What is Service Marketing? Features and Types

Services marketing is marketing, the task of which is to promote the company’s services to the market.

Services marketing is a scientific discipline and branch of modern marketing that studies the features of the marketing activities of organizations whose business is to obtain benefits from the provision of services.

The marketing policy of a company operating in the service sector is significantly different from the marketing policy of a company working with tangible goods. This is due, first of all, to the peculiarity of “production” or the provision of services. A distinctive feature of a service is that it can only exist if there is a relationship between the buyer of the service and the producer of the service.

The service sector includes healthcare, education, restaurant business, insurance, transportation, cosmetology, financial and information services, recreation, and entertainment.

Marketing of services is influenced by the fact that services have a number of features that are different from goods:

This leads to the peculiarities of marketing services, since it is impossible to familiarize yourself with the product in advance due to the above reasons, and the buyer of services can only believe the marketing messages of the service provider about the quality and timeliness of the service.

The expected service is the subjective perception of consumers about the quality level of marketing services that will be provided to them. Externalization of services is a marketing concept for the development of services associated with the emergence of new types and forms of service activities that take on the functions of satisfying needs that were previously satisfied by the organization or household.

Differences between services and goods

Due to the nature of the production and sale of services, their marketing differs from the marketing of material goods.

The service is intangible. It is difficult for a consumer to evaluate and test a service before purchasing. Therefore, the basis for the transaction is trust in the seller, the image and reputation of the company.

Even if the client knows the duration, list and order of procedures, this still will not allow him to assess the quality of the service in advance. The result of the work is always personalized and difficult to describe in specific terms. The feeling of service is created by the staff in the process of providing it.

Production is inseparable from the source. The service is performed by the employee at the place and at the time of service. It cannot be separated from the seller and, in most cases, from the buyer. The one doing the work and the one being served are present at the same time.

Sometimes the direct participation of the buyer is required in the production process of a service. For example, completing an assignment in English class or preparing for a medical examination.

A specific specialist is often contacted for a service. Therefore, personnel management plays an important role in the marketing system. When hiring, you need to evaluate not only the professional, but also the personal qualities of employees. And if you are an expert and provide services yourself, develop a personal brand. This will help attract customers.

If you are selecting a team, then you need to take into account two components: the hard and soft skills of the future employee. The first show professional competencies. For example, knowledge of programs or the ability to assemble code in html. The second are personal qualities: the ability to multitask or quickly adapt to a new team. Research shows that 85% of success at work depends on the development of soft skills.

Services cannot be stored or accumulated. Therefore, it is extremely important to find a balance between supply and demand.

For example, a massage therapist conducts 6 hour-long sessions per working day. At a time of high demand, he will not give two massages at the same time. But if the visitor does not sign up or does not come, the company will still bear the costs of paying for the work shift and renting an office.

How to influence the balance of supply and demand:

Quality assessment is subjective. The quality of the product is constant and depends on the type of raw materials, production technology, and equipment.

The actual result of the work also depends on consumables, tools and technologies. But the quality of the final product does not determine the quality of the service. If the hairdresser gave a successful haircut, but was rude, the visitor will remain dissatisfied.

The quality of the service is inconsistent. The personality of the seller, the situation, and the initial data are of great importance. The perception of quality is influenced by the client’s personal experience, his requests, expectations and even mood.

Complex “7p” in services marketing

Marketing tools are ways of doing it. These include pricing, advertising, sales, studying consumer needs and others.

Marketing tools are reflected in the classic “4P” formula. Based on the standard model, there is an extended version “7P”, which is used at service enterprises.

Basic Tools

Product (service)

Service is the main component of marketing. The concept of a product includes: brand, assortment, quality, functionality.

To create a successful product, it is necessary to understand and continuously study the needs of consumers. Conduct surveys and other research to understand current customer preferences. Constantly improve your service offerings and differentiate yourself from competitors.

You can conduct surveys using different channels and services: email newsletters, pop-ups on the website, surveys on social networks. With their help, you can identify customer needs and improve the service/product

Price

When choosing a product, the client evaluates the material, assembly, warranty, and delivery. It is difficult to compare the services of different companies. Therefore, the first thing a buyer looks at is the price.

The cost reflects not only the costs of materials, rent, wages, but also the professionalism and reputation of the company. On the one hand, a high price increases risks for the buyer. What if the work turns out to be of poor quality, he will lose money and time. On the other hand, low cost is associated with poor service. The client's perception of the price and value of a service is subjective and based on user experience.

It is important to understand who your target audience is and how solvent they are. The cost and concept of positioning in the market depend on this. Price segments are divided into five levels: economy, mid-low, mid-high, premium and luxury. Cross-segment services are suitable for two or more audiences.

And the price helps to even out the balance between supply and demand. For example, cheap tickets for daytime sessions, discounts for visits in the morning.

What to pay attention to when developing a pricing policy:

Promotion

To promote services, they use the same tools as for goods. For example, a website, social networks, a blog, targeted advertising, promotions, outdoor advertising, word of mouth and much more.

The purpose of promotion is to create an image of the service in the client’s mind, to form an idea of the quality and level of service.

Before purchasing a service, the client goes through several stages: he realizes a need or interest, looks for information and compares options, chooses a company or expert, and only then buys. It is important to present the company at every stage.

Influence your audience simultaneously through different channels: online and offline advertising, social networks, newsletters, mobile applications. etc. A buyer with high expectations will not be satisfied and will leave negative feedback. So do a little more than you promise.

The client does not see a specific product, so it is important to explain what he is paying money for.

Distribution

In the “7P” complex, the word “place” refers to the organization of sales channels and delivery of the product to the consumer.

When distributing services, there is no physical movement, as is the case with goods. Distribution of services includes:

The company can carry out work in its own premises, at home, away, in open spaces, outdoors, etc. The location of the service is important to the client.

For example, in large cities, the location of the office, transport links and proximity to the metro matter. A cafe on the ground floor of a shopping center is more likely to attract additional visitors from the street, and the beauty salon’s own parking lot can be positioned as an advantage.

A number of services do not require the personal presence of a specialist or buyer; they can be used via the Internet or by telephone. In such cases, pay attention to the convenience of the site or platform through which the service is provided, the form of payment and the availability of support services.

Staff

All company employees directly or indirectly participate in the creation of the service. Most of the responsibility for quality lies with specialists who work directly with the buyer. Customer satisfaction and company profits depend on the professional and personal qualities of the employee. These include knowledge of work technology, the ability to find an approach to guests, present and sell.

Human resource management tasks:

Process

The task of marketing is to make the process of receiving a service as comfortable and enjoyable as possible for the buyer. Consider the client's journey from filling out an application to writing a review. Develop internal standards for service and communication with customers. For example, scripts, checklists, step-by-step description of the procedure with timing. Set specific goals and priorities for your employees on what to focus on when interacting with a client.

Physical environment

The client’s environment at the time of receiving the service affects the overall impression and assessment of quality. The physical environment includes the design of the room, the uniform and appearance of employees, music, smells, lighting, and location.

The setting allows you to immerse the consumer in the desired context. Licenses and certificates emphasize the status and professionalism of employees and increase trust. In hotels, to create coziness, they use aromatic compositions with the smell of “cleanliness”.

The objectives of service marketing are :

1. profit from the service and its growth;

2. customer satisfaction

3. regular customers;

4. increasing the value of the service;

5. improving the quality of service (satisfaction, interest and high productivity of employees).

Features of the marketing mix for services (4P + process, personnel, material environment).

The specifics of services marketing are reflected in the marketing system. The main reason for creating a special set of marketing communications in service companies is seen in the need to convey to the buyer of services the highest quality of the service that he is going to purchase. There are other reasons for the specificity of the services marketing mix. This, as I wrote earlier, is the direct participation of the buyer in the process of providing the service, which is no less important than the result. In addition, the impossibility of storing services requires accurate calculations of the enterprise’s capabilities in the service sector and coordination of their supply and demand.

The service marketing model should be based on the following principles:

The service marketing concept includes: