Creating the Service Product
Planning & Creating a ServiceCorporate Objectives and Resources
Marketing AssetsCustomer Base, Mkt. Knowledge Product opportunitiesBrand Reputation
Service Marketing Concept
•Benefits to customer Core supplementary elements accessibility (where & When)
•User cost Price/other monetary costs Time Mental and physical effort
Service Operations Concept
•Nature of processes•Geographic scope of ops•Scheduling•Facilities design/layoutLeverage through partners•Task allocation:
Market & Competitive Analysis
Resource Allocation Analysis
Operating AssetsLocation & Equipment, IT Systems, HR (number &. Skills)Cost Structure)
Augmented Service Product
Core Products and Supplementary Services
• Most firms offer customers a package of benefits:
• core product (a good or a service)
• supplementary services that add value to the core
• In mature industries, core products often become commodities
• Supplementary services help to differentiate core products and create competitive advantage by:
– facilitating use of the core service
– enhancing the value and appeal of the core
Shostack’s Molecular Model of a Total Market Entity
DistributionPrice
Marketing Positioning
KEY Tangible elements Intangible elements
Service frequency
Vehicle
Transport
Pre- and post-flight
serviceFood and drink
In-flight service
Product Design: What Do We Offer and How Do We Create and Deliver It?
Design of your product = Core + Supplementary + Delivery process
Core
Scheduling Process
Service Level
Customer Role
Supplementaryservices offeredand how createdand delivered
Delivery Concept For Core Product
Core and Supplementary Services in a Luxury Hotel (Offering Guests Much More than a Cheap Motel!)
Reserva tio nVa let
Pa rking
Receptio n
Ba gga geService
C o ckta il Ba r
Resta u ran tEnterta inment/
Spo rts / Exercise
Teleph o ne
W a ke - upC a ll
Ro o mService
BusinessC enter
C a sh ier
A Bed fo r theN igh t in an
Elega n t Priva teRo o m w ith a
Ba th ro o m
Hotel stay
Note:Core services shouldbe stretched More than the Supplementary
What Happens, When, and in What Sequence?
The Time Dimension in the Augmented Service Product
PreVisit
Reservation
USE GUESTROOM
Parking Get car
Check in
Porter
USE ROOM
MealTV Room service
PhoneCheck out
Time Frame of an Overnight Hotel Stay(real-time service use)
The Flower of Service:Categorizing Supplementary
Core
Information
Consultation
Order-Taking
Hospitality
Payment
Billing
Exceptions
Safekeeping Facilitating elements
Enhancing elements
KEY:
Facilitating Services - Information
Core
Customers often requireinformation about how to obtain and use a service.
They may alsoneed reminders anddocumentation
Facilitating Services - Order-Taking
Many goods and services must be ordered or reservedin advance. Customers needs to know what is availableand may want to secure commitment to delivery
Core
Facilitating Services - Billing
“How much do I owe you?”
Customers deserve clear, accurate and intelligible
bills and statements
Core
Facilitating Services - Payment
Customers may pay faster
and more cheerfully if you
make transactions simple
and convenient for them
Core
Enhancing Services-Consultation
Value can be added to goods and services byoffering adviceconsultation according each customer’sneeds and situation
Core
Enhancing Services - Hospitality
Customers who invest time
and effort in visiting abusiness and using itsservices deserve to betreated as welcome
guests
Core
Enhancing Services - Safekeeping
Customers prefer not toworry about looking afterthe personal possessions that they bring with themto a service site.
And also want deliveryand after-sales services
Core
Enhancing Services - Exceptions
Customers appreciate some flexibility in a business like
Prior special requests. Listening to their complainsResolving problemsRefunds / free repairs
Core
Branding Service Products
Service Branding: Clarifying Distinctive Service Offerings
• Marriott Hotel Brands– Marriott Hotels– Marriott Resorts– Courtyard by Marriott– Fairfield Inns– Residence Inns– SpringHill Suites– TownePlace Suites– Marriott Vacation Clubs
International
• British Airways BrandsIntercontinental
– First– Club World– World Traveller Plus– World Traveller
European
– Club Europe– Euro-Traveller
UK Domestic
– Shuttle
Branding A Family of Brands at Sun Microsystems
• Corporate umbrella brand– Sun Microsystems
• Product line brand (system support services)– Sun Spectrum Support
• Sub-brands (4 levels of support service programs)• Platinum• Gold• Silver• Bronze
Sub-branding clarifies service levels offered at different fees
Platinum: “Mission Critical” On-site service 24/7, two-hour response; telephone support 24/7, onsite parts replacement; additional services available
Gold: “Business Critical” Onsite service Mon-Fri 8am-8pm, four-hour response; telephone support 24/7; onsite parts replacement
Silver: “Basic Support” Onsite service Mon-Fri 8am-5pm, four-hour response; telephone support Mon-Fri 8am-8pm; onsite parts replacement
Bronze: “Self Support” Phone support Mon-Fri 8am-5pm; parts replacement by courier
New Service Development:A Hierarchy of New Service Categories
• Major service innovations--new core products for previously undefined markets Eg: Ebay, Amazon, Dabbawalas
• Major process innovations--using new processes to deliver existing products and offer extra benefits (Eg: Vodafone)
• Product line extensions--additions to current product lines (Eg: SBI Mutual Funds)
• Process line extensions--alternative delivery procedures (Hotels- Self-service, Eat there, Catering)
• Supplementary service innovations--adding new or improved facilitating or enhancing elements
(Eg: institutes providing Book bank)
• Style changes--visible changes in service design or scripts
Success Factors in New Service Development
• Market synergy
• Organizational factors
• Market research factors
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