The Marketing of Services - Essay Example

The Marketing of Services Introduction Book shops in the UK are business s that sell books on the retail market, but more than that they occupy a special place in society because they “offer a sense of community that Amazon cannot match” (Singh, 2014:1). The independent book shops in London include Daunt Books, specialising in travel and literary books; Lutyens & Rubinstein, specialising in fiction and general non-fiction; Goldsboro Books, specialising in signed first editions; Forbidden Planet, science fiction, fantasy and cult entertainment; and Claire de Rouen Books, photography and fashion (Dalton, 2014:1). These stores have been under considerable pressure lately due to the threats posed by eBooks and online book retailers, particularly Amazon (Singh, 2014:1). 2. Service challenges There are five service characteristics of service marketing; these are perishability, intangibility, variability, inseparability, and non-ownership (Lamb, et al., 2014; Mandal, 2014). 2.1 Perishability This characteristic refers to the inability to store a service, thus if a service is not availed of it perishes with the passage of time. The service provided by book shops is the location of the desired books, given the title and topic by the customers, and making these books available to them. Once the customer leaves the store, the service perishes. As such, this does not pose much challenge to the industry because the sale porincipally involves a tangible, the book sold. 2.2 Intangibility While physical goods are capable of being displayed and be subjected to customers’ inspection through sight, smell, touch, measurement as to weight, height, and other dimensions, before the decision to buy is made. The same is not true of service, which could not be scrutinised before purchase because it is intangible and exists only at the time it is delivered to the customer. In the case of book shops, while the books themselves are tangible goods that the customer can anticipate and examine, the manner by which the customers are matched with their desired book is the intangible service, and it is this aspect where challenges arise concerning locating the right book for the right customer. 2.3 Variability Most goods could be manufactured with a great deal of consistency in their quality, features, packaging, and the other aspects that define it. However, services are created by human beings who tend to vary in their execution of the activities that comprise the service. In the book shop, the considerable human element that is prone to errors makes the outcome of the service encounters variable. Each customer who walks in the shop is attended to in a different manner by the contact personnel; the challenge is to deliver the same quality of service experience, although the customers are diverse and have different predispositions and needs to be fulfilled. 2.4 Inseparability In service marketing, the service provider and the delivery of the service product cannot be separated from the consumer and his/her consumption of the service. The service provider undertakes the physical acts that comprise the service – from greeting the customer upon entry to the shop to seeing them off after the visit. The service experience may be shared by more than one individual, i.e. the contact person may lead the customer to the shelves, a senior may answer questions about the contents of certain books, and the cashier may ring up the payment. However, attendance to the customer cannot be separated from the service personnel. 2.5 Non-ownership Unlike physical products, the consumer cannot acquire ownership of the service; instead, what the customer purchases is access to or use of the service. In a book shop, the customer does acquire ownership of the book purchased, but ever the service provided by the store personnel. 3. Assessment of operations 3.1 The services marketing triangle The services marketing triangle specifies three types of marketing tasks: internal marketing, external marketing, and interactive marketing. Internal marketing involve marketing issues between the organisation and the employees who provide the service to the customers, external marketing are matters between the organisation and the customers, and interactive marketing pertain to the interactions between the customers and the contact persons/service providers. As part of internal marketing, the employees of book shops should be provided training not only in handling clients but also on the contents of the books they sell, sufficient to answer customers’ questions. For external marketing, the book shop often attends to customers in a perfunctory manner, at times failing to systematically address requests for books out of stock and giving a date when such will be replenished. Finally, interactive marketing will be much improved if personnel would develop a greater sensitivity towards clients’ needs, if they were thoroughly familiar with the arrangement of books on the shelves, and if they could advise customers of alternative books if the specific titles they asked for are not available. 3.2 Four factors of the Servuction Model 3.2.1 Contact personnel/service providers This aspect of the customer’s experience involves the service providers and contact personnel who interact directly with the customer. The contact personnel tend to briefly interact with the customer, while the service providers are the principal providers of the core service (Hoffman & Bateson, 2011:10). As earlier explained under inseparability, there may be more than one individual involved in serving book shop customers, which may in one sense be advantageous since allowing for specialisations enhances the quality of service to the customers. 3.2.2 Servicescape The servicescape refers to t the use of physical objects or elements to design service environments. These include ambient conditions (temperature, music), inanimate objects (furnishings and equipment), and other physical evidence (signs, symbols, artifacts) (Hoffman & Bateson, 2011:9). Brick and mortar book shops will better enhance the service experience if they are conducive for customers to engage with the merchandise. In some book shops, sitting areas with comfortable furnishings and allowing customers to casually scan books enhances the servicescape and the service experience itself. 3.3.3 Other customers These are the other customers who avail of the service simultaneously with the client under focus, and who form part of the service experience and provide a profound input to it (Hoffman & Bateson, 2011:10-11). This does not seem to be a concern in book shops since customers are generally and quietly absorbed in their own book searches. 3.3.4 Invisible organisations and systems These are the structures that support the visible components of the servuction model; they include the rules, regulations and processes upon which the organisation delivering the service is based, and which profoundly affect the service experience (Hoffman & Bateson, 2011:11). In the book shop industry, important systems are the financial and human resources management systems, but more directly the logistics and supply chain systems are the most vital in improving the servicescape. Determining what titles, how many, and when to order to stock the shelves is key to attracting customers. When a title is in strong demand, good timing, terms, and delivery arrangements of succeeding orders with suppliers could be a source of competitive advantage. 4. How the industry has changed over time The manner in which an industry changes over time can be described in terms of the interplay of two dimensions: the degree of interaction and customization, and the degree of labour intensity of the service provided. This is graphically rendered in the form of a matrix which is shown below (Inman, 2015). For book shops, the degree of interaction and customization is high, because each customer has a different need when looking for books, and therefore they have to be attended to individual by the contact personnel or service provider for the duration of their search and purchase. However, the degree of labour intensity is low. At the most, the contact person/ service provider will answer a few questions, lead the customer to the book on the shelf, and then lead them to the payment counter, probably ring up the payment in the case of very small stores. Thus, according to the matrix the traditional book shop industry provides mass service to the market. Through the years, the influx of technology has enabled the retail selling of books through online vendors. Some businesses are purely online book retailers, while others are brick-and-mortar book shops which have adopted online book sales to enhance their main business. The use of IT in book sales has lowered the degree of interaction and customisation because of the automation. For the online service, degree of labour intensity is still low, particularly because IT handles the ‘labour’ of matching customers with their books, reducing the need for personal service. Online book sellers have therefore assumed the nature of service factories, with service becoming more distant and impersonal, but also more efficient and exact. Source: Inman, 2015:1 5. Proposed measures of service quality 5.1 Face-to-face interaction One metric is of course the number and nature of consumer complaints, however one should pre-empt complaints by providing quality service proactively. The best measures for customer satisfaction would be obtained through a feedback form to be given to customers and for them to accomplish with their honest reactions. Other metrics include the speed with which a client is attended to, the number of times clients are able to find the titles they are searching for, and the type of books (e.g. fiction or non-fiction, subject) that move fastest. 5.2 Interaction mediated by technology This may apply either to online book vendors as well as traditional stores with e-commerce capability. Measures of service quality include search times, ease of use, aesthetic design, processing speed, and security (Yoo & Donthu, n.d.). 6. Comparison of 2 providers as to extended marketing mix (8 Ps), face-to-face and using technology To highlight the current state of the book retail industry in the UK, comparison shall be made between online book retailer Amazon and an independent book shop, Lion & Unicorn Bookshop in Richmond, south-west London. Amazon’s prices were lower than L&U, and it also has a wider array of products compared to the latter which specialises only in children’s books. Amazon has greater access to customers online and has strong advertising appeal, while L&U has to pay a high rent for its space while parking charges deter customers; and promotions consist of flyers and word-of-mouth (Singh, 2014). L&U’s people provide excellent service, recommending books and knowing customers by name, while Amazon has no face-to-face encounters. The process at Amazon involves selections made on a PC or mobile device; that of L&U is quite leisurely, with the customer selecting books off the shelf, and sometimes even sitting in the corner and having a cup of tea. As for positioning, Amazon is an industry leader while L&U undertook niche marketing, specifically for children and families as they specialised in children’s books. In terms of positioning or productivity, Amazon enjoyed strong revenues and hefty profits due to economies of scale; L&U, on the other hand, suffered dwindling sales until it had to shut down after 36 years of business (Singh, 2014). L&U’s case represents the plight of most independent book shops, 67 of which closed in 2013 and another 65 in 2012 due to business lost to Amazon and other online book retailers (Flood, 2012; Singh, 2014). 7. Recommendations The change taking over the book shop industry is an insurmountable disruptive innovation that will eventually take over much of the business, although there will remain a niche for the book shop. To survive, the independent book shop should find a strategy to cater to a readership that prizes the physical ownership of books. Service-wise, providing customers the sense of community and social gatherings will be a strong incentive to entice customers to repeatedly visit the store. Another service may be attached to the simple selling of books, such as partnering with a branded coffee service to operate within store premises – people could converge socially while leisurely looking over the merchandise. While the online retailer offers fast but impersonal service, the book shop will do well to adopt the opposite strategy – providing a people-intensive experience for the enjoyment of books for special interests. References Dalton, D 2014 ’14 Beautiful Independent Bookshops in London.’ BuzzFeed. 2 July. Retrieved 13 March 2015 from http://www.buzzfeed.com/danieldalton/beautiful-bookshops-london#.byjL21m1Z Flood, A 2012 ‘Independent bookshops in crisis, as ebook sales rise.’ The Guardian. 19 June. Retrieved 13 March 2015 from http://www.theguardian.com/books/2012/jun/19/independent-bookshops-in-crisis-ebooks Hoffman, K & Bateson, J 2011 Services Marketing: Concepts, Strategies & Cases. Mason, OH: South-Western Cengage Learning Inman, RA 2015 ‘Service Process Matrix.’ Reference for Business, Encyclopedia for Business. Retrieved 13 March 2015 from http://www.referenceforbusiness.com/management/Sc-Str/Service-Process-Matrix.html Lamb, C; Hair, J; & McDaniel, C 2014 MKTG 8. Mason, OH: South-Western Cengage Learning Mandal, P 2014 Proceedings of the International Conference on Managing the Asian Century. Singapore: Springer Science + Business Media Singh, A 2014 ‘Decline of the independent bookshop as UK figures fall below 1,000 for first time.’ The Telegraph. 22 February. Retrieved 13 March 2014 from http://www.telegraph.co.uk/culture/books/booknews/10654506/Decline-of-the-independent-bookshop-as-UK-figures-fall-below-1000-for-first-time.html Yoo, B & Donthu, N n.d. ‘Developing a Scale to Measure the Perceived Quality of an Internet Shopping Site.’ Quarterly Journal of Electronic Commerce, 2, 1, pp. 31-47. Appendix Servicescape for Lion & Unicorn Bookshop, Richmond Children reading Harry Potter books in the Lion & Unicorn Bookshop in Richmond, which closed down in 2013 (Singh, 2014:1). Read More