Services Marketing Research Paper

Only in the 1980s did service organizations start to take a professional interest in marketing approaches and tools. More recently also, the public services, and the nonprofit services in general, have begun to participate in marketing. Despite its recent arrival, services marketing is undoubtedly the most innovative and, thanks to new technology, seems as though it may change the old approach completely. The trend is moving from mass marketing to one-to-one marketing, a typical feature of services promotion.

1. Peculiarities Of Services Marketing

If services marketing is becoming so important, it is necessary to understand its peculiarities. Everything is related to the intangibility of Services: they are ‘events’ more than ‘goods,’ and as a consequence it is impossible to store them. They are ‘happenings,’ where it is difficult to forecast what will be produced and what the consumer will get. The relationship becomes increasingly important, especially when the consumer becomes a ‘part-time producer’—a ‘pro-sumer’ ( producer + consumer).

Interaction with people is very important in many services, such as restaurants, air transportation, tourism, banking, and so on. The interaction is not only between producer and consumer, but also among the users, as happens in schools among students.

Because of these elements there is another very important aspect: in services marketing it is difficult to standardize performance, and quality can be very different from one case to another. Quality control ahead of the event is impossible, because nobody knows in advance the service that will actually be provided to the customer. Many external factors can affect the level of quality, e.g., the climate, or the unpredictable behavior of customers. Consequently, it is not always possible to fulfill promises at the point of delivery, even if the organization does its best to deliver the required level of quality.

Another peculiarity is that services are not ‘visible’ and so cannot represent a ‘status symbol,’ unless the service can be matched with tangible objects, such as credit cards, university ties, football scarves, etc. But the most important aspect is that services cannot be stored, and therefore production and use are simultaneous. This creates problems in terms of production capacity, because it is difficult to match fluctuations in demand over seasons, weeks, or days. It is possible to synchronize production and use by means of different tools. The most used approach is pricing, because varying service prices may be applied at different periods of time (e.g., telephone charges, or airline tickets). There are other tools, such as ‘user education,’ implemented by the service producer. In this case, the producer tries to ‘educate’ the consumer to ask for a particular, better-quality, service during the so-called ‘valley periods’ when sales are slow.

Other solutions involve the employment of part- time workers during ‘peak periods,’ or the implementation of maintenance activity in the ‘valley periods’; making reservations is a typical approach in the case of theatres or in the health care service. In all cases it is necessary to overcome fluctuating demand with a ‘synchromarketing activity.’

2. Critical Success Factors In Services Marketing

Because of the peculiarities of the services, there are many critical success factors in services marketing: (a) service industrialization, (b) strategic image management, (c) customer satisfaction surveys, (d) operations, personnel, and marketing interaction, (e) internal marketing, (f) user education, and participation, (g) managerial control of costs, and investments, (h) relationship with the public authorities, (i) quality control, and (j) synchromarketing.

Of these, further comment can be devoted to internal marketing, whose goal is ‘to create an internal environment which supports customer consciousness and sales mindedness among the personnel’ (Gronroos 1990). ‘Internal marketing means applying the philosophy and practices of marketing to people who serve the external customers, so that the best possible people can be employed and retained, and they will do the best possible work’ (Berry and Parasuraman 1991).

Another point to emphasize is quality control, because, as has been said, the quality of the service is perceived to be more than objective. Many studies say that the focal point in services is the perceived quality, as a result of a comparison between the expected quality and the image of the service really provided. As a consequence, it is very important to survey customer opinion on a regular basis, and to check whether, via this opinion, service is becoming better or worse. A further point is related to the importance of a company’s image as a factor affecting, positively or negatively, customers’ judgment. This is why it is necessary to manage a company’s image with a strongly strategic approach, outlining what the company is, what people think it is, and how it wants people to think of it. Image improvement is not only a matter of communication; it also involves personnel behavior, services provided, and material facilities.

3. Future Perspectives

At the start of the twenty-first century, services marketing is very important in the developed countries, because of the relevance of services in terms of GNP, employment, etc., and we can predict that it is going to increase further in importance, thanks to new technologies that facilitate the relationship between producer and customer. There will be an increasing amount of one-to-one marketing, which is particularly suitable for services. Another important development will concern the internationalization of services (e.g., McDonald’s, Club Med, Manchester United, Hertz, etc.), where the critical success factors will be related to the improvement of ‘high tech’ in the back office and ‘high touch’ in the front line: Industrialization and personalization at the same time, to achieve high customer satisfaction in every country. Sales of products now often include the offer of some services, as, for example, in the automotive industry, where this is represented by the after sales service, a very important aspect affecting the buyer decision process. Offers such as this are the key issues that, in most cases, actually make the difference, given the fact that the basic product is very frequently similar to other products, and the difference is provided by the service included in the product.

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