Service Marketing - Essay Example

? Service Marketing College: Introduction Service marketing is the marketing sub field that can be divided into two main fields of goods marketing and services marketing. The goods’ marketing area includes marketing of the fast moving goods of the consumers and durables. Service marketing in simple terms refers to both the business-to-business (B2B) and business to consumer (B2C) services and involves marketing such services as financial services, telecommunication services, all kinds of hospitality services, air travel, car rental services, professional services, as well as health care services (Lovelock & Gummesson 2004, p. 21). Thus, service marketing is a variety of the expressions and approaches of marketing ideas conducted with the hope of effectiveness in conveyance of ideas to wide range of population of individuals who receive it. As this paper is emphasizing on marketing of services, it is not good to overlook the concept of “service.” Services are the diverse economic activities offered to people or parties by another person or party. They are often time-based and effective performance brings about the desired outcomes to the objects, recipients, or the other assets of interest for which the purchasers have responsibility. The service customers anticipate value from their access to labor, goods, facilities, professional skills, systems, and networks in exchange for time, money, and effort. However, service customers do not assume ownership of the diverse physical elements involved (Lovelock & Wirtz 2011, p. 35). In the present day, every business entity is interested in promoting its business with such strategies of marketing that will foster its performance via the roof. There are numerous service sector businesses plugged with techniques of product marketing and this is the prime time for them to improve their marketing performance. In fact, services are totally different from products since they are intangible. In addition, the target audience for products and services is different hence the need of applying different strategies of promotion in order to attract potential clients. For effective promotion of services in order to generate significant buzz, service marketers are encouraged to employ 7 Ps in their strategies of service marketing mix. The 7 Ps marketing mix is an extension of the 4 Ps marketing mix, which are the known as the marketing core strategies. The purpose of this paper is to provide advice to Mr Hirohito in his new venture of starting a high street restaurant in London. The paper shall provide information of how to develop appropriate strategies aimed at extended services marketing mix. It will also provide recommendations for action and preparation and presentation of informed, systematic, and effective marketing report as the basis for marketing decisions. Background Information: Hirohito Yamachu set up Wakaba Ltd, a London-based food company, in 2009 after being made redundant while working as head chef in Bank of Japan’s staff restaurant. The main business of Wakaba Ltd is involved in the supply of ready-to-eat ‘sushi’ meals and cooked Japanese cuisine to staff via company canteens in London City area. Currently, the business prides in its list of clients, which includes J P Morgan, Bank of Japan, Barclays, Chase Manhattan, and City Corp. While working there, his cooking was loved and much favored by the employees of the company unlike most of the other staff canteens. CEOs and senior managers even invited business clients, relations, and friends from outside for lunch in the staff restaurant. In 2008, unfortunately, Hirohito Yamachu became a casualty as the restructuring plan of the company as well as the ensuing BPR exercise reached an agreement of outsourcing in-house catering facilities. Termination of his career made him to establish his own business. Bank of Japan became his first client, as he did not need much introduction or serious marketing efforts. His cooking was done at his home with the aid of some family members who ferried food to offices everyday. Currently, Hirohito Yamachu has four additional clients with his reputation spreading very fast. His marketing strategy was simple: Good quality food at a reasonable price, promptly delivered with a smile. His philosophy as a Japanese was simple- be fair with people, treat them with respect, courteous friendly manner, and work hard ethics. Currently, he is considering opening a retail high street restaurant. As a services marketing consultant, the writer of this paper wishes to provide advice to Hirohito Yamachu in this new venture on services marketing related issues. Developing Appropriate Strategies Focused on Extended Services Marketing Mix Hirohito Yamachu’s venture is a service-related business. As such, a service entails the action of carrying out something for something or someone. A service is largely intangible since it is not a material. On the other hand, a product is a tangible material since it can be touched and owned. Actually, a service entails an experience in which consumption happens at the place of purchase. It cannot be owned as it perishes quickly. An individual can visit a restaurant one day and enjoy excellent service, only to visit it the following day and have a rather poor experience. Thus, as marketing consultant, the writer perceives service nature as inseparable, perishable, intangible, no right of ownership, and variability (Marketing Teacher 2000, Para 1). The marketing mix entails a combination of some marketing activities, which organisations engage in to foster their achievement of their targeted market requirements. Traditionally, marketing mix composed of only four Ps: Product, Place, Price, and Promotion. For instance, an automobile manufacturer such as Audi produces high quality products, which are fit for the requirements of varied consumers’ groups- Product. The company also offers a wide variety of vehicles at the value of money prices of their customers depending on their targeted segmented markets- Price. The third P (Place) comes into play as the Audi car manufacturers sell their cars via appropriate outlets like showrooms and dealerships in prime locations- in the appropriate places. Finally, Promotion is captured in that Audi supports its products’ marketing via appropriate advertising and promotional activity (Lovelock & Gummesson 2004, p. 22). 7 Ps marketing mix: Product: product is any business central issue, which determines the successfulness of a business in terms of growth. Business entities should develop their products in such ways that they are easily reckoned in markets due to their unique features. In case a business product satisfies the target audience needs, then there is no way such a business success can be jeopardized and vice versa (Lovelock & Wirtz 2011, p. 35). Price: businesses should set their prices with the potential customers in mind. Such prices should be consumer friendly and should not burn holes in the pockets of the clientele since it minimizes chances of realizing trade leads. In addition, the price of all products must satisfy the customers (Lovelock & Wirtz 2011, p. 35). Place and promotion: the place plays a vital role in the brand and business success. Prior to giving any product green light, there is need of conducting intensive market research in order to set effective distribution channels (or business venue in this case) from where the business can fulfill its clients’ needs easily as well as swiftly. The other P is about promotion: the success and popularity ration of a business’ service delivery is directly dependent on the mechanisms used in marketing products. Promotion can be conducted through a variety of ways such as advertising, personal selling, sales promotion, and so on (Lovelock & Wirtz 2011, p. 35). Getting the right mix of the above elements (product, price, place, and promotion) enables the realization of organisational marketing objectives as well as facilitates the satisfaction of the customers’ requirements. Besides these traditional four Ps, the service marketers find it appropriate to add some extra Ps towards this marketing mix to operate with seven Ps. These additional Ps are a means of enhancing performance since the present day marketing activities are by far customer oriented compared to the past. In addition, the service economic sectors have come to control most nations’ economic activities; this is particularly the case in London. Thus, the extra three Ps are specifically relevant towards the extended new service mix. Wakaba Foods Ltd needs to highlight these additional Ps: fifth, sixth, and seventh Ps (Lovelock & Gummesson 2004, pp. 20-23). The fifth P is about physical layout. The UK economy has for long been dominated by manufacturing sector. Thus, the production units’ physical layout like factories was not of much importance towards the end customers since they never or rarely went into such factories. On the contrary, the present day consumers encounter diverse products in retail units. This is the case with Wakaba Foods Ltd, which entails retailing of food products to their target consumers. Such consumers expect high presentation levels in the modern shops and thus Wakaba Foods Ltd must ensure that its staff is excellent in terms of presentation skills. In addition, the consumers not only need finding their way around Wakaba Foods Ltd’s high street restaurant premises, but also expect an effective presentation or good standard from the employees (Marketing Teacher 2000, Para 3). The sixth P is about providing customer service. Effective customer service provision lies at the centre of present day service industries. Actually, customers have the likelihood of being loyal to the organisations serving them well. This service is not limited to the direct face-to-face interactions, but also to the way in which any other query is handled. Even if the approach of “have a good day” is a somehow corny, it is far much better than a carefree approach to the customer relations. Wakaba Foods Ltd should ensure that its customer interfacing personnel as well as the call centre staff (due to outside catering services) lead from the front in customer care services. Thus, organisations require staffing themselves with individuals with thorough familiarity with effective practice of customer relations (Marketing Teacher 2000, Para 4). The final P of service marketing mix is about processes. Customer service is associated with a variety of processes, which are involved in realizing effectiveness in marketing in any organisation. For instance, there are such processes as customer complaint handling processes, customer requirements and needs’ identification processes, and order handling processes, among others. The 7 Ps: product, price, promotion, price, provision of service, physical presence, as well as processes comprise present day marketing mix, which is particularly pertinent in the service industry. In addition, they are also vital to any kind of business in which priority is on meeting the requirements and needs of their customers (Marketing Teacher 2000, Para 5). Recommendations The marketing mix entails a combination of some marketing activities, which organisations engage in to foster their achievement of their targeted market requirements. Since Wakaba Ltd is in the service delivery sector, it must incorporate the 7 Ps in its operations to guarantee successfulness. One of the key issues that the new venture must consider critically is the customer service aspect. The paper has illustrated in numerous occasions that effective customer care and service are the driving forces in the service-oriented sector and failure of effectiveness in these guarantees and automatic failure of a business. Thus, the restaurant should ensure that it hires staff members who have attained appropriate customer care skills as customers may only be in need of a simple smile to come again in the future. Furthermore, there is no need of Hirohito Yamachu to fire his pioneer workers though they may not have effective customer care skills as may be required in the new high street venture. The paper recommends that these staff members be assigned fitting roles whereby they can contribute to the success of the business without feeling inferior or undermined. The marketing mix of Wakaba Ltd is an example of micro marketing, which entails a variety of related responsibilities and activities. The business should empower its marketing managers and personnel to enhance their designing of effective marketing plans. Such plans should complement the business’ related production, financial constraints, as well as distribution. They should also permit constant adaptation to the changing economic and market conditions. It is possible that the central functions of marketing managers is identification of specific group of consumers or markets and then deliver promotions and products, which ultimately maximize the targeted market’s profit potential. This could be vital for Wakaba Ltd, as it is a small business that more than likely have no resources for targeting large aggregate markets. This paper recommends that Wakaba Ltd should carefully select and woo specific groups, such as the staff the Bank of Japan, in order to realize sufficient profit margins to facilitate its continuity in competing in the marketplace. In fact, Wakaba Ltd should ensure that it establishes effective mechanisms of capturing its present clients (in the five institutions it is supplying its food). This could be done using such things as flyers, or brochures to direct them to their new premise. However, the office delivery activities should not be given up as these should form the platform of reaching more customers. Marketing research on its own makes no decisions and guarantees no success. The marketing managers may look for advice from re-known marketing specialists. Thus, it is imperative for reports to specify the alternative action courses as well as the likelihood of success of these alternatives where possible. However, the marketing managers come up with the final decisions of marketing as opposed to the researcher. Marketing research, in addition, guarantees no success, but is rather a simple recognition of environments in which the marketing activities occurs. In marketing as well as marketing research, phenomena under investigation hardly lends itself towards deterministic modeling. Thus, the first recommendation is that Wakaba Ltd should consider its marketing problem in determination of the amount of resources to be devoted to promotion activities as a means of achieving substantial market share in the hotel industry. The most important aspect is the selection of the venue of the hotel as not all venues could guarantee success. Hirohito Yamachu should take time researching on the best site for his business. Such a site should be accessible to his immediate clients as they may be the only resource of reaching out to more clients in the City of London. The linkage between sales and promotional expenditure is not direct as that existing between things like temperature and pressure. There exist many more amounts of intervening variables, which include the effectiveness of promotional messages, the media used, frequency, and length of campaign, as well as the numerous product dimensions such as their quality, prices, and distribution channels. Thus, marketing works with some probabilistic models, which could assume the form of: y = a(b1)..(ab2)...a(bn)... This is a reflection of the fact that reaching a targeted share of the market requires some unknown amount of promotion, which on its own will be insufficient to attain the target. In the above function, y represents a variety of variables as well as their interactions. This model is further complicated by lack of clear understanding of these interactions quite often. Thus, there is need of Wakaba Ltd marketing team to offer reduction on the level of uncertainty surrounding their marketing decision. In fact, marketing research is the marketing management process for providing essential information relevant to decision-making. The paper notes that marketing research is not involved in making decisions for the business but for this case, it guarantees some success if this paper’s findings are followed. Following the above marketing mix will be essential in reduction of uncertainty surrounding marketing decisions to be made. In order to reach effective marketing decisions, Wakaba Ltd must be analytical, systematic, and objective in its venture into the new business operation to enhance its successfulness. Finally, customer service is linked with a variety of processes, which are involved in realizing efficiency in marketing. Wakaba Ltd needs to come up with effective processes to handle diverse customer issues as this will mark a great success to its operations. For instance, there should be effective processes like customer complaint handling processes, customer requirements and needs’ identification processes, and order handling processes, among others. These are just some few measures among numerous available of ensuring that customer service is prioritized in the venture. Conclusion Service marketing is a variety of the expressions and approaches of marketing ideas conducted with the hope of effectiveness in conveyance of ideas to wide range of population of individuals who receive it. Traditionally, the product marketing mix used four Ps: product, place, prices, and promotion to win and woo customers to their products but this have changed due to intensification of the service sector in most global economies. London has been an industrial city for decades but service sector is gradually overtaking manufacturing. Thus, Wakaba Ltd initiative of venturing the market is timely as food industry is on the rise in the city. The firm has an advantage in that it has some well-established clients in the workplaces served by Hirohito Yamachu since his departure from the Bank of Japan. As a service provider, Wakaba Ltd should incorporate the 7 Ps in its operations. The paper has cited the significance of customer service as an important aspect of marketing mix as customers need to feel as king or queens in service delivery. The trick is ensuring that service delivery is maintained at admirable levels since lack of consistency may spell doom to a business venture while consistency is a guarantee to success. References Lovelock, C & Gummesson, E 2004, Whither Services Marketing? In Search of a New Paradigm and Fresh Perspectives, Journal of Service Research, Vol. 7, No. 1, pp. 20-41. Lovelock, C & Wirtz, J 2011, Services Marketing – People, Technology, Strategy, 7th ed., Upper Saddle River, New Jersey: Prentice Hall. Marketing Teacher 2000, “Services marketing and the extended marketing mix (7 Ps),” viewed 18 February 2012, Read More