Delivering Services through Intermediaries and Electronic Channels - Coursework Example

Running Head: PAPER REPORT Paper report Name Institution Date Introduction There are different business journals and magazines which contains various articles on some essential aspects of services marketing such as customer behavior and marketing of products and services. This mainly in reference to the market prices and distribution services through physical and electronic channels. These aspects are essential in almost all activities of business marketing organizations as they enhance the achievement of the set goals and objectives. The study below is a report of an article on delivery services through intermediaries and electronic services found in a street journal. It focuses on the main issues discussed in the article in reference to the services marketing theory. Delivering services through intermediaries and electronic channels Objectives of the article To identify the primary channels of delivering services from the manufacturers to end consumers To give examples of the key intermediaries To view delivery process from service provider and service deliverer To identify the challenges and benefits of each method of delivery Analyses of the strategies which are considered in management of delivery of services through intermediaries Except is special situations like distance learning where by the learners learn through electronic channels mostly other services are distributed through physical channels in which the providers and consumers are expected to come into contact. Physical intermediaries are considered in the delivery of the most inseparable services so as to maintain their qualities through direct encounter between the company and customer. The two service marketers considered in all intermediaries are: service principal or originator and service deliverer or the intermediary. The principal manufacturers the services and deliverer interacts with the consumers during the process of distributing the services (Geetha, 2009 pp. 3). Service intermediaries Service intermediaries perform various functions for the services marketers; they help to fulfill the promises of the principals to the consumers as well as making services available through the provision of place and time convenient for the consumers. Different from the channels of production, the channels of manufacturer and delivery of the services are considered to be direct from the producer to the consumers through the most suitable intermediary. This is because services cannot be moved through a delivery channel because of the fear of distortion, services are intangible and perishable hence no need for a warehouse. Therefore many of the distribution channels of products are not applicable for the services. The main focus in the distribution of services is the identification of the ways of bringing customer and principal or their representative together. The retailers of goods are represented by the service organizations themselves thus they are intermediaries of the services. The services are delivered direct from the manufacturing companies to the consumers and not many channels of distribution are involved. The service principals depend on their intermediaries for deliverance of services to their specifications, these intermediaries determines the evaluation of the customer to the quality of the company of their concern. Examples of intermediaries include: dealers or franchises like retail services for the support of physical products like gas stations, automobile dealers and so on (Geetha, 2009 pp. 6). Delivery process from service provider and service deliverer Many services are distributed direct from the provider to the consumer; these are mostly the local services like dry cleaners, doctors or hair stylists whose area of distribution is limited. Others are the national chain which considers a number of outlets to reach as many consumers as possible. This considers both physical and electronic intermediaries. The physical intermediary is the best because it creates an opportunity for the company to interact with the consumers hence discuss the nature of the service in details. The electronic intermediaries are also considered as much as the physical because of their abilities to reach as much audience as possible and is convenience for the people who are not physically available like the distance learners thus they are able to acquire education as they still carry on other activities and at far distances. The content is delivered as it is encoded by the sender without much distortion although there is no chance of discussing with the receiver in case of any misunderstanding or failure to understand the content (Geetha, 2009 pp. 12). Key intermediaries in service delivery The services can be delivered from the source to the end consumers through the use of the intermediaries like brokers, franchisees, agents and electronic channels. The franchisees are allowed by the principal to deliver its unique services to the consumers, for example, the fast-food chains can use the Burger Kings to reach the consumers. The Agents and brokers represents the distributors who distribute and sell the services of an individual or a group of service suppliers, for example, insurance services, financial services or trans[port services. The electronic services involve the use of electronics like television, computers, telephone, and interactive multimedia among the others. The information and financial services are currently distributed by the use of media through the electronic mediums, bill paying, banking and education (Geetha, 2009 pp. 20). Franchising This is the most commonly considered intermediary for the distribution of services in most of the developed parts of the world. It is best applied for the services which can be duplicated and standardized by the delivery services, warranties, service policies, promotion, guarantees and branding. Franchising is therefore considered as a relationship whereby the providers of the services and the franchiser formulate and optimizes a format of services which is allowed to be delivered by the other parties (the franchisees). Benefits and challenges of each method of delivery Franchising Benefits The financial risks are shared and more working capital control of the relationship between customers through the intermediary franchisees. It minimizes the risks associated with the process of starting a business due to lack of perceived control over the high fees of operations. It is also possible to overcome national and regional brand marketing disappointing revenues and profits. It enhances the knowledge of local markets inconsistent quality. Disadvantages It is difficult to motivate and maintain the franchisees especially when the business is not performing at its best. There are many cases of high publicized disputes between the franchisees and franchisers. There is also a problem of inconsistent quality whereby some of the franchisees perform worse than others thus undermining the reputation of the company. The other common disadvantage concerns the disappointing revenues and profits since most of the people perceive the franchising to be some kind of bonanzas (Geetha, 2009 pp. 23). Agents and brokers Benefits They reduce the costs of selling and distribution process. These intermediaries are located in various and different places to communicate any information or offer services to the consumers without having to move to other places. For example, most of the financial facilities are locating their agents and brokers to different locations so as to reach as many consumers as possible hence reducing the cost of moving from one place to the other. Intermediary possession of knowledge and skills because various agents have differing skills of doing things thus they are able to differently handle the consumers. Other benefits include: wide representation of the organization, wide knowledge of the local market and –representation of multiple principals of services. Challenges The organizations are not able to control their retail prices because the customers and agents are empowered to negotiate the prices or interfere with the marketing of the services. The organization is not able to keep its private and confidential because they are forced to reveal all the information to the agents and brokers. The dependent agents represents many principals thus when selling they only give the customer what best fits them without minding the principals. This means that the services of some organizations may end up not being sold or sold in small quantities therefore the company incurs a loss (Geetha, 2009 pp. 26). Electronic channels Benefits Low costs because the channels are able to reach as mass audience as possible without having to travel or reach them. It is also convenient for the customers to access the information without having to physically avail themselves. Wide electronic channels of distribution allow the provider of the services to interact with more consumers and intermediaries. There are also quick feedbacks of the customer as the major strength of e-commerce; the consumers are allowed to make comments concerning the services which the providers on the other hand can access immediately. Challenges The process does not seem to be real due to lack of human contact. The websites used on the electronics like computers are not available in all areas especially the local places thus not all the people can access it as planned. Others may assume the information on the cyberspace because they are only interested in what concerns them. Due to the nature of unregulated media, so much unnecessary materials like pornographic and other controversial information are posted which put off some of the browsers from accessing information. It is very expensive for the organizations to publish services through the electronic channels as compared top the other intermediaries. Security of the information is minimized because once posted or announced through these channels they are intended to reach anyone who can have access (Geetha, 2009 pp. 28). While choosing the type of intermediary to use in the marketing and distribution of services it is essential to consider the theory of SMART. This mean that any intermediary should be Specific (able to achieve the set objectives), Measurable (able to assess whether it is meeting the objectives), Achievable (whether the objectives set are achievable or not), Realistic (whether the intermediary is relevant to the objectives set, Time (how fats the intermediary can achieve the objectives). Conclusion The article on Delivering services through intermediaries and electronic channels contains the most essential information for any individual or organization which is concern about the aspects of distributing services from the manufacturer to the end consumer. The article considers the possible intermediaries of distributing these services like, the agents and brokers and electronic channels. These intermediaries are discussed in details considering their benefits and challenges. Reference Geetha (2009) Delivering service through Intermediaries and electronic channels. Retrieved March, 2011 from Read More