DEVELOPING SERVICE PRODUCTS : CORE AND SUPPLEMENTARY ELEMENTS

GROUP 3 Deven pai 1221512 Gulshan bhandari 1221513 Jayant jayasenan 1221514 Jyotishman kaushik 1221515 Lentson amos 1221516

A Case study : STARBUCKS

A Globally dominant specialty-coffee brand Success contributed to three core components a) Highest quality coffee in the world b) Customer Service c) Ambiance Core Product : Coffee Supplementary Services : Wireless Broadband, Access to Apple iTunes music store, Movie DvDs , Books, etc ..

Service Product
A service product comprises all of the elements of the service performance, both physical and intangible, that create value for customers The value proposition must address and integrate three components i) Core Product ii) Supplementary Services iii) Delivery process

Core Product
A Core Product is the central component that supplies the principal, problem solving benefits customers seek

Supplementary Services
These services augment the core product, facilitating its use and enhancing its value and appeal to the customers overall experience

Delivery Processes
Concerns the processes used to deliver both, the core product and each of the supplementary services

SERVICE OFFERING FOR AN OVERNIGHT HOTEL STAY

Reservation

Use Phone

Parking

Scheduling Room Service Service Level Core

Nature Of Process

Check in / Check out

Customer Role

Pay TV

Porter

Meal

FACILITATING SUPPLEMENTARY SERVICES

FLOWER OF SERVICE
CORE PRODUCTS

FACILITATING SUPPLEMENTARY SERVICES

ENHANCING SUPPLEMENTARY SERVICES

The supplementary services are classified into one of the eight clusters The eight clusters are shown as petals surrounding the core of a flower which is said to be flower of service The petals are arranged in the clockwise, in the manner they are said to be experienced however the encounter may not follow the same order

CONTD...

FACILITATING SERVICES Information Order-taking Billing Payment

ENHANCING SERVICES consultation Hospitality Safekeeping Exceptions

INFORMATION
To obtain value from any good service, customers need relevant information Customers nowadays are information hungry Customers also require documentation of what has already taken place such as confirmation of receipts, tickets or monthly summary of account activity(eg: SIB) Information must be provided in both timely and accurate manner(eg: redbus) Traditional ways include using front-line employees, printed notices, brochures etc Nowadays it is provided through videos, websites etc Certain business provide opportunities to track their services(eg: EMS speed post)

ORDER-TAKING
It is the first step when the customer is ready to buy It includes applications, order entry, reservations or check-ins(eg: admission process in college, a restaurant table) Accuracy in order-taking is highly essential It can be done through sales personnel, phone, email or online It should be polite, fast and easily understandable It should ensure minimum physical and mental work(eg: m-tickets)

BILLING
Common to all services (unless the service is free) Inaccurate or incomplete bills disappoint customers Procedures vary from verbal statements to machine displayed price(eg: kirana, hotels) Simple approach is self-billing(eg: small hotels) Customers expect bills to be clear and informative Customers hate waiting for bills Recent trends include express check-outs in hotels and rentals Previewing bills on TV monitors

PAYMENT
Bills requires the customer to pay (which is especially slow) Certain services automatically deduct charges (eg: ATM) Methods range from self-service payment to credit cards, pre-paid and electronic payment Some service business have instituted control systems(eg: ticket checks) However the control process must ensure politeness with firmness Say THANK YOU

VOILA

Enhancing supplementary services

1.Consultation
Response to customers questions. Advice to customers. Tutoring or training in product use. Technical consulting.

2. Hospitality

Greetings. Food and beverages. Waiting facilities and amenities waiting rooms, newspapers, magazines etc. Transport. Security

3. Safekeeping. Caring of customers possessions. Parking of vehicles. Baggage handling. Packaging of goods. Transportation and delivery. Installation of purchased goods. Inspection and diagnosis. Repair and renovation.

4. Exceptions.

Special requests. Handling suggestions/complaints/ compliments Problem solving Restitution.

Managerial implications
The flower of service provide many options for enhancing the core product. The elements are categorized as facilitating and enhancing. Any badly handled element may negatively affect customers perception of service quality. The nature of the product helps to determine which supplementary services must be offered and which might be used to enhance the value of the core product.

Branding Strategies for Services

Brand House Using a single brand to cover all products Eg: Virgin group Sub Brands Corporate and the master brand is the primary frame of reference but the product itself also has a distinctive name Eg: Singapore Airlines Raffles class-Companys business class Singapore airlines Suits-Its beyond first class services

Branding Service Products and Experience

Product Differentiation Product Implies a defined consistent bundle of output as well as the ability to differentiate one bundle of output from another Tangible- Eg: Product menu of fast food restaurant Intangible- Eg: Service Offered by Insurance company, Courses of Universities

 Endorsed Brand
The product brand dominates but corporate name is still featured Eg: Hotel Industry in USA House of brands In these each of the brand is actively promoted under their own name Eg: Yum brands Inc- A&W,KFC,Pizza hut, taco bell and long horns silver

Offering several price based classes of service concept, each is based on packaging a distinctive level of service performance across many attributes Eg: Hotels, airlines ,Cable Television, credit cards

Tiering Service products with Branding

BRITISH AIRWAYS SUB BRANDS Four inter continental offerings Deluxe service Club world World traveller plus World traveller

SUN MICRO SYSTEM HARDWARE AND SOFTWARE SUPPPORT

Platinum: Mission: Critical services with onsite services 24/7 Gold : Business critical support with onsite services from Monday to Friday Silver: basic support with onsite services from Monday to Friday Bronze: Self support with phone services 8am to 5 p.m

NEW SERVICE DEVELOPMENT

1. Style Changes 2. Service Improvements 3. Supplementary Service Innovations 4. Process Line Extensions 5. Product Line Extensions 6. Major Process Innovations 7. Major Service Innovations

REENGINEERING SERVICE PROCESSES

Reengineering involves analyzing and redesigning processes to achieve faster and better performance. Identification of each distinct step. Measuring how long each step takes. Finding ways to speed up the process.

Eliminating a futile step.

Running tasks in parallel. Eliminating certain existing supplementary services. Adding new valuable services. Rethinking points of service.

PHYSICAL GOODS AS A SOURCE OF NEW SERVICE IDEAS

Each and every new physical product has the potential to create a need for related possession processing services. Caterpillar example Cat Financial Cat Insurance

Cat Rental Stores

Cat Logistics Equipment Training Solutions Group Maintenance and Support Remanufacturing

USING RESEARCH TO DESIGN NEW SERVICES

The need for research arises for figuring out which features and what price will create the best value for target customers. Marriott Courtyard example External Factors Room Features Food Related Services Lounge Facilities Basic Services

Value Added Services

Leisure Facilities Security

ACHIEVING SUCCESS IN NEW SERVICE DEVELOPMENT

1. Market Synergy 2. Organizational Factors 3. Market Research Factors 4. Internal Marketing 5. Product Synergy 6. Human Resource Strategies 7. People Processing Services

THANK YOU !