What is service marketing?

Organizations that provide products or products to their consumers use service marketing to enhance brand recognition and revenue. In contrast to product marketing, service marketing promotes intangible transactions that add value to clients. Advertisers utilize efficient service marketing methods to gain client trust and demonstrate how their product may benefit them. Service marketing is interaction and value-based marketing.

Need of service marketing

It is meant to promote either a service or a product. With the growing importance of services in the world's marketplace, it has become a distinct subject worth studying. Because of the distinctive qualities of services, such as intangibility, complexity, perishability, and interdependence, marketing strategy differs from marketing products.

Services add more economic value to most countries than agriculture, raw commodities, and industrial products combined. Service jobs account for the majority of employment in industrialized economies, and they also account for the majority of new job creation.

Types of service marketing

Service marketing consists of three main types:

Business-to-business (B2B)

Many businesses and organizations use the services of other businesses. Networks, money, travel, and technical assistance may be understood as a few examples. The goal is to demonstrate business value to an organization by using their service. This is the most important aspect of business-to-business service marketing. The best example of B2B marketing is that most technology service companies proudly display their recommendations and case studies, demonstrating how they added value to organizations that are appropriate for the target customer.

Post-purchase service

E-commerce marketers use post-purchase services to improve the average order value. This implies they develop ways to persuade people to buy things they did not intend to buy in the first place. Post-purchase service is all about connecting with customers and clients after they purchase and complete payment of an item. Post-purchase branding can help brands build loyalty and acquire marketing exposure even though it is a one-time service or product.

Business-to-customer

It is the segment where companies provide services to their mainstream customers. Providers might provide telecommunication, entertainment, finance, insurance, construction, and replacement services. The company’s main focus may be on providing products. For example, Airtel sells telecommunication services to customers as part of its core business.

Features of service marketing

Perishability

Businesses care about perishability because it influences sale prices, stock levels, and marketing tactics for a certain commodity. It is usually used to describe a product, but it can also be used to describe services also.

Inseparability

Personal services are inextricably linked to personality. Services are both created and consumed at the same time. A service is created at the same time as it is delivered to the customer.

Intangible

It is the quality of not being able to see, touch, or feel the complete product before purchasing and using it. A customer must be persuaded to purchase a product. Satisfaction with the quality of service can only be achieved after utilizing it.

Pricing of services

The quality of service cannot be controlled. Requirements of clients and competition in the marketplace are usually the factors that determine service pricing.

Heterogeneity

Unlike uniform products, operations vary from place to place. Despite the individuals, methods, and types of labor, all being the same, multiple users may have unique experiences with the same service.

7Ps of service mix

The service marketing mix, also known as the 7Ps strategy, examines a firm depending on criteria such as people, process, and physical proof, as well as product, pricing, place, and promotion. The service marketing mix is a concept comparable to the traditional 4Ps marketing mix, but it includes three additional Ps that address service-specific factors. The service marketing mix often referred to as the 7Ps, aids in understanding the service industry and corporate strategy.

To respond to the changing market and client demand, a corporation should regularly maintain track of the 7P's of the marketing mix. For optimal revenue in the industry, the service marketing mix (7Ps) should be examined and re-evaluated regularly.

People, process, and physical evidence are the 7Ps of the service marketing mix, in addition to the 4Ps. When it comes to service mix, there are a few differences between the marketing of products and services.

7Ps are as follows:

• Product,
• Price,
• Place,
• Promotion,
• Process,
• Physical evidence, and
• People.

Common mistakes

Most students get confused with the terminology used to define a good that companies offer. In other words, the terms products and services are often used collectively. Therefore, they consider the concept of products and services the same. However, products are goods that can be touched and tangible in nature, whereas services cannot be touched and are intangible in nature. Similarly, product marketing and service marketing are different concepts. Product marketing emphasizes promoting a product (tangible) and service marketing emphasizes promoting a service (intangible) to create customer value. Therefore, students should be aware of the differences between these two concepts.

Context and applications

Students can pursue further specialization/degree/program in this field through the following streams:

• Marketing management
• Digital marketing
• Bachelor in Business Administration (service management)
• Master in Business Administration (Marketing)

Related concepts

• Customer service
• Interdependence
• Intangibility
• E-commerce
• Social media marketing

Practice problems

1. Why is service marketing complicated sometimes?

1. Complex market
2. No demand and supply
3. Intangibility
4. Market segmentation

Answer: c

Explanation: Service marketing becomes complicated because of intangibility—the services offered cannot be seen, touched, or felt.

2. Which industry in the private sector is the highest expected employment creator?

1. Insurance sector
2. Hospitality
3. Banking Service
4. Business Service

Answer: d

Explanation: When new companies export commodities to neighboring countries, they significantly relate to the productivity and profitability of the region.

3. The search for new customers, while suitably maintaining and retaining the current customers, is referred to as______________.

1. B2B
2. B2C
3. P-P service
4. Conquest marketing

Answer: d

Explanation: Conquest marketing is nothing but selecting the right candidate in place of someone. It focuses on searching for new customers while suitably maintaining and retaining the current customers.

4. Why is centralized mass manufacturing of services difficult?

1. Perishability
2. Inseparability
3. Heterogeneity
4. Intangibility

Answer: b

Explanation: It is hard to tell the difference between a service and the service provider.

5. Which form of marketing is often identified as similar to service marketing?

1. Product Marketing
2. Digital Marketing
3. Diversity Marketing
4. Relationship marketing

Answer: d

Explanation: Like service marketing, relationship marketing also concentrates on sales and depends on the entire interaction with the company.