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MBA (Marketing) Paper 4.


MBA PAPER 4.13 MARKETING OF SERVI ES S!""AB#S UNIT 1 Services: Definition, characteristics, classification Relationship Marketing Services Mission: Meaning Services mission statements Developing a services mission Services Market Segmentation: Meaning Process ases an! p"rpose of market segmentation#


Services positioning an! Differentiation: %vol"tion of positioning Positioning an! services &evels of positioning Process of positioning Importance of positioning#


Services Marketing Mi(: Marketing mi( elements) Service pro!"ct Pricing the service Service location an! channels Promotion an! comm"nication of services People in services Processes Ph*sical evi!ence Developing a marketing mi( strateg*#


Marketing Plans for Services: Marketing planning process Marketing strateg* form"lation Reso"rce allocation an! monitoring Marketing planning an! services#


Service %nco"nter: To"rism an! Travel marketing -otel marketing cons"ltanc* marketing .o"rier services#


Marketing of Services: ank marketing Ins"rance marketing -ospital marketing Telecomm"nication Services %!"cation marketing

Contents #NIT $ I 1. Services Marketing An Introduction 2. Classification of Services 3. Relationship Marketing 4. Services Mission . Services Market Seg!entation #NIT $ II ". #ositioning and $ifferentiation of Services #NIT $ III %. Services Marketing Mi& #NIT $ IV '. Marketing #lans for Services (. Custo!er)focused Services #NIT $ V 1*. +ouris! and +ravel Marketing 11. ,otel Marketing 12. Consultanc- Marketing 13. Courier Services #NIT $ VI 14. .ank Marketing 1 . Insurance Marketing 1". ,ospital Marketing 1%. +eleco!!unication Marketing 1'. /ducation Marketing


"e%%&n 1 Ser'i(e% Marketing $ An Intr&)*(ti&n The service sector has increase! !ramaticall* in importance over the last !eca!e, 0here it no0 acco"nts for nearl* t0o)thir!s of the econom* 1* income an! 2o1s# Dereg"lation of services, gro0ing competition, fl"ct"ations in !eman!, an! the application of ne0 technologies are presenting a consi!era1le challenge to service organi3ations# Services marketing concepts an! strategies have !evelope! in response to the tremen!o"s gro0th of service in!"stries# D"e to their increase! importance, the 0orl! economies have !ra0n increasing attention to the iss"es an! pro1lems of service sector in!"stries# Definition T+e A,eri(an Marketing A%%&(iati&n )e-ine% %er'i(e% a% a(ti'itie%. /ene-it% &r %ati%-a(ti&n% 0+i(+ are &--ere) -&r %a1e an) are pr&'i)e) 0it+ t+e %a1e &- g&&)%. T+i% )e-initi&n i% (&n%i)ere) t& /e t&& /r&a) a% pr&)*(t% a1%& &--er /ene-it% an) %ati%-a(ti&n% t& (*%t&,er%. S& t+ere 0ere atte,pt% t& )i--erentiate p+2%i(a1 pr&)*(t% -r&, %er'i(e% /2 )e-ining (+ara(teri%ti(% 0+i(+ are pre%e4nt in %er'i(e% /*t are n&t -&*n) in (a%e &- p+2%i(a1 pr&)*(t%. K&t1er )e-ine% a %er'i(e a% 3an2 a(t &r per-&r,an(e t+at &ne part2 (an &--er t& an&t+er t+at i% e%%entia112 intangi/1e an) )&e% n&t re%*1t in t+e &0ner%+ip &- an2t+ing. It% pr&)*(ti&n ,a2 &r ,a2 n&t /e tie) t& a p+2%i(a1 pr&)*(t.4 A/rain Pa2ne )e-ine% it a% 3an a(ti'it2 0+i(+ +a% %&,e intangi/i1it2 a%%&(iate) 0it+ it. 0+i(+ in'&1'e% %&,e intera(ti&n 0it+ (*%t&,er% &r 0it+ pr&pert2 0it+ it. 0+i(+ in'&1'e% %&,e intera(ti&n 0it+ (*%t&,er% &r 0it+ pr&pert2 in t+eir p&%%e%%i&n. an) )&e% n&t re%*1t in a tran%-er &- &0ner%+ip. A (+ange in (&n)iti&n ,a2 &((*r an) pr&)*(ti&n &- t+e %er'i(e ,a2 &r ,a2 n&t /e (1&%e12 a%%&(iate) 0it+ a p+2%i(a1 pr&)*(t.4 5 more m"n!ane !efinition in the In!ian conte(t is provi!e! 1* section $6r7 of the Monopolies an! Restrictive Tra!e Practices 5ct, 18/8# Un!er the sai! stat"te a 9service means service 0hich is ma!e availa1le to potential "sers an! incl"!es the provision of facilities in connection 0ith 1anking, financing, ins"rance, chit f"n!, real estate, transport, processing, s"ppl* of electrical or other energ*, 1oar! or lo!ging or 1oth, entertainment, am"sement or the p"rve*ing of ne0s or other information4# Stanton !efines services an! i!entifies factors 0hich !isting"ish pro!"cts from services 0hich are accepte! 1* most of he commentators# 5ccor!ing to Stanton, 9services are those separatel* i!entifia1le, essentiall* activities that provi!e 0ant)satisfaction, an! that are not necessaril* ties to the sale of a pro!"ct or another service# To pro!"ce a service ma* or ma* not re:"ire the "se of tangi1le goo!s# -o0ever, 0hen s"ch "se in re:"ire!, there is no transfer of the title 6Permanent o0nership7 to these tangi1le goo!s4# Stanton emphasi3es fo"r characteristics 0hich !isting"ish services from pro!"ct# The* are, intangi1ilit*, insepara1ilit*, heterogeneit* an! perisha1ilit* an! fl"ct"ating !eman!# ;otler also emphasi3es intangi1ilit*, insepara1ilit*, varia1ilit* an! perisha1ilit*# 5 service is an activit* 0hich has some elements of intangi1ilit* associate! 0ith it, 0hich involves some interaction 0ith c"stomers or 0ith propert* in their possession, an! !oes not res"lt in a transfer of o0nership# 5 change in con!ition ma* occ"r an! pro!"ction of the service ma* or ma* not 1e closel* associate! 0ith a ph*sical pro!"ct# P"t in the simple terms, <services are !ee!s, processes an! performances=# The core offerings of hospitals, hotels, 1anks an! "tilities comprise primar* !ee!s an! actions performe! for c"stomers# Services are pro!"ce! not onl* 1* service 1"siness s"ch as those 2"st !escri1e! 1"t are also integral to the offerings of man* man"fact"re! goo!s proce!"res# >or e(ample, care man"fact"rers offer 0arranties an! repair services for their cars? .omp"ter man"fact"rers offers 0arranties, maintenance contracts an! training# all of these services are e(amples of !ee!s, processes an! performances#

Characteristics of services Stanton points o"t that the special nat"re of services stems form several !istinctive characteristics an! he singles o"r fo"r for partic"lar comment# The* are: 1# Intangi1ilit*, $# Insepara1ilit*,

'# -eterogeneit* 6;otler terms this as varia1ilit*7, an! +# Perisha1ilit* an! fl"ct"ating !eman!# These fo"r have 1een i!entifie! 1* ;otler also as the ma2or characteristics greatl* affecting the !esign of marketing programmes for services# Intangibility Services are essentiall* intangi1le# eca"se services are performances or actions rather than o12ects, the* cannot 1e seen, felt, teste!, or to"che! in the same manner that 0e can sense tangi1le goo!s# >or e(ample, health)care services are actions 6e#g# s"rger*, !iagnosis, e(amination, treatment7 performe! 1* provi!ers an! !irecte! to0ar! patients an! their families# These services cannot act"all* 1e seen or to"che! 1* the patient, altho"gh the patient ma* 1e a1le to see an! to"ch certain tangi1le components of the service 6e#g# e:"ipment, hospital room7# In fact, man* services s"ch as health care are !iffic"lt for the cons"mer to grasp even mentall*# %ven after a !iagnosis or s"rger* has 1een complete! the patient ma* not f"ll* comprehen! the service performe!# Marketing i,p1i(ati&n% Intangi1ilit* presents several marketing challenges: Services cannot 1e inventorie!, an! therefore fl"ct"ations in !eman! are often !iffic"lt to manage# >or e(ample, there is tremen!o"s !eman! for resort accommo!ations in Simla @ Aot* in Ma*, 1"t little !eman! in Decem1er# Bet resort o0ners have the same n"m1er of rooks to sell *ear)ro"n!# Services cannot 1e patente! legall*, an! ne0 service concepts can therefore easil* 1e copie! 1* competitors# Services cannot 1e rea!il* !ispla*e! or easil* comm"nicate! to c"stomers, so :"alit* ma* 1e !iffic"lt for cons"mers to assess# Decisions a1o"t 0hat to incl"!e in a!vertising an! other promotional materials are challenges, as is pricing# The act"al cost of a 9"nit of service4 are ha! to !etermine an! the price@ :"alit* relationship is comple(# Inseparability Services are create! an! cons"me! sim"ltaneo"sl* an! generall* the* cannot 1e separate! from the provi!er of the service# Th"s the service provi!er c"stomer interaction is a special feat"re of services marketing# Unlike the tangi1le goo!s, services cannot 1e !istri1"te! "sing conventional channels# Insepara1ilit* makes !irect sales as the onl* possi1le channel of !istri1"tion an! this !elimits the markets for the seller=s services# This characteristic also limits that scale of operation of the service provi!er# >or e(ample, a !octor can give treatment to limite! n"m1er of patients onl* in a !a*# This characteristic also emphasi3es the importance of the :"alit* of provi!er client interaction in services# This poses another management challenge to the service markets# Chile a cons"mer=s satisfaction !epen!s on the f"nctional aspects in the p"rchase of goo!s, in the case of services the a1ove mentione! interaction pla*s an important role in !etermining the :"alit* of services an! c"stomer satisfaction# >or e(ample, an airline compan* ma* provi!e e(cellent flight service, 1"t a !isco"rteo"s on1oar! staff ma* keep off the c"stomer permanentl* from that compan*# There are e(emptions also to the insepara1ilit* characteristic# 5 television coverage, travel agenc* or stock 1roker ma* represent an! help marketing the service provi!e! 1* another service firm# Marketing i,p1i(ati&n% eca"se services often are pro!"ce! an! cons"me! at the same time, mass pro!"ction is !iffic"lt if not impossi1le# The :"alit* of service an! c"stomer satisfaction 0ill 1e highl* !epen!ent on 0hat happens in 9real time4, incl"!ing actions of emplo*ees an! the interactions 1et0een emplo*ees an! c"stomers# Heterogeneity This characteristic is referre! to as varia1ilit* 1* ;otler# Ce have alrea!* seen that services cannot 1e stan!ar!i3e!# The* are highl* varia1le !epen!ing "pon the provi!er an! the time an! place 0here the* are provi!e!# 5 service provi!e! on a partic"lar occasion is some0hat !ifferent from the same service provi!e! on other occasions# 5lso the stan!ar! of :"alit* perceive! 1* !ifferent cons"mers ma* !iffer accor!ing to the or!er of preference given 1* them to the vario"s attri1"te of service :"alit*# >or e(ample, the treatments given 1* hospital to !ifferent persons on !ifferent occasion cannot 1e of the same :"alit*# .ons"mers of services are a0are of this varia1ilit* an! 1* their interaction 0ith other cons"mers the* also get infl"ence! or infl"ence others in the selection of service provi!er# Marketing i,p1i(ati&n%

eca"se services are heterogeneo"s across time, organi3ations, an! people, ens"ring consistent service :"alit* is challenging# D"alit* act"all* !epen!s on man* factors that cannot 1e f"ll* controlle! 1* the service s"pplier, s"ch as the a1ilit* of the cons"mer to artic"late his or her nee!s, the a1ilit* an! 0illingness of personnel to satisf* those nee!s, the presence 6or a1sence7 of other c"stomers, an! the level of !eman! fo he service# Peri%+ a/i1it2 an) F1*(t*ating 5e,an) Perish a1ilit* refers to the fact that services cannot 1e save!, store!, resol! or ret"rne!# 5 seat on an airplane or in a resta"rant, an ho"r of a la0*er=s time, or telephone line capacit* not "se! cannot 1e reclaime! an! "se! or resol! at a later time# This is in contrast to goo!s that can 1e store! in inventor* or resol! another !a*, or even ret"rne! if the cons"mer is "nhapp*# Marketing i,p1i(ati&n% 5 primar* iss"e that marketers face in relation to service perish a1ilit* is the ina1ilit* to inventor*# Deman! forecasting an! creative planning for capacit* "tili3ation are therefore important an! challenging !ecision areas# The fact that services cannot t*picall* 1e ret"rne! or resol! also implies a nee! for strong recover* strategies 0hen things !o go 0rong# >or e(ample, 0hile a 1a! hairc"t cannot 1e ret"rne!, the hair!resser can an! sho"l! have strategies for recovering the c"stomer=s goo! 0ill if an! 0hen s"ch a pro1lem occ"rs# Services Marketing Management There are a n"m1er of areas of marketing management 0hich !o have special significance for services marketing# It is 0orth commenting on some of those aspects, as the* are important to !eveloping an a0areness of pro1lem an! ke* iss"es in services marketing# Pr&)*(ti'it2 an) 6*a1it2 In striving to gain an! maintain competitive a!vantage, 1oth pro!"ctivit* an! :"alit* are of ke* importance# -o0ever, the nat"re of services implies that it is !iffic"lt to avoi! a tra!e)off sit"ation, 0hen improvements in service pro!"ctivit* can lea! to sacrifices in the level of :"alit*# This is most sensitive in services marketing 0here people are the service !elivers# If a 1ank cashier or travel agent nee!s to process c"stomers more :"ickl* to improve pro!"ctivit*, ho0 can organisatoins ens"re that there is not res"lting !rop in :"alit*E Service :"alit* is meas"re! on t0o levels: Technical quality the overall efficienc* 0ith 0hich a 1ank han!les its c"stomer acco"nts in terms of prompt statements, rates of interest offere! an! so on# Functional quality the 0a* the service is act"all* !elivere!? this incl"!es personal co"rtes*, the service environment in terms of comfort an! !Fcor, the c"stomer=s o0n role#

The importance 0hich is attache! to f"nctional an! technical :"alit* !epen!s on the t*pe of service, an! the 1enefit so"ght 1* the cons"mer# Service Marketing Triangle 5 "sef"l 0a* to concept"ali3e the :"estions the !ecisions that nee! to the ma!e is presente! in the services marketing triangle sho0n in >ig"re 1# The traina1le s"ggests that there are three t*pes of marketing that m"st 1e s"ccessf"ll* carrie! o"t for a service organi3ation to s"ccee!, an! that all of them revolve aro"n! making an! keeping promises to c"stomers# .ompan* 6Management7 Internal Marketing 9ena1ling the promise4 %(ternal Marketing 9setting the promise4

An the right si!e of the triangle are the e(ternal marketing efforts that the firm engages in to set "p its c"stomers= e(pectations an! make promisesE,p1&2ee% to c"stomers regar!ing 0hat is to*%t&,er% 1e !elivere!# 5n*thing that comm"nicates to the c"stomer 1efore service !eliver* can 1e vie0e! as part of this e(ternal marketing f"nction# In service firms there are Interactive Marketing !elivering the promise4

man* factors that comm"nicate toe c"stomers 1e*on! tra!itional elements of a!vertising, special promotions, sales, an! p"1lic relations, for e(ample, the firm=s personnel an! the ph*sical facilities themselves# An the 1ottom of the triangle is 0hat has 1een terme! interactive marketing, or 0hat some refer to as real)time marketing# -ere the act"al service !eliver* takes place)the firm=s emplo*ees interact !irectl* 0ith c"stomers# It is at this point that the promise is !elivere! 6 or nor !elivere!7# -aving a positive link 1et0een 0hat is promise! thro"gh the e(ternal marketing in the 0orl! is "seless if promise cannot 1e kept# The left si!e of the triangle s"ggests the critical role pla*e! 1* internal marketing, 0hich ena1les emplo*ees to keep the promises that have 1een ma!e to c"stomers# Internal marketing refers to the activities the firm m"st carr* o"t to train, motivate, an! re0ar! its emplo*ees# "nless service emplo*ees are a1le an! 0illing to !eliver on the promises ma!e, the firm 0ill not 1e s"ccessf"l in keeping its promises an! the services marketing triangle 0ill collapse# Internal marketing hinges on the ass"mption that emplo*ee satisfaction an! c"stomer satisfaction are ine(trica1l* linke!# Chat the triangle implies is that all three si!es are critical to s"ccessf"l services marketing an! management, that 0itho"t one of the si!es in place the triangle, or the total marketing effort, cannot 1e s"pporte!# %ach si!e represents significant challenges for most service 1"siness, an! as 0e procee! thro"gh the te(t 0e 0ill fin! approaches an! strategies for !ealing 0ith all three#

"e%%&n 7 1a%%i-i(ati&n &- Ser'i(e% The "n!erl*ing o12ective in an* service classification scheme is to get a !eeper "n!erstan!ing of the service pro!"ct# Despite the !iversit* in the range of service pro!"cts it is possi1le to classif* an! e(plore them on the 1asis of certain factors# There have 1een more than si(teen st"!ies regar!ing the classification schemes# Nat"rall*, some are 0orth0hile in !eveloping marketing strategies, 0hile others s"ffer shortcomings# .hristopher &ovelock i!entifies certain iss"es as important in the classification of services# -e points o"t that Service in!"stries contin"e to 1e !ominate! 1* operations orientation, 0ith the service managers insisting that their tasks an! challenges in their in!"str* is "ni:"e an! have nothing in common 0ith those from other service in!"stries? 5 managerial min! set evi!ent in man* service sectors arg"es that the marketing of a service in!"str* has nothing in common 0ith the marketing of another service in!"str*# >or e(ample, the marketing of an airlines service has nothing in common 0ith marketing of a 1anking service or a financial service? .lassification schemes sho"l! offer strategic marketing insights so as to have managerial val"e# 5n* other simple classification 0o"l! 1e ins"fficient#

Pa*ne i!entifies a 0i!e range of factors 0hich are "se! in vario"s classification schemes# The* are T*pe of service, T*pe of seller, T*pe of p"rchaser, Deman! characteristics, Rente! vers"s o0ne! services, Degree of intangi1ilit*, "*ing motives, %:"ipment 1ase! vers"s people 1ase!, 5mo"nt of c"stomer contact, Service !eliver* re:"irements, Degree of c"stomi3ation an! Degree of la1o"r intensit*

5 simple form of classification is to list o"t the service in!"stries, like transportation, 1anking, health care, e!"cation etc# o1vio"sl*, s"ch listing are not helpf"l to i!entif* the feat"res relevant to the marketing of services# Recent researchers have so"ght to classif* the services in a more meaningf"l manner that give insight into the strategic !imensions of services marketing# Hario"s classification schemes, cl"11ing vario"s gro"ps of services that share marketing commonalities, are relie! "pon 1* goo! marketers to gain strategic marketing insights# The "n!erl*ing aim for s"ch classification scheme is to gain a !eeper "n!erstan!ing of the service pro!"ct# Service pro!"cts are also ver* !iverse# The* incl"!e services like entertainment, health services, e!"cation, legal services, management cons"ltanc*, acco"nting, travel etc# inspite of s"ch !iversities, the services can 1e classifie! an! on the 1asis of some criteria the* can 1e e(plore! to provi!e a !eeper insight into the nat"re of service#

Kotler and Station 5ccor!ing to ;otler, service ma* 1e e:"ipment 1ase!# The service ma* meet a personal nee! or a 1"siness nee!, accor!ing to the !ifference in their o12ectives an! the o0nership# The o12ectives ma* either 1e for profit on nonprofit an! the o0nership ma* 1e private or p"1lic# Stanton also lists a classification of services as follo0s: 1# -o"sing, $# -o"sehol! operations like "tilities, ho"se repairs, repairs or e:"ipments in the ho"se etc#, '# Recreation, +# Personal care like la"n!r*, 1ea"t* care etc#, ,# Me!ical an! other health care, /# Private e!"cation, G# "siness an! other professional services,

I# Ins"rance an! financial, 8# Transportation an! 1J# .omm"nication Lovelocks Classification Schemes A1vio"sl* the classification schemes propose! 1* ;otler an! Stanton appear to 1e simple# To "n!erstan! the nat"re of service 1"sinesses an! the e(tent of common characteristics share! 1* !ifferent services 1"sinesses, &ovelock=s classification s*stems provi!es a helpf"l frame0ork# The marketing insights o1taina1le from &ovelock=s classification schemes, mentione! 1elo0, are 0orth !isc"ssing# Nat*re &- t+e %er'i(e a(t In this scheme, the nat"re of the service act, i#e# intangi1ilit* etc# an! the recipients of the services are consi!ere!# It has 0i!e !imensions an! consi!ers ho0 the c"stomer presence, ph*sicall* or mentall*, is re:"ire! !"ring the services !eliver* an! the 1enefits gaine! 1* the c"stomer# It also consi!ers ho0 the c"stomers changes on receipt of the service# It lea!s to the consi!eration of location an! sche!"ling convenience for the presence of the c"stomer to "tili3e the service# It also provi!es marketing insights as to the restr"ct"ring of the service activit* to stan!ar!i3e it in a 0a* provi!ing convenience to the c"stomer in terms of service !eliver* an! to the service provi!er# Re1ati&n%+ip 0it+ (*%t&,er This classification matri( contrasts the nat"re of service !eliver* an! ascertains 0hether there is a formal relationship 1et0een the c"stomer an! service marketer# 5s kno0le!ge of c"stomers i!entities an! a!!resses is graine! to meet o"t specific offers to specific c"stomers 1* targete! !irect marketing, market segmentation seems to 1ecome easier an! the c"stomer=s lo*alt* is e(pecte! to 1e stronger# >"rther, this scheme provi!es insights into tra!e off 1et0een pricing an! "sage rates# In the a1sence of personal relationship, services ma* 1e provi!e! 1* contin"o"s !eliver* or 1* !iscrete transactions# In !iscrete transaction 0here the c"stomer pa*s for each specific service 1eing provi!e!, the c"stomers are often anon*mo"s an! there 0ill 1e a lack of information a1o"t them an! so the market opport"nit* is restricte!# Chere no formal relationship e(ists the important iss"es for marketers 0o"l! 1e esta1lishe! some form of more en!"ring relationship# *%t&,i8ati&n an) 9*)ge,ent in %er'i(e )e1i'er2 In this classification, the !egree of c"stomi3ation of service characteristics is contraste! 0ith the !egree of 2"!gement re:"ire! 1* c"stomer contact staff# 5 !ecision regar!ing the e(tent to 0hich the service offer sho"l! 1e c"stomi3e! is ver* important to the service marketers# The* have to 1alance the cost of c"stom ma!e service 0ith a stan!ar! service an! so the service marketers often seek to limit the n"m1er of options 0hile !eci!ing the e(tent of

c"stomi3ation# In professional service firms, c"stomer contact staff ma* e(ercise a high !egree of 2"!gement or ma* e(ercise)relativel* little 2"!gement esta1lishing a series of ro"tines an! proce!"res# Nat*re &- )e,an) an) %*pp12 -&r %er'i(e% This classification contrasts the nat"re of !eman! fl"ct"ation over time an! the e(tent to 0hich the s"ppl* is constraine!# Since services cannot 1e pro!"ct for strong, the 1"siness ma* 1e lost to another service provi!er if the !eman! e(cee!s the s"ppl* of an* partic"lar service# This classification is "sef"l to contrast !ifferent s"ppl* !eman! sit"ations 0hich affects all service marketers# It emphasi3es in esta1lishing !eman! patterns overtime, an! to "n!erstan! their e(istence# Then !evelopment of strategies are consi!ere! to help change patterns of !eman! so as to make them more favo"ra1le to the service provi!er# Met+&) &- %er'i(e )e1i'er2 The fifth classification foc"ses attention on e(amination of the availa1ilit* of service o"tlets, ranging from single to m"ltiple site, an! the nat"re of the interaction 1et0een the c"stomer an! the service provi!er# Distri1"tion iss"es realtiong to the metho! of !eliver* are foc"se! "pon# ."stomer convenience is the important consi!eration !eliver *are foc"se! "pon# ."stomer convenience is the import consi!eration here# These classification s*stems of &ovelock provi!e frame 0ork for service marketers to consi!er 1oth the nat"re of their 1"siness an! to 0hat e(tent the* share common characteristics 0ith other seemingl* "nrelate! service 1"siness# Ot+er (1a%%i-i(ati&n% %:"ipment 1ase! an! la1o"r 1ase!: .lassification of services, accor!ing to Thomas, can 1e on the t*pe of e:"ipment or people ren!ering the service# In e:"ipment 1ase! services, the e:"ipments or the machines 1eing "tili3e! for service position are important 0hile people pla* a secon!ar* role# Some of the e(amples are a"tomatic ven!ing machines, a"tomatic car 0ashes an! movies# In s"ch services, the e:"ipments ma* 1e operate! a"tomaticall* or 1* "nskille! or skille! la1o"r# In la1o"r 1ase! services, the h"man element is primar* in the pro!"ction an! !eliver* of services# The e:"ipments or machines, if an*, are secon!ar*# This t*pe of services incl"!e co"nselling, legal a!visor* service, catering an! hair !ressing service# There are services in 0hich 1oth he e:"ipments an! la1o"r have e:"al importance as in the case of hospital# &n'enien(e S+&pping Spe(ia1t2 Ser'i(e% 5ccor!ing to Nickles services can also 1e classifie! as 1eing convenience shopping an! specialt* services# %vi!entl*, the 1"*er 1ehavio"r 0ill 1e !ifferent re:"iring special marketing strategies# .onvenience services are those 0hich the c"stomer "s"all* p"rchases fre:"entl*, imme!iatel* an! 0ith the minim"m of efforts# Dr* cleaning services, an! shoe repairing services are e(amples of convenience services# .onvenience of availa1ilit* 0ith minim"m efforts !etermines the 1"*ing !ecisions# The "ser is not prepare! to go to an* efforts to sec"re a s"ppl* an! 0ill accept a s"1stit"te often compromising on price an! :"alit*# So the marketer m"st sec"re a 0i!est possi1le availa1ilit* if he is to ma(imi3e sales# In contrast to the convenience services, shopping services are p"rchase! after comparing :"alit* an! price# 5s information regar!ing the service pro!"ct is important for c"stomer comparisons, a marketing strateg* has to 1e evolve! provi!ing eno"gh information to the c"stomer# Cor! of month is also an important factor in the selection of shopping services# Shopping service incl"!e 1anks, ins"rance companies, ph*sicians an! 1ea"ticians# In the case of specialt* service the c"stomer p"ts in special p"rchasing efforts# The c"stomers 0ill 1e rea!* to travel !istances an! pa* a premi"m for the services# Specialt* services incl"!e me!ical specialists an! legal a!visors# 5s the c"stomer is 0illing to take special p"rchasing efforts the marketing strateg* 0ill 1e foc"se! on service pro!"ct an! 1"il!ing c"stomer satisfaction# 5ccor!ing to -ill the services ma* 1e classifie! as follo0s: 5ffecting person 6eg# -ealth7 or affecting goo!s 6eg# .argo maintenance7, 5ccor!ing to the permanent or temporar* efforts, 5ccor!ing to the reversi1ilit* or irreversi1ilit* of those effects, Ph*sical effects or mental effects an! In!ivi!"al or collective services# "e%%&n 3


Re1ati&n%+ip Marketing The term <relationship marketing= 0as intro!"ce! !"ring the 18IJ=s an! is a relativel* ne0 an! evolving concept# Relationship marketing 6or relationship management7 is a philosoph* of !oing 1"siness, a strategic orientation, that foc"ses on keeping and improving current customers, rather than on ac:"iring ne0 c"stomers# This philosoph* ass"mes that cons"mers prefer to have an ongoing relationship 0ith one organi3ation that to s0itch contin"all* among provi!ers in their search for val"e# 1"il!ing on this ass"mption an! the fact that it is "s"all* m"ch cheaper to keep a c"rrent c"stomer than to attract a ne0 one, s"ccessf"l marketers are 0orking on effective strategies for retaining c"stomers# 5ccor!ing to &eonar! err*: 9Relationship marketing is the attraction, maintaining an! K# in m"lti service organisatoin KK enhancing c"stomer relationships# The marketing min!set is that the attraction of ne0 c"stomer is merel* the first step in marketing process4# This vie0 has three complementar* perspectives: The nat"re of the 0a* the companies vie0s their relationships 0ith c"stomers is changing# emphasis is moving from a transaction foc"s to a relationship foc"s 0ith the aim of long)term c"stomer retention# 5 1roa!er vie0 is emerging of the markets 0ith 0hich the compan* interacts# In a!!ition to c"stomer markets the organi3ation also 1ecomes concerne! 0ith the !evelopment an! enhancement of more en!"ring relationships 0ith other e(ternal markets incl"!ing s"ppliers, recr"itment, referral an! infl"ence, as 0ell as internal markets# 5 recognition that :"alit*, c"stomer service an! marketing activities nee! to 1e 1ro"ght together# 5 relationship marketing orientation foc"ses on 1ringing the three elements into closer alignment an! ens"ring their com1ine! s*nergistic potential is release!#

C stomer Markets ."stomers m"st, of co"rse, remain the prime foc"s area for marketing activit*# "t the foc"s nee! to 1e less on <transactional marketing= an! more on the 1"il!ing of long)term client relationship# These t0o approaches can 1e contraste! as follo0s: Chilst a relationship foc"s has 1een f"ll* a!opte! 1* some service 1"sinesses, it is noticea1l* a1sent in others# Unfort"natel*, man* companies take the transactional ro"te# The investment ma!e in 0inning a ne0 c"stomer, once s"ccessf"l, is imme!iatel* transferre! to the ne(t prospect# &ittle effort goes into keeping that c"stomer# Tran%a(ti&n Marketing 1# $# '# +# ,# /# G# Re1ati&n%+ip Marketing

>oc"s on the single sale 1# >oc"s on c"stomer retention Arientation on pro!"ct feat"res $# Arientation on pro!"ct 1enefits Short timescale '# &ong timescale &ittle emphasis on c"stomer service +# -igh c"stomer service emphasis &imite! c"stomer commitment ,# -igh c"stomer commitment Mo!erate c"stomer contact /# -igh c"stomer contact D"alit* is primaril* a concern of G# D"alit* is the concern of all pro!"ction >irms are no0 starting to recogni3e that e(isting c"stomers are easier to sell to an! are fre:"entl* more profita1le# -o0ever, 0hilst manages intellect"all* conc"r 0ith this vie0, m"ch greater emphasis an! reso"rces are often !evote! to attracting ne0 c"stomers, an! e(isting c"stomers are taken for grante!# It is onl* 0hen some 1reak!o0n in service :"alit* occ"rs, an! the c"stomer levels or is on the point of !efection, that the e(isting c"stomer 1ecomes important# LLL 5!vocate LLL

LLL S"pporter LLL

%mphasis on !eveloping an! enhancing





relationships 6c"stomer keeping7

%mphasis on ne0 c"stomers 6c"stomer catching7

LLL ."stomer LLL

LLL Prospect LLL Fig. 3.1 T+e re1ati&n%+ip ,arketing 1a))er &- (*%t&,er 1&2a1t2 This is not to sa* that ne0 c"stomers or clients are not important in!ee! the* are vital to the f"t"re most services 1"sinesses# Rather, a 1alance is nee!e! 1et0een the effort !irecte! to0ar! e(isting an! ne0 c"stomers# The follo0ing fig"re sho0s the relationship marketing la!!er of c"stomer lo*alt* 0hich emphasi3es this point# It is apparent that ma* organi3ations p"t their main emphasis on the lo0er r"ngs of i!entif*ing prospects an! attempting to t"rn them into c"stomers rather than on the higher <relationship) an! "ltimatel* more re0ar!ing r"ngs of t"rning c"stomers into reg"lar clients an! s"1se:"entl* into strong s"pporters an! event"all* active a!vocates for the compan* an! its pro!"cts# "t moving c"stomers "p the lo*alt* la!!er is not simple# Argani3ations nee! to kno0 e(plicitl* an! in !epth e(actl* 0hat each c"stomer is 1"*ing an! ever* c"stomer is !ifferent an! ho0 it can contin"e to offer a!!itional satisfactions that 0ill !ifferentiate its offering# %ssentiall*, the onl* 0a* to change someone from c"stomer to a!vocate is to replace c"stomer satisfaction 0ith c"stomer !elight 1* offering service :"alit* that e(cee!s e(pectations# G&a1% &- re1ati&n%+ip ,arketing The goal of c"stomer enhancement s"ggests that lo*al c"stomers can 1e even 1etter c"stomers if the* 1"* more pro!"cts an! services form the compan* over time# &o*al c"stomers non onl* provi!e a soli! 1ase for the organi3ation, the* ma* represent gro0th potential# Bene-it% &- (*%t&,er retenti&n oth parties in the c"stomer@ firm relationship can 1enefit form c"stomers retention# That is, it is onl* in the 1est interest of the organisation to 1"il! an! maintain a lo*al c"stomer 1ase, 1"t customers themselves also 1enefit form long)term associations# Bene-it% -&r (*%t&,er% 5ss"ming the* have a choice, c"stomers 0ill remain lo*al to a firm 0hen the* receive greater value relative to 0hat the* e(pect from competing firms# Remem1er that perceive! val"e is the c"stomer=s overall assessment of the "tilit* of a pro!"ct 1ase! on perceptions of 0hat is receive! an! 0hat is given# Hal"e represents a tra!e)off for the cons"mer 1et0een the 9give4 an! the 4get4 components# .ons"mers are more likel* to sta* in a relationship 0hen the gets 6:"alit*, satisfaction, specific 1enefits7 e(cee! the gives 6monetar* an! non)monetar* costs7# Chen firms can consistentl* !eliver val"e from the c"stomer=s point of vie0, clearl* the c"stomer 1enefits an! has an incentive to sta* in the relationship# In a!!ition to the specific inherent 1enefits of receiving service val"e, c"stomers also 1enefit from long)term relationships 1eca"se s"ch association contri1"te to a sense of 0ell)1eing an! :"alit* of life# "il!ing a long)term relationship 0ith a service provi!er can re!"ce cons"mer stress as initial pro1lems, if an*, are solve!? special nee!s are accommo!ate!= an! the cons"mer learns 0hat to e(pect# This is partic"larl* tr"e for comple( services 6e#g# legal, me!ical, e!"cation7, for services 0here there is high ego involvement 6e#g# hair st*ling, health cl"1, 0eight)loss program7, an! for services that re:"ire large investments 6e#g# 1anking, ins"rance7# 5fter a time the cons"mer 1egins to tr"st the provi!er an! to co"nt on a consistent level of :"alit* service# -"man nat"re is s"ch that most of the people 0o"l! prefer not to change service provi!ers, partic"larl* 0hen the* have a consi!era1le investment in the relationship# If the service provi!er kno0s he cons"mers, kno0s their preferences, an! has tailore! services to s"it their nee!s over time, then changing provi!ers 0o"l! mean e!"cating a ne0 provi!er on all of these factors# Most cons"mers 60hether in!ivi!"als or 1"siness7 have ma* competing !eman!s for their time an! mone* an! are contin"all* searching for 0a*s to 1alance an! simplif* !ecision)making to improve the :"alit* of their lives# Chen the* can maintain a relationship 0ith a service provi!er, the* free "p time for other concerns an! priorities#


In some long)term c"stomer@ firm relationships a service provi!er ma* act"all* 1ecome part of the cons"mer=s social s"pport s*stem# >or e(ample, hair!ressers often serve as personal confi!ents# &ess common e(amples incl"!e proprietors of local retail stores 0ho 1ecome central fig"res in neigh1orhoo! net0orks? the resta"rant manager 0ho kno0s his c"stomers personall*? the private school principal 0ho kno0s an entire famil* an! its special nee!s# These t*pes of personal relationships can !evelop for 1"siness)to)1"siness c"stomers as 0ell as for en!)cons"mers of services# The social s"pport 1enefits res"lting from these relationships are important to the cons"mer=s :"alit* of life 6personal an!@ or 0ork life7 a1ove an! 1e*on! the technical 1enefits of the service provi!e!# Bene-it% &- t+e &rgani8ati&n% Increasing purchases: 5s cons"mers get to kno0 a firm an! are satisfie! 0ith the :"alit* of its services relative to that of its competitors, the* 0ill ten! to give more of their 1"siness to the firm# 5n! as c"stomers mat"re 6in terms of age, life c*cle, gro0th of 1"siness7, the* fre:"entl* re:"ire more of a partic"lar service# Lower costs: There are man* start)"p costs associate! 0ith attracting ne0 c"stomers# The* incl"!e a!vertising an! other promotion costs, operating costs of setting "p acco"nts an! s*stems, an! the time costs of getting to kno0 the c"stomer# Sometimes these initial costs an! o"t0eigh the reven"e e(pecte! from the ne0 c"stomer in the short term# 5 prime e(ample occ"rs in the ins"rance in!"str*# Free advertising through word of mouth: Chen a pro!"ct is comple( an! !iffic"lt to eval"ate, an! there is risk involve! in the !ecision to 1"* it as is the case 0ith man* services cons"mers most often look to others for a!vice on 0hich provi!ers to consi!er# Satisfie!, lo*al c"stomers are likel* to provi!e a firm 0ith strong 0or!)of)mo"th en!orsements# This form of a!vertising can 1e more effective than an* pai! a!vertising the firm might "se, an! has the a!!e! 1enefit of re!"cing the costs of attracting ne0 c"stomers# Employee retention: an in!irect 1enefit of c"stomer retention is emplo*ee retention# It is easier for a firm to retain emplo*ees 0hen it has a sta1le 1ase of satisfie! c"stomers# People like to 0ork for companies 0hose c"stomers are happ* an! lo*al# Their 2o1s are more satisf*ing an! the* are a1le to spen! more of their time fostering relationships than scram1ling for ne0 c"stomers# In t"rn, c"stomers are more satisfie! an! 1ecome even 1etter c"stomer# eca"se emplo*ees sa* 0ith a firm longer, service :"alit* improves an! costs of t"rnover are re!"ce!, a!!ing f"rther to profit# Lifetime value of a customer: 9If companies kne0 ho0 m"ch it reall* costs to lose a c"stomer, the* 0o"l! 1e a1le toe make acc"rate eval"ations of investments !esigne! to retain c"stomers# Ane 0a* of !oc"menting the monetar* val"e of lo*al c"stomers is to estimate the increase! val"e of profits that accr"e for each a!!itional c"stomer 0ho remain lo*al to the compan* rather than !efecting to the competition# 5 some0hat less comple( approach to "n!erstan!ing the life)time val"e of a c"stomer is simpl* to m"ltipl* o"t the c"stomer=s average mone* val"e p"rchases over the average lifetime of the c"stomer in a partic"lar in!"str*# The n"m1ers can soon 1ecome ver* large# These relativel* simpl* calc"lations can 1e "se! to assess at least preliminaril* the lifetime val"e of c"stomers in a variet* of in!"stries# 5 more comple( calc"lation 0o"l! attempt to estimate the mone* val"e of all the 1enefits associate! 0ith a lo*al c"stomer, not 2"st the long)term reven"e stream# The val"e of 0or!)of)mo"th a!vertising, emplo*ee retention, an! !eclining acco"nt maintenance costs 0o"l! also enter into the calc"lation# Miven the man* 1enefits of ling)term c"stomer relationships, it 0o"l! seem that a compan* 0o"l! not 0ant to ref"se or terminate a relationship 0ith an* c"stomer# "t all relationships ma* not 1e 1eneficial, an! that ever* c"stomer is not right all of the time# 5 compan* cannot target its services to all c"stomers, some segments 0ill 1e more appropriate than others# It 0o"l! not 1e 1eneficial to either the compan* or the c"stomer for a compan* to esta1lish a relationship 0ith a c"stomer 0hose nee!s the compan* cannot meet# Similarl*, it 0o"l! not 1e 0ise to forge relationships sim"ltaneo"sl* 0ith incompati1le market segments# In man* service 1"siness 6e#g# hotels, to"r package operators, entertainment, e!"cation7, c"stomers e(perience the service together an! can infl"ence each other=s perceptions a1o"t val"e receive!# Th"s, to ma(imi3e service to core segments an organi3ation ma* choose to t"rn a0a* marginall* profita1le segments that 0o"l! 1e incompati1le# In the a1sence of ethical or legal man!ates, organi3ations 0ill prefer not to have long)term relationships 0ith "nprofita1le c"stomers# Some segments 0ill not 1e profita1le for the compan* even if their nee!s can 1e met 1* services offere!# This ma* 1e the case 0hen there are not eno"gh c"stomers in the segment to make it profita1le to


!evelop a marketing approach, 0hen the segment cannot affor! to pa* the cost of the service, or 0hen the pro2ecte! reven"e flo0s form the segment that 0o"l! not cover the costs inc"rre! to originate an! maintain the 1"siness# 5t the in!ivi!"al c"stomer level, it ma* not profita1le for a firm to engage in a relationship 0ith a partic"lar c"stomer 0ho has 1an cre!it or 0ho is a poor risk for some other reason# Retailers, 1anks, mortgage companies, an! cre!it) car! companies ro"tinel* ref"se to !o 1"siness 0ith in!ivi!"als 0hose cre!it histories are "nrelia1le# Chile the short) term sale ma* 1eneficial, the long)term risk of nonpa*ment makes the relationship "n0ise from the compan*=s point of vie0# ."stomers 1ehavio"r s"ch as ver1al @ ph*sical a1"se of emplo*ees, ref"sal to follo0 policies or la0s 0ere fo"n! to res"lt in !issatisfaction for the c"stomer# 5ltho"gh often these !iffic"lt c"stomers 0ill 1e accommo!ate! an! emplo*ees can 1e traine! to recogni3e an! !eal 0ith them appropriatel*, at time the 1est choice ma* 1e not to maintain the relationship at all especiall* at the 1"siness)to)1"siness level 0here long)term costs to the firm can 1e s"1stantial# It sho"l! 1e note! that the 1est c"stomers are not 2"st the ones that generate the most profit# %speciall* in 1"siness) to)1"siness settings, those c"stomers that inspire the 1est i!eas an! innovations are also goo! relationship c"stomers even if the* !o not necessaril* generate the highest profits# Th"s, 0hile in general firms 0ill seek to maintain strong relationships 0ith c"stomers 1eca"se of the 1enefits !isc"sse!, all c"stomer segments an! all in!ivi!"al c"stomers are not necessaril* goo! long)term relationship c"stomers#


"e%%&n 4 Ser'i(e Mi%%i&n Meaning 95 mission is an en!"ring statement of p"rpose that provi!es a clear vision of the organi3ation=s c"rrent an! f"t"re 1"siness activities, in pro!"ct, service an! market terms, its val"es an! 1eliefs, an! its points of !ifferentiation from competitors# 5 mission helps !etermine the relationships in each of the ke* markets 0ith 0hich the organisation interacts, an! provi!es a sense of !irection an! p"rpose 0hich lea!s to 1etter in!epen!ent !ecision)making at all levels of he organisation4# S"ch a mission statement sho"l! e(plicitl* reflect the "n!erl*ing 1eliefs, val"es an! aspirations, an! strategies of the organisation# D"ring the last !eca!e man* services organisatoins have starte! to !evelop mission statements# Aver this perio! there has 1een increasing recognition of the potential val"e of mission statements an! some companies have spent enormo"s amo"nts of time an! effort in !eveloping them# The !evelopment of an effective mission statement is especiall* important in services 1eca"se of the nee! for foc"s an! !ifferentiation in service sector 1"sinesses# Miven the intangi1ilit* of services an! the significance of people in service operations, organi3ations nee! to !evelop a clear statement of p"rpose or <mission= to ens"re that the appropriate attention is !irecte! at the ke* elements of their strateg*# Iss"es to 1e consi!ere! 0hile !eveloping a goo! mission statement for a services 1"siness: This mission statement sho"l! 1e !efine! clearl*# The a"!ience for a mission sho"l! 1e caref"ll* consi!ere!# It is necessar* to "n!erstan! in 0hat 1"siness 0e are in# 5 mission statement sho"l! 1e "ni:"e# 5 mission statement sho"l! 1e market oriente!#

Organi8ati&n:% ,i%%i&n %tate,ent %+&*1) /e )e-ine) (1ear12 In !eveloping a mission statement the ke* is to achieve a 1alance 1et0een not 1eing so narro0 as to restrict gro0th opport"nities an! not 1eing so 1roa! as to lose foc"s# >or e(ample, some 1anks 0hich !iversifie! a0a* from their core 1"siness into stock 1roking an! investment 1anking, 0ith !isastro"s res"lts, are not reconsi!ering their strateg*# Similarl*, a n"m1er of retailers that have !iversifie! a0a* from their core 1"sinesses, have 1een "nprofita1le in these ne0 areas, an! are no0 leaving them an! consoli!ating 1ack into their core retailing 1"siness# -ence the organisation m"st 1e ca"tio"s 0hile !efining mission statement# T+e a*)ien(e -&r a ,i%%i&n %+&*1) /e (are-*112 (&n%i)ere) efore form"lating a mission statement the target a"!iences for the mission an! thrie relative importance sho"l! 1ecomes !are!# The sophistication of the mission nee!s to 1e revie0e! taking into acco"nt the a"!ience to 0hom it is a!!resse!# The follo0ing fig"re o"tlines some of he ke* potential a"!ience for a!mission an! some of their e(pectations, 1ase! on a consi!eration of stakehol!ers# 5 mission statements aims to capt"re the val"es an! 1eliefs of the organi3ation an! provi!e g"i!elines for the 0a* it sho"l! interact 0ith its i!entifie! markets c"stomers, internal emplo*ees, infl"ence markets 6incl"!ing sharehol!ers7, s"ppliers, referral markets, as 0ell as the recr"itment markets for emplo*ees# It sho"l! 1e clear that a mission 0hich attempts to a!!ress ever* one of these gro"ps e:"all* co"l! 1ecome e(tremel* long a an! consist of general <motherhoo!= statements# In consi!ering the vario"s markets o"tlines a1ove the compan* nee!s to consi!er ho0 the compan* inten!s to serve each of them an! to e(tent it 0ants to incorporate recognition of them 0ithin the mission# The !ecision on target a"!iences for the mission sho"l! 1e 1ase! on the conte(t of the partic"lar service firm an! its c"rrent position 0ithin the in!"str* sector# Most senior managers in service firms consi!er that the ke* messages in


the mission statement sho"l! 1e concerne! primaril* 0ith provi!ing a strategic !irection for the organisatoin an! motivating an! foc"sing its internal staff#

*%t&,er% Moo! service :"alit* Tr"st0orthiness >air prices

S*pp1ier% .lear re:"irements Partnership &arge or!ers Relia1le settlement BANK E,p1&2ee% (P&tentia1) No1 s"ppl* Imager of first choice emplo*er .o"rteo"s treatment Fig.4.1

Interna1 %ta-Recognition Re0ar!s Sec"rit* Apport"nit* for a!vancement Re-erra1 S&*r(e% Relia1ilit* Performance Recognition Reciprocation

In-1*en(er% 1# Sharehol!ers Ret"rns Mro0th .ompliance Moo! corporate Moo! corporate citi3en $# Movernment an! reg"lators .re!it rating .ompliance Relia1ilit* No s"rprises

It i% ne(e%%ar2 t& *n)er%tan) in 0+at /*%ine%% 0e are in .onsi!eration of the mission for a service organisation involves asking t0o interrelate! :"estions: Chat 1"siness are 0e in an! 0hat 1"siness sho"l! 0e 1e inE The mission sho"l! provi!e the target a"!ience !etermine! a1ove, incl"!ing emplo*ees an! other relevant stakehol!ers, 0ith a "n!erstan!ing of the strategic !irection an! scope of the organi3ation#The mission is a ke* vehicle for !eveloping an! revie0ing the strategic market an! service options# In consi!ering the 1asic p"rpose of the 1"siness it is essential that these strategic gro0th options are consi!ere!, other0ise the mission ma* simpl* 1e a series of elegant 0or!s "se! to reinforce the e(isting stat"s :"o# To !o this 0hat sho"l! 1e !one is to consi!er the service an! market areas in 0hich the organisatoin ma* 0ish to !evelop# The follo0ing fig"re o"tlines the pro!"ct@ market options 0hich the organisatoin nee!s to consi!er# These incl"!e the follo0ing# Market penetration Market !evelopment Pro!"ct or service !evelopment Diversification Pr&)*(t ; Ser'i(e%


Pre%ent Market Ne0 Present Market Penetration Market Development

Ne0 Pro!"ct or Service Development Diversification

%ach section of the matri( in the a1ove fig"re represents a core marketing strateg* 1ase! on com1inations of foc"s on e(isting markets, ne0 markets, e(isting services an! pro!"cts or ne0 services an! pro!"cts# >or the services firm fo"r possi1le gro0th options are availa1le# 5 first option involves e(pan!ing its markets position 6market penetration7 it can attempt to penetrate the e(isting market for its services 1* attracting c"stomers a0a* from competitors, 1* increasing "sage rates amongst e(isting competitors or 1* improving c"stomer retention# 5 secon! option 6service !evelopment7 involves intro!"cing ne0 services to the e(isting market place# Man* of the 1anks are follo0ing this strateg* 1* intro!"cing a contin"o"s arra* of ne0 pro!"cts incl"!ing investment an! ins"rance services# 5 thir! option 6market !evelopment7 is to !evelop ne0 markets for the e(isting services# This co"l! involve i!entification an! attack of ne0 market segments or ma* involve regional or glo1al geographic e(pansion# The fo"rth option 6!iversification7 involves offering ne0 services or pro!"cts to ne0 markets# Developing a mission involves consi!eration of 0hat services an! markets the compan* 0ants to 1e in, not 2"st those in 0hich it is involve! at present# 5 mission can help i!entif* a polic* !efining f"t"re 1"siness gro0th an! pro1a1ilit*, 1ase! on these fo"r gro0th options# A ,i%%i&n %tate,ent %+&*1) /e *ni6*e 5 mission statement nee!s to 1e "ni:"e to the organisatoin "n!er consi!eration: a ke* metho! of o1taining competitive a!vantage is to 1e !ifferent in a preferre! 0a* to a selecte! c"stomer 1ase# The mission statement sho"l! artic"late the point of !ifferentiation an! at the same time act as a frame0ork for helping eval"ate c"rrent an! f"t"re activities# 5 mission statement sho"l! !ifferentiate the compan* from other companies operating in the same sector an! help to esta1lish an organi3ation=s in!ivi!"alit* an! "ni:"eness# It i% e%%entia1 t& +a'e a ,i%%i&n %tate,ent 0+i(+ i% ,arket &riente) It is partic"larl* important to avoi! mission statements that are pro!"ct oriente!, i#e# the mission sho"l! 1e !efine! in a 0a* that reflects c"stomers nee!s rather than pro!"ct feat"res an! attri1"tes# Argani3ations s"ch as airlines, hotels an! 1anks nee! to consi!er c"stomer nee!s caref"ll* an! "se this kno0le!ge to make an inp"t into the !esign of the services that are offere!# 5 mission statement sho"l! artic"late the right 1alance in terms of the !esire! long)term !irection of the organisatoin, !etermine to 0hom the mission is a!!resse!, in!icate the services to 1e offere! an! markets to 1e serve!, 1e "ni:"e an! foc"s more or c"stomers= nee!s rather than on the characteristics of the pro!"cts an! services offere!# Service Mission Statements Davi! ahs i!entifie! nine components of mission statements# These incl"!e the follo0ing: 1# ."stomersO0ho are the*E $# Pro!"cts or services 0hat are the firm=s ma2or pro!"cts or servicesE '# &ocation 0here !oes the firm competeE +# Technolog* 0hat is the firm=s 1asic technolog*E ,# .oncern for s"rvival 0hat are the firm=s economic o12ectivesE /# Philosoph* 0hat are the 1asic 1eliefs, val"es, aspirations an! philosophical priorities of the firmE G# Self concept 0hat are the firm=s ma2or strengths an! competitive a!vantagesE


I# .oncern for p"1lic image 0hat are the firm=s p"1lic responsi1ilities an! 0hat image in !esire!E 8# .oncern for emplo*ees 0hat is the firm=s attit"!e to0ar!s its emplo*eesE E<a,p1e &- %er'i(e &rgani8ati&n:% ,i%%i&n %tate,ent%

0orld1ide e&press2 !orld"ide mission statement
$,3 1ill 4eco!e the ackno1ledged glo4al leader in the e&press deliver- of docu!ents and packages. 3eadership 1ill 4e achieved 4- esta4lishing the industr- standards of e&cellence for 5ualit- of service and 4- !aintaining the lo1est cost position relative to our service co!!it!ent in all !arkets of the 1orld. +he evolution of our 4usiness into ne1 services6 !arkets6 or products 1ill 4e co!pleteldriven 4- our single)!ined co!!it!ent to anticipating and !eeting the changing needs of our custo!ers.

5 goo! mission sho"l! to the follo0ing: Define the p"rpose of the organisation# I!entif* relevant services an! markets 5ssist in revie0ing c"rrent an! f"t"re strategic options# .reate a 1alance 1et0een narro0ness an! 1rea!th Differentiate the organisation from others in its sector e specific eno"gh to have an impact on the 1ehavio"r of the organisation# e realistic, attaina1le an! fle(i1le# >oc"s more on c"stomer nee!s an! their satisfaction than on the characteristics of the service themselves# Reflect the core competencies of the organisation# Permit close integration 0ith corporate o12ectives, so that s"ccess in achieving the mission can 1e meas"re!# e clearl* "n!erstoo! an! 0i!el* comm"nicate! thro"gh the organisation#

The nine components of the mission o"tline! earlier together 0ith the list a1ove, can act as a check)list 0hen !eveloping a mission# Ance a satisfactor* mission has 1een !evelope!, it sho"l! 1e comm"nicate! 0ithin an! 0here appropriate o"tsi!e the organisation# 5n!re0 .amp1ell an! his colleag"es have i!entifie! the follo0ing fo"r elements as important in a mission:


P"rpose 0h* the compan* e(ists Strateg* the competitive position an! !istinctive competence# Hal"es 0hat the compan* 1elieves in# Stan!ar!s an! 1ehavio"r the policies an! 1ehavio"r patterns that "n!erpin the !istinctive competence an! the val"e s*stem#

Degree of Sophistication It is important that the !egree of sophistication in the 0orking "se! in a mission is appropriate to the organisation concerne!# The "se of technical aca!emic terms appropriate for a strateg* cons"lting firm=s mission 0o"l! 1e totall* inappropriate to a small compan* operating in roa! transportation# Levels of Mission Statement N"st as companies have !ifferent levels of o12ectives, ranging from strategic o12ectives to tactical o12ectives an! action plans, a service organisation sho"l! consi!er to 0hat e(tent it sho"l! !evelop mission or p"rpose statements at lo0er levels# >or e(ample, a 1ank 0ith !iverse financial services operations co"l! have a mission statement for the 1ank as a 0hole as 0ell as in!ivi!"al missions for each 1"siness "nit# Th"s it might !evelop missions for retain 1anking, international 1anking, investment 1anking an! its ins"rance an! stock 1roking activities# Man* m"lti) 1"siness services organi3ations are in a similar position of nee!ing to !evelop missions for their constit"ent parts# It ma* also 1e appropriate to have missions at in!ivi!"al f"nctional levels# Developing a Service Mission The first point in !eveloping a mission statement is to consi!er if the organisatoin is rea!* to procee! 0ith the task# 5 n"m1er of !ifferent approaches can 1e "se! for the !evelopment of a mission# A 0&rk%+&p appr&a(+ This t*picall* takes place in the conte(t of a strateg* or marketing planning 0orkshop 0ith senior e(ec"tives from the organisation# 5 perio! is spent e(plaining the p"rpose an! role of a mission statement an! the !ifferent t*pes of mission that can e(ist at !ifferent levels# This is follo0e! 1* s*n!icate e(ercises, 0here gro"ps of a1o"t five people spen! a s"fficientl* long perio! to pro!"ce a first !raft mission# The missions fro a n"m1er of !ifferent s*n!icates are then presente! an! the strengths an! 0eaknesses of each are !isc"sse! in !etail, lea!ing to the event"al !evelopment of a mission statement# T t&p tea, appr&a(+ 5nother approach is one 0hich consists of 1oar!s of !irectors, 0ith a gro"p of "pto eight people# The session starts 0ith the senior management, or 1oar!, 1eing aske! the p"rpose of their 1"siness# %ach mem1er is aske! to 0rite his or her vie0 of he mission on a car!# Significant variations are often fo"n!# 5fter an appropriate perio! the missions on the car!s are collecte! an! sh"ffle!, an! !"ring a coffee 1reak the* are 0ritten "p on large sheets of paper an! pinne! to the 0alls# The mission statements !o not i!entif* their a"thors# The terms is then invite! to 0rite a secon! version of the mission on a car! an! again these are collecte! an! 0ritten on large sheets of paper 0hich replace the ones on the 0all# 5t this point a more !etaile! !isc"ssion follo0s# 5fter t0o or three attempts a goo! !raft mission ma* start to evolve, altho"gh in some cases more f"n!amental anal*sis ma* 1e nee!e!# This time !evote! to the !evelopment of a satisfactor* mission can 1e consi!era1le# The !evelopment of a mission statement can 1e assiste! 1* an e(ternal cons"ltant# Ance complete!, mission statements change onl* less fre:"entl*# The emergence of a ne0 opport"nit*, a !ecline in the compan*=s e(isting markets or a ne0 technolog* offering a 1reakthro"gh in service !eliver* can create the nee! for change# 5 mission sho"l! 1e s"fficientl* ro1"st to last for some time 1"t sho"l! 1e revie0e! on an ann"al e(ternal environment# "e%%&n = Ser'i(e% Market% Seg,entati&n


Market segmentation is the process of aggregating c"stomers 0ith similar 0ants, nee!s, preferences, or 1"*ing 1ehavio"r# Market targeting involves eval"ating the attractiveness of the segments an! selecting ones the firm 0ill serve# In other 0or!s, segmentation is the anal*sis con!"cte! a1o"t c"stomers an! targeting is the managerial !ecision a1o"t 0hom to serve# oth of these are re:"ire! for effective market positioning, 0hich involves esta1lishing he competitive position for the service in the min! of the c"stomer an! creating or a!apting the service mi( to fit the position# Market segmentation is especiall* important for services in the c"rrent competitive marketplace# Service in!"stries are s"ffering from increasing competition 1oth in the n"m1er of competitors an! in the proliferation of service offerings# Market segmentation helps prevent the 0aste of val"a1le reso"rces 1* !irecting effort into those areas that 0ill help achieve s"ccess# Service pro!"cts are fre:"entl* not clearl* !ifferentiate!# Market segmentation offers the opport"nit* of gaining competitive a!vantage, in a highl* conteste! market, thro"gh !ifferentiation# The market segmentation approach involves i!entification of the 1enefits 0hich !ifferent homogeneo"s gro"ps seek, allo0ing relevant feat"res an! re:"irements to 1e !etermine! an! "se! as a so"rce of service !ifferentiation# Different c"stomers have !ifferent nee!s# 5 hotel 0hich aims to satisf* the prestige e(ec"tive market nee!s to consi!er the specific re:"irements of this segment# These might incl"!e f"ll secretarial an! office facilities, conference amentities, t0ent*)fo"r ho"r catering, a fitness facilit* an! late check)o"t options# S"ccessf"l marketing i!entifies specific nee!s an! preferences for services, an! then !evelops strategies to satisf* these preferences# 5 single service or pro!"ct cannot meet the nee!s of all c"stomers, 1"t it can meet the nee!s of a specific gro"p of c"stomers# 5 service 1"siness sho"l! 1e positione! to serve partic"lar segments of the attractive parts of the market so that it can serve them effectivel* an! pro!"ce the greatest profit# The segmentation process, sho0n in the follo0ing fig"re is concerne! to !ivi!e a heterogeneo"s follo0s fo"r 1roa! steps: The !efinition of the market to 1e a!!resse!# The i!entification of alternative 1ases for segmentation# 5n e(amination of these 1ases an! the choice of the 1est 1ase or 1ases for segmentation# The i!entification of in!ivi!"al market segments, an assessment of their attractiveness an! the selection of specific target segments#

Ance the market segment has 1een selecte!, the process of target marketing involves !eveloping a positioning for the target segments selecte! an! then !eveloping a marketing mi( for each target market#


Definition of Markets

I!entif* alternatives 1ases for segmentation Select 1est 1ase@s for segmentation

Process of market segmentation

I!entif* an! select market segments

Develop positioning for target segments


Develop marketing mi( for each target markets

Marketing mi( !evelopment

Definition of #elevant Market

Fig. =.1 Ser'i(e% ,arket %eg,entati&n

Segmentation The !efinition of the relevant market to 1e a!!resse! involves specif*ing the c"stomer gro"p to 0hich the compan* is seeking to market its services# This can 5pproaches 1e a 1roa! gro"p s"ch as retail c"stomers for a s"permarket in a given geographic region, or a m"ch more specific gro"p 0hich can 1e f"rther segmente!# S"ccessf"l market segmentation means satisf*ing the nee!s of e(isting an! potential c"stomers in a clearl* !efine! market# This involves "n!erstan!ing c"stomer attit"!es, an! c"stomer preferences, as 0ell as the 1enefits 0hich are so"ght# Definition of the target market an! its re:"irements is the first essential step in the segmentation process# .ons"mer .ons"mer characteristics responses $ases of Segmentations Market segments are forme! 1* gro"ping c"stomers 0ho share common characteristics that are in some 0a* meaningf"l to the !esign, !eliver*, promotion, or pricing of the service# .ommon segmentation 1ases for c"stomer markets are !emographic segmentation, geographic segmentation, ps*chographic segmentation an! 1ehavio"ral segmentation# Segments ma* 1e i!entifie! on the 1asis of one of these Meograph* characteristics or a com1ination# Demographic an! Ph*siographic Socioeconomics



Promotional response Fig =.7




5e,&grap+i(% an) %&(i&>e(&n&,i( %eg,entati&n Demographic segmentation incl"!es a n"m1er of factors incl"!ing se(, age, famil* si3e etc# Socio)economic varia1les ma* also 1e consi!ere! here, incl"!ing income e!"cation, social class an! ethnic origins# Man* retail stores target !ifferent c"stomer gro"p# 5n interesting e(ample of market segmentation is seen in the 1anking patterns of cons"mers 1ase! on the lifec*cle of the ho"sehol!# Chilst other factors s"ch as socio economic level are also important, the age an! famil* composition of the lifec*cle concept are partic"larl* val"a1le pre!ictors of a ho"sehol!=s propensit* to either save or 1orro0# 5n anal*sis of the stages 0ithin the c"stomer lifec*cle !etermines 0hat kin!s of 1anking relationships are nee!e! to meet the !eman!s of the ho"sehol!# These nee! change significantl* from a 1achelor 0ho 0ants eas* cre!it facilities an! convenient transactions, *o"ng marrie! re:"iring higher levels of cre!it facilities, thro"gh to ol!er families at the peak of their earning an! spen!ing potential, an! then ol!er people 0itho"t chil!ren at home 0ho have a higher propensit* to save# 5 financial instit"tion can therefore !irect vario"s service offering to in!ivi!"als 1ase! on their stage 0ithin the lifec*cle mo!el# P%2(+&grap+i( %eg,entati&n This form of segmentation cannot 1e e(plaine! in clearl* !efine! :"antitative meas"res it is concerne! 0ith people=s 1ehavio"r an! 0a*s of living# Ps*chographic segmentation is concerne! 0ith anal*3ing lifest*le characteristics, attit"!es an! personalit*# Aften these elements are e(amine! in con2"nction 0ith !emographic varia1les# Service companies are increasingl* starting to look at ps*chographic segmentation# Ge&grap+i( %eg,entati&n Meographic segmentation !ivi!es c"stomers accor!ing to 0here the* live or 0ork an! correlates this 0ith other varia1les# This is appropriate 0here c"stomer nee!s var* it !ifferent areas, or 0here local an! regional tren!s favo"r partic"lar t*pes of service offerings# 5 geographic anal*sis is a relativel* simple means of segmenting a market, it is fre:"entl* one of the first segmentation varia1les to 1e consi!ere! 1* a service firm Meographic segmentation !imensions are t*picall* gro"pe! into market scope factor an! geographic market meas"res# 1# Market scope factors incl"!e a consi!eration of 0here the markets to 1e serve! are locate!: this ma*1e local, national, regional or glo1al# To 1e a ma2or pla*er in some service 1"siness re:"ires a regional or glo1al presence: airlines 0ishing to 1e significant pla*ers are recogni3ing this# Man* airlines are seeking increase! scale of operations thro"gh mergers an! strategic alliances#


$# Meographic market meas"res incl"!e e(amination of pop"lation !ensit*, climate)relate! factors, an! stan!ar!i3e! market areas# Meographic meas"res are especiall* important in the selection of speciali3e! mass comm"nications me!ia# Most mass circ"lation me!ia profile geographic coverage of stan!ar!i3e! market areas in !etail as 0ell as provi!ing me!ia circ"lation 1* t*pe of rea!er an! other varia1les# Meographic market meas"res are "se! to !etermine relative sales potential in !ifferent geographic areas# Bene-it %eg,entati&n The segmentation varia1les liste! a1ove foc"s on the personal attri1"tes of the c"stomer# Segmentation can also 1e carrie! o"t on the 1asis of the c"stomer=s response# enefit segmentation ass"mes that the 1enefits that people are seeking from a given pro!"ct or services are the 1asic reasons 0h* the* 1"* the pro!"ct# This !iffers from ps*chographic segmentation 0hich foc"ses on 0ho 0ill 1"* a pro!"ct# I!entif*ing a segment seeking a common 1enefit permits the service provi!er to !evelop a relevant offering# >or e(ample, vario"s 1enefits are so"ght 0ithin the retail 1anking market# Ane segment seeks large, 0ell kno0n 1anks 0hich offer a f"ll range of service for var*ing nee!s# 5nother segments looks for a!vantageo"s loans 0ith 1orro0ing easil* availa1le at lo0 interest# 5 thir! segment ma* seek high savings interest 0ith :"ick service an! a personal 1anking relationship# 5 fo"rth segment might seek a one)stop 1ank 0ith a 0i!e variet* of services, convenient ho"rs an! :"ick service# 5 1ank can !irect its service to satisf*ing one or more of these segments an! gain a rep"tation for offering a !istinct package# enefit segmentation is applica1le to almost all services as it foc"ses on the clearl*ing reasons for p"rchasing them# >or e(ample, 0ithin the e!"cation market cons"mers can 1e anal*3e! 1ase! on the primar* 1enefits the* seek from the e!"cation e(perience# 5n e(ample of 1enefit segments "se! for categori3ing prospective M 5s can 1e i!entifie! from a s"rve* of can!i!ates# #%age %eg,entati&n Usage segmentation foc"ses on the t*pe an! e(tent of "sage patterns# .ons"mers are t*picall* !ivi!e! into heav* "sers, me!i"m "sers, occasional "sers or non)"sers of the service 1eing consi!ere!# Man* services marketers are concerne! 0ith foc"sing on the heav* "ser segment, 0ho ma* cons"mer man* times more of the service than the occasional "ser# This is the 1asis of man* fast foo! resta"rants 0ho cater for high vol"me "sage 1* provi!ing spee!*, lo0)cost foo!# anks an! 1"il!ing societies are concerne! 0ith heav*, me!i"m, light an! non)"sers of their services# The* 0ish to "n!erstan! the nat"re, 1ehavio"r an! i!entit* of heav* "sers an! attract them to their 1ank# Pr&,&ti&na1 re%p&n%e %eg,entati&n Promotional response segmentation consi!ers ho0 c"stomers respon! to a partic"lar form of promotional activit*# This ma* incl"!e response to a!vertising, sales promotions, in)store !ispla*s an! e(hi1itions# Users of mail or!er catalog"es ten! to 1e goo! "sers of cre!it car!s an! 0ill have a higher response rate to other !irect mail offerings# This information can 1e "se! 1* service companies to ens"re that this segment receives fre:"ent comm"nication 1* !irect mail, th"s 1"il!ing a relationship 0ith the c"stomer as 0ell as o1taining a high response rate to promotions# Cith lo*alt* segmentation c"stomers are categori3e! accor!ing to the e(tent of the lo*alt* the* e(hi1it to the partic"lar pro!"ct or service 1eing offere!# ."stomers can 1e characteri3e! accor!ing to their !egree of lo*alt* in the channels of !istri1"tion on o"tlets# Some c"stomers are ver* lo*al to the services organisation the* are c"rrentl* 0ith, even if the* are not happ* 0ith the service the* are receiving# ."stomers are sometimes !ivi!e! into fo"r categories accor!ing to cons"mer lo*alt* patterns, <har!)core lo*als= 6cons"mers 0ho 1"* their 1ran! all the time7? <soft)core lo*als= 60ho are lo*al to t0o or three 1ran!s7? <shifting lo*als= 60ho shift from favo"ring one 1ran! to another7? an! <s0itchers= 60ho sho0 little s"staina1le lo*alt* to one 1ran!7# The "n!erl*ing reasons for these !ifferent 1ehavio"r patterns nee! f"rther anal*sis# Seg,entati&n /2 %er'i(e Ane area 0hich has receive! relativel* little attention is the consi!eration of ho0 c"stomers respon! to var*ing service offerings# This ma* 1e consi!ere! a s"1set of 1enefit segmentation, 1"t it is of s"fficient importance to 1e a!!resse! separatel*# The vario"s elements of c"stomer service that can 1e offere!, an! possi1le !ifferentiation in terms of service levels 0ithin these elements, represent a consi!era1le opport"nit* to !esign service package appropriate to !ifferent market segments# Segmenting markets 1* service involves a!!ressing the follo0ing iss"es:


.an gro"pings of c"stomers 1e i!entifie! 0ith similar service re:"irementsE .an 0e !ifferentiate o"r service offeringE Do all o"r pro!"cts re:"ire the same level of serviceE

The t*pes of segmentation o"tline! a1ove are ill"strative of the main forms of segmentation "se! 1* services companies# the* are, ho0ever, 1* no means e(ha"stive# To a large e(tent the i!entification of segmentation 1ases involves an! element of creativit*# Those marketing services sho"l! constantl* 1e consi!ering alternative 0a*s of segmenting the market an! seeking 0a*s in 0hich the* can create !ifferential a!vantage over their competitors# This stage of the segmentation process sho"l! res"lt in the selection of the 1est 1ase6s7 for segmentation# The segmentation process sho"l! res"lt in one of fo"r 1asic !ecisions 1eing reache!: 1# The service firm ma* 1e !eci!e to target one segment of the market# $# The service firm ma* !eci!e to target several segments an! so 0ill !evelop !ifferent marketing mi( plans for each segment# '# Management ma* !eci!e not to segment the market 1o"t to offer the service to he mass market# This ma* 1e appropriate if the market is ver* small an! single portion 0o"l! not 1e profita1le# It also ma* 1e the case that the service compan* !ominates the market so that targeting a fe0 segments 0o"l! not increase vol"me or profit# +# 5nal*sis ma* sho0 that there is no via1le market niche for the service offering# The relevance of market segmentation if no0 1eing increasingl* recogni3e! in the services sector# 5 n"m1er of st"!ies have pointe! to the importance of market segmentation# Ane st"!* ranke! <pro1lems in recogni3ing, !efining, "n!erstan!ing an! segmenting markets= as the most important pro1lem facing the senior e(ec"tives s"rve*e!# 5nother s"rve* ranke! segmentation as the thir! most important marketing tool o"t of eighteen s"rve*e!# -o0ever, !espite the recognition of the importance of market segmentation, an! the !evelopments that have 1een ma!e in market segmentation metho!olog*, some service firms are still 1asing their marketing strategies an! tactics on either a1roa! approach to the market, or a relativel* "nsophisticate! approach to segmentation# Ma* service firms nee! to 1e more !iscipline! in their foc"s on their marketplace# Segmentation is at the heart of marketing strateg* an! is concerne! 0ith the !evelopment of a market position that minimi3es competition=s strengths an! ma(imi3es the strength of the service provi!ers# Segmentation an! the associate! steps of positioning provi!e the opport"nit* to tailor the service offere! to 1etter meet the nee!s of specific segments#

"e%%&n ? P&%iti&ning an) 5i--erentiati&n &- Ser'i(e%


Services firms are not i!entif*ing their ke* market segments an! then !etermining ho0 the* 0ish cons"mers to perceive 1oth their compan* an! its pro!"cts an! services# Positioning is of partic"lar significant in the services sector as it places an intangi1le service 0ithin a more tangi1le frame of reference# Th"s the concept of positioning stems from a consi!eration of ho0 an organisation 0ishes its target c"stomer to vie0 its pro!"cts an! services in relationship to those of its competitors an! their act"al, or perceive!, nee!s# Positioning can 1e !efine! as follo0s: 9Positioning is concerne! 0ith the i!entification, !evelopment an! comm"nication of a !ifferentiate! a!vantage 0hich makes the organi3ation=s pro!"cts an! services perceive! as s"perior an! !istinctive to those of its competitors in the min! of its target c"stomers#4 Positioning offers the opport"nit* to !ifferentiate an* service# %ach service firm an! its goo!s an! services has a position or image in the cons"mer=s min! an! this infl"ences p"rchase !ecisions# Positions can 1e implicit an! "nplanne! an! evolve over a perio! of time or can 1e planne! as part of the marketing strateg* an! then comm"nicate! to the target market# The p"rpose of planne! positioning is to create a !ifferentiation in the c"stomer=s min! 0hich !isting"ishe! the compan*=s services from other competitive services# It is important to esta1lish a position of val"e for the pro!"ct or service in the min!s of the target market, i#e# it m"st 1e !isting"isha1le 1* an attri1"te, or attri1"tes, 0hich are important to the c"stomer# These attri1"tes sho"l! 1e factors 0hich are critical in the c"stomer=s p"rchase !ecision# There is therefore no s"ch thing as a commo!it* or <stan!ar!= service# %ver* service offere! has the potential to 1e perceive! as !ifferent 1* a c"stomer# "*ers have !ifferent nee!s an! are therefore attracte! to !ifferent offers# It is therefore important to select !isting"ishing characteristics 0hich satisf* the follo0ing criteria: Importance the !ifference is highl* val"e! to a s"fficientl* large market Distinctiveness the !ifference is !istinctl* s"perior to other offering 0hich are availa1le# .omm"nica1ilit* it is possi1le to comm"nicate the !ifference in a simple an! strong 0a*# S"periorit* the !ifference is not easil* copie! 1* competitors# 5ffor!a1ilit* the target c"stomers 0ill 1e a1le an! 0illing to pa* for the !ifference# 5n* a!!itional cost of the !isting"ishing characteristic6s7 0ill 1e perceive! as s"fficientl* val"a1le to compensate for an* a!!itional cost# Profita1ilit*) the compan* 0ill achieve a!!itional profits as a res"lt of intro!"cing the !ifference

%ach pro!"ct or service has a set of attri1"tes 0hich can 1e compare! to competitive offerings# Some of these attri1"tes 0ill 1e real, others 0ill 1e perceive! as real# 5 compan* 0ishing to position itself sho"l! !etermine ho0 man* attri1"tes an! !ifferences to promote to target c"stomers# Some marketers a!vocate promoting one 1enefit an! esta1lishing recognition as 1eing the lea!er for that partic"lar attri1"te# Athers s"ggests that promoting more than one 1enefit 0ill help in carving o"t a special niche 0hich is less easil* conteste! 1* competitors# The selection of the !ifferentiating attri1"te6s7 is most s"ccessf"l if it confirms fact 0hich is alrea!* in the min! of the target market# Den*ing or fighting c"stomers= perceptions of !ifferent offerings in the market is "nlikel* to 1e s"ccessf"l# 5 s"ccessf"l positioning strateg* takes into acco"nt c"stomers= e(isting perceptions of market offerings# It !etermines nee!s 0hich c"stomers val"e an! 0hich are not 1eing met 1* competitors= services# It i!entifies 0hich "nsatisfie! nee!s co"l! 1e satisfie!# The positioning strateg* seeks to integrate all elements of the service, to ens"re that the perceive! position of the service is strongl* reinforce!# Services have a n"m1er of !isting"ishing characteristics 0hich have special implications for the positioning an! selection of 0hich attri1"tes to emphasi3e# Three of the ke* characteristics of services, make positioning strategies of partic"lar importance in marketing a service# These are the intangi1ilit*, the !egree of varia1ilit* or heterogeneit* in :"alit* of a given service, an! insepara1ilit* the fact that the performance of a service 0ill often occ"r in presence of a c"stomer# Positioning can permit an intangi1le service 1en!fit to 1e represente! tangi1l*# It can help the c"stomer see an intangi1le 1enefit cleanliness? an! this vie0 can 1e reinforce! 1* plastic covere! glasses in rooms an! a paper cover over the li! of a lavator* stating <saniti3e! for *o"r protection=# This helps the c"stomer to associate cleanliness 0ith the service offering, reinforcing the position that the hotel 0ishes to portra*# Service companies often promote their rep"tations in an attempt to a! tangi1ilit*#


Services are also highl* varia1le an! rel* to a great e(tent on inp"t from compan* emplo*ees for their pro!"ction# >or e(ample, in a resta"rant the 0aiter is the main point of contact 0ith the c"stomer an! his service performance 0ill 1e a ma2or factor in the sa* the esta1lishment 0ill 1e 2"!ge!# -is performance 0ill var* at !ifferent times, an! there 0ill also 1e variance 1et0een his service an! that of another 0aiter or 0aitress in the resta"rant, as a res"lt, the :"alit* of the !elivere! service can var* 0i!el*# >"rther, the :"alit* of small elements of a total service offering ma* affect the receive! :"alit* of the service as a 0hole# >or instance, a poor check)o"t proce!"re from a hotel, ma* greatl* affect the perceive! :"alit* of the overall e(perience of sta*ing on it# The c"stomer=s perception of the :"alit* of the service is therefore greatl* affecte! 1* the :"alit* of the overall e(perience of sta*ing in it# The c"stomer=s perception of the :"alit* of he service is therefore greatl* affecte! 1* the :"alit* of the staff 0ho are responsi1le for !eliver*# 5n a!vantage can 1e gaine! 1* provi!ing 1etter traine! an! more highl* responsive people# 5 positioning strateg* ma* therefore incl"!e the !istinctive characteristic of emplo*ing <1etter people4# Services ten! to 1e insepara1le an! are characteri3e! 1* the fact that the* are performe! in the presence of the c"stomer# The !istinctive feat"res of the services o"tline! a1ove provi!es the 1asis for competitive positioning strateg*# Positioning can 1e consi!ere! at several levels: Industry positioning the positioning of the service in!"str* as a 0hole# Organizational positioning the positioning of the organi3ation as a 0hole# roduct sector positing the positioning of a range or famil* of relate! pro!"cts an! services 1eing offere! 1* the organisation# Individual product or service positioning the positioning of specific pro!"cts# %rocess of %ositioning Pro!"ct positioning involves a n"m1er of steps incl"!ing the follo0ing: Determining levels of positioning I!entification of ke* attri1"tes of importance to selecte! segments &ocation of attri1"tes on a positioning map %val"ating positioning options Implementing positioning# 5eter,ining 1e'e1% &- p&%iti&ning The first step in positioning is to !etermine 0hich level6s7 service level, pro!"ct sector level, corporate level are to receive e(plicit positioning attention# Some e(amples 0ill ill"strate the choices that are ma!e 1* some service organi3ations# The level or levels of positioning to 1e "n!ertaken are "s"all* fairl* clear o"t, altho"gh some organisation, have place! !ifferent emphasis on these levels at !ifferent points in time# I)enti-i(ati&n &- attri/*te% Ance the level of positioning has 1een !etermine! it is necessar* to i!entif* the specific attri1"tes that are important to the chosen market segments# In partic"lar, the 0a* in 0hich p"rchasing !ecisions are ma!e sho"l! 1e consi!ere!# In!ivi!"als "se !ifferent criteria fro making a p"rchase !ecision of a service# "&(ati&n &- attri/*te% &n p&%iti&ning ,ap The positioning process involves the i!entification of the most important attri1"te an! location of vario"s companies= services, for these attri1"tes, on a positioning map# Chere a range of attri1"tes are i!entifie!, statistical proce!"res e(ist for com1ining these attri1"tes into aggregate !imensions# S"ch !imensions are referre! to 1* vario"s names s"ch as principal components, m"lti)!imensional scales, factors etc# !epen!ing "pon ho0 the !ata 0ere elicite! an! 0hich statistical proce!"res 0ere "se!# Us"all* t0o !imensions are "se! on positioning maps an! these often acco"nt for a large proportion of the <e(planation= of the c"stomer=s preferences#


Pro!"cts or services are t*picall* plotte! on a t0o !imensional positioning man s"ch as sho0 in the follo0ing fig"re# The positioning map can 1e "se! to i!entif* the position of competitors= services in relation to the selecte! attri1"tes# The anal*sis can 1e f"rther !evelope! 1* !ra0ing separate positioning maps for each market segment# ."stomers in each market segment ma* perceive the service an! its 1enefits !ifferentl* an! !ifferent map 0ill sho0 these !ifferent positions# 5ttri1"te ) 1 Services ) D Services ) 5

Services ) %

Services ) .

Services ) >

Fig. ?.1 I11*%trati'e p&%iti&ning ,an Positioning maps can 1e 1ase! on either o12ective attri1"tes or s"12ective attri1"tes Maps can also "se a com1ination of o12ective an! s"12ective attri1"tes# E'a1*ati&n p&%iti&ning &pti&n% Strengthening c"rrent position against competitors to avoi! hea!)on attack# I!entif*ing an "nocc"pie! market position that 0as not fille! 1* a competitor Repositioning the competition#

Ance a compan* ha! i!entifie! 0here it is positione! at present, it then nee!s to !etermine ho0 to enhance or s"stain its position relative to its competitors# .riteria for goo! positioning The positioning sho"l! 1e meaningf"l# The positioning m"st 1e 1elieva1le# The positioning m"st 1e "ni:"e#

I,p1e,enting p&%iti&ning an) t+e ,arketing ,i< -o0 a compan* an! service is positione! nee!s to 1e comm"nicate! thro"gho"t all of its implicit an! e(plicit interactions 0ith c"stomers# This s"ggests that all elements of the compan*, its staff, policies an! image, nee! to reflect a similar image 0hich together conve*s the !esires position to the market place# This means that a compan* m"st esta1lish a strategic positioning !irection, 0hich is follo0e! thro"gh in all of its tactical marketing an! sales activities#


Services )


5 s"ccessf"l positioning strateg* sho"l! make the service clearl* !isting"isha1le 1* feat"res 0hich are !esira1le an! important to the target c"stomer segment# This means that the positioning strateg* sho"l! 1e e(amine! from time to time to ens"re that it !oes not 1ecome o"t!ate! an! that it is still relevant to the target market segment# The marketing mi( is the ke* to implementing a positioning strateg*# The !esign of the marketing mi( to implement the positioning m"st 1e 1ase! on the ke* salient attri1"tes relevant to the target segment# These attri1"tes sho"l! 1e i!entifie! in the conte(t of anal*sis of competitors, 0hose positions sho"l! 1e assesse! to !iscover their v"lnera1ilit*# 5ll the elements of the marketing mi( can 1e "tili3e! to infl"ence the c"stomer=s perception an! hence the positioning of the pro!"ct or organisatoin concerne!# The marketing mi( can 1e "se! to !evelop a coherent totalit* that creates the positioning in the c"stomer=s min!# Importance of %ositioning Positioning involves 1oth la"nching ne0 1ran!s into the marketplace 6ne0 1ran! positioning7, an! repositioning ol! 1ran!s# It is concerne! 0ith the !ifferentiation of pro!"cts an! services an! ens"ring that the* !o not !egenerate into a commo!it*# To ma(imi3e its potential a compan* sho"l! position itself in its core market segments, 0here it is o12ectivel* or s"12ectivel* !ifferentiate! in a positive 0a* over competing offerings# Positioning is partic"larl* import for services in the market# 5s a res"lt of competitive press"re the cons"mer is 1ecoming increasingl* conf"se! 1* the h"ge offering of services 0ithin each market sector# These offering are comm"nicate! 1* a vast n"m1er of a!vertising messages promoting !ifferent feat"res of the services# The ke* to a s"ccessf"l positioning strateg* is to promote the feat"re 0hich the compan* is 1est an! 0hich e(actl* matches the nee!s of the c"stomer# eca"se of intangi1ilit* an! other feat"res associate! 0ith services, cons"mers fin! that !ifferentiation of services can 1e more !iffic"lt an! comple(# S"ccessf"l positioning makes it easier for the c"stomer to see a compan*=s services as 1eing !ifferent from others an! e(actl* 0hat is 0ante!# Positioning is a strategic marketing tool 0hich allo0s managers to !etermine 0hat their position is no0, 0hat the* 0ish it to 1e an! 0hat actions are nee!e! to attain it# The permits market opport"nities to 1e i!entifie!, 1* consi!ering positions 0hich are not met 1* competitors= pro!"cts# It therefore helps infl"ence 1oth pro!"ct !evelopment an! the re!esign of e(isting pro!"cts# It also allo0s consi!eration of competitor=s possi1le moves an! responses so that appropriate action can 1e taken# The concept is often consi!ere! at the pro!"ct level altho"gh it is also relevant at the pro!"ct sector an! organi3ational level# Positioning involves giving the target market segment the reason for 1"*ing *o"r services an! th"s "n!erpins the 0hole marketing strateg*# It also offers g"i!elines for !evelopment of a marketing mi( 0ith each element of he it 1eing consistent 0ith the positioning#


"e%%&n @ Ser'i(e% Marketing Mi< The marketing mi( concept is a 0ell esta1lishe! tool "se! as a str"ct"re 1* marketers# It consists of the vario"s elements of a marketing programme 0hich nee! to 1e consi!ere! in or!er to s"ccessf"ll* implement the marketing strateg* an! positioning in the compan*=s markets# The !iscipline of consi!ering the integration of the elements of the marketing mi(, as 0ell as the in!ivi!"al vario"s elements, helps ens"re that there is consistenc* 0ithin the marketing strateg* as a 0hole# %ssentiall* the marketing mi( represents the factors 0hich nee! to 1e consi!ere! 0hen !etermining a service firm=s marketing strateg*# >or e(ample, in marketing a la0 firm the follo0ing elements sho"l! 1e consi!ere!: Chat partic"lar legal services it offers to the target market segment6s7 it has selecte!? the pricing strateg* that is appropriate to those services? ho0 it 0ill promote itself an! comm"nicate 0ith its market? the processes it 0ill a!opt? the appropriate service levels it 0ill offer to its clients? the processes it 0ill a!opt? the appropriate service levels it 0ill offer to its clients? the !eliver* s*stem of the legal services? an! the t*pe an! e(pertise of the people 0ho 0ill 1e involve! in provi!ing them# The elements of the marketing mi( for services incl"!e Pro!"ct, Price, Place, Promotion, People, Processes an! Ph*sical evi!ence# The "n!erl*ing concept in !eveloping each of these elements is to "se them to s"pport each other, to reinforce the positioning of the pro!"ct an! to !eliver appropriate service :"alit* to achieve competitive a!vantage# Service %rod ct The term <pro!"ct= is fre:"entl* "se! in a 1roa! sense to !escri1e either a man"fact"re! goo! or service# Th"s goo!s an! services are t0o t*pes of pro!"ct# 5 service pro!"ct !enotes an! activit* or activities that a service provi!er offers to perform, 0hich res"lts in satisfaction of a nee! to 0ant of pre!etermine! c"stomers# The services are offere! to a variet* of c"stomers at several levels as in!ivi!"al service pro!"cts# In fact c"stomers are not 1"*ing goo!s or services the* are reall* 1"*ing specific 1enefits an! val"e from the total offering# Ce term this total offering to c"stomers <the offer=? it represents those 1enefits that c"stomers !erive from the p"rchase of goo!s or services# In planning the offer of pro!"cts an! services, a goo! marketing managers !evices a strateg* 0here1* the offers are vie0e! at vario"s levels to achieve "nmatche! pro!"ct !ifferentiation an! s"perlative c"stomer service# Menerall*, fo"r levels of service pro!"cts are i!entifie!# The* are: T+e (&re &- generi( pr&)*(t It is the 1asic service pro!"ct# 5ltho"gh the term <generics= is the most "s"al !escriptive term, the generic pro!"cts have also 1een !escri1e! as 1ran! free, no names an! "n1ran!e! pro!"cts# 5 t*pical e(ample 0o"l! 1e a 1e! in a hotel rook for a night# T+e e<pe(te) pr&)*(t It is the minim"m set of 1enefits e(pecte! 1* a c"stomer from a service pro!"ct# It consists of the generic pro!"ct an! the minimal p"rchase con!itions 0hich has to 1e met# Th"s, a c"stomer having a transaction 0ith 1ank 0ill e(pect, in a!!ition to the service, a correct transaction recor!ing, timel* service an! minim"m co"rtes*# T+e a*g,ente) pr&)*(t The* are offering in a!!ition to 0hat the c"stomers e(pect in a!!ition to the 1enefit e(pecte! 1* him# The a"gmente! pro!"ct is !escri1e! as the complete 1"n!le of attri1"tes perceive! 1* or offere! to an in!ivi!"al 1"*er incorporating# The properties of the core pro!"ct? The specific properties !ifferentiating the offering of one s"pplier 1* contrast 0ith another? The atten!ant elements of c"stomer service, 0hich 0hen a!!e! to the core an! !ifferentiate! pro!"ct infl"ence the c"stomer=s tastes an! preferences# D"e to these a!!e! feat"res cons"mers prefer man* pro!"cts that are in!isting"isha1le ph*sicall*# >or e(ample, a marketer 0ho ma* not have the most technological a!vance! core pro!"ct 0ill !ifferentiate 1* a!!ing val"e in the form of e(cellent c"stomer service to the core pro!"ct for relia1ilit* an! responsiveness#


T+e p&tentia1 pr&)*(t It consists of potentiall* feasi1le a!!e! feat"res an! 1enefits to hol! an! attract c"stomers# It incl"!es the potential for re!efinition of the pro!"ct to take a!vantage of ne0 "sers an! the e(tension of e(isting applications# 5 service pro!"ct is a comple( set of val"e satisfactions# People 1"* services to solve pro1lems an! the* attach val"e to them in proportion to the perceive! a1ilit* of the service to !o this# Hal"e is assesse! 1* the 1"*ers in relationship to the 1enefits the* receive# "t it has to 1e recogni3e! that c"stomers !iffer an! that their re:"irements for !ifferent attri1"tes var* 1* market segment# This frame0ork reconciles the marketer=s vie0 of a pro!"ct, seen in terms of vario"s inp"ts an! processes nee!e! to pro!"ce it, an! the vario"s 1enefits# This is sho0n in the e(ample of the personal comp"ter market# The core pro!"ct for a comp"ter is a machine that permits inp"t, processing, storage an! retrieval of !ata# This is the minim"m re:"irement for s"ch a pro!"ct# The e(pecte! pro!"ct 0ill also have service s"pport, 0arrant*, a recogni3a1le 1ran! name an! attractive packaging# The a"gmente! pro!"ct ma* incl"!e the s"ppl* of the free !iagnostic soft0are, a genero"s tra!e in allo0ance, "ser cl"1s an! other pro!"ct a"gmentations 0hich are val"a1le to personal comp"ter 1"*ers# The potential pro!"ct ma* consist of f"t"re applications incl"!ing "se as a s*stems controller, facsimile machine or a m"sic composer# The 1ran! name itself also 1ecomes an important element of the a"gmente! pro!"ct# ran!s can 1e a ma2or !etermining element in the p"rchase of services an! an important means of a!!ing !ifferentiation at the a"gmente! pro!"ct level# Bran)ing The pro!"ct level s"1se:"ent to the generic pro!"ct offer opport"nities to provi!e a!!e! val"e to the c"stomers# Hal"e is a!!e! thro"gh the creating of strong 1ran! names an! the o0ners of he 1ran!s can comman! premi"m prices for them# Th"s 1ran!ing has an important role in ass"ring c"stomers of "niform service :"alit*# Af late, 1ran!ing has 1ecome common in services, an! !istinctive 1ran!s are esta1lishe! 0ith consi!era1le efforts# There is an arg"ment that in f"t"re the c"stomers 0ill increasingl* respon! to a compan* 1ran! an! that the c"stomer=s choice 0ill !epen! "pon their assessment of the compan* an! the people 1ehin! it rather than on eval"ation of the f"nctional 1enefits of a pro!"ct or services# * a!!ing val"e to the 1asic generic service pro!"ct a 1ran! achieves !ifferentiation# "t the cons"mer=s perception of service :"alit* !epen!s more on relia1ilit*, responsiveness, ass"rance an! empath*# This means that service marketers sho"l! give increase! attention to ho0 the* can !ifferentiate the pro!"ct s"rro"n! an! enlarge it# The larger the pro!"ct s"rro"n! the greater the pro1a1le !ifferentiation of a compan*=s 1ran! offering from those of its competitors# err* an! Paras"ramen have s"ggeste! some ke* :"estions service managers sho"l! a!!ress 0ith respect to their compan*=s 1ran!ing? 1# 5re 0e proactive in presenting a strong compan* 1ran! to o"r c"stomers 6an! other stakehol!ers7E $# -o0 !oes o"r compan* name rate on the tests of !istinctiveness, relevance, memora1ilit* an! fle(i1ilit*E '# Do 0e "se to f"ll a!vantage 1ran!ing elements other than the compan* nameE +# Is o"r presente! 1ran! cohesiveE ,# Do 0e appl* o"r 1ran! consistentl* across all me!iaE /# Do 0e "se all possi1le me!ia to present o"r me!iaE G# Do 0e recogni3e the infl"ence of the service offering on 1ran! meaningE I# Do 0e 1ase o"r 1ran!ing !ecisions on researchE


8# 5re 0e respectf"l of 0hat e(ists 0hen 0e change o0n 1ran! or a!! ne0 1ran!sE 1J# Do 0e internali3e o"r 1ran!ingE 5!!ressing these :"estions sho"l! help avoi! the specialt* to commo!it* sli!e# The* also provi!e a platform for elements of ph*sical evi!ence to 1e a!!e! 0hich reinforce the 1ran! an! pro!"ct s"rro"n!# Service %rod ct Decisions Man* service organi3ations like to offer a range of services# Decisions on this have to 1e consi!ere! 0ith a vie0 on the compan*=s positioning strateg* an! the competitors services offerings# 5n* ne0 service that might 1e offere! sho"l! 1e 0ithin the competenc* of the compan* to !eliver it# Chen consi!ering service pro!"ct !ecisions man* strategic gro0th options are availa1le to a service compan*# >or this, there is an "sef"l frame0ork, propose! 1* Igor 5nsoff# The frame0ork is calle! a pro!"ct @ market e(pansion gri! or 5nsoff matri(# 5nsoff matri( is "se! to consi!er fo"r strategies 0hich are f"n!amental to the service provi!er i#e# to revie0 0hether more market share sho"l! 1e gaine! for he e(isting service pro!"cts in their c"rrent market? to consi!er 0hether it can fin! or !evelop ne0 market opport"nities for its e(isting pro!"cts? to consi!er 0hether ne0 pro!"cts can 1e !evelope! 0ith potential interest to its c"rrent markets an! then to revie0 opport"nities for !iversification 1* !eveloping ne0 services pro!"cts for ne0 pro!"ct# 5n o"tline of the 5nsoff matri( is given 1elo0: An%&--:% pr&)*(t;Market e<pan%i&n gri) %(isting pro!"ct %(isting Markets Ne0 Markets Market %enetration It 0as propose! 1* Igor 5nsoff 0here1* a compan* seeks increase! sales for its present pro!"cts in its present markets thoro"gh more aggressive promotion an! !istri1"tion# There are three ma2or approaches# %nco"raging the c"rrent c"stomers to 1"* more of the pro!"ct, 5ttracting the c"stomers of the competitors to s0itch to its 1ran!, an! .onvincing non "sers of the service to start "sing it# Market penetration Market !evelopment Ne0 Pro!"cts Pro!"ct 6service7 !evelopment Diversification

Market penetration is achieve! 1* more foc"se! segmentation an! a more clearl* !efine! positioning strateg* an! 1etter application of the marketing mi( elements# It is aime! at greater pro!"ctivit* an! 1"il!ing market share at the e(pense of competitors# Market Development 5nsoff=s secon! 1asic strateg* "n!er 0hich the compan* seeks increase! sales 1* taking its present pro!"cts into ne0 markets# The follo0ing approaches ma* 1e a!opte!: I!entification of potential "ser gro"ps in the c"rrent sales areas 0hose interest in the pro!"ct services might 1e stim"late!# Seeking a!!itional !istri1"tion channels in its present locations, an! To consi!er marketing in ne0 locations !omesticall* or a1roa!#

This strateg* re:"ires in !epth market research to ens"re that the nee!s of the c"stomers are "n!erstoo! an! met competitivel* an! hence it involves a higher risk than other strategies# >"rther, in these circ"mstance the !ifferent nee!s of !ifferent c"stomers are often not given s"fficient consi!eration# So there is a vie0 that market e(tension can 1e more safel* a!opte! if the service if to 1e "se! 1* e(isting c"stomers in the !ifferent market#


Pr&)*(t &r Ser'i(e 5e'e1&p,ent The ne(t strateg* is to consi!er ne0 pro!"ct possi1ilities# Ne0 pro!"ct !evelopment is a comparativel* ne0 for researches# Service pro!"cts 0ith ne0 feat"re an! !ifferent :"alit* levels or an alternative service itself co"l! 1e !evelope!# .hristopher &ovelock has s"ggeste! si( categories of service innovation, incl"!ing the follo0ing: 1# !a"or innovations: these innovations represent ma2or ne0 markets# %(amples: .ell"lar telephones an! Apen Universit* 6Distance e!"cations7# The risk an! re0ar! profile of s"ch ma2or innovations are t*picall* large# $# #tartup $usiness: these are ne0 an! innovative 0a*s of a!!ressing the c"rrent nee!s of c"stomers an! increasing the range of choices availa1le to them# %(amples: Hi!eo .assette hire# Some innovations co"l! fir either of the a1ove t0o categories# '# %ew products for the mar&et currently served: this allo0s the service provi!er to s"e the c"stomer 1ase to the 1est a!vantage an! cross)sell other pro!"cts# >or e(ample, the 5"tomo1ile 5ssociation esta1lishe! a core range of pro!"cts relate! to car 1reak!o0n services# The c"stomer 1ase is no0 offere! a range of other car) relate! services, incl"!ing car ins"rance, travel ins"rance an! map 1ooks# The technological change has increase! the range of opport"nities for innovation an! creativit*, an! is also responsi1le for creating a market for pro!"cts an! services 0hich cons"mers ma* not have consi!ere! that the* re:"ire# >or e(ample, a"tomate! teller machines, electronic mail an! !esk)top p"1lishing have each res"lte! from technological !evelopment an! create! cons"mer !eman!s 0hich previo"sl* !i! not e(its# +# roduct line e'tensions: These offer c"stomers greater variet* of choice 0ithin e(isting service lines# This is t*pical of a 1"siness in mat"rit*, 0hich alrea!* has a core market segment 0hich the service provi!er seeks to maintain# roduct improvements: this "s"all* consists of altering or improving the feat"res of e(isting service pro!"cts#


/# #tyle changes: These involve cosmetic alternations or enhancement of tangi1le elements of the service pro!"ct# The !evelopment of a ne0 corporate image, or the intro!"ction of "niforms for 1ank co"nter staff are e(amples of st*le changes# Diversification It is the fo"rth 1asic strateg* propose! 1* Igor 5nsoff# It is more riskier an! is t*picall* a!opte! 1* mat"re service in!"stries as their gro0th cannot 1e achieve! in an* other 0a*# The process involves intro!"ction of ne0 pro!"cts, 0hich ma* or ma* not 1e relate! to the compan*=s present pro!"cts, into e(isting or ne0 markets# Diversification ma* 1e the res"lt of a !eli1erate attempt 1* management to he!ge against the compan*=s f"t"re 1eing tie! too closel* to a small n"m1er of pro!"ct or markets# It ma* 1e accomplishe! 1* ne0 investment or thro"gh mergers an! ac:"isitions# Mronroos o"tlines fo"r steps that the services marketer nee!s to manage in provi!ing a service offer: (eveloping the service concept the 1asic concept or intention of the service provi!er# (eveloping a $asic service pac&age the core service, facilitating services an! goo!s an! s"pporting services an! goo!s# (eveloping an augmented service offering the service process an! interactions 1et0een the service provi!er an! c"stomers, incl"!ing the service !eliver* process# It incl"!es 1et0een the service pro!ice an! the c"stomer, an! the !egree of c"stomer participation# !anaging image and communication) so that the* s"pport an! enhance the a"gmente! service offer# This is the interface 1et0een the promotion an! pro!"ct marketing mi( elements#

5 consi!eration of these steps makes clear some of the linkages 0ith other elements of the marketing mi(# Ance the 1asic service offer has 1een esta1lishe!, attention can then 1e !irecte! at !evelopment of pricing, promotion, !istri1"tion an! other ingre!ients of the marketing mi(# Service %rice


Pricing pla*s an important role in the marketing of services# Pricing !ecisions have a significant role in the !etermination of the val"e for the c"stomer an! in 1"il!ing the image for the service# Th"s price infl"ences he perception of the :"alit*# It also has an impact on all parts of the marketing channels# S"ppliers, sales people, !istri1"tors, competitors an! c"stomers all are affecte! 1* the pricing s*stem# Special pricing consi!erations appl* to services for vario"s reasons# Some of them are: Imme!iate !eliver*, Importance of availa1ilit*, accor!ing to higher an! lo0er !eman!, i#e# the !eman! fl"ct"ation, Intangi1le nat"re of the pro!"ct as the 1"*er often perceives a strong price :"alit* association# Services categories 0hich cannot 1e stan!ar!i3e!, Prevailing economic an! political con!itions, &ocation 6for e(ample, !ifferent States have varie! ta( str"ct"res7, an! Stat"s of the "ser#

ran!ing allo0s homogeneo"s services to 1e !ifferentiate! an! allo0s a!opting premi"m pricing strateg*# The !ecision on the pricing of a ne0 service m"st take into acco"nt man* relevant feat"res# The most important of these is that the pricing !ecision m"st 1e consistent 0ith the overall marketing strateg*# The charging of !ifferent prices in !ifferent markets ma* also nee! to 1e consi!ere!# In a!!ition, the specific price to 1e charge! !epen!s on the t*pe of c"stomer to 0hom the service is sol!# Hal"e is not !etermine! 1* price 1"t 1* the 1enefits the 1"*er perceives the ne0 service an! the price of alternative services 0hich are competing 0ith it# 5 service compan* 0ill ver* often sell a range of services# It ma* !eci!e to offer 1"n!les of these services at special prices# Package holi!a*s 0hich offer travel, hotel, transportation, sports, facilities an! e:"ipment, entertainment an! ins"rance are e(amples of this# In these areas pricing nee!s to 1e caref"ll* consi!ere! in or!er to o1tain the ma(im"m potential profit an! reven"e from each c"stomer# %ricing strategies Until recentl*, t0o 1roa! strategic approaches to prices 0ere in vog"e# The* are 6i7 Skimming an! 6ii7 Penetration# Skimming strateg* is 1ase! on the perceive! nee! of the "sers 0hich ten! to affect their sensitivit* to the prices# Chen the* are insensitive to the prices it co"l! 1e e(ploite! 1* setting a ver* high price to skim the cream off the market# Chereas, a penetration strateg* ass"mes that 1* pro!"cing a pro!"ct similar to that of a competitor an! then "n!er pricing it an! there1* some or all of its market share can 1e taken a0a*# The recent tren! is an alternative val"e)1ase! strateg* 1ase! on the 1elief that the appropriate concept is the perceive! val"e hel! 1* the c"stomer# %ricing &b'ectives The pricing metho!s 1eing a!opte! sho"l! consi!er the pricing o12ective of the service forms# The most t*pical pricing o12ectives that a compan* co"l! have are: Pricing to achieve a !esire! ret"rn on investment? Sta1ili3ation of pricing margin to ens"re ma(im"m profit? Pricing to reali3e the target market share? an! Pricing to meet an! prevent competition for s"rvival#

These represent some of the more common, pricing o12ectives# The !ecision on pricing 0ill 1e !epen!ent on a range of factors incl"!ing: .orporate o12ectives


Positioning of the service The nat"re of competition &ifec*cle of the service6s7 %lasticit* of !eman! .ost str"ct"res Share reso"rces Prevailing economic con!itions Service capacit*

%ricing Methods 5fter consi!ering the !eman!, cost, competitors an! all the other relevant factors in the light of the pricing o12ectives, the service marketer sho"l! consi!er the metho! 1* 0hich the prices are fi(e!# There are !ifferent metho!s an! some of them are: 1# *ost)plus pricing: It incl"!es all metho!s of setting prices 0ith e(cl"sive reference to cost# * a!!ing an amo"nt of mone* to an estimate! pro!"ct cost a selling price is arrive! at# This mone* 0hich is a!!e! is consi!ere! as the profit e(pectation if the sale if ma!e on the 1asis of a!!ing this anticipate! profit to total or f"ll costs# $# *ompetition pricing: Pricing 1ase! on market con!itions 0here firms compete 0ith one another 1* "n!erc"tting others prices, rather than other forms of competition s"ch as pro!"ct :"alit*, pro!"ct !ifferentiation an! a!vertising# '# *ompetitive parity pricing: Pricing is !one on the 1asis of those that are follo0e! 1* the competitor or market lea!er# +# Loss leading pricing: the price of a pro!"ct or service is !eli1eratel* c"t to a point 1elo0 its cost aiming to attract a!!itional c"stomers 0illing to 1"* profita1le items# It is "s"all* applie! on a short)term 1asis to esta1lish position in the market# ,# +ate of return pricing: it is also referre! to as target ret"rn pricing# The prices are set to achieve a given rate of ret"rn on investments an! assets# /# ,alue $ased pricing: It is market !riven an! reinforces the positioning of the service an! the 1enefits the c"stomer receives from the service# In val"e 1ase! pricing, prices are 1ase! on the services perceive! val"e to a given cons"mer segment# G# +elationship pricing: The f"t"re potential profit streams over the lifetime of c"stomers, forms the 1asis for relationship pricing# It is consi!ere! that the relationship pricing is the appropriate form of pricing 0here there is an ongoing contact 1et0een the c"stomer an! the service provi!er# It is sai! that the relationship pricing follo0s closel* the market oriente! approach of val"e 1ase pricing 1"t takes the lifetime val"e of the c"stomer into acco"nt# I# restige pricing: The pricing at a1ove the going market price on the 1asis that man* 1"*ers regar! price as an in!icator of :"alit* an! so 0ill perceive enhance! :"alit* to pro!"cts 0ith higher than "s"al prices# In s"ch cases sellers 0ill 1e a1le to ask prestige prices for pro!"cts 0hich have !istinctive 1ran! names an! rep"tation#

To gain competitive a!vantage, service firms have to "se pricing more strategicall*# "t it is also a fact that pricing has receive! less attention in service firms# Pricing !ecisions are not approache! in a sophisticate! manner in service marketing# Anl* a fe0 marketers "tili3e pricing as a p"rposive marketing tool# %lace( Service Location and Channels


The location an! channels "se! to s"ppl* services to target c"stomers are t0o ke* !ecision areas# &ocation an! channel !ecisions are essential to consi!er ho0 an! at 0hich place the services can 1e !elivere! to the c"stomer# The* 1ecome more relevant to services as the* cannot 1e store! an! mostl* are pro!"ce! an! cons"me! at the same point# The environment in 0hich the !eliver* of service takes place an! the manner of its !eliver* is important attri1"tes of the service 0hen its val"e is perceive!# Service marketers are e(pecte! to seek an! !evelop appropriate !eliver* approaches# &ocation an! channels are consi!ere! to 1e t0o important iss"es in !eveloping s"ch !eliver* approaches# Location Service location is an important consi!eration in place strateg*# 5 service firm sho"l! !eci!e 0here its operations an! staff are sit"ate! 1eca"se if the* are not convenientl* locate! the c"stomers ma* t"rn to rival service provi!er 0ho, in their perception, are convenientl* place!# The t*pe an! !egree of interaction is an important factor involve! in the location of services# Depen!ing "pon the nat"re of the service, The c"stomer ma* go to the service firm, or The service form ma* go to the c"stomer or The service provi!er an! the c"stomer ma* transact 1"siness at arm=s length#

In the first t*pe of interaction mentione! a1ove, 0here a c"stomer goes to the service provi!er, location selection 1ecomes ver* important# >or a service 1"siness s"ch as a resta"rant, location ma* 1e one of the main reasons for patronage# In this t*pe of interaction, service provi!ers seeking gro0th can consi!er offering their services at more than one location# The optim"m location of services for a m"lti)site operator 1ecomes a critical !ecision in 1"sinesses s"ch as car rental, resta"rants, motels, 1anks an! retailers# S"ch organisatoins take great care in selecting appropriate sites on the 1asis of potential c"stomers in the catchment area an! location of competitor=s sites# 5 n"m1er of sophisticate! comp"ter mo!els have 1een !evelope! 0hich can 1e "se! to assess the !esira1ilit* of vario"s site alternatives# In the secon! t*pe of interaction, 0here the service provi!er can go to the c"stomers, site location 1ecomes m"ch less important provi!e! it is s"fficientl* close to the c"stomer for goo! :"alit* service to 1e receive!# In some circ"mstances the service provi!er has no !iscretion in going to the c"stomer as certain services m"st 1e provi!e! at the c"stomers= premises# This is the case 0ith a 0i!e range of maintenance services s"ch as life repair, pest control an! cleaning services# In other cases services provi!ers have !iscretion in 0hether the* !eci!e to offer their services at the c"stomer=s or their o0n premises# Some garages not offer car t"ne "p an! servicing at the c"stomer=s home or office, as !o hair!ressers an! TH repair firms# Some !r* cleaning an! la"n!r* firms have 1"ilt "p highl* profita1le 1"sinesses 1* !ispensing 0ith the nee! for e(pensive m"ltiple high street locations an! locating their operations in a lo0)cost area an! provi!ing a pick)"p an! !eliver* service# -o0ever, 0hen the c"stomer an! service organisatoin transact at arm=s length, location ma* 1e largel* irrelevant# The c"stomers are not concerne! 0ith the ph*sical locations of s"ppliers of services s"ch as electricit*, telephone or ins"rance, provi!e! efficient mail or electronic comm"nications are in place# Some of the important consi!erations face! 1* a service marketer in location are regar!ing the re:"irement 1* the market, the tren!s relating to the competition 0ithin the sector of service activit* 1eing operate! an! the fle(i1ilit* of the service# .omplimentar* services, innovations an! the o1ligations face! 1* the service provi!er are also important# In location selection, the choice of appropriate co"ntr*, regions 0ithin it an! the comm"nit* 0ithin the region, state or cit* are important consi!eration# &ike0ise, it site selection the specific propert* on 0hich the service is propose! to 1e esta1lishe! has to 1e consi!ere!# Some of the critical factors affecting the location !ecision are: .onvenience perceive! 1* the c"stomers, Aperating cost, .omparative pro(imit* 0ith that of the competitors,


.omplementar* an! s"pporting s*stems, Meographic an! environmental factors, "siness climate in the partic"lar location, 5vaila1ilit* of comm"nication net0orks, an! Transport facilities#

Channels 5 channel, accor!ing to the 5merican Marketing 5ssociation, is the str"ct"re of intra compan* organi3ation "nits an! e(tra compan* agents an! !ealers 0holesale an! retail, thro"gh 0hich a commo!it*, pro!"ct or service is markete!# It incl"!es all the stages an! organi3ations thro"gh 0hich a pro!"ct passes 1et0een its points of pro!"ction an! cons"mption# In the process, three participants, vi3#, the service provi!er, interme!iaries an! c"stomers are involve!# The principal f"nction of a !istri1"tion channel is to provi!e a link 1et0een the pro!"ction an! cons"mption 1* filling a0a* the gaps @ !iscontin"ities e(isting 1et0een them# The !iscontin"ities mentione! a1ove ma* arise from a n"m1er of ca"ses# Some of them are: Meographical separation, Time 6in services fl"ct"ations in s"ppl* an! !eman! are generall* "nlikel* an! so this factor ma* not have m"ch relevance7, Information, A0nership 6this also has little importance in services as transfer of legal title to o0nership rarel* occ"rs7, Sorting#

5 channel ma* 1e simple 0hen there is a single, !irect transaction 1et0een pro!"cers an! cons"mers# This form of !istri1"tion is common in some service sectors 6e#g# professional services7# Chen there is a concentrate! pro!"ction an! the cons"mers are 0i!el* !iff"se!, !ifferent channels !evelop an! coe(ist 0ith a variet* of interme!iaries s"ch as a!vertising agencies 0hich act as 1rokers for a n"m1er of relate! services incl"!ing me!ia 1"*ing, print an! pro!"ction# Travel agents act as mi!!lemen for airlines, hotels an! leis"re services# 5 recr"itment agenc* provi!es a service as interme!iar* 1et0een emplo*er an! emplo*ee# The 1roa! channel options for services are o"tline! in the follo0ing fig"re an! incl"!e: Service Provi!er Direct sales, e#g# acco"nting an! management cons"lting services# 5gent or 1roker, i#e# ins"rance 1roker, estate agent an! travel agent# Seller= agent Seller=s an! 1"*ers= agents or 1rokers, e#g# stock1rokers an! affinit* gro"ps, >ranchises an! contracte! service !eliverers, e#g# fast foo!, car services an! !r* cleaning# 5gent or roker >ranchise! or contracte! service !elivere! "*er=s agent

.ons"mer Fig. @.1 +anne1 &pti&n% -&r %er'i(e (&,panie%


This ill"strates that altho"gh man* services are intangi1le an! insepara1le an! !irect sales ma* 1e the appropriate channel, services can 1e !istri1"te! 1* a consi!era1le n"m1er of other channel options# In financial services sector a range of !istri1"tion options are 1eing "se!# These incl"!e the follo0ing: Direct face)to)face sales Use of tie! or "ntie! sales representatives Direct mail Telemarketing .omp"ter net0orke! !istri1"tion Professional service firms, e#g# estate agents an! cons"ltants# .a1le TH#

Ane approach to consi!ere! the channels is ho0 the* compare 0ith those of the competitors is s"ggeste! 1* &ight# -is frame0ork has these main sectors: The channel participants an! their relationships# The vario"s f"nctions that participants perform "sing material an! technological s"pports# The service the* create#

Location and Channel Choice The choice of 1oth !istri1"tion an! channels for services largel* !epen!s on the partic"lar re:"irements of the market an! the nat"re of the service itself# Technolog* has, in some instances, change! the a!vantage to 1e gaine! 1* pro(imit* of a service to the c"stomer market# >or e(ample, electronic 1anking has remove! some of the nee! for 1anks to 1e locate! on high streets an! also the re:"irements for long opening p"rs to !eliver their services# Man* 1anking transactions can no0 1e performe! easil* 0itho"t personal contact# Technolog* has allo0e! changes in the location !ecision in man* service in!"stries, 1"t the !ecision on 0here an! ho0 to !istri1"te service is often still !epen!ent on the nee!s of the c"stomer# Service !eliver* channels are often the service provi!ers# This highlights the importance of the selection of the appropriate !eliver* channel# %romotion of Services


Promotion is a set of activities !esigne! to increase p"rchases 1* cons"mers an! is the means thro"gh 0hich the service provi!er comm"nicates 0ith his target markets# The promotion of services cover a n"m1er of areas or promotional tools 0hich form the comm"nications mi( or promotions mi(# These incl"!e: 5!vertising Personal selling Sales promotion P"1lic relations Cor! of mo"th, an! Direct mail#

The "se of promotional tools in service sector is a comparativel* recent aspect# No0, the fiercel* competitive environment has ma!e the service marketers "se promotional tools activit*# "t promotional e(ercise as it is !one in cons"mer goo!s companies 0ill not the same for services in!"str*# 5 comm"nication programme for a service organi3ation ma* consist a 0i!e variet* of alternative comm"nications an! promotion tools# To comm"nicate the target markets, the vario"s elements of the comm"nication mi( m"st 1e integrate! 0ithin the promotion an! comm"nication programme# This process involves man* tasks among 0hich the follo0ing are consi!ere! important# I!entification of target a"!ience, Determination of promotion o12ectives Selection of comm"nication mi(

The choice of the comm"nications mi( for services involves !ecisions on s"ch iss"es as 0hether to a!vertise, "se personal selling or generate p"1licit* thro"gh greater p"1lic a0areness 1* s"ch means as thro"gh e!itorials, p"1lications an! press activit*# The choice of me!i"m is !etermine! 1* !ecisions on ho0 to create the most favo"ra1le a0areness amongst the target a"!ience# A)'erti%ing 5!vertising is one of the main forms of impersonal comm"nication "se! 1* service firms# The role of a!vertising in services marketing is to 1"il! a0areness of the service, to a!! to the c"stomer=s kno0le!ge of the service, to help pers"a!e the c"stomer to 1"*, an! to !ifferentiate the service from other service offerings# Relevant an! consistent a!vertising is therefore of great importance to the s"ccess of the marketing of the service# 5!vertising has a ma2or role in helping !eliver the !esire! positioning for the service# eca"se the core pro!"ct is intangi1le it is !iffic"lt to promote, service marketers therefore fre:"entl* choose tangi1le elements 0ithin the pro!"ct is intangi1le it is !iffic"lt to promote, service marketers therefore fre:"entl* choose tangi1le elements 0ithin the pro!"ct s"rro"n! for promotion# Th"s airlines promote the :"alit* of their c"isine, the 0i!th an! pitch of their seats, an! the :"alit* of their in)flight service# There are several important iss"es in a!vertising# The most important are selection of me!ia, !etermination of a!vertising goals an! metho!s of !etermining the a!vertising 1"!get# Me!ia incl"!es ra!io, television, cinema, ne0spapers an! perio!icals, !irect mail an! o"t!oor a!vertising# In selecting the me!ia, the characteristics of the me!i"m atmosphere of the me!i"m, coverage of the me!i"m an! the comparative cost are important factors# Selection of appropriate me!ia an! !etermining the 1alance 1et0een them is essential to o1tain the most effective ret"rn on a!vertising e(pen!it"re# 5 consi!eration of the specific a!vertising goals to 1e accomplishe! 0ill facilitate this process# 5!vertising goals are important to all a!vertising campaigns# The* sho"l! 1e so"n! an! complete an! a meas"rement of effectiveness of an a!vertisement or a!vertising campaign is impossi1le "nless satisfactor*


o12ectives have first 1een specifie!# The a!vertising o12ectives as the* are generall* referre! to, sho"l! 1e e(plicit, commonl* agree!, "ne:"ivocal, tr"e, cali1rate! an! testa1le# 5!vertising 1"!get or the a!vertising appropriation, as it is sometimes referre! to, has man* approaches# These incl"!e the <affor!a1le= metho! 6ho0 m"ch can the organi3ation affor!7? the <percentage of t"rnover= metho! 6a given proportion of the overall 1"!get is set asi!e for a!vertising7: the <competition parit*= metho! 6an amo"nt !esigne! to effectivel* compete in a given competitive area7? an! the <o12ective an! task= metho!# The o12ective an! task metho! s"ggests that a!vertisers sho"l! !eci!e on their 1"!get 1* firstl* !efining their a!vertising o12ectives an!, secon!l* 1* !etermining the a!vertising task, an! its cost, to achieve those o12ectives# It is s"ggeste! this is the most appropriate metho! to "se, an! it is one 0hich has strong appeal amongst more sophisticate! a!vertisers# -o0ever, it is necessar* to eval"ate the tra!e off 1et0een the 1enefits in achieving the o12ectives an! the cost of their achievement# 5!vertising activities generall* sho"l! 1e integrate! 0ith other elements of the comm"nications mi(# The* sho"l! create a positive image to s"pport the activities of the service compan*=s sales personnel so as to increase their prospects for sales to the c"stomers# %ersonal Selling Personal selling has a vital role in service, 1eca"se of the large n"m1er of service 1"sinesses 0hich involve, personal interaction 1et0een the service provi!er an! the c"stomer? the service 1eing provi!e! 1* a person not a machine an! <people= 1ecoming part of the service pro!"ct# Man* c"stomers of service firms have a close an! on)going relationship 0ith the service provi!ers# Un!er these circ"mstances selling has a pivotal role in the comm"nications mi(# In certain services selling is the preeminent element in the comm"nication mi(# Selling of services incl"!e target prospect i!entification, sales call planning, preparation of presentations, han!ling o12ections an! closing a sale# Meorge, ;ell* an! Marshall s"ggest seven g"i!elines for selling services# The* are: Archestration of the service p"rchase enco"nter# >acilitation of a :"alit* assessment 1* the c"stomer, Making the service tangi1le %mphasis on organisatoins images, Use of references from e(ternal so"rces, Recognition of importance of c"stomer contact personnel, an! Recognition of c"stomer involvement !"ring the service !esign process#

&ack of training an! resistance to selling are t0o commonl* face! pro1lems in man* services 1"siness# 5 sales management str"ct"re s"pporte! 1* a programme of sales training, 0ill help improve the capacit* of the sales personnel# Market orientation !evelopment programmes are helpf"l to overcome to pro1lem of resistance to selling# Seles %romotion Sales promotion incl"!es an* marketing activit* !esigne! to sell a pro!"ct or service# It involves man* marketing tactics like price, 1on"s offers, a!!itional services an! gifts# Tra!itionall*, sales promotion 0as "se! mainl* in cons"mers goo!s market# No0 man* service firms also a!opt sales promotion programmes to a large e(tent# Sales promotion tools can 1e aime! at three gro"ps: 1# ."stomers free offers, sample, !emonstrations, co"pons, cash ref"n!s, pri3es, contests an! 0arranties#


$# Interme!iaries)free goo!s, !isco"nts, a!vertising allo0ances, cooperative a!vertising, !istri1"tion contests, a0ar!s# '# Sales force 1on"ses, a0ar!s, contests an! pri3es for 1est performer# Sales promotions are not al0a*s 0ell coor!inate! 0ith marketing o12ectives an! other components of the comm"nications mi(# To help !evelop, implement an! test a promotions programme the follo0ing steps sho"l! 1e taken: 1# Deci!e the o12ectives of sales promotion an! ho0 the* 0ill s"pport other comm"nications an! marketing mi( elements# $# Determine the 1alance of promotions activit* 1et0een c"stomer, interme!iaries an! sales force# '# Deci!e the sales promotion tools to 1e "se!# +# >or each element of sales promotions programme: a# Determine the amo"nt of the incentive? 1# %sta1lish con!itions for involvements? c# Deci!e on the length of the promotion?

!# .hoose the !istri1"tion metho! for promotion? an! e# Sche!"le the promotion timeta1le ,# 5gree the sales promotion 1"!get /# Pre)test the sales promotion 1"!get# G# &a"nch the sales promotion programme I# %val"ate the sales promotion programme# P*/1i( re1ati&n% The Instit"te of P"1lic Relations of %nglan! !efines p"1lic relations practice as 9The planne! an! s"staine! effort to esta1lish an! maintain goo!0ill an! m"t"al "n!erstan!ing 1et0een an organi3ation an! its p"1lics4# P"1lics incl"!e all the gro"ps of people an! organi3ations 0hich have an interest in the service compan*# So the emplo*ees also can 1e incl"!e!# 5s p"1lics are more !iverse, p"1lic relations is essential to comm"nicate 0ith them# P"1lic relations is concerne! 0ith man* marketing takes like) "il!ing an! maintaining image, -an!ling pro1lems an! iss"es smoothl*, Reinforcing positioning, Infl"encing the p"1lic to a position favo"ra1le to the marketer an! Preparing the p"1lic favo"ra1l* 0hile la"nching ne0 services#

5 service organi3ation=s <image= is ma!e "p of the collective e(periences, vie0s, attit"!es an! 1eliefs hel! a1o"t it# P"1lic relations can s"e a range of comm"nications approaches to improve or maintain the image of a service organisation# Averall the o12ectives 0ith image is to ens"re that an organi3ation is vie0e! more favo"ra1l*, an! is more familiar, than competitors in the market segments its serves# 5 0i!e range of tools can 1e "se! in the !esign of a p"1lic relation programme# These incl"!e: P"1lications, incl"!ing press releases, ann"al reports, 1roach"res, posters, articles an! emplo*ee reports#


%vents, incl"!ing press conferences, seminars, speeches, conferences# Investor relations aime! at gaining s"pport of investors an! anal*sis# Stories 0hich create me!ia coverage %(hi1itions incl"!ing e(hi1its, !ispla*s# Sponsorship of charita1le ca"ses an! comm"nit* pro2ects#

A&r) &- ,&*t+ Ane of the most !istinctive feat"res of promotion in service 1"sinesses in the greater importance of referral an! 0or! of mo"th comm"nications# It highlights the importance of the people factor in services promotion# ."stomers "tili3ing a service, talks to other potential c"stomers a1"t their e(perience# S"ch an en!orsement has more relia1ilit* an! impact than an a!vertisement or other mass or personal comm"nications mi( elements# The m"ltiplier effect from 0or! of mo"nt is not "niform to all pro!"cts# It varies from in!"str* to in!"str* an! sit"ation to sit"ation# "t a service marketer sho"l! 1e caref"l a1o"t negative referrals as the* ten! to have a greater impact than positive e(periences# Dissatisfie! c"stomers are likel* to talk a1o"t their e(periences to more people an! this can significantl* re!"ce the effectiveness of a!vertising an! other elements of the comm"nications mi(# 5ire(t ,arketing Direct marketing is recogni3e! as a lo0 cost an! effective metho! for comm"nicating 0hich corporate c"stomers !"e to increasing cost in !irect sales force# Developments in electronic me!ia, telecomm"nications, internet etc# provi!e great opport"nities for !eveloping integrate! programmes for !irect marketing activities# .onse:"entl*, man* service firms have 1eg"n to take a!vantage of the 1enefits of a coor!inate! !irect marketing programme# %eople in Services The s"ccess of marketing a service is tie! closel* to the selection, training, motivation an! management of people# There are man* e(amples of services failing or s"ccee!ing as a conse:"ence of the ineffective or effective management of people# 5ll the people participating in the !eliver* of service provi!e c"es to the c"stomer regar!ing the nat"re of the service itself# -o0 these people are !resse!, their personal appearance an! their attit"!es an! 1ehavio"rs all infl"ence the c"stomer=s perceptions of the services# ;otler sa*s that, 9if the service personnel are col! or r"!e, the* can "n!ermine all the marketing 0ork !one to attract c"stomers# If the* are frien!l* an! 0arm, the* increase c"stomer satisfaction an! lo*alt*4# -ence, the importance of people 0ithin the marketing of services has gaine! m"ch interest in internal marketing# Ane of the 1est kno0n an! most !ramatic e(amples is the t"rn)aro"n! of ritish 5ir0a*s !"ring the 18IJ=s# >ace! 0ith !eclining profits, greater c"stomer complaints, emplo*ee !issatisfaction an! increase! competition, ritish 5ir0a*s la"nche! a series of programmes to refoc"s on the people 0ithin the organisatoin %mplo*ees 0ere involve! in the process of t"rning the compan* aro"n! thro"gh the !evelopment of increase! a0areness of he critical importance of the c"stomer# %mplo*ees 0ere traine! to !evelop ne0 attit"!es to0ar!s c"stomers 1* emphasi3ing that the airline 0as in 1"siness to satisf* their nee!s# In t"rn, the compan* ma!e emplo*ees feel 0ante! an! care! for, 1"il!ing on the principle that those 0ho are looke! after 0ill pass on this caring attit"!e# The s"ccess of this ne0 !irection for the airline 1ro"ght increase! profits matche! 1* greater c"stomer an! emplo*ee satisfaction# The high level of profita1ilit* achieve! 1* ritish 5ir0a*s in 188$, in the mi!st of a ma2or recession, highlights the effectiveness of their strateg*# Th"s 1* recogni3ing the contri1"tion people make to ac:"iring an! keeping c"stomers, 0ithin the overall marketing mi(, the service compan*=s competitive performance 0ill 1e s"1stantiall* enhance!# %rocess in Services The process 1* 0hich the services is create! an! !elivere! to the c"stomer is critical to the service operations as c"stomers often perceive the service !eliver* s*stem as part of the service itself# Process means all 0ork activities# Process involve the proce!"res, tasks sche!"les, mechanisms, activities an! ro"tines 1* 0hich a pro!"ct or service


is !elivere! to the c"stomer# It involves polic* !ecision a1o"t c"stomer involvement an! emplo*ee !iscretion# I!entification of process managemen as a separate activit* is a m"st for service :"alit* improvement# Its importance is service 1"siness is evi!ent 1eca"se of the insepara1ilit* of pro!"ction an! cons"mption# The c"stomers is evi!ent 1eca"se of the insepara1ilit* of pro!"ction an! cons"mption# The c"stomers not onl* think a1o"t the service pro!"ct alone, the* attach importance to the manner in 0hich it is !elivere!# Un!er these circ"mstances, a poorl* !esigne! service process lea!s to poor service :"alit*# anks provi!e a goo! e(ample of this# * reconfig"ring the 0a* the* !eliver service thro"gh the intro!"ction of a"tomatic teller machines 65TMs7 1anks have 1een a1le to free staff to han!le more comple( c"stomer nee!s 1* !iverting cash onl* c"stomers to the 5TMs# Processes are seen as str"ct"ral elements that can 1e engineere! to help !eliver a !esire! strategic positioning# The* can 1e anal*3e! accor!ing to their comple(it* an! !ivergence# Processes can 1e change! to reinforce the positioning or esta1lish a ne0 positioning# 5 clear "n!erstan!ing of the config"ration processes in terms of this comple(it* an! !ivergence, on a 1alance of marketing an! operations activities are important factors for improving services s*stems# Processes are th"s a marketing mi( element 0hich can have a s"1stantial role in reinforcing positioning an! in pro!"ct !evelopment# %hysical )vidence in Service The environment in 0hich the service is !elivere! an! 0here the firm an! c"stomer interact, an* tangi1le components that facilitate performance or comm"nication of the service is kno0n as ph*sical evi!ence in service# The ph*sical evi!ence of service incl"!es all of the tangi1le representations of the service s"ch as 1roch"res, letterhea!, 1"siness car!s, report formats, signage, an! e:"ipment# In some cases it incl"!es the ph*sical facilit*# Ph*sical evi!ence c"es provi!e e(cellent opport"nities for the firm to sen! consistent an! strong messages regar!ing the organi3ation=s p"rpose, the inten!e! market segments, an! the nat"re of the services# 5e'e1&ping a ,arketing ,i< %trateg2 These seven elements of the services marketing mi( interact 0ith each other# The* sho"l! 1e !evelope! in a m"t"all* s"pportive manner to o1tain the 1est possi1le match 1et0een the internal an! e(ternal environments of the organisation# In !eveloping a marketing mi( strateg* service marketers nee! to consi!er the relationships 1et0een the elements of the mi(# It has 1een pointe! o"t that there are three !egree of interaction 1et0een the marketing mi( elements: .onsistenc*, 0here there is a logical an! "sef"l fit 1et0een t0o or more elements of the marketing mi(# Integration, 0hich involves an active harmonio"s interaction 1et0een the elements of the mi(# &everage, 0hich involves a more sophisticate! approach an! is concerne! 0ith "sing each element to 1est a!vantage in s"pport of the total marketing mi(#

Th"s effective relationship marketing is 1ase! on the choice an! !esign of marketing mi( elements that are m"t"all* s"pportive an! leverage! together so that s*nerg* is achieve!# This implies that people, processes an! c"stomer service sho"l! 1e seen as cr"cial a!!itional elements of services marketing mi(# 5t the same time each marketing mi( elements has an impact on the market segments selecte! ens"ring that there is a fit 1et0een the marketing mi( an! each target segment? a fit 1et0een the marketing mi( an! the compan*=s strategic capa1ilities, emphasi3ing its strengths an! minimi3ing the impact of its 0eaknesses? an! a recognition of competitor=s capa1ilities, 0hich involves eva!ing their strengths an! capitali3ing on their 0eaknesses# -ence an effective marketing plan o"tlining the marketing mi( strateg* has to 1e !evelope! an! implemente!# "e%%&n B Marketing P1an% -&r Ser'i(e% There has 1een gro0ing emphasis on, an! acceptance of, marketing planning over the *ears# 5 n"m1er of a"thors have !evelope! approaches to marketing planning? some are highl* aca!emic an! are 1ase! on marketing theor*, 0hilst others have attempte! to i!entif* !emonstrate! 1est practices in a 0i!e range of companies, linking these to the theoretical concepts that have 1een !evelope! in 1oth strategic an! marketing planning# Ane approach that has prove! ro1"st in 1oth in!"strial, cons"mer an! services markets is the marketing frame0ork !evelope! 1* Malcolm McDonal!# This frame0ork is "se! 0i!el* in 1oth service an! in!"strial firms# asing on this


frame0ork, the follo0ing fo"r phases are evolve! 0hich in t"rn has 1een 1roken !o0n into ten ma2or steps# The ma2or phases are: 1# Strategic conte(t $# Sit"ation revie0 '# Marketing strateg* form"lation +# Reso"rce allocation an! monitoring These fo"r phases together 0ith the associate! steps are sho0n in the follo0ing fig"res# 5ltho"gh the process is sho0n as in!ivi!"al steps, man* of the steps are interrelate! an! the process is interactive# 5lso the !egree to 0hich each step sho"l! 1e emphasi3e! in a given service firm 0ill !epen! on the si3e an! nat"re of the organisation# %hase*I( Strategic Conte+t The first phase of marketing planning has t0o steps: !efining the mission an! i!entif*ing corporate o12ectives# These are !erive! !irectl* from the strategic planning process# It is necessar* to i!entif* the strategic conte(t of the marketing plan to ens"re that specific marketing o12ectives an! strategies are !irecte! to0ar!s the overall corporate goals of the compan*# Mi%%i&n Mission The p"rpose of he mission statement is to give the vario"s stakehol!ers of the Strategic service 1"siness Phase)1: conte(t a clear sense of p"rpose an! !irection# The mission statement is an important !evice for coor!inating activities in a service organisatoin# .orporate It provi!eso12ectives a frame0ork to ena1le staff operating in !iverse parts of the organisatoin to 0ork together in a coor!inate! manner to0ar!s the achievement of the overall o12ectives an! philosoph* of the enterprise# Chilst !etermination of the mission "s"all* occ"rs at the corporate planning level, it is essential that this is consi!ere! in the marketing plan so that the s"1se:"ent steps of the marketing plan are foc"se! to0ar!s achieving the Marketing a"!it organi3ation=s overall p"rpose#

SCAT anal*sis

Phase)$: Sit"ation Revie0

;e* ass"mptions

Marketing o12ectives an! strategies

%stimate e(pecte! res"lts

Phase)': Marketing Strateg* >orm"lation

I!entif* alternative mi(es

Marketing programmes

Phase)+: Reso"rce 5llocation an! Monitoring

Monitoring, control an! revie0

Fig. B.1 T+e ,arketing p1anning pr&(e%%

&rp&rate &/9e(ti'e% Ance a mission statement has 1een !evelope! corporate o12ectives nee! to 1e a!!resse!# The p"rpose of the corporate o12ectives is for he stakehol!ers to meas"re the s"ccess of the mission# Peter Dr"cker has i!entifie! a n"m1er of ke* areas in 0hich o12ectives nee! to 1e set# These incl"!e the follo0ing: 1# Market Stan!ing: a# Sales an! market shares 1* pro!"ct an! market segment? 1# ."stomer service levels? an! c# 5vaila1ilit* of services

$# Innovation ne0 pro!"cts an! services re:"ire! to achieve market o12ectives# '# Pro!"ctivit* of emplo*ees an! capital# +# Ph*sical an! financial reso"rces: a# "il!ings, e:"ipment, processes an! technolog*?

1# .apital? an! c# Ra0 material an! components#

,# Profita1ilit*: a# To replace assets? 1# >or innovation an! e(pansion? an!



To re0ar! risk taking an! attract ne0 capital#

/# Manager performance an! !evelopment G# Corker performance an! attit"!e I# P"1lic responsi1ilit* Service companies nee! to consi!er in 0hich specific areas o12ectives sho"l! 1e set for their organisation# Service companies approach the setting of o12ectives in !ifferent 0a*s# ritish 5ir0a*s corporate o12ectives are sho0n in the follo0ing ta1le# In the earl* 18IJs, ritish 5ri0a*s regar!e! itself as an airline 0ith the primar* f"nction of fl*ing plans# It 0as le! 1* o12ectives 0hich stresse! technical efficienc*, ignoring the o12ective of tr*ing to satisf* passengers nee!s in the 1est possi1le 0a*# 5 ma2or t"rnaro"n! in profita1ilit* 0as 1ro"ght aro"n!, in part, 1* mo!if*ing the o12ectives of the compan* to recogni3e that instea! of 1eing in the 1"siness of fl*ing airplanes, ritish 5ir0a*s 0as in fact in the 1"siness of satisf*ing passenger re:"irements# Ta/1e 1C.1 Briti%+ air0a2:% (&rp&rate &/9e(ti'e% 1# $# '# +# ,# /# G# To provi!e the highest levels of service to all c"stomers, passengers, shippers, travel agents an! freight agents# To preserve high professional an! technical stan!ar!s in or!er to achieve the highest levels of safet* To provi!e a "niform image 0orl!0i!e an! to maintain a specific set of stan!ar!s for each clearl* !efine! market segment To respon! :"ickl* an! sensitivel* to changing nee!s of o"r present an! potential c"stomers To maintain an!, 0here opport"nit* occ"rs, e(pan! o"r present ro"te str"ct"re# To manage, operate an! market the airline in the most efficient manner# To create a service an! people oriente! 0ork environment, ass"ring all emplo*ees of fair pa* an! 0orking con!itions an! contin"ing concern for their careers#

A12ectives ma* 1e :"alitative 6as in the case of ritish 5ir0a*s= o12ectives7 :"antitative or a com1ination of 1oth# >or e(ample, one financial services compan* e(presse! corporate o12ectives 0hich incl"!e!: Profit !o"1ling gro"p earnings 1* $JJ/ Mro0th tre1ling gro"p reven"es 1* $JJG Innovation la"nching at least one ma2or ne0 pro!"ct or service ever* t0o *ears 0hich 0ill represent at least 1JP of total sales reven"e 0ithin t0o *ears of la"nch# .orporate Image achieving "nprompte! a0areness improvement, as meas"re! 1* e(ternal research, from 'JP to ,JP 1* $JJ, Services increasing cons"ltanc* an! val"e a!!e! services from 1,P to $,P of total reven"es 1* $JJ, Staff containing staff t"rnover to less than /JP of in!"str* average for the sector#

The setting of corporate o12ectives alongsi!e the mission statement provi!es an opport"nit* to test the appropriateness of 1oth the corporate o12ectives an! the mission statement# The corporate o12ectives, in a!!ition to comprehensivel* covering the areas i!entifie!, sho"l! also ena1le eval"ation of 0hether the corporate mission is 1eing achieve!# Th"s the mission statement an! corporate o12ectives are tightl* interlinke!# %ach ke* element of the


mission statement sho"l! 1e covere! 1* a corporate o12ective# In most cases these 0ill 1e :"antifie! so that the e(tent to 0hich the* are accomplishe! can 1e o12ectivel* assesse!# The marketing planning process starts 0ith these t0o steps !erive! from the strategic planning process# Service companies 0ith relativel* homogeneo"s services operating in a local market nee! to !evelop onl* one marketing plan at the corporate level, 0hilst those companies 0ith consi!era1le !iversit* of service an! markets nee! to !evelop !ivisional or s"1"nit marketing plans, 0hich are then integrate! into an overall marketing plan# .lear o12ectives, 1oth corporate an! marketing, are ke* elements of the marketing plan# The 1asic p"rpose of the marketing plan is to provi!e an integrate! frame0ork for implementing the marketing strateg* an! s"1)programs, in or!er to achieve these specifie! o12ectives# %hase , II ( Sit ation #evie" The sit"ation revie0 phase consists of three steps: the marketing a"!it, sit"ation anal*sis an! the i!entification of ke* ass"mptions in the marketing plan# Marketing a*)it The p"rpose of the marketing a"!it is to gather all the !ata necessar* to !etermine ho0 the 1"siness can s"ccee! in each marketing segment in 0hich it chooses to compete# The !ata collecte! are "s"all* split 1et0een the e(ternal appraisal of the environment in 0hich the compan* operates, an! an internal assessment# oth sets of !ata nee! to 1e relate! to the c"rrent sit"ation an! the likel* f"t"re tren!s# The categories of anal*sis for a marketing a"!it are sho0n in the follo0ing fig"res# This incl"!es: En'ir&n,enta1 &,petiti'e Ana12%i% 1# %nvironmental 5nal*sis Ana12%i% $# .ompetitive 5nal*sis Ma2or competitors '# Market 5nal*sis Political Their goals an! +# .ompan* 5nal*sis %conomic o12ectives The marketing a"!it involves a comprehensive an! s*stematic e(amination an! anal*sis of the a1ove fo"r categories# Social Market place 1ehavio"r There are man* anal*tical Technological tools an! techni:"es 0hich can 1e "se! to lookMarket at 1othshare services an! c"stomers in a logical, str"ct"re! manner# Several of the most important of these are the follo0ing: >inancial Mro0th &egal Service :"alit* The pro!"ct @ service lifec*cle# Reg"lator* Positioning The oston .ons"lting Mro"p matri( Religio"s Aperations an! reso"rces The m"ltiple factor portfolio matri( glo1al Marketing mi( an! strategies

Marketing A*)it

Market Ana12%i% Si3e Mro0th ."stomer segments ."stomer nee!s "*er 1ehavio"r Interme!iaries

&,pan2 Ana12%i% A"r goals an! o12ectives Market share Mro0th Service :"alit* Positioning Aperations an! reso"rces Marketing mi( strategies


S0&t ana12%i% Ance all the !ata from the marketing a"!it have 1een amasse! it is necessar* to eval"ate the compan*=s internal position in relationship to its partic"lar strengths an! 0eaknesses, compare! 0ith the opport"nities an! threats presente! 1* the e(ternal environment# This anal*sis is 0ell kno0n SCAT 6Strengths, Ceaknesses, Apport"nities an! Threats7 anal*sis an! provi!es a familiar, easil* "n!erstoo!, an! str"ct"re! !evice for !eveloping i!eas for the f"t"re# The p"rpose of the SCAT anal*sis is to separate o"t the meaningf"l !ata in the marketing a"!it an! to !iscover 0hat management m"st !o to 1est satisf* its c"stomers in each market segment in 0hich it chooses to complete# The f"n!amental o12ectives of SCAT anal*sis is to i!entif* those tren!s, forces an! con!itions 0hich have a potential impact on the form"lation an! implementation of the compan*=s marketing strategies# This is almost important step for t0o reasons# >irstl*, an* change in the e(ternal environment can have a profo"n! impact on a compan*=s markets# * anticipating an! taking action the compan* 0ill 1e 1etter place! to take a!vantage of these changes# Secon!l*, it provi!es an! opport"nit* to esta1lish 0hich are the most important aspects to eval"ate# The total amo"nt of environmental information that co"l! 1e collecte! in the marketing a"!it is enormo"s, an! clearl* the compan* m"st i!entif* those aspects 0hich are of the greatest significance an! make a !ecision as to ho0 m"ch !etail an! acc"rac* is re:"ire!# This stage la*s the fo"n!ations for i!entif*ing the ke* marketing o12ectives an! strategies# Chen all fo"r areas of the SCAT have 1een i!entifie! there m"st 1e a !ecision a1o"t 0hat the* mean, an! 0hat actions are nee!e! to enhance or !eal 0ith the partic"lar aspects# Ke2 a%%*,pti&n% The last step in the sit"ation revie0 stage is the i!entification of ke* ass"mptions# The p"rpose of ke* ass"mptions is to i!entif*, from the sit"ation revie0, those factors that 0ill 1e critical to the s"ccess or fail"re of the marketing strateg*#


;e* ass"mptions are an estimate of the f"t"re operating con!itions for the marketing plan# The* ma* infl"ence 1oth its form"lation an! implementation# ;e* ass"mption might incl"!e the follo0ing: .hanges in gross national pro!"ct Interest rates Inflation rates Stat"s of econom* 5nticipate! !eman! levels Reg"lator* changes

Chen ke* ass"mptions are i!entifie!, it is s"ggeste! that the* sho"l! 1e presente! in t0o col"mns# The first col"mn lists the ke* ass"mptions "n!er appropriator hea!ings# The secon! col"mn lists <implications for marketing plan=# This forces the marketing planner to consi!er 0hat ke* ass"mptions mean for the plan# ;e* ass"mptions that are critical, an! 0hich co"l! change, ma* nee! to form the s"12ect of contingenc* plans# %hase ,III( Marketing Strategy -orm lation The ne(t phase of the marketing plan is marketing strateg* form"lation# This is perhaps the most important aspect of the 0hole process# The first step of this phase is setting the marketing o12ectives an! strategies# It is necessar* to set realistic an! achieva1le o12ectives for the compan*=s ma2or services in each of its markets# This is follo0e! 1* development of mar&eting strategies- estimating e'pected results an! identifying alternative mar&eting mi'es. Marketing &/9e(ti'e% an) %trategie% The p"rpose of setting marketing o12ectives an! marketing strategies is to target the profit, reven"e an! market share necessar* to satisf* the mission, an! ho0 an integrate! marketing mi( is to 1e !evise! to achieve the target for each segment# 5 mar&eting o$"ective is a precise statement, 0hich o"tlines 0hat is to 1e accomplishe! 1* the service compan*=s marketing activities? mar&eting strategies are the means 1* 0hich marketing o12ectives are achieve!# The process of setting o12ectives consists of the follo0ing three levels: 1# Level /: Setting 1roa! marketing o12ectives# The 1roa! marketing o12ectives 0o"l! 1e concerne! 0ith long) term profita1ilit*, an! 1e relate! to the organi3ational o12ectives# $# Level $: Setting o12ectives for ke* res"lt areas# -ere the o12ectives are !efine! more precisel* an! specificall* relating to !ifferent f"nctions# '# Level ': Setting s"1o12ectives to s"pport the 1roa! o12ectives# These o12ectives 0o"l! 1e 1ase! on sales vol"me goals, geographic e(pansion, an! service offering e(tension# Marketing o12ectives help !etermine 0here the organisation 0ant to go an! also provi!e *ar!sticks 1* 0hich it can meas"re its performance# 5 marketing o12ective sho"l! meet several criteria, an! sho"l! 1e: +elevant the marketing o12ective sho"l! 1e relevant in relation to the corporate mission an! o12ectives# #pecific it sho"l! foc"s on clear an! i!entifia1le goals# !easurea$le the o12ective sho"l! 1e :"antifie! Time $ound it sho"l! have an achievement !ate attache! to it# *hallenging o12ectives sho"l! 1e relia1le, 1"t sho"l! stretch people in achieving them# Focused marketing o12ectives sho"l! foc"s on iss"es relating to 1oth the markets pro!"cts an! services, 0hich the compan* 0ishes to a!!ress#


Market o12ectives an! strategies to achieve the target incl"!e: 1# Increase! pro!"ctivit*: a# Sales force effectiveness? 1# More efficient !istri1"tion? c# Pricing strategies? an!

!# Improve! c"stomer service# $# Increase! reven"es from: a# Market penetration? 1# Service !evelopment? c# Market !evelopment? an!

!# Diversification# '# Decrease e(penses: a# Scale relate!? an! 1# Non)scale relate! %ach of these elements nee!s to 1e s*stematicall* investigate! to !etermine its potential impact on re!"cing the i!entifie! gap# E%ti,ate) e<pe(te) re%*1t% The p"rpose of e(amining the e(pecte! res"lts from the marketing strategies is to ens"re that marketing strategies 0ill act"all* !eliver the !esire! marketing o12ectives# Ance the strategies have 1een !etermine! an! !ecisions ma!e a1o"t the marketing mi( to 1e !evelope! in each market segment, the financial implications of the strategies nee! to 1e eval"ate!# %stimating e(pecte! res"lts involves the !etaile! revie0 of sales reven"es, cost of sales, marketing costs, operating e(penses an! overhea! e(penses# The financial anal*sis sho"l! sho0 that the strateg* 0ill pro!"ce anticipate! res"lts# It is !oes not, the marketing strategies nee! to 1e e(amine! f"rther to see ho0 the* can 1e re!evelope! to achieve the !esire! res"lts# This, like all steps in the marketing plan, ma* 1e an interactive process# I)enti-2 a1ternati'e ,i<e% The p"rpose of consi!ering alternative mi(es is to !iscover if more effective marketing strateg* is availa1le 1efore the plan is implemente!# 5 marketing manager ma* eval"ate a n"m1er of mi(es, "sing 1oth anal*sis an! trial an! error, to fin! the 1est "se of availa1le reso"rces 1efore selecting the final marketing mi( to 1e implemente! as marketing programmes# If the propose! marketing strateg* is not likel* to achieve the !esire! level of e(pecte! res"lts other marketing strategies 0ill nee! to 1e consi!ere!# -o0ever, even if the propose! marketing strategies 0ill !eliver the !esire! res"lts, alternative marketing mi(es sho"l! also 1e investigate! to !etermine if the* can !eliver improve! res"lts# Th"s several f"rther sets of marketing strategies sho"l! 1e !evelope! an! eval"ate!# 5t this point the !evelopment of contingenc* plans sho"l! 1e consi!ere!# 5ltho"gh it is not possi1le to esta1lish a contingenc* plan for ever* event"alit*, the impact of !ifferent sets of ass"mptions sho"l! 1e assesse! an!, 0here appropriate, 1roa! contingenc* plans that 0ill nee! to 1e consi!ere! if certain sit"ations arise# In spite of 1est intentions, change! sit"ations can force marketing strategies to 1e altere!# It is especiall* important that responsi1ilit* for !etermining 0h* variances have occ"rre!, an! for taking appropriate corrective action, is !elegate! to specific managers to ens"re that plan o12ectives can 1e met 1* marshalling the necessar* reso"rces an! 1* taking positive an! timel* action# %hase , I. ( #eso rce /llocation and Monitoring


The last phase in the marketing planning process is reso"rce allocation an! monitoring# This involves t0o final steps: marketing programmes? an! monitoring, control an! revie0# Marketing pr&gra,,e% The p"rpose of marketing programmes is to ens"re that all firm=s staff kno0 0hat actions the* are responsi1le for, an! to !etermine ho0 to allocate the ph*sical an! financial reso"rces availa1le to sec"re s"ccess in each market segment# %ach element of the marketing mi( 0ill have its o0n specific programme, 0hich in t"rn 0ill 1e linke! to specific marketing o12ectives# Marketing programmes are similar to marketing o12ectives an! strategies in that the* sho"l! !o the follo0ing: -ave an esta1lishe! timeta1le an! 1e a1le to 1e carrie! o"t 0ithin a !efine! perio! of time# I!entif* the reso"rces nee!e! to carr* them o"t# Provi!e for monitoring an! control of performance#

Programmes sho"l! clearl* !escri1e the reso"rces nee!e! to accomplish marketing strategies an! the time hori3on in 0hich to achieve them# Programmes provi!e the opport"nit* for all mem1ers of the marketing team to 0ork together in an integrate! manner# Programmes involve the !evelopment of a practical, fact)1ase!, res"lts)oriente! approach 0hich act as a roa! map for management to implement marketing activities# 5 !etaile! marketing 1"!get nee!s to 1e prepare! at this point to ens"re that the necessar* 1"!get allocations, reflecting pro2ecte! costs, are availa1le to carr* o"t the programmes# 5 f"rther task 0ithin programmes is the !evelopment an! prioriti3ation of important marketing activities, s"1activities an! tactics# This involves the preparation of marketing programme timeta1les to help ens"re that ke* tasks are accomplishe! on sche!"le# Marketing programmes nee! to 1e closel* linke! 0ith the final stage of monitoring, control an! revie0 to ens"re s"ccess# M&nit&ring. (&ntr&1 an) re'ie0 The p"rpose of monitoring, controlling an! revie0ing the programmes an! strategies is to ens"re that the short)term strategies are 0orking to 1ring the 1"siness consistentl* to0ar!s achieving its long)term o12ectives an! mission# Some service companies are ver* 0eak at setting an! control their achievement# * contrast other service firms are e(tremel* rigoro"s in their monitoring an! control proce!"res# Ane !iversifie! service firm re:"ires all 1"siness "nits to report !etaile! 0eekl* res"lts into an electronic mail1o( so that performance an! profita1ilit* is calc"late! on a 0eekl* 1asis# Some retailers have similar performance !etails availa1le at the close of each !a*# .learl* the level of !etail an! fre:"enc* of reporting 0ill 1e !etermine! 1* the t*pe of Service .ompan* an! the sector in 0hich it operates# Some service firms 0ill 0ant 0eekl* or even !ail* performance fig"res, 0hilst others can control operations a!e:"atel* 0ith monthl* or :"arterl* reports# 5s the marketing plan is implemente!, performance criteria for meas"ring the performance of marketing efforts 0ill nee! to 1e !etermine!# T*pical performance meas"res to 1e monitore! an! controlle! incl"!e the follo0ing:

Reven"es Market share Marketing costs Averhea! costs Profits


Ret"rn on investments .ons"mer attit"!es Sales force pro!"ctivit* 5!vertising effectiveness .omplaints ."stomer retention

Information s*stems an! reporting proce!"res nee! to 1e esta1lishe! to ens"re that the right information is iss"e! to the right person at the right time an! it a "sef"l format# The essential element of monitoring an! control is to ens"re the !evelopment of information s*stems that meet the nee! of the marketing management charge! 0ith taking corrective action# The ten)step marketing planning frame0ork represents a practical an! proven approach for !eveloping an! refining a services marketing plan#


"e%%&n D *%t&,er>-&(*%e) Ser'i(e% C stomer Service 5 ma2or !ifferentiating factor for service companies is the :"alit* of c"stomer service# ."stomers are 1ecoming more sophisticate! in their re:"irements an! are increasingl* !eman!ing higher stan!ar!s of service# -ence c"stomer service is no0 consi!ere! as a 1roa!er an! separate element of the marketing mi(# These incl"!e the follo0ing: 1# .hanging c"stomer e(pectations $# The increase! importance of c"stomer service '# The nee! for a relationship strateg* .ompanies often have !ifferent perspectives on c"stomer service# These incl"!e: 5ll the activities re:"ire! to accept, process, !eliver an! f"lfill c"stomer or!ers an! to follo0 "p on an* activit* that has gone 0rong# Timeliness an! relia1ilit* of !elivering pro!"cts an! services to c"stomers in accor!ance 0ith their e(pectations# 5 comple( of activities involving all areas of the 1"siness 0hich com1ine to !eliver the compan*=s pro!"cts an! services in a fashion that is perceive! as satisfactor* 1* the c"stomer an! 0hich a!vances the compan*=s o12ectives# Total or!er entr* an! all comm"nications 0ith c"stomers, all invoicing an! total control of !efects# Timel* an! acc"rate !eliver* of pro!"cts an! services or!ere! 1* c"stomers 0ith acc"rate follo0 "p an! en:"ir* response incl"!ing timel* !eliver* of invoice#

These alternative vie0s ill"strate the e(tent to 0hich the meaning of c"stomer service varies consi!era1l* from one compan* to another# The more pragmatic vie0 of c"stomer service is that it is 1roa!er than an* of these !efinitions an! that it is concerne! 0ith the 1"il!ing of 1on!s 0ith c"stomers an! other markets or gro"ps to ens"re long)term relationships of m"t"al a!vantage 0hich reinforce the other marketing mi( elements# ."stomer service can th"s 1e seen as an activit* 0hich provi!es time an! place "tilities for the c"stomer an! 0hich also involves pre)transaction an! post)transaction consi!erations relating to the e(change process 0ith the c"stomer# .hristopher has o"tline! fo"r ke* steps in creating a c"stomer service strateg*: 1# Identifying a service mission: 5 service compan* sho"l! artic"late its service commitment an! val"e either 0ithin its corporate mission an!@ or in a separate c"stomer service mission statement 0hich reflects the compan*=s philosoph* an! commitment to c"stomer service# $# #etting customer service o$"ectives: In consi!ering levels of performance in setting these o12ectives, service companies nee! to consi!er the importance of service :"alit* varia1les s"ch as relia1ilit*, responsiveness, ass"rance, empath* an! tangi1les# ."stomer service o12ectives nee! to 1e consi!ere! in the conte(t of pre) transaction, transaction an! post)transaction activities# This involves "n!erstan!ing 0hat c"stomers val"e, an! their cost 1ase, an! !eveloping a val"e proposition s"perior to that of competitors# '# *ustomer service strategy: .histopher=s approach to !eveloping a service)1ase! strateg* consists of fo"r parts: a# I!entif* service segments? 1# I!entif* most important pro!"cts an! c"stomers? c# Prioriti3e service targets? an!


!# Develop the service package Market research can 1e "se! to i!entif* the ke* components of c"stomers service an! their relative importance, an! !evelop service segments# +# Implementation: once the most effective service package has 1een !evelope! for each segment the compan* 0ishes to p"rs"e it sho"l! then 1ecome part of an integrate! marketing mi(# >or service)sensitive sectors s"ch as airlines the service attri1"tes can 1e "se! as part of the promotional campaign# 5 service compan* sho"l! foc"s especiall* on c"stomer service an! keep c"stomer satisfaction levels "n!er constant revie0# Us"all* there is a nee! for a complaint s*stem 0hich allo0s "nhapp* c"stomers to 1e i!entifie! an! corrective actions taken# 51ove all else, a service compan* nee!s to sta* in to"ch 0ith the changing nee!s of the c"stomers in terms of c"stomer service# Ser'i(e E*a1it2 D"alit* can 1e vie0e! from t0o perspectives internal an! e(ternal# Internal :"alit* is 1ase! on conformance to specifications# %(ternal :"alit* is 1ase! on relative c"stomer)perceive! :"alit*# It is essential that :"alit* is meas"re! from the c"stomer=s perspective, not form 0hat managers 0ithin a compan* thing their c"stomers= vie0s areQ 5 mo!el has 1een !evelope! 1* Paras"raman an! his colleag"es 0hich helps i!entif* the gaps 1et0een the perceive service :"alit* that c"stomers receive an! 0hat the* ect# The mo!el i!entifies five gaps: 1# .ons"mer e(pectation management perception gap# $# Management perception service :"alit* e(pectation gap# '# Service :"alit* specifications service !eliver* gap# *onsumer +# Service !eliver* e(ternal comm"nications to cons"mers gap# Cor! Mo"th service gap# Personal Nee!s ,# %(pecte! service of perceive! Past %(perience .omm"nicationsr Map), is the service :"alit* shortfall as seen 1* the c"stomers, an! gaps 1)+ are shortfalls 0ithin the service organisatoin# Th"s gaps 1)+ contri1"te to gap),# These gaps are sho0n in the follo0ing fig"res: %(pecte! Service Map , Perceive! Services Marketer Service !eliver* 6incl"!ing pre an! post) contracts7 Map ' Translation of perception into service :"alit* specification Map + %(ternal .omm"nications to cons"mers

Management perceptions of cons"mer e(ceptions


Fig. D.1

The first gap is the !ifference 1et0een cons"mer e(pectations an! management perceptions of cons"mer e(pectations# Research sho0s that financial service organisatoins often treat iss"es of privac* an! confi!entialit* as relativel* "nimportant, 0hilst cons"mers consi!ere! them ver* import# The secon! gap is the !ifference 1et0een the management perceptions of cons"mer e(pectations an! service :"alit* specifications# Managers 0ill set specifications for service :"alit* 1ase! on 0hat the* 1elieve the cons"mer re:"ires# -o0ever, this is not necessaril* acc"rate# -ence man* service companies have p"t m"ch emphasis on technical :"alit*, 0hen in fact the :"alit* iss"es associate! 0ith service !eliver* are perceive! 1* clients as more important# The thir! gap is the !ifference 1et0een service :"alit* specification an! the service act"all* !elivere!# This is of great importance to services 0here the !eliver* s*stem relies heavil* on people# It is e(tremel* har! to ens"re that :"alit* specifications are met 0hen a service involves imme!iate performance an! !eliver* in the presence of the client# This is the case in man* service in!"stries: for e(ample, a me!ical practice is !epen!ent on all he a!ministrative, clerical an! me!ical staff performing their tasks accor!ing to certain stan!ar!s# The fo"rth gap is the !ifference 1et0een service !eliver* intention an! 0hat is comm"nicate! a1o"t the service to c"stomers# This esta1lishes an e(pectations 0ithin the c"stomer 0hich ma* not 1e met# Aften this is a res"lt of ina!e:"ate comm"nication 1* the service provi!er# The fifth gap represents the !ifference 1et0een the act"al performance an! the c"stomers= perceptions of the service# S"12ective 2"!gment of service :"alit* 0ill 1e affecte! 1* man* factors# Th"s a g"est in a hotel ma* receive e(cellent service thro"gho"t his sta*, apart from poor checking o"t facilities# "t this last e(perience ma* !amage his entire perception of the service, changing his overall estimation of the :"alit* of the total service provi!e! from goo! to poor# The gap mo!el o"tline! a1ove provi!es a frame0ork for !eveloping a !eeper "n!erstan!ing of he ca"ses of service :"alit* pro1lems, i!entif*ing shortfalls in service :"alit* an! !etermining the appropriate means to close the gaps#


Service :"alit* is concerne! 0ith the a1ilit* of an organisatoin to meet or e(cee! c"stomer e(pectations# The meas"re of performance is perceive! service :"alit*# It has 1een arg"e! that the :"alit* of a service has t0o important components: Technical 0uality the o"tcome !imension of the service operations process# Functional quality the process !imension in terms of the interaction 1et0een the c"stomer an! the service provi!er#

These t0o !imensions of service :"alit* highlight the s"12ective nat"re of :"alit* assessments# Menerall* clients of professional service firms s"ch as acco"nting an! la0 firms have !iffic"lt* in !isting"ishing 1et0een goo! an! o"tstan!ing technical :"alit* of the service? th"s 2"!gments are often ma!e on the s"12ective 1asis of ho0 the client 0as treate!# Image also has a role to pla* here# Several 0riters s"ggest that technical an! f"nctional :"alit* !etermine m"ch of the corporate image 0hich, in t"rn, can infl"ence the c"stomer=s perceive! service :"alit*# In recent *ears research has 1een "n!ertaken in an effort to "n!erstan! the factors 0hich infl"ence service :"alit*# Cork 1* err* an! his colleag"es has i!entifie! five ke* areas as follo0s: Tangi$les the ph*sical facilities, e:"ipment, appearance of personnel# +elia$ility the a1ilit* to perform the !esire! service !epen!a1l*, acc"ratel* an! consistentl*# +esponsiveness 0illingness to provi!e prompt service an! help c"stomers# Empathy caring, in!ivi!"ali3e! attention to c"stomers#

These !imensions represent ho0 cons"mers organi3e information a1o"t service :"alit* in their min!s# An the 1asis of e(plorator* an! :"antitative research, these five !imensions 0ere fo"n! relevant for 1anking, ins"rance, appliance repair an! maintenance, sec"rities 1rokerage, long)!istance telephone service, a"tomo1iles repair service, an! others# The !imensions are also applica1le to retail an! 1"siness services, an! logic s"ggests the* 0o"l! 1e relevant for internal services as 0ell# Sometimes c"stomers 0ill "se all of the !imensions to !etermine service :"alit* perceptions, at other times not# Re1ia/i1it2F 5e1i'ering &n pr&,i%e% Relia1ilit* is !efine! as the a1ilit* to perform the promise! service !epen!a1l* an! acc"ratel*# In its 1roa!est sense, relia1ilit* means that the compan* !elivers on its promises promises a1o"t !eliver*, service provision, pro1lem resol"tion an! pricing# ."stomers 0ant to !o 1"siness 0ith companies that keep their promises, partic"larl* their promises a1o"t the core service attri1"tes# Re%p&n%i'ene%%F Being 0i11ing t& +e1p Responsiveness is the 0illingness to help c"stomers an! to provi!e prompt service# This !imension emphasi3es attentiveness an! promptness in !ealing 0ith c"stomer re:"ests, :"estions, complaints an! pro1lems# To e(cel on the !imension of responsiveness, a compan* m"st 1e certain to vie0 the process of services !eliver* an! the han!ling of re:"ests from the c"stomer=s point of vie0 rather than from the compan*=s point of vie0# A%%*ran(eF in%piring tr*%t an) (&n-i)en(e 5ss"rance is !efine! as emplo*ees= kno0le!ge an! co"rtes* an! the a1ilit* of the firm an! its emplo*ees to inspire tr"st an! confi!ence# This !imension is likel* to 1e partic"larl* important for services that the c"stomer perceives as involving high risk an!@ or a1o"t 0hich the* feel "ncertain a1o"t their a1ilit* to eval"ate o"tcomes, for e(ample, 1anking, ins"rance, 1rokerage, me!ical an! legal service# Tr"st an! confi!ence ma* 1e em1o!ie! in the person 0ho links the c"stomer to the compan*, for e(ample sec"rities 1rokers, ins"rance agents, la0*ers, co"nselors# In s"ch service conte(ts the compan* seeks to 1"il! tr"st an! lo*alt* 1et0een ke* contact people an! in!ivi!"al c"stomer# E,pat+2F Treating (*%t&,er% a% in)i'i)*a1%


%mpath* is !efine! as the caring, in!ivi!"ali3e! attention the firm provi!es its c"stomers# The essence of empath* is conve*ing, thro"gh personali3e! or c"stomi3e! service, that c"stomers are "ni:"e an! special# ."stomers 0ant to feel "n!erstoo! 1* an! important to firms that provi!e service to them# Personnel at small service firms often kno0 c"stomers 1* name an! 1"il! relationships that reflect their personal kno0le!ge of c"stomer re:"irements an! preferences# Chen s"ch a small firm competes 0ith larger firms, the a1ilit* to the empathetic ma* give the small firm a clear a!vantage# Tangi/1e%F Repre%enting t+e %er'i(e re%p&n%i/i1it2 Tangi1les are !efine! as the appearance of ph*sical facilities, e:"ipments, personnel an! comm"nication materials# 5ll of these provi!e ph*sical representations or images of he service that c"stomers, partic"larl* ne0 c"stomers 0ill "se to eval"ate :"alit*# Service in!"stries that emphasi3e tangi1les in their strategies incl"!e hospitalit* services 0here the c"stomer visits the esta1lishment to receive the service, s"ch as resta"rants an! hotels, retail stores, an! entertainment companies# The most relevant approach in !efining an! meas"ring service is the "ser)1ase! approach# The i!ea that :"alit* is s"12ective an! 0ill 1e strongl* linke! to the in!ivi!"al=s nee!s an! e(pectations recogni3es that cons"mers have !ifferent criteria for 2"!ging service :"alit*# This "ser)1ase! approach e:"ates :"alit* 0ith ma(im"m levels of satisfaction# In meas"ring :"alit* in this 0a*, ho0ever, a !istinction nee!s to 1e !ra0n 1et0een :"alit* of service !eliver* an! the service o"tp"t, or 1enefit# The c"stomer ma* 1e involve! in the service pro!"ction, th"s impacting on the :"alit* of the service !eliver* process# The act"al o"tp"t of he service ma* 1e 2"!ge! 1* the c"stomer in terms of their e(pectations of the o"tcome or 1enefit# The c"stomer=s overall 2"!gment of service :"alit* can 1e an eval"ation of 1oth the process an! the o"tcome, compare! 0ith the c"stomer=s o0n e(pectations an! !esire! 1enefits# This lea!s to an important i!ea in assessing :"alit* from a services marketing perspective: perceived service quality. Perceive! service :"alit* represents the c"stomer=s 2"!gement of an organi3ation=s service 1ase! on their overall e(perience of the service enco"nter# Un!erstan!ing ho0 c"stomers arrive at this 2"!gementOthat is to sa*, ho0 the* !eci!e 0hether or not the* are satisfie! 0ith a partic"lar serviceOis ver* important for services marketing management# 5 n"m1er of techni:"es can 1e s"e! to help improve service :"alit*# Some of these have 1een "se! in man"fact"ring, 0hilst others have 1een !evelope! or refine! in the conte(t of the service sector# T0o important techni:"es are !isc"sse! 1elo0: Ben(+,arking In or!er to eval"ate service :"alit* it is important to esta1lish a firm=s performance relative to its competitors# enchmarking involves looking for the 1est 0a*s to achieve competitive a!vantage# The compan*=s pro!"cts, service an! practices are contin"all* compare! 0ith the stan!ar!s of the 1est competitors an! i!entifie! in!"str* lea!ers in other sectors# * o1serving an! meas"ring the 1est 0ithin an! o"tsi!e the in!"str* it is possi1le to improve the performance of the compan*# 5n earl* firm to a!opt 1enchmarking 0as Rero( .orporation 0ho "se it as a ma2or tool in gaining competitive a!vantage# Rero( first starte! 1enchmarking in their man"fact"ring activities an! foc"se! on pro!"ct :"alit* an! feat"re improvements# * e(amining competitors= processe! step 1* an! operation 1* operation, Rero( 0ere a1le to i!entif* the 1est metho!s an! practices in "se 1* their competitors# enchmarking has no0 come to 1e recogni3e! as appropriate for an* area of a compan*=s operations# The task of creating competitive a!vantage involves o"tperforming, rather than matching the efforts of competitors# This, together 0ith the o1vio"s !iffic"lties in gaining all the information re:"ire! on competitors, an! their internal s*stems an! processes, le! to the a!option of a 1roa!er perspective on 1enchmarking# Th"s 1enchmarking 0as e(pan!e! from a foc"s solel* on competitors to a 0i!er, 1"t selective, foc"s on the pro!"cts an! services to top performing companies regar!less of their in!"str* sector# This 1roa!er perspective on 1enchmarking has 1een "se! as a ma2or element in increasing 1oth :"alit* an! pro!"ctivit*# Ser'i(e /1*eprinting; pr&(e%% ana12%i%


Service companies 0ho 0ish to provi!e high levels of service :"alit* an! c"stomer satisfaction nee! to "n!erstan! all the factors 0hich ma* infl"ence c"stomer perception# < l"eprinting= or service process anal*sis is a concept 0hich 1reaks !o0n the 1asic s*stems an! str"ct"re of an organisation in or!er to !evelop a greater "n!erstan!ing of the points of contact 1et0een the c"stomer an! the service provi!er# Several approaches to carr*ing o"t a 1l"eprinting e(ercise have 1een s"ggeste!: 1# 1lueprinting2 *ycle of service analysis: The concept s"ggests that each contact 0ith the c"stomer is a <moment of tr"th=, each 1eing an opport"nit* to either increase of !ecrease c"stomer satisfaction# The c"stomer=s perception is a contin"o"s stream of e(periences 0hich together !etermine the service :"alit*# The compan* 0ill ver* often not perceive the service in this 0a* as their emplo*ees are constraine! in their vie0 1* the partic"lar part of he overall service 0ith 0hich the* are involve!# The 1l"eprinting@ c*cle of service approach ena1les a service compan* to shift its emplo*ees= perception so that the* have a 1etter "n!erstan!ing of the c"stomer=s e(perience# $# ,alue chain analysis: it involves 1reaking !o0n each of activities of a firm into its vario"s activities, an! sho0ing 0here val"e is a!!e! for its c"stomers# %ach activit* can 1e anal*se! to !etermine its contri1"tion to c"stomer satisfaction an! service :"alit*# '# #tory$oarding: this concept 0as !evelope! 1* the Calt Disne* organisation in !esigning its theme parks in or!er to engineer the c"stomer e(perience an! ens"re the greatest c"stomer satisfaction# Chen a film is ma!e, each scene is o"tline! in a!vance, "sing a series of sketches arrange! in a se:"ence kno0n as a stor*1oar!# Similarl*, sketches of each contact a c"stomer has 0ith the service provi!er can 1e "se! to i!entif* points for improvement in c"stomer service# Scenes can 1e rearrange! to improve the :"alit* of the c"stomer e(perience# The 1est kno0n metho!olog* is the 1l"eprinting approach s"ggeste! 1* Shostak# The 1l"eprint is a val"a1le tool in helping vis"ali3e the service process, "n!erstan!ing 0hat can go 0rong an! setting performance stan!ar!s for improvement in service :"alit*# This helps nto 2"st 0ith solving potential pro1lems 1"t also in !esigning 0a*s to !eal 0ith service recover*# Man* service companies are no0 1ecoming intereste! in "sing 1l"eprinting metho!s to improve their service :"alit*# C stomer retention Man* service companies place too m"ch emphasis on 0inning ne0 c"stomers an! too little on retaining e(isting c"stomers# .ompanies are no0 starting to !evelop specific programmes in or!er to increase c"stomer lo*alt*# There are man* reasons 0h* retaining c"stomers is so profita1le# These incl"!e the follo0ing: Retaine! 1"siness# Sales, marketing an! set "p costs are amorti3e! over a longer c"stomer life)time# Increase! e(pen!it"re over time# Repeat c"stomers often cost less to service# Satisfie! c"stomers provi!e referrals Satisfie! c"stomers ma* 1e 0illing to pa* a price premi"m# 5ll these reasons ma* not appl* for a partic"lar service 1"siness, 1"t overall the* represent a significant profit improvement opport"nit* for most service sector companies# The most important iss"es for companies to remem1er is that a c"stomer 0ho is lost thro"gh !issatisfaction 0ith a service provi!er 0ill 1e gaine! 1* a competitor# ;eeping c"stomers in therefore a ke* strategic iss"e for service companies to a!!ress# ."stomer retention helps pre!ict the profita1ilit* of the compan*, an! therefore provi!es an e(cellent management tool for consi!ering the s"ccess of :"alit* an! c"stomer service programmes# Retaining a c"stomer allo0s a compan* to !evelop the relationship an! enco"rages 1oth repeate!, an! increasingl* fre:"ent, 1"*ing activit*# 5n a!!itional 1enefit of effective retention programmes is emplo*ee satisfaction# The :"antifie! res"lts of retaining c"stomers can act as a great motivator to staff an! increase their 0illingness to perform e(cellent c"stomer service# 5 total :"alit* management approach 0hich strives to attain a service free of !efects sho"l! 1e consi!ere! an essential part of a retention programme# #elationship a Marketing %rogramme


Relationship marketing 6or relationship management7 is a philosoph* of !oing 1"siness, a strategic orientation, that foc"ses on keeping an! improving c"rrent c"stomers, rather than on ac:"iring ne0 c"stomers# This philosoph* ass"mes that cons"mers prefer to have an ongoing relationship 0ith one organi3ation than to s0itch contin"all* among provi!ers in their search for val"e# 1"il!ing on this ass"mption an! the fact that it is "s"all* m"ch cheaper to keep a c"rrent c"stomer than to attract a ne0 one, s"ccessf"l marketers are 0orking on effective strategies for retaining c"stomers# Miven the man* 1enefits of long)term c"stomer relationships, it 0o"l! seem that a compan* 0o"l! not 0ant to ref"se or terminate a relationship 0ith an* c"stomer# In some cases it ma* 1e prefera1le for the firm an! the c"stomer not to contin"e their relationship# Developing Marketing &rientation The process of changing to a market orientation !eman!s gen"ine an! on)going commitment, especiall* at top management levels, if real change is to happen# 5 programme to increase marketing orientation involves the follo0ing: 5n i!entification of the e(isting t*pes of orientation that alrea!* e(ists 0ithin the organisation some of these, o"tline! shortl*, ma* 1e a long 0a* from the marketing i!eal# 5n assessment of the present levels of marketing effectiveness 0ithin the 1"siness# The form"lation an! implementation of an action plan to improve the marketing orientation#

I)enti-i(ati&n &- &rientati&n% The f"ll potential of marketing is not reali3e! in man* service sector firms 1eca"se of their conflicting orientations# -ence the top management sho"l! p"t their hea!s together to i!entif* the var*ing orientations an! their associate! attit"!es# 5fter a !isc"ssion of their implications, mem1ers of the senior management can i!entif* the e(tent to 0hich the* 1elieve these vie0s are hel! in their compan*# The res"lts are then s"mmari3e! an! contraste! 0ith the !esire! marketing orientation# These orientations once i!entifie!, can form a "s"al 1ackgro"n! for a !isc"ssion of the mission of the organisatoin an! the share! val"es that m"st 1e !evelope! 1* top management if a marketing orientation is to 1e !evelope!# I!entif*ing Marketing %ffectiveness ;otler i!entifie! five attri1"tes that can 1e "se! to a"!it the marketing effectiveness of the 1"siness organisatoin: 1# ."stomer philosoph* $# Integrate! marketing organisation '# 5!e:"ate marketing information +# Strategic orientation ,# Aperational efficienc* The a"!it rates the firm on each of these five attri1"tes# P1anning a ,arketing &rientati&n The a"!it reveals a nee! for improvements in the marketing area an! the ne(t stage is form"lating a plan to reali3e them# The plan m"st involve the follo0ing steps: Un!erstan!ing the organi3ational an! c"lt"ral !imensions of change# I!entif*ing a champion for marketing# .on!"cting a nee! anal*sis


Designing a training an! !evelopment programme Argani3ing ke* s"pport activities#

The organizational dimension To help i!entif* the organi3ational an! c"lt"ral !imensions of the pro1lem, Mc;inse* S .ompan*=s <GS= frame0ork can 1e "se! to consi!er ke* elements re:"ire! 1* an effective marketing)oriente! services organisation# This s"ggests that a strateg* to !evelop a marketing orientation m"st 1e s"pporte! 1* a set of share! val"e, s*stems, management st*le, an! organi3ational str"ct"re an! of skills an! staff# This frame0ork provi!es a means of vie0ing organi3ations as packages of ke* sills, or skill gaps# -ence, it can 1e "se! as a tool for anal*3ing organi3ational !eficiencies, 1"il!ing on position skills an! i!entif*ing ne0 skills nee!e!# Recognition of each of these c"lt"ral, organisatoin an! skill re:"irements is an essential task in installing a marketing orientation# Management m"st also 1e prepare! to change parts of the organisation to meet these re:"irements# 3 champion for mar&eting The attit"!e of the chief e(ec"tive can 1e the !etermining factor in the s"ccess or fail"re of the plan to change to a marketing orientation# The !evelopment of a f"ll* marketing)oriente! organisation re:"ires intense effort to shift e(isting attit"!es an! re:"ires a lea!er 0ith imagination, energ* an! persistence# Citho"t this person, the programme can fail or !egenerate into a token management)training e(ercise# Af partic"lar importance is this champion=s 1ehavio"r# *onducting a needs analysis 5 management !evelopment nee!s anal*sis is the thir! step# Management !evelopment can 1e !efine! as an <attempt to improve c"rrent or f"t"re managerial performance 1* imparting information, con!itioning attit"!es or increasing skills#4 The nee!s anal*sis is a thoro"gh e(amination of the competitive an! marketing environment in 0hich the compan* is place! an! 0ill i!entif* the kno0le!ge, skills an! attit"!es that nee! to 1e !evelope!# The management development programme The nee! anal*sis can form the 1asis for a management !evelopment programme aime! at improving marketing effectiveness# Chile several option e(ist, one effective metho! is to !esign an! r"n a series of co"rses involving marketing staff an! e(ec"tives from all other f"nctions 0ithin the organisation# Chile the content 0ill var* accor!ing to the compan*=s sit"ation, in general it 0ill cover the kno0le!ge, skills an! attit"!es necessar* to !evelop a marketing) !riven organisation# 4ey support activities The follo0ing ten ke* activities are consi!ere! as s"pport activities of the marketing plan: %sta1lish a marketing task force %sta1lish appropriate organi3ational str"ct"re to s"pport marketing 5c:"ire marketing talent Use e(ternal cons"ltants Promote market)oriente! e(ec"tives Ma(imi3e the impact of management !evelopment Develop a marketing information s*stem Install an effective marketing)planning s*stem# Recogni3e the long)term nat"re of the task#


%ns"re commitment

Ance the management !evelopment programme has 1een initiate!, the a1ove tasks m"st 1e complete! to ens"re the s"ccessf"l installation of a marketing orientation#


"e%%&n 1C T&*ri%, an) Tra'e1 Marketing To"rism is a ma2or in!"str* thro"gho"t the 0orl! to!a*# It em1races activities ranging form the smallest sea)si!e hotel, for e(ample, to airlines, m"ltinational hotel chains an! ma2or international to"r operators# The concept of to"rism marketing comprises of: I!entif*ing an! anticipating cons"mer !eman! 6an! !esire7 for to"rism pro!"cts an! services Developing a means of provi!ing pro!"cts an! services to f"lfill these nee!s .omm"nicating this to the cons"mer, there1* motivating sales, conse:"entl* satisf*ing 1oth the cons"mer, an! the organi3ation=s o12ectives#

;rippen!orf sa*s, 9Marketing in to"rism is to 1e "n!erstoo! as the s*stematic an! coor!inate! e(ec"tion of 1"siness polic* 1* to"rist "n!ertakings 0hether private or state, o0ne! at local, regional, national an! international levels to achieve the optional satisfaction of the nee!s of i!entifia1le cons"mer gro"ps an! in !oing so achieves an appropriate ret"rn4# "rkart an! Me!lick opine, 9To"rism marketing activities are s*stematic an! coor!inate! efforts e(ten!e! 1* National To"rism Arganisation an! @ or to"rist enterprises at international, national an! local levels to optimi3e the satisfaction of to"rist gro"ps an! in!ivi!"als in vie0 of s"staine! to"rism gro0th#4 In vie0 of the a1ove, the follo0ing points emerge regar!ing to"rism marketing: To"rism marketing is a process of creating a pro!"ct or provi!ing a service# To"rism marketing comprises fact fin!ing, !ata gathering, anal*3ing 6marketing research7, comm"nication to inform an! promote 6Promotion7, ens"ring an! facilitating sales, selection of marketing planning 6!istri1"tion7, coor!ination, control an! eval"ation 6marketing planning an! a"!iting7, !eveloping professionall* so"n! personnel 6people7# To"rism marketing is an integral effort to satisf* to"rism an! more so, it is a !evice to transform the potential to"rism into the act"al to"rism# To"rism marketing is the safest 0a* to generate !eman!, e(pan! market an! increase the market share# To"rism marketing is a managerial process to promote 1"siness#

Thro"gh market planning, segmentation an! marking research, a to"rism marketing mi( can 1e !evelope! to achieve the to"rism organi3ation=s goals thro"gh strategic marketing# Market %eg,entati&n In to"rism marketing segments ma* 1e categori3e! accor!ing to age, fre:"enc* of travel, e!"cation, occ"pation or income# Ather 1ases for segmentation of to"rism an! travel markets incl"!e P"rpose 6of trips 1"siness, vacation, convention, social@famil*7? Ps*chographic 60here 1ehavioral aspects of motivation are "se!7? an! enefits 60here the 1enefits 1eing so"ght 1* the cons"mer are the ke* varia1le7#

T+e t&*ri%, ,arketing ,i< The marketing mi( refers to the 1len! of i!eas, concepts an! feat"res 0hich marketing management p"t together to 1est appeal to their target market segments# %ach target segment 0ill have a separate marketing mi(, tailore! to meet the specific nee!s of cons"mers in the in!ivi!"al segment# %rod ct Mi+


The to"rism pro!"ct is a non)material intangi1le thing# The follo0ing service are incl"!e! in the pro!"ct mi( for the to"rism in!"str*: 5ttraction 5ccommo!ation: one star to >ive star, .ottages# Transportation: 5ir0a*s, Rail0a*s, Roa!s, Sea)0a*s Recreation: Theatre, .l"1, Park, M"sic Resta"rant: Cestern, .hinese, In!ian, Athers# Shopping: 5rtistic, -an!icrafts, -an!loom, ooks, Marments, Ne0eller*#

ran!ing pla*s a ver* important role in to"rism marketing# .ar rental firms, hotel chains an! airlines, in partic"lar emplo* tremen!o"s efforts to ens"re that their name is 0i!el* recogni3e! an! s*non*mo"s 0ith :"alit*, val"e or some other characteristic# Travel agents an! to"r operators !epen! on rep"tation to a large e(tent, an! so it is imperative that the* have a strong, recogni3a1le i!entit*# The main reason to 1"il! 1ran! lo*alt* is to enco"rage repeat 1"siness# %rice Mi+ In the to"rism in!"str*, the pricing !ecisions are fo"n! critical an! challenging since it is a m"lti)segment in!"str*# Chen a to"rist proposes to visit a partic"lar place, the total cost on his@her travelling incl"!es the e(penses inc"rre! on transportation, accommo!ation, comm"nication or so# In the pricing !ecisions, the pro!"ct or the service mist of the to"rist organi3ations is fo"n! important# This makes it essential that the to"rist organi3ations set prices in line 0ith the :"alit* of services to 1e ma!e availa1le to the c"stomers# Pricing polic* !ecisions 0ill 1e !irecte! 1* strategic o12ectives# If the o12ective is market penetration then prices m"st 1e set ver* competitivel* to appeal to the largest possi1le n"m1er of potential cons"mers# If, on the other han!, a firm is p"rs"ing a niche strateg*, catering for the l"("r* market in high val"e, e(cl"sive to"rism services, then prices sho"l! reflect this promotion an! a!vertising can 1e "se! to !ifferentiate the pro!"ct on an e(cl"sivel* 1asis an! premi"m prices ma* 1e charge!# The to"rist professionals 0hile making the pricing !ecisions are re:"ire! to think in favo"r of !isco"nting price# The !ifferent forms of !isco"nt, s"ch as !isco"nting for cash pa*ment, price re!"ction for :"alit*, tra!e !isco"nts, tra!e allo0ances, seasonal !isco"nt, !istresse! stock an! similar !isco"nt tactics are the options# %lace Mi+ Distri1"tion management is concerne! 0ith t0o things availa1ilit* an! accessi1ilit*# If to"rism marketing management is to 1e certain that their pro!"cts an! services are 1oth availa1le an! accessi1le to the target market, the* m"st !esign a channel strateg* that 0ill 1e effective# Some to"rist organi3ations !eal !irectl* 0ith the cons"mers? some other organi3ations "tili3e more than one metho! of !istri1"tion# The mi!!lemen are the fo"r operators an! the transport operators 0ho 1"* services like hotel rooms, seats in the aircrafts, rail0a*s, arrange chartere! flights an! sell the same either to the travel agents or even !irectl* to the to"rists# 5irlines, for e(ample, sell tickets thro"gh travel agents, an! sell seats on flights to to"r operators, 0hilst also operating !irect marketing 1* offering travellers the opport"nit* to make reservations thro"gh their o0n 1anking offices#

%romotional Mi+ The to"rist organi3ations take "p the responsi1ilit* of informing, sensing an! pers"a!ing the potential to"rists# The marketers nee! to "se the vario"s components of promotin to increase the n"m1er of "sers#


The a!vertisement helps in provi!ing important information to the act"al an! potential to"rists# Its coverage is so 0i!e# It essentiall* follo0s the 5ID5 principle of attracting the attention- aro"se interest- create desire- an! stim"late actions. 5!vertising is aime! to create the a0areness of the travel offers availa1le on a resort an! its attractions to infl"ence their 1"siness !ecisions# 5nother !imension of the promotion mi( is p"1licit* 0hich foc"ses attention on strengthening the p"1lic relations 1* !eveloping a rapport 0ith the me!ia people an! getting their personali3e! s"pport in p"1lici3ing the 1"siness# #ales promotion thro"gh 1roch"res, point of sale !ispla*s an! even vi!eo cassettes pla*s a ver* important role as a!vertising# In a to"rism in!"str* a travel compan* offers to their clients compliments s"ch as flight 1ags, 0allets for tickets an! foreign e(change an! covers an! passport# The hotels offer a n"m1er of facilities like shoe shine clothes, first ai! se0ing kits an! shampoo# >"rther, the clients also get fr"its an! flo0ers in their rooms# There is not !o"1t that almost all the promotional meas"res generate goo!0ill an! a!! val"es to the pro!"ct# ersonal selling: The travel an! hotel 1"siness !epen! consi!era1l* on the personal selling# The !evelopment of travel an! to"rism has 1een possi1le !"e to 0ell e!"cate! an! traine! sales personal# eople: The to"rism in!"str* !epen!s s"1stantiall* on the management of h"man reso"rces# The travel agents an! travel g"i!es pla* an important role an! therefore the management of people helps in !eveloping their cre!entials to !eliver goo!s to the to"rist organi3ations#


"e%%&n 11 G&te1 Marketing Marketing hotel services incl"!e in its p"rvie0 ever*thing an! almost all the !imensions !irectl* or in!irectl* helping in promoting the 1"siness# This necessitates form"lation of a so"n! marketing mi(, s"ch as an aggregation of !ifferent s"1)mi(es s"ch as pro!"ct, promotion, pricing, place, people an! process# Market Segmentation for Hotel The hotel professionals segment the market in s"ch a 0a* to i!entif* the changing nee!s an! re:"irements of !ifferent segments to make the marketing !ecisions effective# The main 1ases for hotel segments are geographic, ps*chographic an! socio)economic# The geographic 1ases incl"!e hotel companies locate! at !ifferent places an! ps*chographic 1ases incl"!e life c*cle, 1"*ing motives an! kno0le!ge of prospects regar!ing the services# The social)economic 1ases incl"!e 0omen segment, 0eak)en! segment an! instant market segment# To 1e more specific, the life)st*le segment is fo"n! to 1e more important# Marketing Mi+ for Hotel Ind stry The term marketing mi( is the com1ination of 0hat market offers an! i!entif*ing the act"al point 0here marketing actions can 1e taken to improve the accepta1ilit* of hotel pro!"ct an! stim"late !eman!# The com1ination of core an! peripheral services, the creative promotional !ecisions, the pricing strategies helping hotels in maintaining the commercial via1ilit*, the efficient hotel personnel are important !ecision making areas 0hich gravitate attention on the form"lation of a so"n! mi( for the hotel in!"str*# It is against this 1ackgro"n!, the !ifferent s"1)mi(es of the marketing mi( are !isc"sse!# %rod ct Mi+ The pro!"ct mi( for the hotel services incl"!e catering management, resta"rant an! cafeteria management, management of 1e!rooms, management of convention halls etc# The 1oar!ing services are consi!ere! to 1e an important part of pro!"ct mi(# In a!!ition, the lo!ging services also 1ecome significant# %rod ct Mi+ of Hotel Services -ere it is essential that facilities like light, 0ater, electricit*, ventilation, entertainment, sanitation arrangement of 1e! etc# are also e:"all* important# Chile form"lating the pro!"ct mi(, the hotel organisations are re:"ire! to make possi1le a fair mi( of all the a1ove services# %romotion Mi+ It is not onl* s"fficient to provi!e :"alit* services, 1"t it is e:"all* important to promote the 1"siness in s"ch a 0a* that the prospects come to kno0 a1o"t the :"alit* to 1e offere! to them# There are n"m1er of components for promoting the 1"siness s"ch as, a!vertisement, p"1licit*, sales promotion, personal selling an! 0or! of mo"th# Reception Celcome %n:"ir*

oar!ing &o!ging

.atering, Resta"rant

e!, room, light, 0ater, ventilation TH, Dance, M"sic Shopping 5rca!e, >air, %(hi1ition ea"t* Parlo"r, hair c"tting, la"n!r* .ore S Peripheral

%ntertainment Pro!"ct mi( Shopping


Personal .are

.omm"nication an! Transport

Telephone, Ne0spapers, Maga3ines, Reservation, .ar rental

Me!ical Fig. 11.1 A)'erti%ing

>irst ai!@ 5m1"lance

The hotel professionals make pro!"ctive "se of print me!ia, 1roa!cast me!ia an! telecast me!ia for a!vertisement# There are significant !evelopments in the print me!ia an! !"e to sophistication in the printing technologies, it is possi1le to attract the attention of prospect"s 1* !ispla*ing attractive scenes, events, comforts etc# Chile selecting the me!ia, it sho"l! 1e kept in min! the maga3ines an! ne0spapers preferre! 1* target a"!ience# The professionals have to select a s"ita1le time for transmission in 1roa!cast me!ia, 0hen a ma2orit* of the target a"!ience are s"ppose! to 1e close to the ra!io set# Similarl*, in telecast me!ia, 0hile a!vertising !"e 0eightage to 1e given in selecting sensitive ho"rs, 0hen a ma2orit* of vie0ers are fo"n! 1efore their T#H# sets# The scenes of hotel location, the s0imming pool, the shopping comple(, the personal car centres, the arrange! 1e! rooms, the resta"rants an! convention hall, the aesthetic management are re:"ire! to 1e telecast in s"ch a 0a* that attracts the target "sers# P*/1i(it2 In the hotel in!"str*, p"1lic relations activities pla* an important role in informating the clients regar!ing the merits of !ifferent services offere!# The specialties of hotel are presente! in s"ch a 0a* that the prospects are motivate! to avail of the facilities offere! 1* a partic"lar hotel# In the hotel 1"siness, there are n"m1er of events 0hich sho"l! 1e transmitte! to the local press, s"ch as men"s for certain f"nctions hel! at hotel, partic"lars or certain important conferences or e(hi1itions to 1e hel!, men"s for special !a*s of the *ear, photographs of staff !resse! "p for special !a*s an! 0ell)kno0n people sta*ing in the hotel# Sponsore! fashion)!esigning events, entertainment programmes, 1ea"t* contest etc# can also 1e effective p"1licit* tools# Sales %romotion &ike other organi3ations, the hotels also offer incentives to the "sers vis)T)vis to the personnel an! organi3ations evencing interest in promoting the 1"siness# T&&1% &- %a1e% pr&,&ti&n Directe! at -otel Staff: Travel, concessional accommo!ation for close relations, "se of 0e!!ing halls for staff, contests, gift# Directe! at To"r Aperators an! Travel 5gents: .ompliments 6Pen, ashtra*s, !iaries, calen!ars, 1roch"re, tra!e e(hi1ition, l"nch, !irect mail letters, circ"lars7 concessional accommo!ation, contest# Directe! at M"ests: Aff)reason !isco"nt, point of sale, sales, literat"re, compliments 6Pen, ashtra*s, !iaries, calen!ars, gifts, contest, 2oint promotion 0ith travel companies, !irect mail7#

A&r) &- ,&*t+ The 0or! of mo"th promotion is ver* m"ch instr"mental in sensiti3ing the prospects# In the hotel in!"str* it is m"ch more significant# The 0or! of mo"th promoters are those 0ho are satisfie! 0ith the service of hotels, 0ho int"rn


motivate the prospects# The hotel professionals 1ear the responsi1ilit* of i!entif*ing opinion lea!ers 0ho can s"ccessf"ll* act as a p"1licist# Persons 0ith high comm"nicative a1ilit*, having a rep"tation in the societ* are fo"n! s"ita1le for p"1lici3ing the services of hotels# Per%&na1 %e11ing The hotel 1"siness is s"1stantiall* infl"ence! 1* personal selling# The sales personnel are re:"ire! to 1e frien!l* in !ealings an! e(pression# The* are re:"ire! to 1e helpf"l an! patient an! 0ork to0ar!s generating more satisfaction to c"stomers# >or selling s"ccessf"ll*, it is essential that sales forces are professionall* so"n!# 5 fair com1ination of personal an! social skill is fo"n! essential for the sales force to 1e engage!# Pri(e ,i< Pricing !ecisions are fo"n! critical an! challenging# The hotel professionals nee! to 1e intelligent 0hile fi(ing the hotel traffics since the service are of perisha1le in nat"re# In a!!ition, the seasonal fl"ct"ation in !eman! an! increasing intensit* of competition also complicate the task# So the* nee! intelligence 0hile making strategical an! tactical pricing !ecisions# Tactical pricing is fo"n! instr"mental in promoting the hotel 1"siness# There are n"m1er of 0a*s for practicing this tool: Seasonal Disco"nts: To charge lo0er prices, especiall* !"ring off)season# Tra!e Disco"nts: This is offere! to to"r operators an! travel agents Special Disco"nts: Special f"nction room rates for overnight conventions#

P1a(e Mi< In the hotel in!"str* the !istri1"tion of services is mainl* relate! to the transmission of information 1* the relate! persons to the "ltimate "sers# 5s an! 0hen the 1ookings are ma!e of a 1e!)room or a f"nction room or of a resta"rant, the confirmation is fo"n! essential# 5 n"m1er of factors are fo"n! infl"encing the !istri1"tion process, s"ch as location, point of sale, the cost of !istri1"tion, effectiveness of marketing reso"rces, image of hotels, tactical strateg* an! the motivational schemes# The choice of location is the most important 1"siness !ecision, speciall* for proprietor o0ne! resta"rants, g"est ho"ses an! small to"rist attractions# Cith the intro!"ction of comp"ters an! increasing "ser of information technologies, a ra!ical change has come in the !istri1"tion s*stem# The mi!!leman are 0holesalers 1"*ing hotel rooms in 1"lk an! then selling the same to the retailers, kno0n as the travel agents# The to"r operators are calle! the pro!"cers of services# The travel agents 1"* the services at the re:"est of their clients an! provi!e a convenient net0ork of sales o"tlets 0hich caters to the nee!s of the catchment area# The strategic choice 1et0een internal an! e(ternal selling, !omestic an! international selling, !irect an! in!irect selling occ"p* a place of significance# The hotel professionals are s"ppose! to make the !ecision so"n!, so that the process of !istri1"tion is ma!e cost effective# Pe&p1e The people 0orking in the organisation are :"ite important for the s"ccess of the 1"siness# In hotel in!"str*, the receptionists, the porters, the ho"se)keepers, the 0aiters an! 0aitresses pla* an incremental role in promoting the 1"siness# The marketing managers take "p the responsi1ilit* of managing the frontline personnel in s"ch a 0a* that the promise! services reach to the "ltimate "sers# If the hotel personnel in s"ch a 0a* that the promise! services reach to the "ltimate "sers# If the hotel personnel prove to 1e high performers, personall* committe!, professionall* so"n!, val"e oriente!, a0are of the 1ehavioral management, familiar 0ith the aesthetic management, the* can satisf* the "sers# "e%%&n 17 &n%*1tan(2 Marketing


The Instit"te of Management .ons"ltanc* U; consi!er cons"ltanc* services as the services provi!e! 1* an in!epen!ent an! :"alifie! person or persons in i!entif*ing the investigating the pro1lems concerne! 0ith polic*, organisatoin, proce!"res an! metho!s? recommen!ing appropriate action an! helping to implement these recommen!ations# The aforesai! vie0s make it clear that in the cons"ltanc* services, an e(pert of the relate! fiel! or !iscipline or gro"p of e(perts i!entif* an! investigate the pro1lems an! on the 1asis of their e(pertise, make availa1le s"ita1le s"ggestions an! also help in the implementation of recommen!ations# 5s for e(ample, person or persons having an! o"tstan!ing e(cellence in the concerne! areas like legal, me!ical, management, technical or so make availa1le speciali3e! services to a person or persons in the shape or kno0le!ge an! information# The* make an in!epth st"!* of the pro1lems an! offer to them appropriate s"ggestions to com1at the pro1lem# >or the services ren!ere!, the* ma* or ma* not charge fee or commission# The application of marketing concept in the cons"ltanc* services is a recent phenomenon# 5 n"m1er of cons"ltants have 1een fo"n! engage! in the process an! the* have 1een fo"n! selling their vie0s or e(pertise# This ma!e 0a*s for concept"ali3ing marketing in the cons"ltanc* services# The gro0ing significance of innovative i!eas, e(pertise mainl* to e(cel competition pave! aven"es or practicing marketing# 5n in!ivi!"al or an instit"tion starte! the process of marketing the cons"ltanc* services on national an! international levels for making profits 0hich ma!e the 1"siness con!itions competitive# Since then, the marketing concept has gaine! importance# Th"s 1* cons"ltanc* marketing# The emphasis is one marketing of e(pertise 1* an in!ivi!"al or an instit"tion 0here the* form"late the marketing mi( an! keep on moving the process of innovating the !ecisions to esta1lish their e!ge on the competitors# Market %eg,entati&n .lients possess some "ni:"eness 0hich complicate the task of a marketer, 0hile assessing their nee!s an! i!entif*ing the level of their e(pectations# In the cons"ltanc* services, there are a n"m1er of factors infl"encing the nee!s an! re:"irements of the prospects# In the cons"ltanc* services an! organisation nee!s to segment the market on the 1asis of region, sector an! geographical con!itions# Market segmente! on the 1asis of 3ones helps the cons"ltanc* organisatoins in st"!*ing the nee!s an! re:"irements of !ifferent 3ones an! the !evelopment of marketing reso"rces are th"s ma!e optimal to the "sers representing a partic"lar 3one# Segmentation on the 1asis of sector helps the cons"ltants an! the cons"ltanc* organisatoins in "n!erstan!ing the e(pectations of !ifferent categories of "sers in a !ifferent 0a*# Marketing ,i< -&r t+e (&n%*1tan(2 &rgani%at&in% The form"lation of marketing mi( is an important !ecision making area 0hich re:"ires professional e(cellence# 5n in!ivi!"al or a gro"p of in!ivi!"als engage! in the cons"ltanc* services is re:"ire! to form"late a so"n! marketing mi( that makes possi1le an optimal !evelopment of marketing reso"rces# It is the :"alit* an! :"antit* of !ifferent s"1mi(es that pla* a significant role in !etermining the :"alit* of marketing !ecisions# This makes it essential that the marketers 0hile form"lating pro!"ct mi(, place mi(, promotion mi(, price mi( an! people keep in their min! the intensit* of competition in a!!ition to the level of e(pectations of clients# Pr&)*(t ,i< In the cons"ltanc* services, the important pro!"cts are technical services, legal services, me!ical services an! the managerial services# The provi!ers an! the clients ma* 1e an in!ivi!"al or even an instit"tion# The form"lation of pro!"ct mi( re:"ires a n"m1er of care an! preca"tions# The innovative i!eas, sophisticate! technologies, intensive research nee! !"e care 0hile form"lating the pro!"ct mi(# The form"lation of a so"n! pro!"ct mi( makes it essential that the cons"ltanc* organi3ations make efforts to !esign a so"n! pro!"ct portfolio in 0hich !ifferent t*pes of services are incl"!e!# The me!ical cons"ltants nee! to 1e a0are of the latest !evices of treatment an! to offer the patients the 1est me!ical ai!s# The technical cons"ltants also nee! to innovate their pro!"ct mi( in the face of technological sophistication from the pro!"ct mi(# The legal cons"ltants nee! to 1e a0are of the latest !evelopments, s"ch as amen!ments in la0s, r"les an! reg"lations an! to form"late the service mi( accor!ingl*# Th"s the elimination an! incl"sion processes nee! to 1e a!opte! even in cons"ltanc* services# These facts make it clear that like other organi3ations, the cons"ltanc* organi3ations also nee! to make possi1le innovating in the face of m"lti)!imensional !evelopments in the 1"siness# The form"lation of so"n! package is also fo"n! important in the pro!"ct mi( of the cons"ltanc* organisatoins# -ere the emphasis is on the 1len!ing of !ifferent t*pes of services keeping in vie0 the nee!s an! re:"irements of !ifferent


segments availing the services# The packages 1ecome a point of attraction if the marketers sho0 their professional e(cellence in the 1len!ing process# In vie0 of the a1ove, it is right to mention that the form"lation of a so"n! pro!"ct mi( is consi!ere! essential an! the marketing professional serving the cons"ltanc* organisatoins nee! to make it possi1le# This is easier 0hen the* are 0ell a0are of the changing nee!s an! re:"irements an! the increasing level of e(pectations of the clients @ c"stomers# Pr&,&ti&n ,i< &ike other services, the cons"ltanc* services are also re:"ire! to 1e promote!# Cith the help of so"n! mi( of promotion 0hich is a fair 1len!ing of the !ifferent constit"ents, s"ch as a!vertising, p"1licit*, sales promotion, 0or!) of)mo"th promotion an! personal selling, the cons"ltanc* services can 1e effectivel* promote!# A)'erti%ing Chile a!vertising, the cons"ltanc* organisatoins nee! to !ra0 their attention to some of the important pro1lems mentione! 1elo0: .omposing slogans having creativit*# Selecting s"ita1le vehicles for traveling the messages In2ecting sensitivit* to the messages, themes an! appeals# Making the a!vertisements meas"res cost effective# Increasing the life)span of a!vertisement slogans Testing the a!vertising slogans 1efore their final la"nching Testing the a!vertising effectiveness# Cith the increasing sophistication in print technolog*, the print me!ia is an effective instr"ment in informing, sensing an! pers"a!ing the clients# The ne0spapers, maga3ines, posters, 1ro"chers, leaflets are effective print me!ia# No0, the telecast me!ia has esta1lishe! its e!ge over the print an! 1roa!cast me!ia# This is !"e to the fact that televisions have the o"tstan!ing merit of a"!io)vis"al e(pos"re# The marketing an! a!vertising professionals 1ear the responsi1ilit* of making the a!vertisement slogans creative provi!e a!e:"ate 1"!get to make a!vertisement effective an! p"rposef"l# P*/1i(it2 &ike other organisatoins even the cons"ltanc* organisatoin are re:"ire! to "se this component of promotion# The "ltimate o12ect of p"1licit* is to transmit the ne0s an! information to the masses# In the cons"ltanc* services, the p"1licit* meas"res are re:"ire! to 1e innovative# This re:"ires s"pport of aca!emics an! professionals in the fiel! of creative literat"re an! getting them p"1lishe! in the important ne0spapers, maga3ines an! 2o"rnals preferre! 1* the target clients# The services to 1e offere! 1* a cons"ltanc* organisation 0o"l! 1e p"1lishe! in a rep"te! me!ia having 0i!er circ"lation# The technical, me!ical, legal=s management 2o"rnal, an! the important ne0spapers an! maga3ines preferre! 1* the prospects re:"ire !"e attention of marketing professionals# The marketing professionals serving the cons"ltanc* organisatoin nee! to !evelop rapport 0ith the me!ia people to p"1lish the !evelopments# Argani3ing press conferences, !ispla*ing an! vis"ali3ing positive contri1"tions, :"alit* of services, 1enefits to the "sers are some of the important aspects re:"iring !"e attention of marketing professionals in general an! the p"1lic relations officers in partic"lar# Sa1e% pr&,&ti&n This component of promotion 1ears the efficac* of to"ching the target 0ith the help of incentives offere! to the mi!!lemen an! the clients# It is a temporar* incentive instr"mental in promoting the cons"ltanc* 1"siness#

The cons"ltanc* organi3ations are re:"ire! to infl"ence the personnel s"ppose! to offer the services to the clients 1* small gifts# In a!!ition, the sales promotion meas"res are also offere! for the "sers or clients# This ma* 1e in !ifferent forms, s"ch as concessional services for a partic"lar perio!, offering of small gifts to the c"stomers, organisatoin of sales contests for the clients an! "sers, package 1enefits to the c"stomers for a partic"lar perio!# Chile offering


incentives, the cons"ltanc* organi3ations also nee! to t"rn their e*es on the strategies a!opte! 1* the competitors so that the* are in a position to offer the innovative meas"res# Per%&na1 %e11ing Sales people are s"ppose! to perceive po0er, val"e an! !ecision making s*stem in the client=s organisatoins# It is also essential that the* !evelop personal relationship 0ith clients# The s"ccess of personal selling s"1stantiall* !epen!s on the personalit* an! e(cellence of an in!ivi!"al# Ph*sical attractions are assigne! !"e 0eightage in the ver* conte(t# If the* 1ehave 0ell, act 0ell, move 0ell, comm"nicate 0ell an! receive 0ell? the task of cons"ltanc* organi3ations 1ecomes simple# Personal promotion helps the cons"ltanc* organi3ations in creating imp"lse 1"*ing# 5 cons"ltant salesman is re:"ire! to !evice ne0 0a*s to move market into action so that imp"lse 1"*ing is generate! in a right !irection# The e(cellence of a cons"ltative salesman occ"pies a place of o"tstan!ing significance# If the clients remain satisfie! 0ith the comm"nicative a1ilit* of the cons"lting sales people, the task of cons"ltants an! the cons"ltanc* organi3ations is simplifie! consi!era1l*# It is pertinent to mention that it is not onl* the cons"ltants 0ho generate the 1"siness 1"t virt"all* it is the res"lt of a 2oint en!evo"r of the cons"ltative sales people an! the cons"ltants that simplif* the process of promoting the 1"siness# The cons"ltative sales people are re:"ire! to create a0areness an! interest, reinforce to overcome cognitive !issonance, facilitate an! ca"se the p"rchase to take place an! ens"re that the clients are satisfie! 0ith the service of cons"ltants# It is against this 1ackgro"n! that personal selling occ"pies a place of o"tstan!ing significance in the promotion of cons"ltanc* services# A&r)>&->,&*t+ pr&,&ti&n * 0or!)of)mo"th comm"nication the emphasis is on promoting the services 1* the hi!!en sales force# It is pertinent to mention that the satisfie! gro"p of c"stomers comm"nicate to their close frien!s an! relatives the o"tstan!ing properties of he services availe! 1* them# >or instance, if *o" are satisfie! 0ith the services of a me!ical cons"ltant *o" talk to *o"r frien!s an! relatives regar!ing the same# In fact, *o" act as a hi!!en sales force# In f"t"re *o"r frien!s an! relatives prefer to "se the services of the same !octor# &ike this, if a legal cons"ltant helps *o" in protecting the propert*, *o" talk to *o" frien!s an! relatives the same# The* prefer to "ser the services of the same legal cons"ltants as an! 0hen the* nee!# These facts are a m"te testimon* to this proposition that :"alit* goo!s or services are promote! even 1* the satisfie! gro"p of c"stomers or "sers# It is in the conte(t the 0e talk a1o"t the instr"mentalit* of 0or!)of)mo"th promotion in promoting the cons"ltanc* services# It is important that in this conte(t the marketing professionals also nee! to s"e the services of opinion lea!ers or vocal persons# The* i!entif* s"ch persons, offer to them concessional services in a!!ition to small gifts an! e(pect from them a strong a!vocac* in favo"r of their services# %rice mi+ In the cons"ltanc* services the price mi( refers to fee or commission charge! 1* the cons"ltants or the cons"ltanc* organisatoins for making the services availa1le to the clients# The pricing o12ectives ma* 1e either price)competitor or non)price)competitor# In the price)competitor o12ective, the cons"ltanc* organi3ations offer lo0er price since the pricing !ecisions are re:"ire! to 1e motivational# In the non)price)competitor o12ective, sta1le pricing is follo0e!# The other o12ectives are profit)generating, market sta1ilit*, market share etc# It is important that the cons"ltants an! the cons"ltanc* organi3ations e(plore possi1ilities for a rational pricing polic* 0hich helps in maintaining the commercial via1ilit* 1esi!es serving the social interests# %lace Mi+ 5n in!ivi!"al cons"ltant offers the services !irectl* to the "ltimate "sers# "t the cons"ltanc* organisatoins offer the services to the clients 0ith the help of 1ranch offices# To 1e more specific 0hen the hea! office locate! for off, it is essential that the cons"ltanc* organi3ations make s"ita1le arrangements for the offering of service at !ifferent places thro"gh its 1ranches# The opening of 1ranch offices simplif* the task of hea! office 0hich also helps in improving the :"alit* of services# %eople Mi+ In almost all the cons"ltanc* organi3ations, the instr"mentalit* of people in implementing the policies an! programmes in an effective 0a*# The cons"ltanc* organi3ations also nee! the services of :"alit* people serving as cons"ltants, cons"ltant sales people, 0orking in the 1ranch offices# 5 fair s*nchroni3ation of sophisticate!


technologies an! :"alit* emplo*ees makes the 0a*s for :"alit* "pgra!ition# If the emplo*ees serving the 1ranch offices are satisfie! 0ith the incentives offere! to them, the promise! services reach to the clients or the "ltimate "sers# This makes it essential that the cons"ltanc* organisatoins make possi1le emplo*ee)orientation 1* offering to the emplo*ees incentives in !ifferent forms# Th"s 0hile managing people, the marketing professionals nee! !"e 0eightage to the incentive plans for emplo*ees 0hich 0o"l! pave aven"es for performance orientation#


"e%%&n 13 &*rier Ser'i(e% Cith the increasing press"re of 0ork an! !ecreasing efficienc*, the Department of Posts faile! in managing the mailing services 0hich ma!e it essential that an alternative s*stem emerges to cater to the changing nee!s of tra!e as 0ell as the !omestic sectors# The co"rier services th"s came into e(istence# 5 n"m1er of formal an! informal organisatoins starte! offering the services at regional, national an! international levels# The !ifferent categories of "sers have no option 1"t to !epen! on the private sector 0ho, of co"rse offer :"alit* 1"t of e(pensive nat"re# It is against this 1ackgro"n! that 0e talk a1o"t the marketing of co"rier services# Co rier Marketing , / Concept al -rame"ork Marketing the co"rier services foc"ses o"r attention on the application of mo!ern marketing principles in the 1"siness process# .o"rier marketing is a managerial process that make possi1le a plane! !evelopment of services# It is an organi3e! efforts to make the services commerciall* via1le to the co"rier organi3ations vis)T)vis affor!a1le to the "sers 0ho make "se of their m"lti)!imensional services# The marketing concept makes it essential that the organi3ations form"late a so"n! service mi( in 0hich 0e fin! a fair s*nchroni3ation of !ifferent t*pes of services# The co"rier marketing practices th"s make possi1le form"lation of !ifferent s"1mi(es of the marketing mi(, s"ch as the pro!"ct mi(, the promotion mi(, the price mi(, the place mi( an! the people mi(# In a!!ition, the !evelopment of so"n! marketing inp"ts 1ecomes a focal point 0hich makes the 0a*s for the !evelopment of :"alit* o"tp"ts# .oncept"ali3ing co"rier marketing makes the 0a*s for satisf*ing the "sers 0hich happens to 1e the most important thing for increasing the market share an! the level of profits# The co"rier organi3ations th"s can maintain commercial via1ilit*# * form"lating an! innovating the marketing mi(, the co"rier organisations can 1e s"ccessf"l in !eveloping an! perceiving a ne0 perception of :"alit* 0hich makes possi1le :"alitative improvements in the process# Meneration of profits an! satisfaction to the "sers are the t0o important !imensions 0hich pave aven"es for m"lti)!imensional :"antitative)c"m):"alitative improvements in the process# The organi3ations 1* making the services competitive can 1e s"ccessf"l in e(celling competition# Since the marketing foc"ses on professional e(cellence, the co"rier organi3ations can also 1e s"ccessf"l in pro2ecting a fair image# These facts make it clear that the application of marketing principles is to 1enefit the co"rier organi3ations in man* 0a*s# It is against this 1ackgro"n! that the lea!ing co"rier organisatoins are fo"n! practicing innovative marketing# Marketing Mi+ for Co rier &rgani0ations The co"rier organi3ations are re:"ire! to form"late a so"n! marketing mi( for improving the :"alit* of services# The co"rier services are re:"ire! to 1e ma!e competitive an! this makes it essential that the co"rier organi3ations concept"ali3e marketing in s"ch a 0a* that the processes of :"alitative)c"m):"antitative transformation are activate! in the face of emerging 1"siness con!itions# It is against this 1ackgro"n! that the marketing professionals are s"ppose! to make creative marketing !ecisions# This foc"ses o"r attention on the form"lation of !ifferent s"1mi(es# %rod ct Mi+ Dispatching &etters, Mo"nting intensit* of competition makes it essential that the co"rier organi3ations form"late a so"n! pro!"ct mi(# * Packets 6Inlan!7 form"lating a so"n! pro!"ct mi(, the* 0o"l! 1e in a position to "n!erstan! the changing nee!s an! re:"irements of !ifferent segments of "sers on prospects an! the service profile 0o"l! 1e ma!e "ser)frien!l*# Dispatching &etters, Incl"sion of innovative services in the service mi( 0o"l! enrich the service profile an! 0o"l! also 1e instr"mental in Packets 6>oreign7 sensiti3ing the prospects# The stim"lation of !eman! makes it essential that the c"stomer get the services 0hich are not to 1e ma!e availa1le 1* the Department of Posts# This !ra0s o"r attention on the form"lation of a so"n! pro!"ct mi( for the co"rier organi3ations# The professionals are s"ppose! to 0ok 0ith the service motive# The* nee! to make Pro!"ct .o"rier reach to the "sers Dispatching it s"re that the promise! services 0itho"tval"a1le making an* !istortion in the process# Mi( Services !oc"ments, papers

Dispatching o(es 6Inlan!7

Dispatching o(es 6>oreign7

Fig. 13.1

Chile form"lating the pro!"ct mi(, the* are re:"ire! to make it s"re that the service portfolio incl"!es 1oth the high) profit)generating services as 0ell as the lo0)profit)generating services# %romotion Mi+ A)'erti%ing The first constit"ent of promotion, i#e# a!vertising pla*s an effective role in promoting the 1"siness# To 1e more specific in the present age of sophisticate! technologies, 0e fin! a!vertisement instr"mental in promoting the 1"siness of co"rier organi3ations# In this conte(t, the* nee! to a!vertise thro"gh print me!ia, 1roa!cast me!ia an! the telecast me!ia# The co"rier organi3ations fin! print me!ia ore effective 1eca"se the sophistication in the !evelopment of print technolog* has opene! !oors for creativit*# The availa1ilit* of :"alit* materials is fo"n! in2ecting a!!itional attractions 0hile a!vertising thro"gh the print me!ia# The a!vertising professionals nee! to select the me!ia preferre! 1* the target prospects# The ne0spapers, maga3ines in 1ig circ"lation ma* 1e effective since the services are "se! 1* almost all the segments of the market# In a!!ition, the co"rier organi3ations also get an opport"nit* of making !escriptive a!vertisements to co"rier organi3ations also get an opport"nit* of making !escriptive a!vertisements to inform in !etail the target prospects# >"rther 0e have 1een fo"n! more effective# The marketing professionals an! to 1e more specific the a!vertising professionals 1ear the responsi1ilit* of composing creative slogans so that messages, themes an! appeals are fo"n! instr"mental in sensiti3ing the prospects# There is no !o"1t that !"e to a"!io)vis"al e(pos"re 0e fin! telecast me!ia ver* m"ch effective in stim"lating the !eman!# The large) si3e! co"rier organi3ations are fo"n! "sing all the three me!ia# P*/1i(it2 eing an "npai! form of pers"asive comm"nication, the p"1licit* makes it essential that the professional attempt to !evelop a rapport 0ith the me!ia people an! organi3e a get)together an! offer to them l"nch, !inner an! the small gifts to infl"ence them to 0rite articles an! ne0s items in favo"r# If the me!ia people are fo"n! satisfie! 0ith the :"alit* of services offere! 1* them, the* ma* give s"ita1le coverage as a ne0s item 0hich 0o"l! consi!era1l* 1e instr"mental in sensiti3ing the prospects# The p"1licit* meas"res are fo"n! more effective since the prospects at large feel that the me!ia people are presenting right things regar!ing the services of co"rier organisatoins# Th"s the co"rier organisatoins ma* also "se this component of the promotion mi(# Per%&na1 %e11ing It is right to mention that for promoting the 1"siness of co"rier organisation, 0e fin! personal selling ver* m"ch effective# The co"rier organisatoins ma* 1e s"ccessf"l in promoting the 1"siness in a right fashion, if the sales people have high comm"nication a1ilit*# To 1e more specific the large si3e! co"rier organi3ations ma* engage agents, tra!e representatives for !eveloping contract 0ith the target prospects# If the sales personnel have high comm"nicative a1ilit*, attractive personalit* an! commitment to profession, the !ialog"es can 1e transforme! into a !eal# Ce can=t !en* the fact that the co"rier organisatoins nee! to recr"it an! train :"alit* sales people for that ver* p"rpose# The


instr"mentalities of messengers acting as co"rier have 1een accepte! 1* all# If the co"rier, agents, representative narrate to the prospects right things in a right fashion, 0e fin! eno"gh scope for stim"lation# A&r)>&->,&*t+ pr&,&ti&n If the co"rier organi3ations offer 0orl! class services to the prospects or "sers? it is nat"ral that the* remain satisfie! an! comm"nicate to their frien!s an! relatives the pl"s an! negative points# The* in a tr"e sense act as a hi!!en salesforce# If 0e come to kno0 a1o"t the o"tstan!ing :"alit* of co"rier services from o"r frien!s an! relatives, 0e prefer to "se the services of that ver* organisation as an! 0hen the circ"mstances necessitate so# The co"rier organi3ations ma* also take the s"pport of opinion lea!ers for this p"rposes# Sa1e% pr&,&ti&n Sales promotion happens to 1e an important component of the promotion mi(# The co"rier organisatoin nee! to think a1o"t the innovative promotional tools for the sales personnel, marketing personnel an! more so for the "sers of the services# in these conte(t, the* nee! to offer gifts, offer an attractive package, concessional services to the ha1it"al "sers or so# The main thing in the process is to make the tools innovative 1eca"se almost all the co"rier organi3ations are fo"n! offering small or 1ig gifts# %rice Mi+ The pricing !ecisions of co"rier services 1ecome critical 1eca"se the organi3ations are s"ppose! to make rational !ecision 0hich on the one han! maintain their commercial via1ilit* 0hile on the other also s"1serve the interests of those segments of the societ* 0ho fin! it !iffic"lt to pa* the high tariff# &ike other organi3ations, the co"rier organisatoins are also re:"ire! to keep into consi!eration the fact that even the 0eaker sections of the societ* fin! it convenient to "ser their services# It is against this 1ackgro"n! that 0e go thro"gh the price mi( of the co"rier organi3ations# The co"rier organi3ations 1"* the s"pporting services from the !ifferent categories of organisatoins 0hich s"1stantiall* infl"ence their tariff str"ct"re# It is right to mention that 0hatever the* charge as tariff from the "sers remains the onl* so"rce of financing the 1"siness an! therefore it is !iffic"lt for them to s"1serve the social interests 1* offering concessional or s"1si!i3e! services# -o0ever the co"rier organi3ation nee! to e(plore aven"es for the same# The co"rier organi3ations are re:"ire! to make the pricing !ecisions more scientific an! progressive# This !ra0s o"r attention on charging high str"ct"re from the "sers !ispatching val"a1le !oc"ments an! papers, charging lo0 str"ct"re from the ha1it"al "sers, charging ver* lo0 str"ct"re from the ha1it"al large)si3e! "sers# The motive is to increase the market share an! therefore in no case the tariff str"ct"re sho"l! cross the str"ct"re charge! 1* the Department of Posts# If the* improve the :"alit* of services an! make the str"ct"re competitive, the market share 0o"l! a"tomaticall* 1e increase!# %lace Mi+ The place mi( !ra0s attention on the t0o important iss"es, first the services are processe! in a right 0a* in or!er that the gap 1et0een the services)promise! an! service)offere! is 1ri!ge! over an! secon! the co"rier organi3ation an! their 1ranch officers are locate! at a sensitive point so that the "sers as 0ell as the personnel 0orking there !on=t feel an* tro"1le# The first !imension of the place makes it essential that the professionals manage their hea! an! 1ranch offices properl*# The personnel 0orking there are efficient an! the technologies "se! in the process of offering the services are sophisticate!# The secon! !imension of the place mi( !ra0n attention on the location points for the 1ranch an! hea! offices# Ce can=t !en* that the places selecte! for the offices of the co"rier organi3ations sho"l! smoothl* 1e accessi1le# The re:"ire! infrastr"ct"ral facilities sho"l! 1e availa1le at the centers an! the offices sho"l! 1e manage! in a right 0a*# The interior !ecoration nee!s !"e attention of the professionals 1eca"se this is the provision fo"n! instr"mental in a!!ing attractions to the services# In this conte(t, it is also significant that proper f"rnishing is ma!e possi1le an! sophisticate! comm"nication services are availa1le at the centers# To 1e more specific, 0e fin! safet* an! protection provisions re:"iring !"e attention of the professionals responsi1le for managing the 1ranch offices as 0ell as the hea! office# The availa1ilit* of po0er an! transportation facilities can=t 1e "n!er estimate!#


The management of place for the co"rier organi3ations nee! !"e attention of the polic* planners failing 0hich the ne0 perception of :"alit* can=t 1e !evelope!# Th"s it is right to mention that the co"rier organi3ations nee! to manage place mi( 0ith the help of efficient personnel an! 0ith the s"pport of sophisticate! technologies# %eople Mi+ In a!!ition to other components of the marketing mi(, 0e also nee! to gravitate o"r attention one the people mi(# It is against this 1ackgro"n! that the professionals make a strong a!vocac* in favo"r of managing the people mi(# This !ra0s attention on the !ifferent categories of emplo*ees serving the co"rier organi3ations at hea! or 1ranch offices# * performance)orientation, o"r emphasis is on improving the efficienc* of emplo*ees involve! in the process# This makes it essential that the marketing professionals assign !"e 0eightage to the management of emplo*ees serving the co"rier organi3ations# The emplo*ees 0orking at the hea! an! 1ranch offices are re:"ire! to 1e efficient, 0ell a0are of the operation an! maintenance of technologies "se! in the process, sincere an! p"nct"al to the management of time an! familiar 0ith the 1ehavioral profile of prospects or "sers# * sho0ing commitment to the profession, the* can prove themselves to 1e high performs# Ce talk a1o"t performance)orientation 1"t !on=t fin! it essential to assign !"e 0eightage to emplo*ee)orientation# * the emplo*ee)orientation, o"r foc"s is on motivating the emplo*ees s"ita1l* 1* offering to them efficienc*)1ase! incentive plans# The professionals nee! to reali3e that "nless the* offer to the emplo*ees s"ita1le incentives, the process of efficienc*)generation 0o"l! har!l* 1e accelerate!# This makes it essential that the co"rier organi3ations assign an overri!ing priorit* to the incentive plans for the emplo*ees 0hich 0o"l! make 0a*s for performance orientation# In vie0 of the a1ove, it is right to mention that the professionals 1earing the responsi1ilit* of form"lating a so"n! marketing mi( also consi!er the instr"mentalit* of people mi( an! the* nee! to 1len! the !ifferent s"1mi(es in s"ch a 0a* that the marketing !ecisions are fo"n! proactive#


"e%%&n 14 Bank Marketing The ne0 concept of 1ank marketing assigne! !"e 0eightage to c"stomer satisfaction# It is aime! at having a f"ll vie0 of c"stomers nee!s f"lfilling them in the 1est possi1le 0a* 1* re:"ire! services, i!entification of potential c"stomers an! con!"cting the activities on the 1asis of market segmentation# It is sai! that marketing of 1anking service is concerne! 0ith pro!"ct, promotion, pricing an! place# In a!!ition, an n"m1er of e(perts also a!vocate in favo"r of people, process an! ph*sical evi!ence# Market Segmentation The 1ank professionals have to segments the market in s"ch a 0a* that the e(pectations of all the potential c"stomers are st"!ie! in the right perspective an! the marketing reso"rces are !evelope! to f"lfil the same# The polic* of segmentation helps the professionals in form"lating an! innovating the policies an! at the same time simplifies their task, 0hile form"lating an! innovating the strategic !ecisions# 5n important criteria for market segmentation is the economic s*stem is 0hich agric"lt"ral sector, in!"strial sector, services sector, ho"sehol! sector, instit"tional sector an! r"ral sector re:"ire !"e 0eightage# Marketing Mi+ for the $anking Services The form"lation of the marketing mi( for the 1anking services is the prime respnonsi1le)to the pro!"ct portfolio, 0hich means, the !ifferent t*pes of services@ schemes form"late! 1* the 1anks# Pro!"ct Portfolio for anks a# Deposits i# Time !eposit ii# Deman! !eposit 1# International anking i# &etters of cre!it ii# >oreign c"rrenc* c# .ons"ltanc* i# Ta( ii# Merchant 1anking iii# Pro2ect co"nselling iv# Investment co"nselling !# &oans an! 5!vances i# 5gric"lt"ral loan ii# Hehicle loan iii# %!"cational loan iv# Ne0el loan v# e# Miscellaneo"s "siness loan


i# Safe)c"sto!* ii# .re!it car!s iii# Travellers= .he:"e iv# .ollections v# Mift .he:"e %romotion Mi+ In the form"lating of marketing mi(, the 1ank professionals see also s"ppose! to 1len! the promotion mi( in 0hich !ifferent components of promotion, s"ch as a!vertising, p"1licit*, sales promotion, 0or! of mo"th promotion, personal selling an! telemarketing are given !"e 0eightage# A)'erti%e,ent Chile !eveloping a!vertising he 1ank has to prepare appeals, slogans an! messages an! select a s"ita1le me!ia for travelling the messages# There are a n"m1er of !evices to a!vertise, s"ch a 1roa!cast me!ia, telecast me!ia an! the print me!ia# >or promoting the 1anking 1"siness, the print me!ia is fo"n! economic as 0ell as effective# The telecast me!ia ver* m"ch effective, 1"t it is fo"n! ver* e(pensive# The messages, appeals can 1e presente! in a ver* effective 0a*# The* have to provi!e s"fficient 1"!get an! test the effectiveness of a!vertisements# strengthen the p"1lic relation activities to promote their 1"siness# Per%&na1 %e11ing The personal selling is fo"n! instr"mental in promoting the 1anking 1"siness# It is 2"st another name for pers"asion# The 1anking organi3ations nee! to make "se of this !imension 0ith the help an! cooperation of efficient an! personall* committe! sales people# If the sales people have in)!epth kno0le!ge of the sales, !ialog"e, sales techni:"e 1ehavioral profile of the c"stomers, the task of transforming the !ialog"e into a 1"siness is fo"n! easier# This re:"ires an intensive training programme# The personal selling is 1ase! on the personal skill of sales people# If the* kno0 in !etail a1o"t the prospects to 1e intervie0e!, the :"estions to 1e aske! 1* the prospects@ representative of 1"siness ho"ses, it is possi1le for them to convince# Sales %romotion The 1anking organi3ations also think in favo"r of promotional incentives 1oth to the 1ankers as 0ell as the c"stomers# The gift, contests, fairs an! sho0s, !isco"nt an! commission, entertainment an! travelling plans for 1ankers, a!!itional allo0ances, lo0 interest financing an! retaliator* are to mention a fe0 fo"n! instr"mental in promoting the 1anking 1"siness# !ord of mo th The social reformists, pop"lar cine artists, TH artists, opinion lea!ers, vocal persons ma* act as 0or! of mo"th promoters# 5 satisfie! gro"p of c"stomers is consi!ere! to 1e the most s"ccessf"l hi!!en promoters# The* 0ill commen! to others the e(cellent services of a partic"lar 1ank or the o"tstan! properties of a partic"lar scheme# -ence it is clear that the 0or! of mo"th promotion is an important component of promotion mi(, 1"t its instr"mentalit* is infl"ence! 1* the :"alit* of service offere!# %rice Mi+ The pricing !ecisions relate! to interest an! fee or commission charge! 1* 1anks are fo"n! instr"mental in motivating the target market# The pricing polic* is consi!ere! important for raising the n"m1er of c"stomers vis)T)vis the accretion of !eposits# Af co"rse, there are a n"m1er of factors of infl"ence the process, 1"t the ke* role is place! 1* the Reserve ank of In!ia# %lace Mi+ 5 selection of s"ita1le place for the esta1lishment of a 1ranch is significant 0ith the vie0 pint of making the place accessi1le an! in a!!ition, the safet* an! sec"ring provision are also important# The management of office is also anks nee! to !evelop an!


fo"n! significant 0ith the vie0 point of making the services attractive# The f"rnishing, civic amenities an! parking facilities cannot 1e overlooke!# Af late, aesthetic management getting !"e place in the foreign 1ranches# This !ra0s o"r attention on 1ea"tif*ing the office an! premises an! making the place environment frien!l*# Th"s these consi!eration nee! !"e 0eightage 0hile managing the 1ranches of a 1ank# Pe&p1e Meneration of efficienc* is s"1stantiall* infl"ence! 1* the :"alit* of h"man reso"rces# The commercial 1anks nee! to assign a priorit* to the !evelopment of :"alit* people for the !evelopment of an organisation# -ence the first task 1efore the 1anks is to overha"l the recr"itment process# Chile fi(ing criteria for selection, the* nee! assign !"e 0eightge to the ethical val"es# >"rther, the e!"cation an! training facilities are re:"ire! to 1e innovate!# 51ove all !"e 0eightge to 1e given for the !evelopment of 5uman- 5umane- 5umanism- these three terms if fo"n! in the h"man reso"rces, help !eveloping pro!"ctive people# It is high time that the commercial 1anks concept"ali3e innovative marketing to satisf* the c"stomers= e(pectations an! to meet the glo1al competition#


"e%%&n 1= In%*ran(e Marketing The term ins"rance marketing refers to the marketing of ins"rance service 0ith the motto of c"stomer)orientation an! profit)generation# The ins"rance marketing foc"ses on the form"lation of an i!eal mi( for the ins"rance 1"siness so that the ins"rance organi3ations s"rvive an! thrive in a right perspective# The* :"alit* of services can 1e improve! 1* form"lating a fair mi( of the core an! peripheral services# The marketing concept in the ins"rance 1"siness is concerne! 0ith the e(pansion of ins"rance 1"siness in the 1est interest of societ* vis)T)vis the ins"rance organisatoins# The ins"rance companies lag 1ehin! most man"fact"rers in) recogni3ing the marketing concept in their organi3ations# Ins"rance companies ten! to0ar!s a strong sales orientation, since the services the* sell, altho"gh certainl* necessar* ones, rarel* sell themselves# Potential polic* hol!ers are rel"ctant to think a1o"t the !isaster an! !eath# So the* postpone planning for these possi1ilities "nless the* are contacte! an! infl"ence! 1* ins"rance agents# Th"s the ins"rance compan*=s m"t"al orientation is to0ar! sales, not marketing# "t in the mo!ern 1"siness 0orl!, the marketing concept insists on fi(ing of acco"nta1ilit* for overall marketing performance# The selection of risks 6pro!"ct planning7, polic* 0riting 6c"stomer service7, rating of act"arial 6pricing7 an! agenc* management 6!istri1"tion7 all marketing activities make "p an integrate! marketing strateg*# Partic"larl* in the !eveloping co"ntries like o"rs, the organi3ational o12ectives a!vocate sprea!ing of ins"rance services m"ch more 0i!el* an! in partic"lar to the r"ral areas an! speciall* to the economicall* 1ack0ar! classes 0ith a vie0 to reaching all ins"ra1le persons# This nat"rall* necessitates an integral marketing strateg*# In other 0or!s, market)orientation in place of sales orientation is nee! of the ho"r# -ence the marketing concept in the ins"rance 1"siness foe"ses on the form"lation of marketing mi( or a control over the 0hole gro"p of marketing activities that make "p an integrate! marketing strateg*# Market Segmentation In the ins"rance organi3ations, the task of form"lating the overall marketing strategies cannot 1e performe! efficientl* "nless the market is segmente!# It 0as against this 1ackgro"n! that marketing st"!ies engineere! a so"n! fo"n!ation for segmenting the markets of ins"rance 1"siness# The market for the ins"rance 1"siness is fo"n! vast, the potential polic*hol!ers are in ver* goo! n"m1er an! their nee!s an! re:"irements are not i!entical# The segmentation helps the ins"rance organisatoins in !ivi!ing an! s"1)!ivi!ing the market into small segments in 0hich the nee!s an! re:"irements are fo"n! 1* the large i!entical# If the market segmentation is !one in a right fashion, the marketers fin! it convenient to i!entif* the level of e(pectation of "sers# The main p"rpose of market segmentation is to kno0 the market# Unless the ins"rance companies kno0 the nee!s an! re:"irements an! i!entif* the level of e(pectations of the polic* hol!ers, it is !iffic"lt to form"late a so"n! marketing strateg*# Chere a large n"m1er of "sers living in the r"ral areas, the emergence of a strong r"ral sector cannot 1e negate!# The region)0ise segmentation simplifies the task of having a microscopic st"!* of c"lt"re, lang"age, likes an! !islikes# This helps in making the marketing !ecisions creative# It is essential that the ins"rance organisatoins capitali3e on the availa1le opport"nities in the market# The* nee! to increase their market share# This makes it essential that the* s"ccee! in informing, sensing an! pers"a!ing the !ifferent segments 0here the potential "sers are availa1le# It is not pro!"ctive to concentrate on onl* one segment# The ins"rance professionals nee! to 1"siness in all the segments, s"ch as r"ral an! "r1an, men an! 0omen, agric"lt"ral an! in!"strial or so# The nee! of the ho"r is to sprea! the ins"rance 1"siness even to the agric"lt"ral sector of the econom*# The segmentation 0o"l! help ins"rance professionals in making the promotional meas"res creative 0hich 0o"l! 1e ver* m"ch instr"mental in sensiti3ing he prospects# The a!vertisement professionals 0o"l! make a!vertisement appeals, messages, campaigns proactive to the receiving capacit* of the target a"!ience# The sales promotion meas"res can also 1e innovate! to get a positive response# The personal selling ma* 1e effective since the sales personnel@ agents are s"ppose! to 1e a0are of the nee!s an! re:"irements of c"stomers@ "sers# Th"s the segmentation 0o"l! help marketers in man* 0a*s# The pricing@ fee !ecision can also 1e rationali3e! an! the 0eaker sections of the societ* 0o"l! get s"1stantial 1enefits# The main thing in segmentation is receiving the e(pectations of "sers@ prospects in a right fashion an! accor!ingl* !eveloping a s"ita1le marketing strateg*#

Marketing Mi+ for Ins rance


The ins"rance organi3ations in general an! the p"1lic sector ins"rance organisatoins in partic"lar nee! to assign !"e 0eightage to the form"lation of marketing mi( for the ins"rance 1"siness# The emerging tren!s in!icate that if the ins"rance organi3ations !ela* the process of form"lating a so"n! marketing mi( for their 1"siness, there 0o"l! 1e a sharp fall in their market share in the f"t"re, 0hich 0o"l! 1ring !o0n the rate of profita1ilit*# It is against this 1ackgro"n! that 0e go thro"gh the pro1lem of marketing mi( for the ins"rance services# This makes it essential to st"!* the !ifferent s"1mi(es of marketing s"ch as the pro!"ct mi(, the promotion mi(, the price mi(, the place mi(, the people, the process an! the ph*sical evi!ence, in relation to the marketing of ins"rance# Ins rance %rod ct The ins"rance organi3ations pro!"ce or generate services in !ifferent forms# 5 pro!"ct is 1oth 0hat a seller has to sell an! 0hat a 1"*er has to 1"*# th"s an* enterprise that has something to sell, tangi1le goo!s or not is selling pro!"cts# In the ins"rance 1"siness, the ins"rance organisatoins are fo"n! selling services an! therefore, services are their pro!"ct# Th"s a pro!"ct is also calle! a 1"n!le of "tilities consisting of vario"s pro!"ct feat"res an! accompan*ing services# Chen an in!ivi!"al or a compan* 1"*s a polic* from the ins"rance organi3ations, not onl* the policies are 1o"ght 1"t the agents=s assistance an! a!vice, the prestige of the ins"rance organi3ations, the facilities of claims an! compensations are also 1o"ght# In the conte(t of form"lating the pro!"ct mi(, it is essential that the ins"rance organisatoins promote innovation an! in the pro!"ct portfolio incl"!e even those services an! schemes 0hich are likel* to get a positive response in the f"t"re# In a!!ition, the* nee! to form"late a so"n! package that proves to 1e more motivational# Chile form"lating a package, the ins"rance professionals nee! to assign !"e 0eightage to the interests of r"ral In!ia# The private sector ins"rance organisatoins have 1een fo"n! making their service mi( internationall* competitive# This makes a strong a!vocac* in favo"r of innovative pro!"ct strateg* for the p"1lic sector ins"rance organi3ations# In vie0 of the a1ove, the follo0ing aspects nee! !"e attention of polic* makers: 1# The form"lation of pro!"ct mi( sho"l! 1e in the face of innovative pro!"ct strateg*# The strategies a!opte! 1* the foreign an! private ins"rance companies sho"l! 1e taken into consi!eration 0hile initiating the innovation process# $# The Data Processing Department is s"ppose! to collect necessar* information relate! to the changing level of e(pectations of prospects so that the senior e(ec"tives make the pro!"ct portfolio pro!"ctive to the "sers an! profita1le to the ins"rance organi3ations# '# It is also significant that the ins"rance organi3ations initiate the process of elimination of the services, schemes not profita1le to them# This necessitates a st"!* of the pro!"ct life c*cle# +# The form"lation of pro!"ct strateg* sho"l! assign !"e 0eightage to the r"ral segment emerging as a 1ig profita1le segment# ,# The ins"rance organisatoins incl"!e in the pro!"ct portfolio even those policies an! schemes 0hich 1ecome instr"mental in safeg"ar!ing the interests of the 0eaker sections of the societ*# /# The form"lation of a package is also fo"n! important# Ce fin! the foreign ins"rance companies !esigning a package on the 1asis of the nee!s an! re:"irements of the concerne! segment# This 0o"l! make the pro!"ct mi( competitive# G# There are some of the profita1le areas 0hich till not are fo"n! either partiall* tappe! or even totall* "ntappe!# The agents, r"ral career agents, the 1ranch managers 1ear the responsi1ilit* of i!entif*ing the profita1le segments of f"t"re an! helping the senior e(ec"tive in tapping the potential optimall*# I# 5 so"n! pro!"ct portfolio is the nee! of the ho"r an! therefore the reg"lator* 1arriers or constraints in activating the innovation process sho"l! 1e minimi3e!#

%romotion Mi+


In the form"lation of marketing mi(, the promotion mi( occ"pies a significant place# In the promotion mi(, a n"m1er of s"1mi(es, s"ch as the a!vertising, p"1lic relations, sales promotion, 0or!)of)mo"th promotion, personal selling are incl"!e!# A)'erti%ing 5!vertising a pai! form of pers"asive comm"nications is fo"n! important to promote the ins"rance 1"siness# The a!vertising professionals 1ear the responsi1ilit* of making the a!vertisement slogans, appeals, campaigns creative so that the process of sensiti3ing the prospects is fo"n! proactive# The ins"rance companies a!vertise thro"gh telecast me!ia, 1roa!cast me!ia an! the print me!ia# 5mong these, telecast me!ia is fo"n! to 1e more effective in sensiti3ing process# Cith the help of a"!io)vis"al e(pos"re, the rate of accepta1ilit* of the messages can 1e increase! si3ea1l*# If the a!vertising professionals are 0ell a0are of the messages creative# The 1roa!cast me!ia can also 1e "se! for that ver* p"rpose# Thro"gh the availa1le 1ig transmission net0ork an! a 0ell !evelope! s*stem, the ins"rance organisatoins are s"ppose! to "se even the 1roa!cast me!ia# 5nother 1enefit of this me!ia is to reach the messages even to the remotest parts of the co"ntr*# The print me!ia can also 1e "se! for promoting the ins"rance 1"siness# eing economic in nat"re an! impressive in e(pression, the print me!ia of late, has 1een fo"n! gaining pop"larit*# The sophistication in the print technologies has ma!e the me!ia more attractive# It is against this 1ackgro"n! that no0 almost all the organi3ations assign !"e 0eightage to this# The ins"rance organi3ations nee! to promote the print me!ia since this 0o"l! simplif* their task of making the appeals effective 1* "sing regional lang"ages# P*/1i(it2 In a!!ition to a!vertisement, the ins"rance@ professionals also nee! to think in favo"r of p"1licit* since this component of promotion if "se! in a right fashion makes o"r promotional efforts proactive# The a!vertisements ma* 1e insensitive, 1"t 0e fin! p"1licit* effective since the messages, vie0s, opinions, facts, fig"res are p"1lici3e! 1* me!ia or the vocal lea!ers# It is a !evice to promote 1"siness 0itho"t making an* pa*ment an! therefore it is calle! as an "npai! form of pers"asive comm"nication 1earing high rate of sensitivit*# Strengthening the p"1lic relations activities is another !imension re:"iring !"e attention an! the p"1lic relations officers shall 1eat the responsi1ilit* of pro2ecting a positive image of the organisatoin# The PRA is consi!ere! to 1e professional having the 0orl! class e(cellence in infl"encing the prospects, "sers, others# -e@She 1ears an important responsi1ilit* of informing, sensing an! pers"a!ing# -e@she is fo"n! responsi1le for managing the sales !ialog"es# This makes it essential that 0e fin! selection of s"ita1le persons for the sai! p"rpose an! in a!!ition also intensif* training programmes, refresher co"rses, caps"le co"rses to e!"cate an! train them in t"ne 0ith the changing 1"siness con!itions# The receptionists, secretaries, front)line)staff p"1lici3e the 1"siness 0ith their gest"re an! post"re# The* are s"ppose! to kno0)ho0 to talk, ho0 to initiate, ho0 to impress an! ho0 to concl"!e# The* sho"l! look smart an! attractive an! sho"l! also have :"alit* comm"nicative a1ilit*# It is an art 0hich is fo"n! 1ase! on certain properties# It is essential to e!"cate an! train them properl* so that the*, 0ith the help of their !ialog"es an! 1o!* comm"nications s"ccee! in impressing "pon the prospects@ "sers# If the* are 0ell a0are of the changing level of e(pectations of c"stomers, the task is ma!e easier# Sa1e% pr&,&ti&n Sales promotion is a temporar* !evice 0hich is a!opte! onl* for a partic"lar perio!# In the ins"rance 1"siness, the incentives to the polic* hol!ers "sers or to the agents, r"ral career agents or even to the ins"rance personnel for promoting the 1"siness are the sales promotion tools# Incentives to the en! "sers for taking a polic* pla* an incremental role in promoting the ins"rance 1"siness# The offering of small gifts !"ring a partic"lar perio!, the re1ate, !isco"nt, 1on"s can 1e instr"mental in increasing the 1"siness of ins"rance organi3ations# It is right to mention that s"ch incentive to the polic* hol!ers@ prospects 0o"l! 1e s"ccessf"l in increasing the 1"siness# It is the responsi1ilit* of the ins"rance professionals that the* keep on activating the process of innovation so that the foreign ins"rance companies fin! it !iffic"lt to compete 0ith the p"1lic sector ins"rance organi3ations# This makes it clear that incentives to the "ser@ polic*hol!ers as 0ell as to the agents an! the r"ral career agents 0o"l! 1e instr"mental in promoting the ins"rance 1"siness, provi!e! the ins"rance professionals innovate the same, m"ch earlier than their competitors#

Per%&na1 %e11ing The personal selling occ"pies a place of o"tstan!ing significance# This is !"e to the fact that the ins"rance 1"siness is s"1stantiall* infl"ence! 1* the instr"mentalit* of agents an! the r"ral career agents# It the* are a0are of the art of


informing, sensing an! pers"a!ing the potential polic*hol!ers, the task of ins"rance organisations is simplifie! consi!era1l*# Personal selling is 1ase! on the e(cellence of an in!ivi!"al# This foc"ses o"r attention on the a1ilit* of an in!ivi!"al to infl"ence the imp"lse 1* activating the pers"asion process# This makes it significant that the agents as 0ell as the r"ral career agents have certain o"tstan!ing properties or attri1"tes, s"ch as patience, comm"nicative a1ilit*, attractive personalit* an! commitment to the profession# -ence the ins"rance organi3ations are s"ppose! to assign !"e 0eightage to the e(cellence in an in!ivi!"al 0ho is assigne! this responsi1ilit*# The nee! to provi!e !"e incentive to the agents so that the* 0ork satisfactoril* an! keep on moving the process of informing an! pers"a!ing the polic*hol!ers@ prospects# Chile recr"iting agents, the ins"rance professionals nee! to 1e caref"l so that persons 0ith high comm"nicative a1ilit*, an attractive ph*si:"e an! everlasting patience are assigne! the responsi1ilit* of acting as an agent# The 1ranch managers 1ear the responsi1ilit* of managing an! !eveloping the agents 1* monitoring their contri1"tions to the process of increasing the ins"rance 1"siness# The* are s"ppose! to organi3e refresher co"rses to !evelop the agents so that the emerging tren!s in the investment potentials of a comman! area vis)T)vis the changing level of e(pectations of the polic*hol!ers@ prospects are transmitte! to them in a right fashion an! on time# The personal selling th"s re:"ires an intensive care# It is high time that the Career Agents Schemes an! the Rural Career Agents Schemes are promote!# A&r)>&->,&*t+ pr&,&ti&n The 0or!)of)mo"th comm"nications res"lt into 0i!er p"1licit* 0hich s"1stantiall* sensitive the process of infl"encing the imp"lse of "sers@ prospects of the ins"rance services# The satisfie! gro"p of c"stomers, the opinion lea!ers, the social reformists, the pop"lar personalities acts as 0or!)of)mo"th comm"nicators# The ins"rance organi3ations nee! to assign !"e 0eightage to the :"alit* of service ma!e availa1le to the "sers# The ins"rance professionals are also s"ppose! to seek the cooperation of opinion lea!ers, vocal persons for promoting the 1"siness an! for that the offering of small gifts to them is re:"ire! essential# 5nother !imension of this component of the promotion mi( is to seek the cooperation of "sers 0ho are satisfie! 0ith the services# The* are ha1it"al "sers an! therefore it is nat"ral that the* talk to their frien!s an! relatives a1o"t *o"r positive contri1"tions# The a!vertisements slogans ma* 1e insensitive, even the sales promotion meas"res ma* 1e ineffective 1"t the positive feelings of *o"r frien!s an! relations comm"nicate! to *o" can=t 1e ineffective# This makes it clear that the most important thing in the promotion of an* 1"siness is the :"alit* of services that *o" offer to *o"r "sers@ c"stomers# %rice Mi+ In the ins"rance 1"siness, the pricing !ecisions are concerne! 0ith the premi"m charge! against the policies interest charge! for !efa"lting the pa*ment of premi"m an! cre!it facilities, commission charge! for "n!er0riting an! cons"ltanc* services# The form"lating of pricing strategies 1ecomes significant 0ith the vie0point of infl"encing the target market or prospects# It is pertinent that the ins"rance organisatoins in general an! p"1lic sector ins"rance organi3ations in partic"lar a!opt s"ch a strateg* for pricing that makes it a motivational tool an! paves the 0a*s for increasing the ins"rance 1"siness# This necessitates a ne0 vision for setting premi"m str"ct"re an! pa*ing the 1on"s an! charging the interest# The ins"rance organi3ations prefer to make a mi( of high a lo0 pricing strateg*# To 1e more specific, in the p"1lic sector ins"rance organisatoins 0hich are instr"mental in offering policies, schemes for the 0eaker sections, it is pertinent that the pricing strateg* is rationali3e! to cater to the lo0 pa*ing capacit* of the concerne! segment# -o0ever the ins"rance organisatoins 0o"l! 1e re:"ire! to think in favo"r of a high pricing strateg* for the affl"ent section of the societ*# The motive is to make the premi"m str"ct"re commerciall* via1le so that the ins"rance organi3ations s"ccee! in having a so"n! pro!"ct portfolio 1esi!es f"elling !evelopment orientation# The pricing !ecisions make it essential that the ins"rers keep in their min!s the nat"re of polic* vis)T)vis the segment to 0hich the prospects 1elong# The ins"rance e(ec"tives 1ear the responsi1ilit* of managing the pricing !ecisions in s"ch a 0a* that a rational premi"m str"ct"re is possi1le# There are n"m1er of factors infl"encing the rate of premi"m, s"ch as the positive !evelopments in the socio)economic environment, gro0ing healthcare facilities, rising stan!ar! of living of the masses, increasing !iscretionar* income, increasing rate of literac*, attit"!inal change in investors or so# The investment !ecisions of ins"rance organisatoin are also fo"n! instr"mental in infl"encing the costs# %rice Mi+


5nother component of the marketing mi( is relate! to the place !ecisions# Chile locating 1ranches, the 1ranch managers nee! to consi!er a n"m1er of factors, s"ch as smooth accessi1ilit*, availa1ilit* of infrastr"ct"ral facilities an! the management of 1ranch offices an! premises# In a!!ition, it is also significant that the 1ranch managers assign !"e 0eightage to the safet* provision# The places fo"n! of v"lnera1le nat"re sho"l! not 1e selecte! for the location of 1ranch offices an! the "sers= safet* vis)T)vis the safet* of ins"rance personnel an! cash nee! !"e attention# The management of offices makes it significant that the 1ranch managers are partic"lar to the office f"rnishing, civic amenities an! facilities, parking facilities an! interior office !ecoration# The foreign ins"rance companies are fo"n! serio"s to this component of place management 0hich helps them in attracting the "sers# esi!es, the management of premises is also an important component since of late the management e(perts make a strong a!vocac* in favo"r of aesthetic management for generating the 0ork c"lt"re an! motivating the "sers# The plantation, gar!ening, !"st1in, !rains, sign posts are some of the important facets 0hich makes *o"r premises attractive an! health*# In vie0 of the a1ove, it is right to opine that the place management of ins"rance 1ranch offices nee!s a ne0 vision, a !istinct approach an! an innovative strateg*# This is essential to make the 0ork place con!"cive, attractive, proactive to the generation of efficienc* or so# The motives are to offer the promise! services to the en! "sers 0itho"t an* !istortion an! making the 1ranch offices a point of attraction# The 1ranch managers nee! professional e(cellence to make place !ecision pro!"ctive# Pe&p1e The management scientists make a strong a!vocac* in favo"r of managing the ins"rance personnel since the* i!entif* people as an important component of the marketing mi(# This foc"ses o"r attention on the !evelopment of ins"rance professionals# The "se of comp"ters, micro)comp"ters, fa( machines, sophisticate! telephonic services, e) mailing, internet an! intranet services have a 1ig impact on the perception of :"alit* of services# This makes it essential that the ins"rance organisatoin also think in favo"r of !eveloping personnel in line 0ith the !evelopment an! "se of information technologies#This gravitates attention on the e!"cation an! training facilities to the ins"rance personnel# The front)line)staff as 0ell as the 1ranch manages are re:"ire! to 1e given the training facilities so that the* are in a position to make possi1le an effective "se of the technologies# The ins"rance organisatoins 1ear the responsi1ilit* of !eveloping the cre!entials of their emplo*ees# the senior e(ec"tives 0hile recr"iting, training an! !eveloping the ins"rance personnel make it s"re that emplo*ees serving the organisation have a high 1ehavioral profile in 0hich empath* has 1een given !"e place# The marketing management of an organisation pla*s a contri1"tor* role in f"elling the processes of :"alitative)c"m) :"antitative improvements# The !ifferent mi(es are re:"ire! to 1e innovate! to cater to the changing nee!s an! re:"irements of the !ifferent categories of "sers# The pro!"ct mi( necessitates a fair s*nchroni3ation of core an! peripheral services, the pro!"ct portfolio is re:"ire! to 1e ma!e optimal, the packages nee! !"e attention in the form"lation process, the ne0 services are re:"ire! to 1e incorporate, the "nprofita1le services or schemes are re:"ire! to 1e eliminate! an! the effective f"lfillment of !evelopment nee!s re:"ire 0orl! class ins"rance professionals 0ho 1* making their !ecision innovative are fo"n! s"ccessf"l in having a so"n! pro!"ct mi(# In a!!ition, the promotion !ecisions also nee! a ne0 vision, a !istinct approach mi(# In a!!ition, the promotion !ecision also nee! a ne0 vision, a !istinct approach an! an ne0 strateg*# The sophistication in the process of a!vertising, the creativit* in a!vertisement messages an! slogans, the 0ell manage! p"1lic relation activities, the innovative tools of sale promotion, the 0or!)of)mo"th comm"nications, the personal selling, an! the telemarketing nee! !"e attention of marketing e(ec"tives# The premi"m, 1on"s, commission policies nee! to 1e ma!e rational an! the place !ecision re:"ire !"e 0eightage# The management of ins"rance personnel re:"ires an overri!ing priorit* an! the ph*sical attractions of ins"rance professionals are to 1e given !"e 0eightage# In vie0 of the a1ove, it is right to opine that the marketing practices nee! a ne0 look, an innovative approach an! the concept"ali3ation of the holistic concept of management# The !efine! principles of social or societal marketing if practice! in a right fashion 0o"l! pave aven"es for the 1len!ing of three important consi!erations, s"ch as profit) generation, c"stomer)satisfaction an! social)orientation# It is in this conte(t that the p"1lic sector ins"rance organi3ations nee! to reali3e gravit* of the sit"ation an! to assign an overri!ing priorit* to the management of marketing activities#


"e%%&n 1? G&%pita1 Marketing -ospital is a social instit"tion for !elivering healthcare, offering consi!era1le a!vantages to 1oth patient an! societ*# It is consi!ere! to 1e a place for the !iagnosis an! treatment of h"man ills an! restoration of health an! 0ell)1eing of those temporaril* !eprive! of# 51ove all, it is a social instit"tion responsi1le for protecting the social interests an! a non)profit organisation# Ce have faile! in improving the me!icate facilities keeping pace 0ith the gro0ing re:"irements 1"t have 1een s"ccessf"l in making the environment "nhealth* 0hich is fo"n! raising the press"re on 1oth the government as 0ell as the private hospitals# In vie0 of the prevailing con!ition, 0e e(pect m"ch more from hospitals government of private# * marketing me!icate services, the hospitals 0o"l! not onl* serve masses 1"t 0o"l! also 1e efficacio"s in inc"lcating mass a0areness to prevent ailments an! to !ecrease the n"m1er of prospects# Marketing of me!icare services means, making availa1le the me!icare services to the "sers in s"ch a 0a* that the* get :"alit* services at a reasona1le cost# The social marketing principles foc"s on making availa1le the services even to those segments of the societ* 0ho are not in a position to pa* for the prices# It is in this conte(t that a managerial approach to form"late a so"n! service mi( is re:"ire!# Marketing Mi+ for Hospital Services The components of marketing mi( namel*, pro!"ct, price, place an! promotion co"l! 1e applie! for effective marketing of hospital services# %rod ct mi+ The service programming for hospitals incl"!e !ifferent t*pes of services re:"ire! to protect the p"1lic interests# The services have 1een classifie! as line services, s"pportive services an! a"(iliar* services# The first one, line services incl"!e emergenc* services, o"t!oor an! in!oor services, intensive care "nit an! operations theatre# This is also calle! core services# The s"pporting services in a tr"e sense !etermine the :"alit* of services ma!e availa1le 1* me!ical an! para)me!ical personnel# The a"(iliar* services consists of registration an! in!oor case recor!s, stores management, transportation management, mort"ar* arrangement, !ietar* services, engineering an! maintenance services >or effectives marketing these services are to 1e manage! in an effective 0a*# %romotion Mi+ In the me!icare services innovating the promotional meas"res an! inc"lcating mass a0areness are important for promotion of hospital services# >or making availa1le right services to the right "sers at the right time, it is essential to inst"mentalise the personal promotion# In this conte(t, 1oth the core an! para)me!ical personnel pla* an important role# To 1e more specific, the frontline personnel have 1een fo"n! pla*ing an o"tstan!ing role# If n"rses neglect patients, if receptionist miscomm"nicate "sers, prospects, if !octors !o not sho0 h"man approach, the me!icare services even after the availa1ilit* of most sophisticate! e:"ipment an! technologies, most efficient !octors an! n"rses, most comforta1le 1"il!ings an! infrastr"ct"ral facilities 0o"l! fails in !elivering the goo!s to the societ*# Ultimatel*, the personnel !etermine the magnet of s"ccess an! not the s"pporting forces# 3dvertisement and pu$licity meas"res are important to promote me!ical services# Chile a!vertising, the hospitals an! health care centres sho"l! make possi1le creativit* in their campaigns, messages an! slogans for the prospects to avail the services# #ervice promotion is an important !imension of promotion, 0hich is fo"n! instr"mental in the generation of efficienc*, formation of a team spirit, esta1lishment of a 0ork c"lt"re an! more so a personal to"ch in service# This re:"ires a team 0ork an! involvement of all the me!ical an! para)me!ical personnel# The word of mouth communication also pla*s an o"tstan!ing role# The satisfie! "sers act an agent in sprea!ing the message to their frien!s, relatives an! others, 0ho are fo"n! motivate! an! prefer to "ser the services of that hospital as an! 0hen the circ"mstances necessitates so#


%rice Mi+ No0 the hospitals nee! to invest a lot on the sophisticate! e:"ipment an! technologies to improve the :"alit* of me!ical ai!# Increasing cost on inp"ts in fo"n! aggravating the setting the task of fee str"ct"re 0hich makes possi1le a fair s*nchroni3ation of "sers= an! hospitals interests=# The fees strateg* for hospitals sho"l! 1e in proportion to the income of the "sers 0hich 0o"l! engineer a so"n! fo"n!ation for :"alitative or :"antitative improvements# >or a social instit"tion like hospital, a !iscriminator* fee str"ct"re is s"ita1le, since it provi!es even 0eaker sections of the societ* an opport"nit* to avail the :"alit* me!ical services# %lace Mi+ >or effective !istri1"tion of me!icare services it is essential that the hospitals sho"l! 1e a1le to provi!e 1asic me!ical services at !ifferent parts of resi!ential areas an! also to r"ral areas in partic"lar# >"rther, 0herever there is concentration of "sers= like in!"strial esta1lishments, e!"cational instit"tions, the hospitals m"st 1e a1le to take their services to those places# To concl"!e for marketing of hospital services innovation is a m"st# The aim sho"l! 1e to serve the societ*? to improve :"alit*? to make services cost effective? to minimi3e the me!icare nee!s an! in !"e co"rse to minimi3e the press"re on hospitals#


"e%%&n 1@ Te1e(&,,*ni(ati&n Marketing Telecomm"nication services pla* an incremental role in the m"lti)!imensional !evelopment activities# 5 0ell f"nctioning telecomm"nications net0ork is an essential component of economic infrastr"ct"re# The application of mo!ern marketing principles in the telecomm"nication services 0o"l! make 0a*s for the generation of profits an! at the same time 0o"l! also make the services affor!a1le to the "sers at large# The telecomm"nications organi3ations are s"ppose! to market the services in s"ch a 0a* that a high level of efficienc* generates a high level of profit# Cith the gro0ing sophistication in the process of telecomm"nication technologies, m"lti)facete! services are 1eing offere! 1* the telecomm"nication organisation 0hich is manage! an! controlle! as a government !epartment 1* the Ministr* of .omm"nications# Telecomm"nications marketing foc"ses on marketing the services professionall* an! this makes it a managerial process# The marketing professionals 1ear the responsi1ilit* of managing the services 0hich enrich the service profile of telecom in or!er that the 0orl! class services are ma!e nationall* an! internationall* competitive# Marketing Mi+ for Telecomm nication &rgani0ations The form"lation of a so"n! marketing mi( is fo"n! essential to make possi1le an optimal !evelopment of marketing reso"rces# The marketing professionals 1ear the responsi1ilit* of !eveloping optimal marketing inp"ts so that the 0orl! class services reach to the !ifferent segments of "sers in a right 0a*# It is in this conte(t the form"lation of marketing mi( for telecomm"nication is consi!ere!# It goes thro"gh the !ifferent s"1mi(es s"ch as the pro!"ct mi( covering he !esigning of a :"alit* services profile, the promotion mi( having more creativit* an! sensitivit*, the tariff polic* making possi1le !esigning of a so"n! tariff str"ct"re, the place mi( containing the pro1lem of processing the services 0ith the motto of 1ri!ging over the gap 1et0een services promise! an! services offere! an! the people mi( for striking a 1alance 1et0een performance)orientation an! emplo*ee)orientation# %rod ct Mi+ The telecomm"nication organi3ations offer m"lti)!imensional services to the !ifferent categories of !omestic an! instit"tional "sers# telecomm"nication incl"!e a n"m1er of services s"ch as the telephonic service incl"!ing cell services, telegraphic services, e)mailing services, fa( services, internet services an! so on# An one han! the telecom organisatoins feel that the services are :"ite satisfactor*, 0hile on the other han! there are increasing cases of !issatisfaction among the "sers# This makes it essential that sincere efforts to 1e ma!e to improve the :"alit* of service# In the categor* of services mi(, the telephonic services occ"p* a place of o"tstan!ing significance 1eca"se of ma2orit* of the "sers of almost all the categories are fo"n! "sing the same# Cith the !evelopment of cor!less an! cell"lar phones, 0e fin! a change in the nat"re of services# In this conte(t, it is the prime responsi1ilit* of the telecomm"nication organisatoins to make it s"re that "sers get :"alit* services, s"ch as services 0ith ha !ismal 1reak!o0n, noise an! interr"ption, :"alit* a"!io)!eliver* or so# The cases of one)0a* are to 1e checke!# The technical personnel are re:"ire! to make it s"re that the "sers are ma!e availa1le :"alit* instr"ments an! the replacement is ma!e possi1le as the 0hen the circ"mstance necessitate so# The marketing professionals 1ear the responsi1ilit* of making it s"re that a so"n! services profile is !esigne! in 0hich 1oth the categories of services, s"ch as core an! peripheral are optimall* 1len!e!# The innovation in the form"lation of a services portfolio nee!s to 1e given !"e 0eightage# The main think in the process is to form"late a service mi( that makes the 0a*s for profit)generation vis)T)vis "ser)satisfaction# In vie0 of the a1ove, it is right to mention that like other organi3ations, the telecomm"nication organisation also nee! to form"late a so"n! pro!"ct mi( that foc"ses o"r attention on offering of the 0orl! class services so that the level of efficienc* is increase! an! the task of marketing professionals is ma!e easier# %romotion Mi+ This s"1mi( of the marketing mi( foc"ses on creative promotional meas"res helping the telecom organisatoins in informing, sensing an! pers"a!ing the "sers# In this conte(t, !ifferent constit"ents of promotion, s"ch as a!vertising, p"1licit*, sales promotion, personal selling, 0or!)of)mo"th promotion are !isc"sse!# A)'erti%ing


&ike other organi3ations, the telecomm"nication organisatoins ma* also a!vertise 0ith the help of me!ia# 5ll the three me!ia, s"ch as the print me!ia, 1roa!cast me!ia an! telecast me!ia can 1e "se! for that ver* p"rpose# Chile a!vertsing, the marketing professionals in general an! the a!vertising professionals in partic"lar are s"ppose! to make the slogans, themes an! appeals more creative so that the target prospects are sensiti3e! in a right 0a*# The print me!ia ma* 1e more effective since 0hile a!vertising thro"gh this me!ia, an organi3ation gets a!e:"ate space to inform an! sense the "sers# In a!!ition, the* can also a!vertise thro"gh the 1roa!cast me!ia# Telecast me!ia emerging as the most effective me!ia fo"n! ver* m"ch instr"mental in sensiti3ing the prospects# Cith the help of a"!io)vis"al e(pos"res, it is possi1le to inform an! sense the "sers an! the prospects# The a!vertising professionals having 0orl! class e(cellence are to 1e engage! for that p"rpose 0ho 0o"l! !esign a!vertisement la*o"t, compose slogans an! messages 1earing more creativit*# If the* are professionall* so"n!, the a!vertising 1"!get 0o"l! also 1e ma!e optimal# P*/1i(it2 5nother component of promotion foc"ses on p"1lici3ing the 1"siness 0ith the s"pport of me!ia personnel an! opinion lea!ers# The telecom organi3ations ma* "se this constit"ent 0ith he motto of informing the prospects the salient feat"res of innovative services offere! or to 1e incl"!e! in the services mi(# The marketing professionals or the p"1lic relation officers nee! to accept the responsi1ilit* of !eveloping rapport 0ith the me!ia people, to arrange for them l"nch or !inner an! to offer to them some small gifts to 0rite ne0s items or articles relate! to the services an! to place them at the e*e catching locations# It is in this conte(t that 0e talk a1o"t the instr"mentalit* of p"1lic relations activities in promoting the telecom 1"siness# Sa1e% pr&,&ti&n It is essential that the telecomm"nication organisatoin makes "se of sales promotion meas"res for promoting the innovative services, speciall* "se! 1* the large)si3e! c"stomers# If he prospects are offere! some small gifts, the motivation process 0o"l! 1e s0itche! on# In a!!ition, the* also nee! to offer innovative tools of sales promotion to some of the high performers in the gro"p of emplo*ees 0ho instr"mentalise the process of getting the profita1le 1"siness# This 0o"l! consi!era1l* 1e helpf"l in tapping the market potentials 0hich 0o"l! activate the process of profit generation# Per%&na1 %e11ing The instr"mentalit* of personal selling is involve! in the essence of promoting the 1"siness 0ith the s"pport an! cooperation of sales people# The telecomm"nication organisatoins are re:"ire! to promote its 1"siness to tap the sales potentials or the market potentials 0hich remain "ntappe! or partiall* tappe! !"e to a comm"nications gap# The role of personal selling 1ecomes important in the conte(t of privati3ation of telecom services an! !"e to emergence of 1"*ers= market# A&r)>&->,&*t+ pr&,&ti&n This constit"ent of the promotion mi( is fo"n! 1ase! on the :"alit* of services offere! 1* the service generating organisatoins# In the telecomm"nication organisatoins, 0e fin! this component instr"mental 1eca"se the satisfie! gro"p of "sers 0o"l! narrate to their frien!s, relatives, 0ell 0ishers regar!ing the o"tstan!ing services the* e(perience! as a c"stomer# The in!ivi!"als tr"st on their relatives an! frien!s an! therefore "se the services as an! 0hen the circ"mstances necessitate so# It is in this conte(t that 0e make a strong a!vocac* in favo"r of improving the :"alit* of services 1* the telecomm"nications organisatoin# The s"pport an! cooperation of opinion lea!ers or vocal persons 0o"l! also 1e effective in the process# The aforesai! components of promotion are fo"n! helpf"l to the telecomm"nication organi3ations in promotion the 1"siness# The main thing in the promotion is to inform, sense an! pers"a!e the prospects or "sers in s"ch a 0a* that the* are transforme! into the ha1it"al "sers# The instr"mentalit* of a partic"lar constit"ent 0o"l! !epen! "pon the prevailing con!itions#

%rice Mi+ 5lmost all the organi3ations either pro!"cing goo!s or generating services fin! pricing !ecisions significant to the !evelopment process# In the conte(t of telecomm"nication organisatoin the !ifferent categories of "sers 1"* the


services an! therefore the telecomm"nication organisatoin is re:"ire! to 1e more caref"l in setting the tariff str"ct"re# The main thing is the !esigning of a rational tariff str"ct"re 0hich on the one han! makes the 0a*s for profit) generation 0hile on the other han! also make the services affor!a1le to the "sers# The telecomm"nication organisation a!opts a !iscriminator* polic* of pricing# The special categories of "sers are given s"1si!i3e! or concessional services, s"ch as the r"r"al "sers, ne0 or 1"!!ing entreprene"rs, ne0 instit"tions promoting 0elfare or so# I this conte(t, it is important to mentioni that the telecomm"nication organisatoin charges !ifferent sla1l of tariff for !ifferent operational ho"rs# There is also provision for special concession on selecte! !a*s an! festivals# Th"s !iversifie! pricing strateg* is a!opte! 1* the telecomm"nication organisation to generate reven"e# The Telecom Reg"lator* 5"thorit* pla*s an significant role in making the pricing !ecisions in the In!ian conte(t The pricing !ecisions an! the tariff str"ct"re also !epen! "pon the nat"re an! t*pes of services offere! 1* the telecomm"nications organisatoin# >or the !ata@fa( services, facsimile services, internet services, there is a !ifferent sla1 an! 1ase# The pricing !ecisions are of sensitive in nat"re# The governmental interference in the process of making the pricing !ecision is to 1e checke! to 1e e(tent it is fo"n! legitimate# The revision in tariff str"ct"re, licensing fee have a close relation 0ith the costs of services# The aforesai! facts makes it clear that the telecomm"nication organisatoins nee! free!om 0hile setting the tariff) str"ct"re# The marketing professionals serving the telecomm"nications organisatoins are s"ppose! to 1e a0are of the 1"siness as 0ell as the social responsi1ilities# >or promoting 1"siness, the* nee! to generate more reven"e an! for enriching the social profile, the* nee! to strike a 1alance 1et0een the organi3ational strength an! the social re:"irements# %lace Mi+ In the place mi(, 0e nee! to gravitate o"r attention on t0o important iss"es, first the promise! services reach to the "ltimate "sers in a !ecent 0a* an! secon! the location points for the telecomm"nication services# The first pro1lem is relate! to the processing of services in 0hich the marketing professionals are s"ppose! to 1e s"re that 0hatever the services have 1een promise! are !elivere! to the "ltimate "sers in !ecent 0a*# In a!!ition to the aforesai! pro1lem, 0e also fin! cases of "nplanne! an! inconvenient location# The a!ministrative offices in partic"lar are re:"ire! to 1e accessi1le# The "sers an! personnel 0orking there sho"l! not face !iffic"lties 0hile visiting the offices# Th"s the place !ecisions 1ecomes important to the telecomm"nication organisations# Pe&p1e In the form"lations of marketing mi(, 0e also nee! to manage the h"man reso"rces in an effective 0a*# The Department of Telecomm"nications has 1een facing the pro1lem of ina!e:"ac* of :"alit* people res"lting into lo0 level of efficienc*, !eceleration in pro!"ctivit* an! profita1ilit* or so# The increasing !omination of tra!e "niorns in the !a*)!o)!a* activities makes it !iffic"lt for the management to 1ring things on the rail# The tra!e "nions also feel that poor level of efficienc* is s"1stantiall* on acco"nt of inefficient emplo*ees 1"t ver* often the* !on=t fin! it essential to reg"late them# In vie0 of the a1ove, the marketing professionals are re:"ire! to assign !"e 0eightage to the people mi(# The telecomm"nication organisatoin is also s"ppose! to assign an overri!ing priorit* to the Total D"alit* Management that foc"ses innovative schemes attention on :"alit* technologies, :"alit* emplo*ees, :"alit* environmental con!itions at the 0orkplace, reasona1le tariff str"ct"re, an! a1ove all, personali3e! services to the cons"mers#


"e%%&n 1B E)*(ati&n Marketing 5n important :"estion ma* 1e raise! here that 0h* !o 0e "ser the term marketing for literac*# Since 0e have 1een investing h"ge amo"nt of mone* an! !eplo*ing a goo! n"m1er of personnel an! sophisticate! technologies to literate the masses, it is 2"!icio"s to kno0 a1o"t the res"lts, if 0e+ invest more for removing illiterac* 6inp"ts7 1"t the literac* 6o"tp"t7 is not increasing proportionatel*, the polic* 0o"l! 1e !eeme! to 1e "npro!"ctive since it is cost)ineffective# The ver* essence of marketing is to make o"r policies an! programmes cost)effective so that 0e cross the target or atleast even to"ch the target 0itho"t crossing the financial an! time limits# The marketing particles 1ear the efficac* of improving the inp"t)o"tp"t ratio since 0e frame a service mi( keeping in vie0 the sensitivit* of target prospects, attempt to promote the same 1* s"ing mo!ern sophisticate! !evices, frame a fee)str"ct"re in the face of holistic concept of management an! channeli3e the services 0ith the s"pport of efficient an! personall* committe! personnel acting an! 1ehaving professionall*# In vie0 of the aforesai! facts, 0e "se the term marketing for literac*, e!"cation an! !evelopment of kno0le!ge# -ere, it is also to 1e clarifie! that 1* "sing the term marketing 0e are not 1o"n! to generate profits# Since most of the not) for)profit making organi3ations are no0 fo"n! li1eral to the generation of profits, it is also significant to mention that 0hatever the* generate as s"rpl"s sho"l! essentiall* 1e re)investe! or plo"ghe! 1ack for the !evelopment an! e(pansion of 0orl! class services# The simple logic in "sing the term marketing is to make availa1le to the prospects the :"alit* services either free of cost or for the free) str"ct"re the* are s"ppose! to pa*# The marketing practices 0o"l! simplif* the processes of :"alitative)c"m):"antitative transformation in the process of efficienc* generation# The "niversities, colleges, instit"tes, st"!ies an! research centers are fo"n! engage! in the process of offering higher e!"cation# Scientific inventions an! innovations, techno8logical a!vances, professional e(cellence, managerial proficienc* are some of the important !imensions pla*ing a !ecisive role in shaping the !estin* of a nation# The s*stem of higher e!"cation is fo"n! efficacio"s in making availa1le to the societ* a !e!icate!, committe!, !evote! an! professionall* so"n! team of h"man reso"rces 0ho !eci!e the f"t"re of a nation# 5gainst this 1ackgro"n!, the cr*ing nee! of the ho"r is to manage the s*stem of higher e!"cation in s"ch a 0a* that sets a right !irection for the !evelope2mnt of h"man reso"rces in the national an! international perspectives# The "niversities, colleges, instit"tes, research centers are fo"n! in !eplete! con!ition# The financial cr"nch is a ma2or pro1lem 0hich has 1een !isallo0ing these centers to importance the time hono"re! changes in their c"rric"l"m even if the* are fo"n! !*ing# %(cept a ver* fe0 almost all the centers are engage! in pro!"cing s"1stan!ar! o"tp"ts res"lting into "nemplo*ment, povert* an! 1ack0ar!ness# It is in this conte(t that 0e talk in favo"r of marketing higher e!"cation 0hich accor!ing to the holistic marketing principles attempts to enrich the efficienc* of these centers vis)T) vis offer :"alit* services even to the poor persons having an o"tstan!ing e!"cational 1ackgro"n!# This is 1ase! on the principles of societal marketing in 0hich the e!"cational instit"tions are not s"ppose! to make profits# Th"s, the marketing practices pave 0a*s for the !evelopment of h"man reso"rces in the face of international specifications# -ere, the :"alitative transformation esta1lishes an e!ge over the :"antitative transfig"ration# Marketing of Distance )d cation The !istance e!"cation s*stem has come into sta* as an accepte! form of e!"cation an! has 1een gaining 0i!e) sprea! pop"larit* in recent *ears# This is evi!ent from the fact that more than GJ co"ntries are offering e!"cational programmes tho"gh !istance e!"cation all over the 0orl! to!a*# The !istance e!"cation has ma!e in possi1le for those in inaccessi1le areas? the !rop)o"ts, 0ho 0ant re)entr* into e!"cation an! the economicall* 0eaker sections to avail of e!"cational opport"nities# It can 1e a partic"lar 1oon for 0omen, since parents are "n0illing to sen! them 1e*on! their imme!iate locale for e!"cation after the completion of school e!"cation# 5t present there are 1J open "niversities in In!ia# >"rther, among $$8 conventional Universities, /$ are !"al mo!e Universities offering e!"cation 1oth "n!er reg"lar an! !istance e!"cation mo!es# Distance e!"cation no0 caters over G lacs of st"!ents# It is e(pecte! that this gro0th 0o"l! o"tn"m1er the formal s*stem itself in the near f"t"re# Th"s there is potential market for !istance e!"cation#5s man* as G$ Universities are v*ing each other to attract higher enrolment of their !istance e!"cation programs# It is partl* !"e to the fact that almost all the Universities greatl* !epen! on !istance e!"cation programmes for generating their o0n financial reso"rces# -ence, "nless these Distance %!"cation Instit"tes a!opts s*stematic an! effective marketing, it 0o"l! 1e ver* !iffic"lt for them to s"rvive in the long)r"n# This paper makes an attempt to e(plain the strategies to 1e a!opte! for s"ccessf"l marketing of !istance e!"cation programmes 1* the Distance %!"cation Instit"tes# Market Segmentation


The !istance e!"cation learners 1elong to !ifferent segments# The ma2or segments of !istance e!"cation learners are r"ral an! "r1an, !rop)o"ts, el!er persons 0ho !i! not have the opport"nit* to learn thro"gh reg"lar stream in their earl* age an! those 0ho 0ant to "p!ate kno0le!ge an! ac:"ire special skill# esi!es these, other specific segments are 0omen, sociall* 1ack0ar! an! ph*sicall* han!icappe!# 5ppropriate marketing strategies nee! to 1e evolve! for reaching these "nreache! gro"p thro"gh !istance an! open learning# Learner*orientation The learner oriente! marketing approach is concerne! 0ith i!entif*ing the specific e!"cational nee!s of the target market an! tailoring an! !eliver* of those e!"cational programmes to the satisfaction of learners# It involves i!entif*ing the right t*pe of pro!"ct mi( of e!"cational programmes, offere! at right price, thro"gh effective !eliver* mechanisms an! 0ith appropriate promotional tools# In other 0or!s, all activities an! strategies of D%Is "ltimatel* aim at satisf*ing the learners# Marketing Mi+ The marketing mi( concept is a 0ell esta1lishe! tool "se! as a str"ct"re 1* marketers# It consists of the vario"s elements of a marketing programme 0hich nee! to 1e consi!ere! in or!er to s"ccessf"ll* implement the marketing strateg* for an* service 1"siness# The ma2or elements are Pro!"cts, Price, Place, Promotion, Ph*sical %vi!ence, People an! Process# The "n!erl*ing concept in !eveloping each of these elements is to "ser them to s"pport each other, to reinforce the positioning of the pro!"ct an! to !eliver appropriate service :"alit* to achieve competitive a!vantage# %rod ct mi+ Distance %!"cation is a service pro!"ct an! has a comple( set of val"e satisfactions# People attach val"e to !istance e!"cation in proportion to the perceive! a1ilit* of the service to !o this# Hal"e is assigne! 1* the 1"*ers in relation to the 1enefits the* receive# 5"gmentation of the e(pecte! pro!"ct represents a means of creating pro!"ct !ifferentiation an! th"s a!!e! val"e from the c"stomer perspective# In Distance %!"cation service, the aca!emic programmes offere! are core pro!"cts# The e(pecte! pro!"ct consists of the generic pro!"ct together 0ith the minimal s"pport facilities 0hich nee! to 1e met# The a"gmente! pro!"ct is the area 0hich ena1les one pro!"ct to 1e !ifferentiate from another# The* !ifferentiate 1* <a!!ing val"e= to the core pro!"ct in terms of relia1ilit* an! responsiveness# Th"s, in Distance %!"cation, the aca!emic programmes offere! are core pro!"ct? the :"alit* learning materials an! effective contact programmes are e(pecte! pro!"cts an! speciali3e! programmes are a"gmente! pro!"cts# Service %rod ct Decisions D%Is offer a range of aca!emic programmes# Decisions on the range of services to 1e offere! nee! to 1e consi!ere! in the conte(t of the D%Is positioning strateg* an! the competitors= service offerings# Ne0 co"rses to 1e offere! sho"l! also 1e consistent 0ith the competence of the D%I to !eliver them# Market %enetration Market penetration 1* D%Is is concerne! 0ith ho0 to e(ploit the c"rrent position in the market place 1etter# This can 1e achieve! 1* more foc"se! segmentation, a more clearl* !efine! positioning strateg* or thro"gh 1etter application of the marketing mi( elements# %ssentiall* it is concerne! 0ith gaining greater pro!"ctivit* from the marketing mi( elements an! 1"il!ing market share for its !istance e!"cation programme# Market Development 5n alternative strateg* to service !evelopment is to "n!ertake market e(tension, 0hich seeks ne0 gro"ps of 1"*ers 0ith a firm=s c"rrent service offerings# >or instance, man* D%Is have opene! their St"!* .entres in overseas to attract foreign clients# The Distance %!"cation Instit"tes 6D%Is7 sho"l! have a right t*pe of pro!"ct mi( to s"it the re:"irements of !ifferent segments of !istance e!"cation learners# Different e!"cational programmes sho"l! 1e !esigne! in s"ch a 0a* that it s"its to !ifferent segments# 5 partic"lar segment 0hich 0o"l! like to ac:"ire a higher :"alification for the sake of higher :"alification looks for a co"rse 0hich 0o"l! like to ac:"ire a higher :"alification for the sake of higher :"alification looks for a co"rse 0hich the* 0o"l! like to ac:"ire 0itho"t m"ch effort an! a specific nee!# The Distance %!"cation Instit"tions are also a1le to get a goo! enrolment for s"ch t*pe general aca!emic programme# 5 !egree in histor* is a goo! e(ample that s"its for mass marketing# 5nother segment of learners 0hich 1elong to class marketing


is a specific gro"p 0hich re:"ire speciali3e! kno0le!ge an! skill in their chosen area of interest# The Distance %!"cation Instit"tes have to i!entif* s"ch t*pe of speciali3e! aca!emic programmes s"ite! to specific segment of learners# >or instance, the Distance %!"cation Instit"tes of the 5lagappa Universit* offer speciali3e! co"rses on 1ank management, sports management, corporate secretar* ship, 0omen=s st"!ies, chil! care, marketing, !igital instr"mentation an! 0aste 0ater treatment# The important aspect of Distance %!"cation Instit"tes is that the* have to constantl* st"!* the re:"irements of inten!ing learners an! m"st !evelop nee! 1ase! ne0 e!"cational programmes# S"ch programmes are to 1e !evelope! for !ifferent levels s"ch as certificate, !iploma, "n!er)gra!"ate an! post)gra!"ate !epen!ing on the learner=s nee!# eca"se of increase! sophistication, each in!ivi!"al m"st 1e a m"lti!isciplinarian# -e ma* 1e an e(pert in one fiel! 1"t necessar* re:"ires consi!era1le kno0le!ge in relate! fiel!s also# >or e(ample, even a ph*sician nee! to have 1asic engineering kno0le!ge !"e to a!vance! me!ical e:"ipments he has to !eal 0ith# Tho"gh .omp"ter %ngineering is a speciali3e! fiel!, the kno0le!ge of comp"ter operations has 1ecome a 1asic nee! to ever* in!ivi!"al 0orking in an* fiel!# >or instance, co"rse on %).ommerce, Me!ical Transcriptions, Information Technolog* %na1le! Services are in great !eman! no0# -ence, there is a great potential for information Technolog* e!"cation 0ith the D%Is can effectivel* e(plore 1* !eveloping appropriate programme s"ite! to !ifferent segments# Similarl*, the c"rric"l"m an! the co"rse materials of the e(isting co"rse nee! to 1e revise!@ mo!ifie! perio!icall*, !epen!ing on the re:"irement# >or instance, the c"rric"l"m on comp"ter e!"cation, economic legislations, an! ta( la0s re:"ire fre:"ent revision an! "p)gra!ation# %hysical )vidence This is the service firm=s ph*sical environment 0here the service is create! an! 0here the service provi!er an! c"stomer interact, pl"s na* tangi1le elements that are "se! to comm"nicate or s"pport the role of the service# In a service 1"siness, the marketer sho"l! seek to compensate for the intangi1ilit* !imension 1* provi!ing ph*sical cl"es to s"pport the positioning an! image an! enhance the pro!"ct s"rro"n!# Ph*sical evi!ence can 1e !ivi!e! into t0o t*pes essential an! peripheral# %ssential ph*sical evi!ence in !istance e!"cation represents the ke* !ecisions ma!e 1* the D%Is a1o"t the !esign of the learning reso"rces s"ch as, print materials an! pre)recor!e! a"!io)vi!eo cassettes# It is the fact that the s"ccess an! effectiveness of !istance e!"cation s*stems largel* !epen! on the st"!* materials, 1eca"se the learners have less contact 0ith the instit"tion @ teachers# -ence, the* have to 1e s"pplie! 0ith speciall* prepare! teaching materials prepare! "n!er Self)Instr"ctional Pattern# The co"rse materials are presente! in s"ch a 0a* that a learner can learn from the materials in!epen!entl* an! the materials themselves have to perform the f"nctions of a teacher s"ch as e(po"n!ing, e(plaining, g"i!ing, motivating, remin!ing, eval"ating etc# this is a the essential part of ph*sical evi!ence# It is 0orth mentioning the role pla*e! 1* Distance %!"cation .o"ncil 6D%.7, common 0ealth %!"cational Me!ia .entre for 5sia 6.%M57 an! Staff Training an! Research Instit"te of Distance %!"cation 6STRID%7 an! %!"cational Me!ia Research .entres 6%MR.7 in con!"cting training, research an! g"i!ance in the area of preparation of self)instr"ctional materials, m"lti)me!ia, staff !evelopment, comp"teri3ation an! net0orking# The logical arrangement of contents, the l"ci! st*le, conversational lang"age, "se of personal prono"ns an! !ivision of content into small managea1le learning steps shall increase the effectiveness of learning# esi!e these, even the :"alit* of paper "se!, printing an! the si3e of letters also co"nt in stim"lating the learners to "ser the co"rse materials# This forms the peripheral ph*sical evi!ence of the pro!"ct an! a!!s tangi1ilit* to the val"e of the service provi!e! to the learner segment to 0hich it is !irecte!#

1 ality The !istance e!"cation s*stem is critici3e! for the lack of :"alit*# It is arg"e! that for the sake of :"antit*, :"alit* is ver* often sacrifice!# The D%Is sho"l! ens"re that :"alit* is maintaine! along 0ith the increase in enrolment# -ence, 0hat is re:"ire! is some sort of <ISI Mark= for the Distance %!"cation instit"tes to ens"re :"alit*# The Distance %!"cation .o"ncil in cons"ltation 0ith the National 5ssessment an! 5ccre!itation .o"ncil is in the process of !eveloping some sort of D"alit* 5ssessment an! 5ccre!itation that 0ill 1e relevant to the Distance an! Apen %!"cation s*stem#


P*/1i( re1ati&n% P"1lic relations is !efine! 1* the ritish Instit"te of P"1lic Relations as, 9the planne! an! s"staine! effort to esta1lish an! maintain goo!0ill 1et0een an organisation an! its p"1lics4# These <p"1lics= are all the gro"ps of people an! organisatoins 0hich have an interests in the !istance e!"cation programme# 5n e(ample of the main p"1lics of !istance e!"cation is sho0n in the follo0ing fig"re: Present St"!ents Prospective St"!ents Me!ia


%mplo*ers an! In!"str*

Distance %!"cational Instit"tes

.entral an! &ocal Movt#


%!"cational 5"thorities

Schools, teachers

Professional organi3ation

5!ministrative an! 5ca!emic Staff

P"1lic relations is concerne! 0ith a n"m1er of marketing tasks# These incl"!e the follo0ing : "il!ing or maintaining image S"pporting the other comm"nication activities -an!ling pro1lems an! iss"es Reinforcing positioning Infl"encing specific p"1lics 5ssisting the la"nch of ne0 services

5 service organi3ation=s <image= is ma!e "p of the collective e(perience, vie0s attit"!es an! 1eliefs hel! a1o"t it# P"1lic relations can s"e a range of comm"nication approaches to improve or maintain the image of a D%I# Averall the o12ective 0ith image is to ens"re that a partic"lar D%I is vie0e! more favora1l* than competitors in the market segment it serves# 5 0i!e range of tools can 1e "se! in the !esign of a P"1lic Relation programme# These co"l! incl"!e) P"1lications incl"!ing press releases, ann"al reports, 1roch"res, posters etc# Press conferences, seminars an! conferences %(hi1itions an! tra!e fairs


5s 0ith other elements of the comm"nications mi(, a P"1lic Relation programme sho"l! follo0s a process, 0hich consists of the specification of o12ectives, !etermining the mi( of P"1lic Relations activities to 1e "n!ertaken# Implementing an integrate! programme an! eval"ating the res"lts# A&r)>&->,&*t+ pr&,&ti&n Research points to personal recommen!ations thro"gh 0or! of mo"th 1eing one of the most important information so"rces# Ane of the most !istinctive feat"res of promotion in Distance %!"cation marketing is the greater importance of referral an! 0or! of mo"th comm"nications# Th"s highlights the importance of the people factor in services promotion# &earners are often closel* involve! in the !eliver* of a service an! the* talk to other potential c"stomers a1o"t their e(periences# The* are gla! to offer a!vice on a specific D%I# Th"s, 0or! of mo"th can have an important impact that other mass or personal comm"nication mi( elements in !istance e!"cations# Mronroos has o"tline! a comm"nication pattern that ill"strates the role of 0or! of mo"th an! referrals have to pla*# %(pectations @ p"rchases Interactions %(periences Cor! of mo"th @ referrals

5n e(isting or a ne0 !istance e!"cation learners has certain e(pectations# Ance the !ecision to 2oin !istance e!"cation has 1een ma!e, the can!i!ate 1egins interacting 0ith the D%I an! !iscovers the technical an! f"nctional :"alit* of the service 1eing s"pplie!# 5s a res"lt of the e(periences, that follo0 from these interactions an! the 2"!gments ma!e a1o"t service :"alit*, the can!i!ate ma* or ma* not ret"rn# Positive or negative 0or! of mo"th comm"nication 0ill then infl"ence the e(tent to 0hich others "se the service# It is sai! that the <satisfie! cons"mer is a 1etter sales force=# Chen the programmes are offere! 0ith 1etter iss"es materials, effective !eliver* s*stem, proper organi3ations of Personal .ontact Programmes, effective st"!ent s"pport services, proper con!"ct of e(aminations an! timel* anno"ncement of res"lts the satisfie! learner 0ill 1e acting as an effective am1assa!or for Distance %!"cation Instit"te# The m"ltiplier effect from 0or! of mo"th varies from sit"ations to sit"ation# -o0ever, negative e(periences ten! to have a greater impact than positive e(periences# &earners 0ho are !issatisfie! ten! to tell more than t0ice as man* people of their 1itter e(periences# Th"s, negative 0or! of mo"th can significantl* re!"ce the effectiveness of a!vertising an! other elements of the comm"nications mi( an! positive 0or! of mo"th can res"lt in less e(pensive formal comm"nications programmes 1eing nee!e!# Direct Marketing In recent *ears more sophisticate! approaches to !irect marketing have 1een a!opte!# Developments in electronic me!ia, telecomm"nications an! comp"ters are no0 presenting greater opport"nities for !eveloping an integrate! programme of !irect marketing activities# These can 1e "se! in con2"nction 0ith each other to reinforce the personal selling, a!vertising an! other promotional elements# Man* D%Is are taking the a!vantage of the 1enefits of a coor!inate!, !irect marketing programme# .ontacting the potential fee!ing centres, 0herever there are cl"ster of prospective learners, co"l! 1e another effective tool# >or e(ample contacting anking @ Ins"rance instit"tions co"l! help promoting co"rses on 1anking, ins"rance etc# it is onl* the effective teaching that creates a lasting impression on the min!s of the learners an! help create goo!0ill on D%I# %eople The s"ccess of marketing of !istance e!"cation programmes is tie! closel* to the selection, training, motivating an! management of people# There are man* e(amples of !istance e!"cation programmes failing or s"ccee!ing as a conse:"ences of the ineffective or effective management of people# The importance of people 0ithin the marketing of services has le! to great interest in internal marketing# Internal marketing aims to enco"rage effective 1ehavio"r 1* staff# Chich 0ill attract c"stomers to the firm# This means that, the Distance %!"cation Instit"tions sho"l! ens"re that their emplo*ees sho"l! have the !esira1le 1ehavo"r that 0ill attract learners to the instit"te# Chile the e(pression <o"r emplo*ees are o"r greatest asset= is increasingl* 1eing


hear! among organisatoins# It is clear that this statement is often a platit"!e# * recogni3ing the contri1"tion, people make to ac:"iring an! keeping c"stomers, 0ithin the overall marketing mi(, the service compan*=s competitive performance 0ill 1e s"1stantiall* enhances# The i!ea 1ehin! internal marketing is to ens"re that all mem1ers of the staff in the D%I provi!e the 1est possi1le contri1"tion to the marketing of e!"cation programmes an! s"ccessf"ll* complete all telephone, mail electronic an! personal interactions 0ith the learners in manner that a!!s val"e to the service enco"nter# Internal marketing in all its forms 0as recogni3e! as an important activit* in contri1"ting to the people element of marketing mi( an! in !eveloping a c"stomer foc"se! organisation# In practice, internal marketing is concerne! 0ith comm"nications, 0ith !eveloping responsiveness, responsi1ilit* an! "nit* of p"rpose# The f"n!amental aims of internal marketing are to !evelop internal an! e(ternal c"stomer a0areness an! remove f"nctional 1arriers to organisation effectiveness# %rocesses The processes 1* 0hich services are create! an! !elivere! to the c"stomer is a ma2or factor 0ithin the services marketing mi(# 5ll 0ork activit* is process# Processes involve the proce!"res, tasks sche!"les, mechanisms, activities an! ro"tines 1* 0hich a pro!"ct or service is !elivere! to the c"stomer# It involves polic* !ecisions a1o"t c"stomer involvement an! emplo*ee !iscretion# I!entification of process management as a separate activit* is a prere:"isite of service :"alit* improvement# The importance of this element is especiall* highlighte! in service 1"sinesses# If the D%I f"nctions effectivel* 0ith a 0ell esta1lishe! a!ministere! s*stems an! proce!"res, it shall have a clear a!vantage over less efficient competitors# >or e(ample, a D%I 0hich ens"res proper recor!ing of <change of a!!ress= of a partic"lar learner, 0ill 1e seen as 1eing efficient# If there is an* conf"sion in recor!ing of changes in a!!ress of the learners, is likel* to 1e more critical of others services offere! 1* the D%I# Th"s, the s"ccessf"l marketing of !istance e!"cation re:"ires i!entif*ing an! !evolping right t*pe of e!"cational programmes, pricing theme 0ithin the reach of the learners, making the programmes availa1le at the places convenient to the learners an! promoting them 0ith s"ita1le pormotioanl tools# >"rther, the s"ccess of marketing of !istance e!"cation is tie! closel* to 1e 1ehavio"r of the mem1ers of he staff 0orking in the D%Is# The 0ell esta1lishe! proce!"res an! s*stems in the f"nctioning of the Instit"te is an a!!e! a!vantage# 51ove all, in the case of !"el mo!e "niversities, the Distance %!"cation Instit"te is a ma2or s"1)s*stem an! re:"ires a!ministrative, aca!emic an! financial s"pport an! free!om to make the marketing of !istance e!"cation effective an! efficient#

MO5E" E#ESTION PAPER PAPER 4.13 MARKETING OF SERVI ES Ti,eF 3 G&*r% Se(ti&n $ A 5ns0er an* FIVE D"estions N&te F 5ll :"estions carr* e:"al marks 1# Chat !o *o" mean 1* servicesE Chat are the salient feat"res of services 0hich complicate the task of marketing services effectivel*E $# Disc"ss the concept of market segmentation 0ith reference to hospital services# '# Ce fin! ,th P i#e# 9People4 more effective in managing the services# .omment on this statements# Ma<i,*, Mark%F 1CC 6, ( I L +J7


+# Chat !o *o" "n!erstan! 1* service mission statementsE Chat are its componentsE ,# %(plain the concept of c"stomer foc"se! service# /# The service generating organisatoins nee! to make their fee str"ct"re 2"!icio"s, speciall* in the In!ian perspective# Do *o" agree 0ith this vie0E N"stif* *o"r ans0er# G# ring o"t the importance of personal selling an! 0orl! of mo"th promotion in the service generating organi3ations#

I# The 1anks primaril* !eal in services an! therefore the form"lation of the pro!"ct mi( is to 1e processe! in the face of changing socio)economic con!itions of the "sers=# .omment on this statement an! foc"s on the pro!"ct mi( for the 1anking services# Se(ti&n $ B 5ns0er an* FO#R D"estions D"estion No# 1, is compulsory# 8# Chat !o *o" mean 1* to"rism marketingE >oc"s on the 1ehavioral profile of "sers of the to"rism services# 1J# %(amine the application of marketing mi( elements in !istance e!"cation# 11# Chat !o *o" mean 1* the marketing mi(E State an! e(plain in 1rief the !ifferent components of marketing mi( for marketing the ins"rance services# 1$# %(plain relationship marketing 1'# ring o"t the importance of positioning of services# %(plain the process of positioning# 1+# %(plain the steps involve! in marketing planning process# 1,# %(plain the marketing strategies a!opte! 1* I.I.I ank in marketing their services# 6+ ( 1, L /J7