2. What is service ?
INTRODUCTION:-
SERVICE IS ANY ACT OR PERFORMANCE THAT
ONE PARTY CAN OFFER TO ANOTHER THAT IS
ESSENTIALLY INTANGIBLE AND DOES NOT
RESULT IN ANY OWNERSHIP
-PHILIP
KOTLER
2

3. In simple terms Services are the deeds, processes and
performances.
Contribution to india’s GDP and labour force by sector
GDP% (2006-2007) labour (2003)
Agriculture 18.5 60
Industry 26.6 12
Service 54.9 28

4. As we begin our discussions of service marketing and
management, it is important to draw distinction between
service industry and company, services as
products, customer service and derived service.
In normal circumstances whenever we talk about service
we talk about consumer services only but services can be
divided into four distinct categories.

5.  Service industry and companies:- includes those
companies and industries typically classified within the
service sector whose core product is service. E.g. Taj
palace hotels, indian airlines, fortis.
 Services as products:- represents a wide range of
intangible product offerings that customers value and pay
for in the market place. E.g. IBM provides information
technology consulting services to market place.

6.  Customer service:- customer service is the service
provided in support of a company’s core product.
 Derived service:- the value derived from the service is
really the service provided by good not the good itself.
For example, pharmaceutical provides medical services, a
razor provides barbering services.

7. Why service marketing
Service marketing is very important now a days, as in most of the economies whether developed, under
developed or developing the service sector is contributing a lot and it is shown by the data below
United states: 78.6 Sweden 70.9
France : 77.2 Australia 70
Netherlands: 73.9 Germany 70
United kingdom: 73.4
Japan: 73.1

8. Characteristic of Service
Intangibility
Inseparability
Heterogeneity
Perishability
Ownership
8

9. 7 P’s OF SERVICE MARKETING
PRICE
PLACE
PRODUCT
PROMOTION
PHYSICAL EVIDENCE
PROCESS
PEOPLE
9

10. People Physical evidence process
Employees Facility design Flow of activities
Recruiting Equipment Standardized
Training Signage Customized
Motivation Employee dress No. of steps
Rewards Other tangibles Simplex
Teamwork Reports Complex
Customers Business cards Customer involvement
Education Statements
training Guarantees

11. Challenges and questions for
service marketers
How can service quality be defined and improved when the product is intangible and
standardized?
How can new services be designed and tested effectively when the service is
essentially an intangible process?
How can the firm be certain it is communicating a consistent and relevant image
when so many elements of the marketing mix communicate to customers and some
of these elements are the service providers themselves?
How does the firm accommodate fluctuating demand when capacity is fixed and the
service itself is perishable?

12. How can the firm best motivate and select service employees who, because
the service is delivered in real time, become a critical part of the product
itself?
How should prices be set when it is difficult to determine actual costs of
production and prices may be inextricably intertwined with perceptions of
quality?
How should the firm be organized so that good strategic and tactical
decisions are made when a decision in any of functional areas of marketing,
operations, and human resources may have significant impact on the other
two areas?

13. How can the balance between standardization and
personalization be determined to maximize both the efficiency
of the organization and the satisfaction of its customers?
How can the organization protect new service concepts from
competitors when services processes cannot be readily
patented?
How does the firm communicate quality and value to
consumers when the offering is intangible and cannot be
readily tried or displayed?

14. How can the organization ensure
the delivery of consistent quality
service when both the
organization’s employees and the
customers themselves can affect
the service outcome?