48317137 Service Marketing Ppt

8/6/2019 48317137 Service Marketing Ppt

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MANAGING

SERVICEPROMISES

MANAGING

SERVICEPROMISES


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CUSTOMER

COMPANYExternal

Communicationsto CustomersThe

Communicatio

n Gap

Provider Gap 4

ServiceDelivery

Part 6 Opener


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Pricing and services

Lecture 11


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Pricing of Services

Discuss three major ways that service pricesare perceived differently from goods prices by

customers

Articulate the key ways that pricing ofservicesdiffersfrom pricing ofgoodsfrom a companys

perspective


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Overview (cont.)

Demonstrate what value means to customers

and the role that price playsin value

Describe strategies that companies use to

price services


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3 key differences

Customer knowledge ofservice prices: Service variability limits knowledge

Providers are unwilling to estimate prices

Individual customer needs vary

Collection ofprice information is overwhelming

Prices are not visible

Role ofnon-monetary costs:

Time costs

Search co

sts

Convenience costs

Psychological costs

Price as an indicator ofservice quality


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Three Basic Marketing Price Structures and

Challenges Associated with Their Use for Services

P= DC+OC+ProfitChallenges:1. Costs difficult to trace.

2. Laboris more difficult to

price than materials.

3. Costs may not equal the

value that customers

perceive the services areworth.

Challenges:1. Small firms may charge too

little to be viable.

2. Heterogeneity ofservices

limits

comparability.3. Prices may not reflect

customer value.

Challenges:1. Monetary price must be adjusted to reflect

the value ofnon-monetary costs.

2. Information on service costsis less available to

customers; hence, price may not be a central factor.


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Value is low price.Value is everything

I want in a service.

Value is thequality I get for

the price I pay.

Value is all thatI get for all

that I give.

Four Customer Definitions of Value


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Value is low price.

Discounting

Odd pricing

Synchro-pricing

Penetration pricing

Pricing Strategies When the Customer Defines

Value as Low Price


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Value is everythingI want in a service.

Prestige pricing

Skimming pricing


Value as Everything Wanted in a Service


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Value is the quality I

get for the price I pay.

Value pricing

Market segmentation

pricing


Value as Quality for the Price Paid


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Value is low price. Value is everything

I want in a service.

Value is the quality

I get for the price I pay.

Value is all that I get

for all that I give.

Discounting

Odd pricing

Synchro-pricing Penetration pricing

Prestige pricing

Skimming pricing

Value pricing

Market segmentation

pricing

Price framing

Price bundling

Complementary pricing

Results-based pricing

Summary of Service Pricing Strategies for

Four Customer Definitions of Value


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Integrated marketing

communications


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Integrated Services Marketing

Communications

Service communication challenges.

Integrated service marketing communications

Present four ways to integrate marketing communications

in service organizations Present specific strategiesfor managing promises,

managing customer expectations, educating customers,

and managing internal communications.


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Communications and the Services

Marketing Triangle

Internal MarketingVertical communications

Horizontal communications

Interactive MarketingPersonal selling

Customerservice centerService encounters

Servicescapes

External MarketingCommunication

AdvertisingSales promotionPublic relationsDirect marketing

Company

CustomersEmployees

Source: Kotler, Philip, MarketingManagement: Analysis, Planning, Implementation,and Control,9th Edition, 1997.


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Goal:Delivery is

greater thanor equal topromises

Offerserviceguarantees

Createeffectiveservicescommunications

MANAGING SERVICE PROMISES

Makerealisticpromises

Coordinateexternalcommunication

Approaches for Managing

Service Promises


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Services Advertising Strategies Matched

with Properties of Intangibility

Source:Adapted from B. Mittal, The Advertising ofServices: Meeting the Challenge ofIntangibility, Journalof Service Research,2, no. 1, August1999, pp. 98116.


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Goal:Delivery is


Preparecustomersfor theserviceprocess

Clarifyexpectationsafter the sale

Teachcustomers toavoid peakdemand periodsand seek slowperiods

Confirmperformanceto standards

Approaches for Improving Customer

Education


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Goal:Delivery is


Createeffective verticalcommunications

Align back-officepersonnel with

external customers

Createeffective horizontalcommunications

Createcross-functional

teams

Approaches for Managing Internal Marketing

Communications

Documents

48317137 Service Marketing Ppt