Influencing factors on Service Delivery Impacts of Service Characteristics The Role of Intermediaries The Impact of Technology Strength & Weaknesses of Delivery Models

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SERVICES
MARKETING
Distributing Services
Tom Chapman
www.marketing101.co.uk
Twitter @idlehans

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Introduction
 Influencing factors on Service Delivery
 Impacts of Service Characteristics
 The Role of Intermediaries
 The Impact of Technology
 Strength & Weaknesses of Delivery Models

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Different Services Places
Characteristics Service delivery at
Customer’s Place Provider’s Place Third Party’s
Place
Service Types Services with Services with Services with
immovable immovable immovable
external factors internal factors external factor at
Services with high third party’s
process place.
standardisation Services where
third party
determines place
Examples House Keeping Hairdresser Airport
Elderly Care Bank Legal Services
Restaurant (Court)

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Location & Customer Behaviour
Characteristics Service delivery at
Customer’s Place Provider’s Place Third Party’s
Place
Quality Less control over Tangibles Responsiveness
Dimensions atmospherics. (equipment &
Empathy, employees)
employee
relationship more
important.
Greater Atmospherics Customer
Variability have a greater recruitment
effect on buying
decision

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Deciding on a Location

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Timing of Service Delivery

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Timing of Service Delivery

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Timing of Service Delivery

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Channels of Service Delivery

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Differences between electronic
delivery channels
Characteristics Electronic Delivery Channels
Service Telephone Internet Mobile
Machine Channel
Customer Low High Medium High
Location
Flexibility
Breadth of Medium Medium Medium High (Voice,
Modalities (Visual) (Voice) (Visual) Visual)
Interactivity High High Medium High
Responsiveness Low High Medium High
“for mobile service delivery, consumers are most concerned with the time-
related gains they can obtain.” Kleijnen, De Ruyter, & Wetzels (2007, 42)

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Employees & Customers
Employees Customers
 They are the service  Productive Resources (Bitner,
1997)
 They are the organisation
 Contributors (Bitner, 1997)
 They are the Brand
 Competitors (Bitner, 1997)
 They are the marketers
 temporary employees
(Bettencourt,1997)
 Promoter (Bettencourt,1997)

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Customer Characteristics
 Physical proximity
 Verbal interaction
 Varied activities
 Heterogeneous customer mix
 Core service is compatibility
 Waiting times
 Share time, space or facilities

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Intermediaries
Customer
Originating Firm Intermediary Experience
Core + Core = Core

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Franchising Benefits
Franchisers Franchisees
 Leveraged business format  Established business format
 Consistency in outlets  Brand marketing
 Knowledge of local markets  Minimal start up risks
 Shared risk

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Franchising Challenges
Franchisers Franchisees
 Maintaining & Motivating  Encroachment
franchisees
 Reduced profits and revenues
 Disputes and conflict
management  Lack of control
 Quality control  High fees
 Ownership of customer

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Agents & Brokers
Benefits Challenges
 Reduced selling & distribution  Loss of control over pricing
costs and other aspects of
marketing
 Intermediary skill & knowledge  Representation of multiple
service principles
 Wide representation
 Knowledge of local markets
 Customer choice

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Channel Conflict
 Objectives and performance
 Costs and rewards
 Quality and consistency
 Empowerment and control
 Channel ambiguity

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Technology
Benefits Challenges
 Consistent delivery for  Customers are active not
standardised services passive
 Lack of control in electronic
 Low cost (marginal) environment
 Price competition
 Customer convenience
 Inability to customise
 Wider distribution  Lack of consistency with
customer involvement
 Customer choice and ability to  Requires changes in customer
customise behaviour
 Customer feedback /
 Security
interaction  Geographic competition

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Technology - Meuter, et al (2005)
 “For many firms, often the challenge is not managing the
technology but rather getting consumers to try the
technology.”
 “Managers can use tactical strategies to influence role
clarity, motivation, and ability either before or after an SST
has been introduced.” Meuter, et al (2005, 78)
 Education
 Hand Holding
 Communicate benefits
 Learning from other consumers

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References
 Bettencourt, L. A. (1997). Customer voluntary performance: customers as
partners in service delivery. Journal of Retailing, 73(3), 383-406.
 Bitner, M. J., Faranda, W. T., Hubbert, A. R., & Zeithaml, V. A. (1997).
Customer contributions and roles in service delivery. International
Journal of Service Industry Management, 8(3), 193-205.
 Bruhn, D. M. (2005). Services Marketing: Managing the Service Value
Chain. Financial Times/ Prentice Hall.
 Kleijnen, M., De Ruyter, K., & Wetzels, M. (2007). An assessment of value
creation in mobile service delivery and the moderating role of time
consciousness. Journal of Retailing, 83(1), 33-46.
 Lovelock, C. H. W., Jochen. (2004). Services marketing (5th ed. ed. Vol.
xviii, 652 p. ill. 25 cm.). Upper Saddle River, N.J.: Pearson Education
International/Prentice Hall.
 Palmer, A. (2007). Principles of Services Marketing. McGraw-Hill Higher
Education.
 Meuter, M. L., Bitner, M. J., Ostrom, A. L., & Brown, S. W. (2005). Choosing
among alternative service delivery modes: An investigation of customer
trial of self-service technologies. Journal of Marketing, 69(2), 61-83.