Overcome the challenges of service marketing by service provider:
Any service provider company that sells a service (IT, entertainment, education, health, tourism) faces four challenges to promote itself.
• The services are intangible.
• The supplier is the product.
• they are perishable
• Quality may vary from day to day.
• The services are intangible:
It is easier to sell a product than a service because a product is tangible or physical. When customers can see a product and examine its color, shape, size, features, and quality of the materials used, they can make a purchase decision immediately. Indian consumers like to feel the product before buying it, especially if it’s clothing.
How do you sell something that customers cannot show or own?
However, a service is intangible. Consumers cannot feel it or possess it as a product. Therefore, it takes longer to convince them. Take tourism for example. That industry sells experiences. The only way a customer can preview the “product” is by viewing photographs, reading reviews online or listening to other people who have traveled to those destinations. Education is also a service. The various utilities it consumes (electricity, gas, telecommunications, internet) are also all services. Apart from the prices. Clients choose a service provider based on the quality of the service.
There are special approaches to overcome the challenge of service marketing. One is customer testimonials. You can take written testimonials from your existing customers and put them, along with the photo of each customer, on your company’s website, in your store and in your brochures. Customer reviews on established websites such as Google, Yelp, and TripAdvisor also work well. Also enable social network ratings on networks that attract followers that are your potential customers.
• The supplier is the product:
You can buy a product from different channels i.e. online, at a mall, at a convenience store, etc. But service has a point of purchase. The buyer deals directly with the service provider or its distributor. And they go to the same point every time they need that service. For example, when you need a haircut, you are likely to go to the same salon every month. You can go one step further and demand that the same person comb you (because he/she knows your preferred style). Therefore, the relationship between the service and the service provider is inseparable.
How can a service provider offer a personalized service for thousands of customers?
When it comes to a few clients, it is possible to know them well. You will know your preferences and your level of satisfaction with your services. But that may not be possible when there are dozens or hundreds or thousands of customers.
The answer is systems and processes. The Marriott hotel group, for example, records customer preferences in a master database that can be accessed by any Marriott chain hotel, anywhere in the world. Then, when you make a reservation, they already know you, and set up your room accordingly! And their customers love that. By using a customer relationship management system, you can track the preferences of each customer. This will allow you to offer a highly personalized service every time. Just don’t overdo it, as companies that know too much can scare customers.
• They are perishable:
Like some products, for example, food, services are perishable. There is only a lot of time in a work day. The service provider needs to sell the maximum capacity to be profitable. Unfortunately, there will never be a constant queue of customers waiting to be served one after another.
How can service providers create a constant demand for their services?
Take the example of an airline. If a flight is half empty, the revenue collected from ticket prices will not be sufficient to cover operating costs. So airlines use different strategies to fill their planes. They can group flights for a particular route or use code-share agreements with partner airlines or join an alliance of airlines such as Star Alliance. Therefore, it is about balancing demand with supply. If you can do that, then you minimize your business losses and increase your profitability. There are periods of demand (such as the holiday season) and then there are periods when sales fall due to low demand.
There are a couple of marketing strategies to counter periods when there is less demand:
• Aggressive promotion, including online and offline advertising.
• Discounts and sales during periods of low demand.
• Loyalty programs with points.
Marketing experts can create a sense of false urgency and false demand, making people rush to buy services. They do this by offering discounted prices for a limited period.
• Quality may vary from day to day:
A product may have little variability, because each unit of that particular model is constructed with an exact specification or design created by a manufacturer.
How can a service be standardized so that the customer always obtains the same quality?
But with a service, there is a lot of variability. There will be variations depending on who offers the service, and in what location, how busy is that day’s service schedule and other factors.
This can be achieved through standard processes and frequent audits. By training yourself and your employees to complete the same process each time, you can achieve a higher overall level of service. Use customer surveys and comments to find out where/when/under what circumstances the greatest variation in service quality occurs. Frequent improvements, in response to customer feedback, can lead to greater customer satisfaction.
Also read: Services, Concept of Production Management, Features of Service, Importance of Production management, Qualities of Production Manager, Concept of Entrepreneurship, Types of Entrepreneur, Process of Entrepreneurship, Need of Entrepreneurs, Barriers to Entrepreneurship