After reading this chapter, you should be able to : Explain the concept of marketing and apply it to a service organization

Copyright © 2013 by John Wiley & Sons, Inc. All Rights Reserved.

After reading this chapter, you should be able to:• Explain the concept of marketing and apply it to a service

organization.• Understand and apply the concept of brand management.• Define and apply the concept of brand image to an

organization.• Define and apply the 4 P’s of Marketing.• Define and apply the four steps of the marketing process.• Contrast the expectations of quality customer service as a

marketing tool.

CHAPTER 13MARKETING AND ESTABLISHING

AN IMAGE FOR SERVICE


Introduction

• Introduction to Service Marketing– Marketing embraces customer service because neither

can exist alone. – Marketing and customer service go hand in hand. – They are part of a larger system of business processes.


Changes in Marketing

• Much of what occurs in the hospitality industry occurs off -line. – You cannot dine online.

• What is changing is the way that we interact with our guests. The service provider can:– Determine guest expectations.– Sell the product, encouraging new and return guests.– Refer others, offer promotions with last-minute deals, or just soft

sell.• And the customers can:– Receive services like concierge, reservations, and advance

purchase.– Make complaints in the public sector.– Form initial ideas regarding quality.


Marketing Defined

• Marketing is the coordination of the exchange of goods and services in an effort to fulfill the wants and needs of the customers.

• This involves a deliberate control of advertising and brand management.

• Marketing aims to fulfill the wants and needs of its customers.


Customer Service and Marketing

• In the past, customer care and personal service went hand in hand. Consumers had few choices because of a lack of communication, transportation, and technology.

• Customers were treated as regulars, and they appreciated the comfort of being known.

• The world was, in a sense, small. • More recently, there have been many changes in the way

businesses market to the public. The world has become much larger and more knowledgeable.


4 Steps of Marketing for Quality Guest Service

• The process of marketing as it relates to customer service• Divided into four steps that flow from one to another as

the concepts of marketing are applied to a service business.

• Each section is further divided, delving into details within each of the four steps. 1. Analysis and Identification of Needs.2. Establishment of a Marketing Plan.3. Implementation of Controls to Position.4. Follow-up—Service after the Sale.


1. Analysis and Identification of Wants and Needs

• What defines a buyer’s choice of:– Brand– Type– Amount– Timing

• What determines their expectations?


1. Analysis and Identification of Wants and Needs (cont’d)

• 1.1 Define the Profile– Establishing a profile requires answering questions to help define

the market and competition.• 1.2 Define Best-in-Class– The following list can be used as a ranking to strive for, and a

benchmark for adapting best-practice methods. • Who first comes to mind when your industry is mentioned?• Who is the best at quality service?• Who has the overall best product?• Who has the nicest property?• Who has the nicest options or amenities?• Who leads in innovation?• Who leads in market share?



• 1.3 Define the Customers– Customer Intelligence

• The process of gathering information regarding your customers. – Market Segmentation

• The process of dividing the market into groups. • Typically done demographically

– Reasons That Motivate Customers to Purchase a Product or Service• Price• Individuality Convenience• Service Rating

– Generations• Baby Boomers, 1946–1964, 77 million• Generation X, 1965–1974, 45 million• Generation Y (also known as echo boomers), 1977–1994, 72 million• Generation Z (also known as Millennials), 1995–Present



• 1.4 Research Customer Information– Now that you know the best-in-class and the profile of the customer, it is

important to look at it from the customers’ point of view. What do they see, hear, and experience?

– Management Information System (MIS)• More than just a computers; it is everything in a system of people,

equipment, and procedures to collect and interpret information in an effort to make the best management decisions.

• This includes comment cards, surveys, focus groups, company records, property operation systems, and information.

– Property Operation Systems (POS)• All POSs are part of the MIS. They may also be referred to as property

management systems (PMSs). • Brand include: PosiTouch, Micros, Fidelio, Squirrel, and Aloha are just a

few of the most popular systems available. • All serve as registers, schedule reservations, and keep track of inventory.• Newer features permit staff scheduling and projections. All of this

information can be used in the research-collection process.


2. Establishment of a Marketing Plan

• Step 2 consists of the four steps establishing a marketing plan. – 2.1 Realizing the possibilities– 2.2 Selecting a goal – 2.2 Segmenting a market – 2.4 Selecting a strategy


2. Establishment of a Marketing Plan (cont’d)

• 2.1 Realization of Possibilities– The first step is to open your mind and brainstorm. Be

creative. Open up to unlimited possibilities. Enlist the help of others. Benchmark other businesses to see what is out there.

• 2.2 Select a Goal or Objective– Then, begin to narrow it down. Tools could assist in

narrowing the options. Think about your answers to the prior questions:• What business are you in?• What does your brand stand for?• What is your selling point?



• 2.3 Segment Your Market– Consider the following questions in determining which

you want to go after:• Which market do you currently serve?• Which market does the competitor serve?• Which market is most profitable?• Which market is emerging?



• 2.4 Select a Strategy– Options– Are you changing the:

• Product• Service• Reputation• Overall package

– Are you going to sell the heck out of it?– Are you to earn profits through:

• Volume• Price• Increased sales per customer

– After the direction of the strategy is determined, you must• Establish a timeline.• Dictate resources.• Support your brand.

– All of these decisions impact customer service.


Corporate Responsibility

• Corporate responsibility is the idea that a company upholds values and ethical standards to be a good steward to its community and environment.

• It is a form of self-policing that ensures proper conduct of actions and, therefore, benefits its stakeholders.


3. Implementation of Controls to Position

• Step 3 of Marketing for Quality Service: Implementation of Controls to Position—The 4 Ps.– Place– Product– Promotion– Price– (people)


3. Implementation of Controls to Position (cont’d)

• Place– Place includes the atmosphere, the environment, and

the all of the surroundings.– It involves the capacity, the décor, the amenities, and

the physical appearance. – Place is like a headache or hiccups. Most people do

not think about it until there is an issue.



• Promotion– The promotional mix is a combination of advertising,

public relations, and promotions.– They include word of mouth, television, newspaper,

familiarization (fam) trips, online, and presence, including social media and publications. All need to be controlled.

• Social Buying



• Product– What you are selling? • Core• Often tangible and intangible

– Ex: MLB.TV App



• Price– Price is often an indicator of quality. Prices change and

customers notice. Price must be in line with all of the other Ps. Numerous pricing strategies exist, such as the following:• Comparative pricing• Mark-up pricing• Desired profit pricing• What the market will tolerate pricing• Market skimming pricing

– The customer will always consider price as a factor. It must be determined how much they will consider it.



• People– People are sometimes referred to as the fifth P, although purists

maintain that people would fit in under another of the Ps. – No matter where it falls, the human resource function is key. All

should be considered in hiring, promoting teamwork, satisfaction, training, and development.

– Your employees make the difference. – Everything can be controlled, with the exception of the human

element. Humans must be cultivated and managed, and what they are capable of is often beyond belief.

– Your strategy should prepare and adjust for new customer situations and also take into account the physical and emotional labor involved.


Internal Marketing

• The Four Steps to Orchestrating Internal Marketing to Employees.1. Motivating 2. Involving 3. Reminding 4. Maintaining


Internal Marketing (cont’d)

1. Motivating– Getting them interested– Getting buy-in– Showing value– Providing incentives– Presenting incentives



2. Involving– Letting them know their roles– Showing them how to perform their roles

3. Reminding– This cannot be a one-time event.– Be aware that over-reminding is just as bad as under-

doing it.– Remember that employees are intelligent individuals.



4. Maintaining– Follow-up is key.– Check to ensure they are getting the true message.– Maintain consistency.


4. Follow-up—Service after the Sale

• Step 4: Follow-Up—Service After the Sale– Service does not stop with the sale or transaction. A

few will move on, but for many it should be the beginning of the relationship.

– You should make sure the customers feel good about their decisions and work on building a long-term relationship with them.

– This is commonly called relationship marketing.


4. Follow-up—Service after the Sale (cont’d)

• Post-Purchase Behavior of the Customers– Transactional Customers• Transactional customers are one-time patrons. • This isn’t always bad. They could be traveling through,

changing life segments, or be looking for other great experiences. • Customers who are pleased may speak well of your

establishment. The main thing is to make sure they aren’t displeased. Surveys and tools can assist with this.

– Relationship Customers• Returning customers are the key to businesses. It is estimated

that it costs 3-4 times more to attract a new customer than it does to retain a return customer.


Discussion Questions

1. What is the difference between expected and unexpected turnover?2. What signals do managers give off that create an organizational

culture?3. List and briefly describe the four steps of the marketing process.4. List and briefly describe the 4 Ps of marketing, relating them to

customer service.5. How has marketing changed in recent times?6. Why is a return customer preferable to a transactional customer?7. How do marketing and customer service relate to each other?8. Predict the outcome of the high-tech high-touch dilemma in 15 years.9. What is internal marketing and how can it help a business?10. Which generation are you from? Outline five tips that you could give

a business owner to best accommodate your generation.

Documents

After reading this chapter, you should be able to : Explain the concept of marketing and apply it to a service organization