Services are an integral part of most businesses today. To effectively market services, you need a different approach from product marketing. This book covers all key aspects of services marketing and management, combining detailed and up-to-date academic research, with practical tips for real-life application. It’s a useful services marketing handbook for corporate leaders and marketers, as well as anyone interested to learn the fundamentals of services marketing. In this summary, we’ll briefly outline the 5 essential parts of Services Marketing. Do check out our complete book summary bundle for a one-glance overview of all the key components!
Services are a major part of the global economy, and most “product firms” also offer services as a source of revenue and differentiation. In fact, Rolls-Royce’s revenue from its aircraft servicing and spare parts sales is estimated to be 7 times that of its engine sales!
Winning in services markets require a different approach from traditional product marketing, including 5 key parts:
Part 1: Understanding Service Markets
The book explains how services are different from products, the implications for marketing, as well as the key global trends affecting service markets. In particular, marketers should familiarize themselves with the 3 stages of service consumption – each phase comes with different opportunities to influence client perceptions, choices and repeat purchases. In a nutshell: The author also explain how to use the “3Cs” (Customer, Competitor, Company) and “STP” (Segmentation, Targeting, Positioning) analyses to systematically think about your positioning and differentiation.
Part 2: Applying the 4Ps of Marketing
Developing your services marketing plan requires all 4Ps to be addressed, and here’s an overview of some of the elements to be considered (get the full details from the book or get a detailed overview in the full book summary):
• Product: In developing your service products & brands, you need to look at the core product (what the clients are really buying), as well as the supplementary services (the related activities that enhance the main product/service). The book explains the “flower of service” and how the core and supplementary services come together to make your flower look good, the various branding strategies and considerations for your corporate and specific product brands, as well as 7 categories of new service development and factors affecting service innovation success.
• Place: Besides addressing the “what”, “how”, “where” and “when” of your distribution strategy, the book also explains the use of intermediaries, and how to deliver your services globally and/or expand internationally.
• Price: Your costs, competition and customer value determine the price you charge, which in turn affects your revenues, user base and positioning. The book explains how to use yield or revenue management (RM) to maximize your revenue per available capacity, and also introduces the concepts of price elasticity, rate fences and various pricing strategies.
• Promotion: Your Marcom Strategy will involve the Who, What, How, Where, and When of your communication, with the goal to explain and promote the value of your offer. Integrated Marketing Communications (IMC) links the components above and your corporate design, to ensure consistency in style and message across channels.
Part 3: Managing the Customer Interface
Because services are more complex, and are highly people-dependent, there are several key components to be addressed in order to deliver consistent, quality services:
• Designing Service Processes. A well-designed process facilitates the delivery of your service promise, and the book explains how to use 2 essential tools (Flowcharts + Blueprints) to design & document your service processes, and fail-proof your critical processes.
• Balancing Demand and Capacity. Cycles of excess demand/ capacity can hurt profitability, and the book highlights various methods to manage capacity and demand to minimize adverse cyclical effects.
• Managing People for Service Advantage. Great service staff can create a positive impression, deliver superb customer experience, build loyalty, drive sales, and create a competitive advantage for the firm. Yet, frontline jobs are one of the most demanding. The author highlights 3 key sources of role conflicts/ stress for frontline staff, and 3 HR management principles to create a cycle of success.
• Crafting the Service Environment (Service-scape). What people perceive and interpret about their service environment affect their feelings, which affect their experience, perception and responses. A well-designed environment not only improves brand image and client satisfaction, but also increases client purchases and operational productivity. Use the 5 components of Bitner’s Servicescape Model to tailor the desired customer experience.
Part 4: Developing Customer Relationships
Loyal clients are usually more profitable, since they make repeat purchases, give a higher share-of-wallet, have a genuine liking for your firm and refer your services. The book addresses what it means to manage relationships and build loyalty, develop a real Customer Relationship Management (CRM) system, and effectively handle complaints and service recovery. For example, the Wheel of Loyalty is a useful framework for strategizing your customer loyalty development efforts:
Part 5: Striving for Service Excellence
Finally, the author explains various models, tools and measurements that you can use to measure and improve your service quality and productivity, as well as to analyze and address service quality problems. The book ends off by detailing what a world-class service organization would look like, with an assessment tool classified into 4 progressive performance levels: Service Losers, Service Non-entities, Service Professionals, and Service Leaders.
Other Details in “Winning in Service Markets”
This is an extremely detailed handbook, filled with definitions, frameworks, models, examples, tools and checklists for a thorough understanding and review of service marketing. This article merely provides a glimpse into some of the key components and ideas covered in the book. For more details, do get our full book summary. You can also buy a copy of this book, or get short volumes from the series, each covering a specific theme of services marketing.
Start enhancing the effectiveness of your services marketing today!