2. Differentiating services from goods
Goods
Search goods Experienced goods
Only after buying or
Prior purchase/use after consumption
Tangible Intangible
3. Differences between services and
physical goods
S.NO. Physical goods services
1 Tangible Intangible
2 Homogeneous Heterogeneous
3 A thing An activity and process
4 Core value produced in Core value produced in the buyer
factory and seller interactions
5 Customer do not participate in Customer participate in the
the production process production
6 Can be kept in stock Cannot be kept in stock
7 Transfer of ownership No transfer of ownership
8 Production and distribution Production ,distribution and
are separated from consumption are simultaneous
consumption process
4. Element Core Goods Core Service
Example Example
Business Custom clothier Business hotel
Core Business suits Room for the
night
Peripheral Garment bag Bath robe
Goods
Peripheral Deferred In house
Service payment plans restaurant
Variant Coffee lounge Airport shuttle
5. Degree of Interaction and Customization
Low High
Service factory: Service shop:
Degree of labor intensity
* Airlines * Hospitals
Low * Trucking * Auto repair
* Hotels * Other repair services
* Resorts and recreation
Mass service: Professional service:
* Retailing * Doctors
High * Wholesaling * Lawyers
* Schools * Accountants
* Retail aspects of * Architects
commercial banking
6. Supporting Facility: The physical resources that
must be in place before a service can be sold.
Examples are golf course, ski
lift, hospital, airplane.
Facilitating Goods: The material consumed by the
buyer or items provided by the consumer.
Examples are food items, legal documents, golf
clubs, medical history.
Information: Operations data or information that
is provided by the customer to enable efficient and
customized service. Examples are patient medical
records, seats available on a flight, customer
preferences, location of customer to dispatch a taxi.
7. Explicit Services: Benefits readily observable
by the senses. The essential or intrinsic
features. Examples are quality of meal, attitude
of the waiter, on-time departure.
Implicit Services: Psychological benefits or
extrinsic features which the consumer may
sense only vaguely. Examples are privacy of
loan office, security of a well lighted parking
lot.
9. Services are rendered and consumed during
the same period of time. As soon as the service
consumer has requested the service
(delivery), the particular service must be
generated from scratch without any delay and
friction and the service consumer
instantaneously consumes the rendered
benefits for executing his upcoming activity or
task.
10. The service relevant resources, processes and
systems are assigned for service delivery during a
definite period in time. If the designated or
scheduled service consumer does not request. An
empty seat on a plane never can be utilized and
charged after departure.
When the service has been completely rendered to
the requesting service consumer, this particular
service irreversibly vanishes as it has been
consumed by the service consumer. Example: the
passenger has been transported to the destination
and cannot be transported again to this location at
this point in time.
11. Services are intangible and insubstantial: they
cannot be touched, gripped, handled, looked
at, smelled, tasted or heard. Thus, there is neither
potential nor need for transport, storage or
stocking of services. Furthermore, a service cannot
be (re)sold or owned by somebody, neither can it
be turned over from the service provider to the
service consumer nor returned from the service
consumer to the service provider. Solely, the
service delivery can be commissioned to a service
provider who must generate and render the
service at the distinct request of an authorized
service consumer.
12. Each service is unique. It is one-time
generated, rendered and consumed and can
never be exactly repeated as the point in
time, location, circumstances, conditions, curre
nt configurations and/or assigned resources
are different for the next delivery, even if the
same service consumer requests the same
service. Many services are regarded as
heterogeneous or lacking homogeneity and are
typically modified for each service consumer or
each new situation (consumerised).
13. Example: The taxi service which transports the
service consumer from his home to the opera is
different from the taxi service which transports
the same service consumer from the opera to
his home – another point in time, the other
direction, maybe another route, probably
another taxi driver and cab.
14. The service provider is indispensable for service
delivery as he must promptly generate and
render the service to the requesting service
consumer. In many cases the service delivery is
executed automatically but the service provider
must preparatory assign resources and systems
and actively keep up appropriate service
delivery readiness and capabilities.
15. Additionally, the service consumer is
inseparable from service delivery because he is
involved in it from requesting it up to
consuming the rendered benefits. Examples:
The service consumer must sit in the hair
dresser's shop & chair or in the plane & seat;
correspondingly, the hair dresser or the pilot
must be in the same shop or
plane, respectively, for delivering the service.
16. Direct Recipient of the Service
Nature of
the Service Act People Things
People’s bodies: Physical possessions:
Health care Freight transportation
Passenger transportation Repair and maintenance
Tangible actions Beauty salons Veterinary care
Exercise clinics Janitorial services
Restaurants Laundry and dry cleaning
People’s minds: Intangible assets:
Education Banking
Intangible actions Broadcasting Legal services
Information services Accounting
Theaters Securities
Museums Insurance
17. Type of Relationship between Service Organization and Its Customers
Nature of
Service Delivery “Membership” relationship No formal relationship
Insurance Radio station
Telephone subscription Police protection
Continuous delivery Electric Utility Lighthouse
of service Banking Public Highway
Long-distance phone calls Restaurant
Theater series tickets Pay phone
Discrete transactions Transit pass Toll highway
Sam’s Wholesale Club Movie theater
Airline frequent flyer Public transportation
18. Extent to Which Service Characteristics Are Customized
Extent to Which Personnel
Exercise Judgment in Meeting
Customer Needs High Low
Surgery Preventive health programs
High Taxi services Education (large classes)
Gourmet restaurant Family restaurant
Telephone service Public transportation
Hotel services Spectator sports
Low Retail banking Movie theater
Cafeteria Institutional food service
19. Availability of Service Outlets
Nature of Interaction
between Customer and
Service Organization Single site Multiple site
Customer travels to Theater Bus service
service organization Barbershop Fast-food chain
Service provider Taxi Mail delivery
travels to customer Pest control service AAA emergency repairs
Taxi
Transaction is at Credit card company Broadcast network
arm’s length Local TV station Telephone company
Editor's Notes
Transition effect for split picture, slide 1(Basic)Tip: Use this template with a cropped picture and reveal the rest of the picture on the next slide.To reproduce the picture and text effects on this slide, do the following:On the Home tab, in theSlides group, click Layout, and then click Blank.On the Insert tab, in the Images group, click Picture, select a picture, and then click Insert.Under Picture Tools, on the Format tab, in the bottom right corner of the Size group, click the Size and Position dialog box launcher. In the Size and Position dialog box, on the Size tab, under Crop from, enter a value into the Right box tocrop the picture so that under Size and rotate, the value in the Width box changes to 5”. On the Home tab, in the Drawing group, click Arrange, point to Align, and then do the following:Click Align to Slide.Click Align Right. On the Insert tab, in the Text group, click Text Box, and then on the slide, drag to draw your text box.Enter text in the text box, select the text, and then on the Home tab, in the Font group, select Calibrifrom the Font list, select 24 from the Font Size list, click the arrow next to Font Color, and then under Theme Colors click White, Background 1, Darker 35% (fifth row, first option from the left).On the Home tab, in the Paragraph group, click Center to center the text in the text box.Drag the text box to the left of the picture. Select the text box. On the Home tab, in the Drawing group, click Arrange, point to Align, and then do the following:Click Align to Slide.Click Align Middle. To reproduce the transition and background effects on this slide, do the following:On the Transitions tab, in the Transition to This Slide group, click More, and then under Wipes, click Split Vertical In.Right-click on the slide background area, and then click Format Background. In the Format Background dialog box, click Fill in the left pane, and then select Solid fill in the Fill pane.Click the button next to Color, and then under Theme Colors clickDarkBlue, Text 2, Darker 50% (sixth row, fourth option from the left).
