Services are radically different from products and need to
be marketed very differently. So the classical 4 P structure of the Marketing
Mix needs to be modified suitably to incorporate the 8 Ps for services
marketing, which was previously known as the 7 Ps only.
Services can range from financial services provided by the
banks to technology services provided by the IT company or hospitality services
provided by hotels and restaurants or even a blog where an author provides a
service (information presentation, interesting reading etc) to his audience.
Services marketing are dominated by the 7 Ps of marketing namely Product,
Philosophy, Price, Promotion, Place, People, Physical evidence.
While everyone knows about the 7 Ps of services marketing,
the 8th P of Services Marketing has emerged in research very recently. The 8th
P is Process.
In integral services management, improving productivity is a
requisite in cost management; but quality, as defined by the customer, is
essential for a service to differentiate itself from other providers.
It has been recognized that overall profitability of a firm
may be greatly impacted by focusing on not only at the top-line by improving
sales but also focusing on the bottom-line by lowering over-all cost of
delivering services. In services management, often the variable costs are a lot
more than fixed costs, and so incremental costs, if managed properly can have a
huge impact on productivity. So for services, a firm may greatly benefit
through proper re-engineering of processes and remodeling the same if required
to improve productivity at each stage.
It has also been established in research that process
improvements deliver better standardization and hence better quality in
services. Quality perception is a crucial differentiating factor on services
management and for long term sustainability of the same. Business Process
Remodeling can lead to major process efficiency improvements which again can
impact overall quality as is actually delivered by the firm and is also
perceived by the customers / clientele .
Product
The definition of a product can be a service, idea or goods
of some kind and needs to address quality; name; packaging; guarantees; and
product features.
Are you absolutely clear on how your product meets the needs
of your market segment?
Unlike the private sector the moral imperative rests with
the charity is to set its own standards for product quality as the beneficiary
or customer often has little or no choice.
Philosophy
This is an important component in the marketing mix for
charities as every product should not only reflect the underlying philosophy or
ethos of the organization, it should also be clear what the philosophy behind
the introduction of the particular product is as well.
Price
Within your charity you need to fully understand what price
should be charged for the product in question even if in reality you offer it
to your customers on a subsidised basis or even free.
However never forget that people can be extremely cynical
and that if the charity you are working for provides its product free of charge
that to some free equates to of no value ie worthless. Even if you provide a
product free of charge, it will enhance the perceived value if you can ensure
that the true price is recognised.
Promotion
Oddly, when you say marketing to some people they either
automatically think of market research or promotion. In reality, promotion
consists of advertising; personal selling; referrals; sales promotion;
leaflets; public relations; networking and so on.
Place (distribution)
In other words, how you’re going to get your product to your
market.
People
The people you need to provide the service; the training and
commitment of those people; in fact all the relationships which need to be
established at every stage of the product cycle in developing and getting it to
the end user.
Physical evidence
How do you prove that you have actually delivered your
product, especially if it’s only an idea? This is especially important when
selling ideas which is why many fund raisers if trying to raise funds for a new
building will often get a model made of it to provide some physical evidence of
their product.
Processes
The policies, the systems, the order processing, the
customer involvement – maintaining the flow of the product to the market.
Not having the processes in place can often be used as an
excuse for not going ahead and it is not uncommon for charities to have lots of
good ideas to bring in a new product only to then stall if the processes have
not been agreed.
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