The nature and dinstictive characteristics of services warrant/merit their own marketing and management framework. Discuss fully.

Services are defined by Palmer (1994 p1) as “activities or benefits that one party can offer to another that are essentially intangible and does not result in ownership of anything. Its production may or may not be tied to a physical product.” Many authors however argue on the basis of the availability of pure services since the nature and distinctive characteristics pose challenges or problems in the marketing and management framework.

In fact, services differ from physical goods due to the following characteristics:-

1                    Intangibility

Palmer (1994 p 3) states that “a pure service cannot be assessed using any of the physical senses- it is an abstraction which can not be directly examined before it is purchased.” Therefore, services do not have tangible properties which can be used by consumers to verify advertising claims before purchasing is done, for example, medical services.

2                     Inseparability

This refers to the simultaneous production and consumption of the service. Basically, it is impossible to separate the two. However, due to this factor, services are first sold and then produced and consumed at the same time. In such cases, the customer is both a co-producer and co-consumer as in the case of getting a hairdo. Therefore, the production process is critical to the customer’s enjoyment of the service. The producer and consumer have to interact in order for benefits of the service to be realised.

3                    Inconsistency

Service variability has impact upon not just outcomes but also the production process. The output usually depends on the input by the service personnel conducting the transaction. It can be difficult to monitor and control during the production and consumption process to ensure consistency due to the simultaneous occurrence of the two. This results in variations in quality and quality management and control becomes difficult.

4                    Ininventorability

Services cannot be stored and are produced on demand and in the presence of a consumer, that is, they are perishable.

5                    Lack of ownership

Under normal circumstances, customers buy products and get the title or ownership of that product as a result of the sale. With services, however, there is an inability to own services because of intangibility and inseparability. Buyers in this situation merely buy the right to a service, for example, using a car park or car rental services.

Marketing is a process of identifying customer needs and allocating resources towards the production of goods/services that satisfy the identified need to a target segment and the company sells at a profit. Management, in turn, involves analysis, planning, implementing and controlling resources and operations of a company. All firms do marketing and management but services firms, however, adapt strategies that justify or are linked to the nature of the services.

Marketers in service firms use physical evidence and the development of strong brands in reducing uncertainty due to intangibility. This has a tendency of reducing perceived risk as well because of the availability of tangibles. For example, car rentals services depending on the target segment will site the tangible cues which include model of the car, features of the car, speed and for hair salons they can use uniforms, colour and logos.

In addition, service organizations can use word of mouth to reduce perceived risks associated with services due to their intangibility. Satisfied and delighted customers can be influenced in providing information to potential customers. On the other hand, they can also use pamphlets that describe and explain the benefits accrued with using the service.

This will provide consumers a basis on which to measure risk and quality. Management, on the other hand, will allocate resources, for example, fixtures and fittings to the service area which comply with the desired image. This is to say that,  due to the intangibility of services, service organizations normally have to furnish or equip their service area in not only a way that complies with their desired image but also as a platform for consumers to use to reduce risk and influence perceptions positively.

Simultaneous service production and consumption leads marketing in being a facilitating medium for interaction instead of being a medium of exchange. The inseparability of services requires direct seller interaction so that the service is done properly. Furthermore, internal marketing has to be used so that employees get to understand their importance in service production thereby motivating them to do their work perfectly since they feel that they belong.

Whereas marketing focuses on interaction, management has to provide high level training for service personnel, for instance, in internet cafes, the personnel should be able to attend to customers at any time without wasting the customer’s time. More to that, they have to effectively screen and recruit skilled personnel normally for high involving purchases of services like medical services and legal services who can interact nicely with the customer for good results. In addition, management can also go a long to decentralize.  This is necessary to enable quick response to customers, that is, concerning queries and complaints as in the case of banks, hair salons and barber shops. This, however, will enhance customer satisfaction, for example, the use of service recovery techniques when a mistake occurs, since the service personnel will make a quick decision when things go wrong instead of making the customer to wait while s/he enquires with the superiors.

Communication has to be enhanced both within the organization and between the service personnel and the customer. Staff should use non-technical language when communicating with the customer because this might lead to misunderstanding which results in mistakes, conflict and dissatisfaction. Therefore, inseparability warrants effective communication to produce results, that is, customer enjoyment of the benefits.

Due to differences in tastes, management has to manage its customers uniquely based on those differences. In cases of restaurants, they can design sitting areas meant for singles, couples, smokers, non-smokers and so on. On a different note, service providers also have to use multi-site locations so that they reach out to all their customers, for example, She n He hair salon having other outlets  besides the one in Harare.

On services variability this cause for quality control standard to be put in place. Some organizations might develop systems that minimize deviation and human error for instance ATM , computers, and computerized tills. Management has to seek ways of automation. The marketers might inturn change the service package and let the service be customized if it were standardized. On the other hand marketing can prepack the service as brand building strategy.

Due to the fact that services can not be stored management will therefore plan capacity around peak demand. Service personnel might therefore have to specialize or be multi-skilled to increase capacity during peak demand. Hiring of staff can be utilized for example in fast foods outlets and hair saloons. More to that the service firm`s management can arrange for overlapping shifts for personnel such that customer will always be attended to as if there are stocks or inventory had it been a product.

From the marketing perspective service firms use pricing and promotion to even out demand peaks and valleys. In terms of pricing there maybe the use of off peak low pricing, low pricing for reservation through e-mail or telephone and premimum rates during peak times .As for promotion, the firm might have competition or promotions during off peak times so as to increase demand, for example running a promotion for customers who utilize your hotel services during non-festive seasons.

On a different note marketers can market their service to a different market all together to utilize capacity during low demand. As another tool of managing capacity management can increase customer participation by including self service in the service package for example in restaurants.

On the other side of the coin services also use the same strategies applicable to products .The marketing concept which states that a product or a service has to be produced to satisfy the customer need is applicable to both products and services despite their different. The marketing mix is also used for both of them since services apply price, place, promotion and product. Marketing research is also done in the same process with products in investigating customer needs and the benefits expected of the service.