Service Classification and Analysis of Service Encounters - Assignment Example

? Marketing Research- Report on Service Encounters Table of Contents Table of Contents 2 PART I 3 PART II 3 Reference List 8 Appendix 10 PART I This study seeks to shed light on the concepts of services marketing and understand the nature of the services being offered by the companies. Furthermore, services marketing as a core competency will be also evaluated along the course of the study. In order to accomplish this assignment theories and literature of services marketing will be consulted and the service experiences encountered by me in the first week of the assignment will be evaluated on the backdrop of the theories. Based on the textbook learning about service marketing, the experiences will be categorised and aging theories will be related to the encounters. The study will be divided in two parts, in this part experience of the service encounters will be highlighted and in the second part, the theories and classifications will be done. Along with that a suitable conclusion and recommendations will also be provided. Service Encounters This section of the report covers the description of the various service deliveries I have encountered in the last week. Although I have come across various service encounters in the recent past, only six of them will be described. The service encounters ranging from banking to tourism services. I have decided to only highlight those service encounters that actually offered something to learn from that experience. Also it should be noted that each of the service encounter that I proposes to shed light on are from different sectors. The entire segment of my service encounters can be found in the appendix section of this study (Refer to Appendix section). PART II Introduction Service marketing is considerably a new concept of marketing and is often dubbed as the subfield of marketing. Service marketing typically refers to the business to business (B2B) and business to consumer (B2C) services (Storbacka, Strandvik and Gronroos, 1994). The notion and real life application of services marketing are evident in sectors such as travel, telecommunication, health care and financial services to name a few. The study is meant for the purpose of understanding the nature of services and to test the viability of the statement ‘service customers is a core competency that marketing managers must develop’. In the section of the study, I will reflect upon my experience of service delivery and will try to relate the same with the theories portrayed by scholars across the world. Lastly, suitable conclusion to the study will be drawn and along with that recommendation will be provided. Service Classification It is an imprudent act to generalise the concept of services because the services offered by the companies greatly differs. The differences in the services of two companies become more visible when these companies belong to different industries. According to industry experts and academicians, one of the wisest approaches to segment the services of the firms is to use marketing relevant characteristics (Lovelock, Patterson, and Wirthz, 2010). In general, the services are classified on the basis of various factors such as the strategic implication of the characteristics of the services by considering the fact that customers are involved in the production process. The services can be classified as the tangibility/intangibility of the service process, on the basis of the direct service recipients, the place in which the service is being delivered, on the basis of customization and standardization, relationship with the customer, discrete and continuous services, and high & low contact services. In the context of my personal service encounters, I will choose the degree of tangibility or intangibility involved in the process of service delivery. This basis of classification describes the fact that whether the services being offered by the company involves anything physical or the process is more intangible. In my cases, all the services are intangible and but involves different characteristics which distinguish the services. It has been observed that the tangible service offerings are further classified as intangible actions aimed at influencing people’s mind (mental stimulus processing) and intangible actions aimed at promoting intangible assets (information processing). However, in this context I cannot relate my experience with one of the particular in the aforementioned because I have come across both the processes. For example, service encounter at the bank can be deemed as intangible actions aimed at directing the intangible assets, whereas my experience at the movie theatre can be termed as the service process that is intangible action and is directed towards intangible assets (Summers and Smith, 2010). Analysis of Service Encounters Scholars have defined service to be an act or an experience that is offered by a party to another party. It is essentially intangible in nature and it does not result in any kind of transfer of ownership. In the similar way, another set of scholars defines services as the processes that provide place, form, time and problem solving value to the receivers (Robinson, Neeley and Williamson, 2011). Hence, in simple words service can be adjudged as that might be bought and sold yet cannot be dropped on foots. As mentioned earlier, service marketing typically refers to the business to business (B2B) and business to consumer (B2C) services (Lovelock, Patterson and Wirtz, 2011). It materializes in a number of ways and in the similar ways can be categorised as consumer services and business services. For example, some consumer services are banking and finance, insurance, restaurant, hotel and transportation among others. On the other hand, some of the business services include architectural services, accountancy services, telecommunication, consultation and legal services among others. According to O’Cass and Ngo (2011) over the last three decades services marketing have emerged as a recognized field of research. Likewise, Dagger, David and Ng (2011) emphasized on the fact that service marketing is the new and contemporary logic of marketing. The development of services marketing has led to the emergence of various service marketing theories. For this project 2-3 of the most vital theories will be selected and analysed on the basis of the services I have experienced. Eminent scholars such as Mandhachitara and Poolthong (2011) enumerated that service marketing is one of the crucial forms of marketing in the current context. The needs of consumers are changing at a rapid pace and as a result of that companies belonging to the service sector are finding extreme difficulties to identify the needs of the consumers. Hence, it is essential to offer services that fulfil the need of every individual. With this base, the concept of customized service emerged where companies basically offer customized service to the customers. Studies have shown that customized service has not only increased the level of customer satisfaction but at the same time it has played imperative roles in promoting a service (Lewis and Soureli, 2006). This theory is highly related to the experience I have gathered while inside a restaurant near my university (refer to appendix). In this situation, I have clearly understood the reason why marketers focus heavily on understanding the deeper needs of the consumers. The restaurant offered me customized package which enhanced my satisfaction level. In the similar way, the insurance and the banking organization also offered me with customized services and allowed me to use the services that are only required by me. This proves that it is an essential to offer services as per the need of the customer in order to generate greater satisfaction. Eminent theorists such as Kim and Ok (2009) stated that service marketing is built on the careful and deeper understanding of the customer needs which makes companies successful. As a result of that companies put in strong efforts so as to identify the needs of the consumers. Scholars such as Jones, Mothersbaugh and Beatty (2002) enlightened to the fact that a service firm has a tendency to know the exact requirement of customers in a deeper way so that they can understand precise needs and can amalgamate the notion of customization and standardization. This theory has a great resemblance with the services I encountered at the movie theoriser and the travelling company I have availed during one of my trips. In both the cases I have observed that the companies are using some ways to identify the needs of the consumers. For example, after getting out from a movie theatre, the employees handed over a questionnaire to uses that was meant for rating the service delivery and service quality. In addition, suggestions for further development were asked. In the similar way, the tour conducting organization hosted a focus group interview session in which we were asked about the service development, additional service, pricing etc. Hence, from the above discussion, it is evident that the theories of services marketing portrayed by scholars can be easily experienced during service encounters. Also the notion that with services marketing both companies and the buyers are benefitted is highly justified. Recommendations In this section recommendations will be provided to the companies regarding the ways by which they can develop their service delivery mechanism. 1. Regular Feedback and Market Research activities: - Companies are strongly advised to carry out regular market research activities so as to track the changes taking place in the market (Dick and Basu, 1994). The service delivery or a service design not only gets impacted by the customer needs but also the changes taking place in the external business environment. One of the biggest advantages of market research activities is that it allows the study of customer expectation, to underpin the customer reactions about a service offered by the company and also to evaluate the acceptance rate of the service (Dimitriadis, 2011). Another big advantage of carrying out market research and taking regular feedbacks is that it allows a firm to make suitable adjustments as per the requirement and suggest new strategies. Thus, it is evident that regular feedback and market research activities offer companies with various advantages. 2. Customer Involvement in Designing Phase: - The success of a new service is greatly dependent upon its design. Studies have shown that despite streamlined delivery channels the service has failed because of poor designing (Gwinner, Gremler and Bitner, 1998). However this can be expunged if customers are involved in the process. Hence, the companies are strongly recommended to engage customers during the service designing process. For example, pilot study of a service i.e. Short scale development before going into full fledged design and delivery etc. greatly serve the purpose. Conclusion The study was initiated for the purpose of understanding the nature of services exists in the marketplace and to test the viability of the statement ‘service customers is a core competency that marketing managers must develop’. In this context, the study revealed that there are various ways by which service process can be categorized and each of the factors are carried out on the basis of different service traits. The study has also shown that proper service leads to increased customer satisfaction. Even in my case I also have observed that whenever, companies offered me quality services or customized service my satisfaction level has greatly increased. Thus, the statement ‘service customers is a core competency that marketing managers must develop’ is true and justified. Reference List Dagger, T. S., David, M. E., and Ng, S., 2011. Do Relationship Benefits and Maintenance Drive Commitment and Loyalty? Journal of Services Marketing, 25(4), pp.273–281. Dick, A. and Basu, K., 1994. Customer Loyalty: Toward an Integrated Conceptual Framework. Journal of Academy of Marketing Science, 22(2), pp. 99-113. Dimitriadis, S., 2011. Customers' Relationship Expectations and Costs as Segmentation Variables: Preliminary Evidence from Banking. Journal of Services Marketing, 25(4), pp. 294-308. Gwinner, K. P., Gremler, D. D., and Bitner, M. J., 1998. Relational Benefits In Services Industries: The Customer’s Perspective. Journal of the Academy of Marketing Science, 26 (2), pp. 101-114. Jones, M.A., Mothersbaugh, D.L. and Beatty, S.E., 2002. Why Customers Stay: Measuring The Underlying Dimensions Of Service Switching Costs And Managing Their Differential Strategic Outcomes. Journal of Business Research, 55 (6), pp. 441-50. Kim, W., and Ok, C., 2009. The Effects of Relational Benefits On Customers' Perception Of Favorable Inequity, Affective Commitment, And Repurchase Intention In Full-Service Restaurants. Journal of Hospitality & Tourism Research, 33 (2), pp. 227-244. Lewis, B.R., and Soureli, M., 2006. The Antecedents of Consumer Loyalty in Retail Banking. Journal of Consumer Behavior, 5, pp. 15-31. Lovelock, C. H., Patterson, P. G. and Wirtz, J., 2011. Services marketing: An Asia-Pacific and Australian Perspective. New Jersey: Pearson Education Inc. Lovelock, C., Patterson, P. and Wirthz, J., 2010, Services Marketing: An Asia-Pacific and Australian Perspective. 5th ed. New South Wales: Pearson Education. Mandhachitara, R., and Poolthong, Y., 2011. A Model of Customer Loyalty and Corporate Social Responsibility. Journal of Services Marketing, 25(2), pp. 122 – 133. O’Cass, A., and Ngo, L. V., 2011. Achieving Customer Satisfaction in Services Firms via Branding Capability and Customer Empowerment. Journal of Services Marketing, 25(7), pp.489–496. Robinson, L., Neeley, S. E., and Williamson, K., 2011. Implementing Service Recovery through Customer Relationship Management: Identifying the Antecedents. Journal of Services Marketing, 25(2), pp.90–100. Storbacka, K., Strandvik, T. and Gronroos, C., 1994. Managing Customer Relationships For Profit: The Dynamics Of Relationship Quality. International Journal of Service Industry Management, 5 (5), pp. 21-38. Summers, J. and Smith, B., 2010. Communication Skills Handbook. 3rd ed. Queensland: John Wiley and Sons Australia Ltd. Appendix Service Encounter 1 The first service encounter was in a bank where I went on to open an account. After going through their various account types, I observed that most accounts will not serve my purpose and I will not be able to afford. However, the bank offered me with customized account that suited my requirements. The staff members were extremely helpful and it caused a high level of satisfaction within me. Hence, I would definitely act as a word of mouth promoter for the firm. Service Encounter 2 The second service encounter was with an insurance company. In this case also I went on to buy an insurance policy for higher education. Initially, I found the policies to be extremely difficult to afford as the monthly premium was high. However, the salesman offered me customized package where I can choose my own premium amount and the maturity value will be calculated on that basis. Although, it served my purpose but I would not rate the company more than 3 out of 5 because of their poor hospitality. Service Encounter 3 This is the case that describes my visit to a neighbouring country. In reaching so, I had availed the services of a tour conducting company. The trip was very well and their hospitality was simply superb. However, one thing I have noticed is that they are taking feedback of our overall experience. These show their dedication towards service delivery. Hence, I will always recommend my friends and family to avail the services of this company. Service Encounter 4 The fourth experience that I would like to share is related to a movie theatre. Recently, I visited a movie theatre and found the system to be world class. Starting from their queue management till making the customer seat in the accurate place, the service was brilliant. Despite being late in entering the theatre, I have hardly faced any trouble finding my seat. Hence, I would definitely rate their service 5/5. Here also I have found the management to be using a feedback method enhance the quality of service delivery. Service Encounter 5 This is the experience of watching a live soccer match. I will at first mark this as a dreadful experience. The first incident occurred when I was buying tickets at the counter. Due to mismanagement, I had to literally tussle with others to get the ticket. The next incident took place when I was searching my chair. I saw another person sitting and on asking him to vacate the chair he refused without any proper explanation. The situation worsened as there were no security personnel. Literally, I watched the whole match standing. Hence, better management was definitely required. Service Encounter 6 This is last encounter and it was related to my stay at the hotel for one night while I was out for some data collection work on my next project. In this hotel, I experienced the average quality of the services. The services were not up to the mark because throughout the duration of my stay, I have hardly received their prompt response. Whenever I needed something on an urgent basis, I never received in a timely manner and had to wait. However, their dining service was comparatively good. Hence, I rate their services as 2.5/5. Read More