QUESTION

Week 2

• Is it possible for an economy to be entirely based on services? Is it a sign of weakness when a national economy manufactures few of the goods that it consumes?
• What are the main reasons for the growing share of the service sector in all major economies of the world?
• What is so distinctive about services marketing that it requires a special approach, set of concepts and body of knowledge?
• Consider quick-service restaurants such as KFC, McDonalds or even Starbucks coffee shops. Would you classify them as a good or a service? Why?
• Demonstrate your understanding of backstage and frontstage in a service operations system.

Week 3

• Explain Hofstede’s four key cultural dimensions and show how these dimensions may impact on service firms dealing with a range of consumers from a variety of cultures importing to South East Asia.
• Explain why services tend to be harder for customers to evaluate than goods.
• Describe four ways in which a management consultancy firm might reduce the risk perceptions of a new client:
• Describe the differences between high-contract & low-contract services, and explain how the nature of the customer’s experience may differ between the two.

Week 4

Why is market segmentation and selective targeting particularly important to service organisations?

What should a service provider aim to achieve through positioning?

What are the managerial benefits of positioning maps?

Are there any limits to the number of market segments that a service provider can create and target? What are these?

Week 5

Why is it frequently necessary for service firms to develop a portfolio of service offerings?

Distinguish between core, facilitating and supporting services, and potential value afforded by each.

What is the role of service branding?

Week 6

What is meant by ‘distributing services?’ How can an experience or something intangible be distributed?

What are the different options for service delivery? For each of the options, what factors do service firms need to take into account when using that option?

What are the key factors driving place and time decisions of service distribution?

What marketing and management challenges are raised by the use of intermediaries in a service setting?

How does the nature of the service affect the opportunities for globalisation?

Week 7

• Why is the pricing of services more difficult compared to the pricing of goods

• Of the different types of costs explained in this chapter, which are likely to be the most significant in a service setting. Why?

• In what ways can price capture and communicate value in services.

• Explain hot flexible capacity might be created in each of the following situations.

A)    Tax Accountant

B)     Hairdresser

C)     Office cleaning service

D)    Interflora franchise

• Select a service business and describe in detail how it handles customer waits. How might it improve its systems to increase the customer experience?

Week 8

• Why is the marketing communications mix larger for service firms than that for goods firms?
• What are the four key challenges or issues in service communications and how can they be overcome?
• Why permission is based marketing gaining so much focus in service firms communications strategies?

Week 9

• Distinguish between hard and soft service standards?
• Spell out the guidelines for effectively designing and implementing a customer service strategy.
• Select an organisation and map customers touch points or specific encounters in the overall customer experience?
• Think of an organisation in which you have worked which had a very good or poor organisational service culture? Describe the factors that contributed to the shaping of that organisational culture. Which factors do you think contributed most. Why?

Week 10

• Select a bad and a good waiting experience and contrast the two situations with respect to the aesthetics of the surroundings, diversions and other people waiting?

Week 11

• Describe the casual link between customer satisfaction and a firms financial performance.
• Explain the zone of indifference. Under what conditions is this zone likely to be widest?
• Explain the key drivers of e- service quality.

Week 12

• Why is target marketing the right customer so important for successful customers relationship management?
• Explain why is more profitable to retain existing customers than continually to try to attract new ones.
• Demonstrate your understanding of switching barriers (COST)

SOLUTION

Week 2

• Is it possible for an economy to be entirely based on services? Is it a sign of weakness when a national economy manufactures few of the goods that it consumes?

An economy entirely based on services can exist for short period only but cannot sustain for a longer time. No it is not a sign of weakness if the national economy manufactures few of the goods it consumes. For an economy to sustain for a longer period it should have both export and import in a proper balance and services cannot be exported they can be outsourced as in case of U.S. economy.

• What are the main reasons for the growing share of the service sector in all major economies of the world?                                                                                                        The growing share of service sector in the major economies indicates development and rise in the GDP of the country, the main reason behind it is that now people are moving towards service sector.(Ghosh 2009)
• What is so distinctive about services marketing that it requires a special approach, set of concepts and body of knowledge?                                                                               The most distcint thing about service marketing is that you hav eto sell something which is perishable, intangible and can be just felt . they are performance or deeds which cannot be defined that si why they need special approach.
• Consider quick-service restaurants such as KFC, McDonalds or even Starbucks coffee shops. Would you classify them as a good or a service? Why?                                            Quick service restaurants are clear example of a service as providing customers their favourite food in the ambience they like is providing intangible service. Here the product is the experience of eating the quality and special food is the service they provide.(Ghosh 2007)
• Demonstrate your understanding of backstage and front stage in a service operations system.                                                                                                                                    Services represent the front stage interactions and the manufacturing and production is considered the backstage in service operations system. Fronts stage represents the interaction a customer or the consumer has with the service and backstage is that part of the service which the consumer can’t see.

Week 3

• Explain Hofstede’s four key cultural dimensions and show how these dimensions may impact on service firms dealing with a range of consumers from a variety of cultures importing to South East Asia.                                                                                              Hofstede’s four key cultural dimensions is a model of cultural dimensions where he collected and analysed cultural data from over 40 countries of IBM and identified four dimensions which helped in distinguishing one culture from another. These dimensions are:                                                                                             Power/ Distance( PD) : South East Asian markets are considered High PD so the firm over here will acknowledge the leaders power and for every answer we need to get in touch with top management

Individualism  (IDV) : In case of South East Asia they have low IDV , which means they will show respect for age and wisdom and will suppress feelings and emotions to work in harmony. They will accept changes very slowly and will carry on respecting their traditions.

Masculinity (MAS): In South EastAsia there are high MAS so the people out here will expect the male and female roles to be different. The men in the firm will be suggested to avoid emotions while decision making.

Uncertainty/ Avoidance Index (UAI)           :  In South East ASIA they show high UAI which means they have very formal business code of conduct and many rules and regulations. They require and anticipate structured performance and growth.

• Explain why services tend to be harder for customers to evaluate than goods.                   It is harder to evaluate services than goods because they are intangible, and it is tough to judge the experience and outcomes which are the products here in case of service industry.(Introduction to services marketing 2009)
• Describe four ways in which a management consultancy firm might reduce the risk perceptions of a new client:

By doing SWOT analysis of the market and educating the new client about it.               Guaranteeing safe returns on investment to the new client.

Associating with experienced and skilled manpower in the same arena.

Giving best customer support whenever the client needs regarding follow ups etc.

Asking the client to make investments on basis of gradual returns.

• Describe the differences between high-contract & low-contract services, and explain how the nature of the customer’s experience may differ between the two.

High contact services where the service provider has maximum contact with the customer or direct contact like hair dressing or banking etc.

Low contact where the service provider has minimum contact with their customer like radio services or remote fixing of softwares.

In both the cases the customers experience is different in both the cases because in high contact the customer experiences the service directly mostly within the premise of the organization and has opportunity to give feedback immediately and there is scope for improvement for the service provider, but in case of low contact since the services are provided without any close contact with consumer the feedback or the response takes time to reach service provider. (Services Marketing 2010)

Week 4

• Why is market segmentation and selective targeting particularly important to service organisations?                                                                                                                                                Market segmentation and selective targeting is very important to service organizationsbecause the services is such a product which are designed to satisfy exclusive needs of particular segment of market . Every service cannot be utilised by every customer so they need to be targeted to their niche market for better penetration.

• What should a service provider aim to achieve through positioning?                      The service provider should aim at getting an established place in the market andtry to maintain it for long term through positioning by using its distcint products or services.(Service Marketing 2010)
• What are the managerial benefits of positioning maps?                                                       A service provider should aim at communication about the service and testing new service through effective positioning. Positioning helps in creating impact of the target consumers. The managerial benefits of positioning maps are that they help in analysing   the overall strategic assessment of the service organization in any given environment.(Services Marketing 2010)

• Are there any limits to the number of market segments that a service provider can create and target? What are these?                                                                                           Yes there are limits to the number of markets a service provider can create and target. The reason being there are three levels of market segmentation in service industry and they are: ( Introduction to  services marketing  2009)

1. First level segmentation: demographics and psychographics
2. Second level segmentation: desired benefits
3. Third level segmentation: Behaviour

Week 5

• Why is it frequently necessary for service firms to develop a portfolio of service offerings?

It is necessary for the service firms to develop a portfolio of service offerings very frequently because the features which are used in every service industry are customer needs and satisfying their requirements and the needs keep in changing frequently. So to stay in competition they need to keep up breast with the changing needs. Moreover the perish ability of the services needs them to think of different portfolios with time.

• Distinguish between core, facilitating and supporting services, and potential value afforded by each.                                                                                                                                            Core Services: core service is the product whose main aim is to satisfy the basic needs of the consumer                                                                                                                supportingservices: These are the benefits which can be added to give more value for the same service to the customer.                                                                                     Facilitating services: Intangible aspects of the services which help the core service are facilitating services and they help in augmenting the core services.            (Services Marketing 2010)
• What is the role of service branding?                                                                                                            It helps in revealing real needs of customer by using and integrating new technologies.

Week 6

• What is meant by ‘distributing services?’ How can an experience or something intangible be distributed?                                                                                                                                          Distributing services means using three more P’s to provide the services to the customer like People ( companies invest in people by training etc.), Process (developing process to reduce errors and human involvement for greater customer satisfaction) and creating physical evidence for service ( like TV commercials for leisure trips etc.). These experience scan be distributed using physical evidences like TV commercials or brochures which mentionedand depict about the services.
• What are the different options for service delivery? For each of the options, what factors do service firms need to take into account when using that option?

Different options for service delivery are:

sales promotion

Publicity and public relation

Direct marketing

Personal selling and

Advertising

While using these options the service firm needs to keep in mind that since services cannot be inventoried so they should be increased during lean period and decreased during peak time. There should be reduction in the role of intermediaries and service personnel and the customer should be involved as a co-product.(Introduction  to service marketing 2009)

• What are the key factors driving place and time decisions of service distribution?                                    Relationship Marketingis the best way which influences the place and time decision of service distribution.( Waheed 2007)
• What marketing and management challenges are raised by the use of intermediaries in a service setting?                                                                                                                            Use of intermediaries in a service setting curbs direct contact with the customer and the intermediaries might not be able to convey the service or product in a better manner like the service provider.(waheed 2007)
• How does the nature of the service affect the opportunities for globalisation?                               If the services are like speciality coffee experience given by Starbucks then they have great scope for globalization , because if the service has wider scope and caters to the need of various markets worldwide it will flourish globally but if the services are market specific then there can’t be any globalization scope.

Week 7

• Why is the pricing of services more difficult compared to the pricing of goods                 the pricing of services is difficult as compared to pricing of goods because they have to consider factors like differential pricing, discount pricing, cross leader pricing and offs set pricing.(Waheed 2007)

• Of the different types of costs explained in this chapter, which are likely to be the most significant in a service setting. Why?

The most significant costs in service settings are non monetary costs as time cost, search cost, psychological cost and convenience costs.

• In what ways can price capture and communicate value in services.

Price can capture and communicate value in services by using techniques like competitive pricing strategies. Price matching or price bidding is other means by which we can show value to the customer.

• Explain hot flexible capacity might be created in each of the following situations.

A)   Tax Accountant : Through increasing value using consumer referrals and long term value of customer

B)    Hairdresser: enhancing the skills of the employees and giving added values like a head massage with hair cut etc.

C)    Office cleaning service: Making it right on time and right the first time approach can be used to create flexibility. Dual shifts can be used for clearing the office at night and in the day too.

D)   Interflora franchise: By adding home delivery service on time or within few hours for various occasions we can create flexibility out here.

• Select a service business and describe in detail how it handles customer waits. How might it improve its systems to increase the customer experience?                                    Starbucks coffee is a great example of service business for specialty coffee. It handle sits customer wait by training its employees to be very customer friendly , Then they have kiosks for music and downloading their favourite music CD’s or iPhone tunes can be downloaded while the customer is waiting for their order to be served. Secondly they have ventured into books and CD’s sales which keep the customers busy while they are waiting for their service delivery.

They can improve their customer experience by keeping books because coffee is mostly accompanied with a book or latest newspaper or magazines. OS they can add them in the shop to handle their customers waiting time.(Bechmann 2010)

Week 8

• Why is the marketing communications mix larger for service firms than that for goods firms?

It is larger because there are three more additions which are necessary for service industry and they are People, Process and Physical evidence for process.

• What are the four key challenges or issues in service communications and how can they is overcome?                                                                                                                  Not wide scope for promotion as the services is promoted while they are delivered to the customer. This can be tackled by adding effective promotional short term techniques so that at the point of contact with customer itself the promotion can be done.

Services are intangible so they cannot be shown to the consumer, but it can be handled by making them experience them of in the form of TV commercials or brochures.

Handling the customers wait period before delivering the service, but by reducing the delivery time we can entertain the customer and tell them about the services.

Packaging a service is very critical, but it can be handled in better way like McDonalds does it by giving new dimension to packaging of services.

• Why permission is based marketing gaining so much focus in service firms communications strategies?                                                                                                   The reason why permission marketing is gaining popularity in service firms is because it is not just about informing the customer , but it is about education and the customer does not feel interrupted or bothered like in case of mass marketing etc.

Week 9

• Distinguish between hard and soft service standards?                                                          Hard service standards are where the service firm is very pushy about selling its services. Soft service standards are where they ask for customers views and recently permission promotional marketing has been introduced which means they ask the customer whether they are comfortable to listen to them or not.
• Spell out the guidelines for effectively designing and implementing a customer service strategy.                                                                                                                     Generation of an Idea

Screening

Testing the concept

Business analysis &Design of service

Test marketing

Infrastructure development

Service launch

• Select an organisation and map customers touch points or specific encounters in the overall customer experience?                                                                                                Find a Starbucks—à Met by staff–àlisten to the music–àwait in line–àcheck the pricing—à do the selection–àorder-à pay–àwait for coffee–à find the milk-àlook for chair–à find the chair-à sit and tastethe coffee-àsenses the atmosphere-àfinds something to read-àgoes to the toilet–à leaves … no one says goodbye.(Bechmann 2010)
• Think of an organisation in which you have worked which had a very good or poor organisational service culture? Describe the factors that contributed to the shaping of that organisational culture. Which factors do you think contributed most? Why?

The organization which has very good service culture is Convergys for which I worked. The factors which contributed to the organizational culture were the treating of employees as their customer, giving those added benefits and programs during the whole year to boost their morale and trips organized by office to take employees for excursions etc. The factor which contributed most was the involvement of the employee on each and every level of the organization, which gave them the feeling of empowerment and work satisfaction.

Week 10

• Select a bad and a good waiting experience and contrast the two situations with respect to the aesthetics of the surroundings, diversions and other people waiting?             Bad waiting experience is waiting for the turn to send a speed post in post office. Here the government buildings are in bad shape and the employees are busy talking to each other and discussing their personal matter. Even the fans and coolers are not working ,so standing and waiting for hours together to send  letter is painful.

A good waiting experience is at McDonalds where there is proper ambience. The air conditioners are working, the toilets are clean to support the customerand if we have to wait the kids can enjoy in the play area and the cleanliness can be found everywhere.

Week 11

• Describe the casual link between customer satisfaction and a firm’s financial performance.                                                                                                                          If the customer will be dissatisfied firstly he will stop buying the services which will affect the financial performance of the organization, moreover he will spread bad word of mouth promotion so no new customers will be coming.
• Explain the zone of indifference. Under what conditions is this zone likely to be widest?                                                                                                                                    It is the zone of indifferencereferred by famous management guru Chester Bernard according to which organizations can function on the unique concept of authority where the individuals work in an environment and accept the orders without questioning the authority. The zone is supposed to be widest when the organization follows the autocratic approach. (Fredericks 2011)
• Explain the key drivers of e- service quality.                                                                                    Service Discovery

Service Brokering

Service Negotiation

Service Mediation

Service Billing

Service Payment

Service Composition

Service Security

Week 12

• Why is target marketing the right customer so important for successful customer’s relationship management?                                                                                                     Target marketing is very essential for customer relationship management because it helps in developing repeat selling opportunities and through word of mouth they spread good words about the company. It helps in developing structural attractiveness for the organization. Thusincreasing the growth potential for the company.
• Explain why is more profitable to retain existing customers than continually to try to attract new ones.                                                                                                                It is profitable to retain old customers than attracting new ones because the old ones will go for repeat buying and they will increase the revenue for the company. Moreover they will provide free word of mouth publicity for the company. It is easier to retain old customers by strengtheningand establishing relationship with them as compared to attracting new ones.
• Demonstrate your understanding of switching barriers (COST)                                                      Switching barriers o the switching costs is the real or perceived costs that are incurred by the organization when changing suppliers and are not incurred if the supplier remains the same.Since the switching costs directly affect the market share so none of the companies want to lose their customers to their competitors.This means if the customer is buying your product today, then all other things remaining the same the customer is likely to buy your product tomorrow also. That is why many companies follow the strategy of Bargain and then rip off strategy in pricing pattern where switching cost exists.( Fletcher 2003, p 9)

References

Bechmann, S. 2010, Service Design & Service Branding, slideshare.net,viewed on 21 october 2011,http://www.slideshare.net/bechmann63/service-design-service-branding

Fletcher, A. 2003, Switching Costs, Economic Discussion Paper 5, part One: Economic models and policy implications, Office of Fair Trading, London, p 9).

Fredricks, L. 2011, The agony of Indifference discovered, Gem State Writers.

Ghosh, S. 2009, Services Marketing Session 1, slideshare.net,viewed on 21 october 2011,http://www.slideshare.net/shantanughosh123/services-marketing-1972131

Introduction to Services Marketing 2009, chapter 1, Sideshare.net, viewed on 21 october 2011, http://www.slideshare.net/rockinglucky87/intro-to-service-marketing-presentation?src=related_normal&rel=3084087

Waheed, U. 2007, Services Marketing , Sideshare.net, viewed on 21 october 2011,http://www.slideshare.net/ch_paki/services-marketing.

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