels.
• 😀 To manage service variability, technology and training are key: Automation, like order screens at fast food chains, and staff training help ensure consistent service quality.
• 😀 Perishability requires time-sensitive promotions: Services like flights or hotels must sell in real-time, leading to flash sales and discounts to fill available slots.
• 😀 Repurchasing incentives help manage perishability: Hotels may offer discounts on future bookings to encourage immediate re-purchases.
• 😀 Marketers must plan for slow periods: In services with seasonal demand, like travel to tourist destinations, companies must adjust availability and pricing strategies.

Q & A

What are the four key aspects that differentiate service marketing from product marketing?

The four key aspects that differentiate service marketing from product marketing are: the intangible nature of services, the inseparable nature of services, the perishable nature of services, and the variability of services.

Why is the intangible nature of services a challenge for marketers?

The intangible nature of services is a challenge for marketers because consumers can't physically hold or touch a service, making it difficult to convey its value. Marketers address this by using cues like imagery, atmosphere, and examples to make the service feel more tangible.

How do marketers make the intangible nature of services more tangible?

Marketers make the intangible nature of services more tangible by using cues such as showcasing happy customers, creating professional atmospheres, and using imagery to show the value or benefit of the service, like sponsorships with athletes or professionals.

What does the inseparable nature of services refer to?

The inseparable nature of services refers to the fact that the consumer must be present to receive the service. For example, you have to be there to get a haircut, unlike a product, which can be used without the presence of the manufacturer or seller.

How do companies address the difficulty consumers face when trying a service for the first time?

Companies address this difficulty by offering free trials, guarantees, or using technology to reduce the risk for consumers. For example, subscription services often offer a free first month, and technologies like virtual try-ons allow consumers to visualize how the service might work for them.

Why is variability a challenge in service marketing?

Variability is a challenge because services can differ every time, leading to inconsistent customer experiences. For example, you may receive excellent service at one visit but poor service on another. This inconsistency can affect customer loyalty.

How can businesses reduce the variability in their services?

Businesses can reduce variability by using technology, such as automated order systems in fast food, and by providing consistent training to staff so that all customers receive the same high level of service, regardless of who serves them.

Why are guarantees important in service marketing?

Guarantees are important because they reduce the perceived risk for customers, especially when trying a new service. If consumers know they can get their money back or receive a free trial, they are more likely to take the first step and try the service.

What makes services perishable, and how does this affect marketing strategies?

Services are perishable because they cannot be stored or resold once the opportunity has passed, such as unsold hotel rooms or missed flight seats. This affects marketing strategies as companies must focus on filling services during specific times, using tactics like last-minute deals or discounts.

What strategies can businesses use to sell perishable services?

Businesses can sell perishable services by offering discounts, creating last-minute deals, or encouraging repeat business through incentives, like discounts for booking a future service while still using the current one. Planning for peak and off-peak periods also helps manage demand.