Marketing - Branding of Services and Goods - Essay Example

1. Branding is an area where the marketing of service products and goods are, for all intents and purposes, similar if not exactly the same. Write 5 points illustrating the similarities that occur using practical examples to enhance your answer. Branding of services and goods has a lot of similarities. Services, like goods, also have logos, trademarks and symbols that differentiate them and enable the customer to build a connect with the service. However, since services are not tangible, the branding goes on the associated goods like letter heads, wrappings, boxes etc. FedEx provides services, however, they have logos on all the things that are used in couriering the goods from one place to another. This helps consumers identify the service and develop brand loyalty. Services also have a catchy slogan just like any other branded goods for instance American Airline’s “We know why you fly. Were American Airlines”. Just like goods, services are also advertised on TV, billboards and magazines etc. We see the advertisements of DHL everywhere. It is challenging however, as the features and the functions of the services are conveyed to the consumer just like in the promotion of goods. Branded services also have a brand personality just like a branded good. The consumers have a relationship with the brand for example banks like Abn Amro and Standard Chartered have an image in the minds of the consumers which the brands deliver to the consumer. This image and trust has been branded in the consciousness of the consumer. The aim of branding services just like that of branding goods is to build a connection with the consumers thus initiating customer loyalty. Consultancies have brands and logos to differentiate themselves from the crowd and to enable their clients to recognize them and to be loyal to their brand of service. 2. Buyer behavior is one way in which the marketing of goods and services differ. Write 5 points illustrating the differences that occur and provide practical examples to enhance your answer. Buyer behavior greatly varies when buying a good from buying services. Customer perception of a product serves to differentiate the product from the competition. This perception thus has to be created in a way so that the consumer thinks of the brand positively. This becomes a lot more complex in a service as every consumer has an individual interaction with the staff and thus the perceptions greatly vary. For example, Pringles will have similar experience for many consumers but the service of a consultant may be good for one but bad for the other. It is a lot more difficult and challenging to market a service as services are perishable and they cannot be stored, used later, exchanged or returned unlike goods. Thus buyers give in a lot more thought before buying a particular service and marketing services has to be a lot stronger and convincing. Marketing services relies heavily on word-of-mouth. If a patient has a bad experience with a doctor providing services, he will negatively advertise him and in turn deter many other patients. In a goods industry however, promotions are backed by advertisements, money back guarantees, refunds, exchange etc which a service industry cannot give. One bad experience dents the image for that consumer forever. Buyers require individual customer service when buying a service. This involves customizing services according to individual needs. Goods are customized but not to such an extent as services. In most cases, to buy a service, buyers need to come to the product. Services cannot be mass marketed and distributed like a brand of shampoo. Thus easy accessibility and convenience etc play an important role in determining buyer behavior. 3. Some services are referred to as being high in credence qualities. Explain the meaning behind this term and provide 3 examples of services that reflect high credence properties. Suggest one way in which management can reduce the risk associated with such services. Credence qualities are when the customer cannot judge the qualities of a product even after experiencing it. For example a customer may have difficulty in evaluating professional services such as medicine. When a customer avails a medical service like a diagnosis how will he assess if he had the best diagnosis that is available? It is not possible for him to make such an evaluation. Most library services have credence qualities. A customer asking a librarian help with referencing cannot possibly know if they got the best reference. Even the librarian is not sure if she gave the best reference. Another example of credence services is of lawyers where clients cannot assess even after experiencing the service whether they got the best solution to their problem or there are other lawyers with better solutions. One way to lessen the perceived risk of purchasing the service in consumers is by word of mouth marketing. Patients relying on what they hear about the credibility of the person diagnosing them, when a client comes to a lawyer after hearing good about him or when a client comes to a librarian after a friend has told him about how good a job this librarian does will feel less at risk. A good word-of-mouth marketing will lessen the fears of the customer and build his trust in the service. 4. Identify and provide examples of 3 benefits experienced by organizations who engage in relationship marketing Relationship marketing is a means to develop and stress on a continuous relationship between customers and the organization. Relationship marketing is becoming an integral part especially of the service industry. It is beneficial for the firm in many ways firstly by building a strong relationship with customers and providing value to customers. This gives the customers something more than the product itself and they feel that their money is well spent. This builds a connect with the customers and they wish to come back again thus strengthening brand loyalty and thus increasing profit for customer. Secondly, relationship building is integrated in marketing, services and the quality of the product. Thus with a strong customer relationship, the firm has a competitive edge and can sustain better against competition. All banks provide the same service, however customers have personal preferences mainly because of the extraordinary staff which the competing bank cannot have thus giving the firm an edge. Thirdly, relationship building is intended to make the customers more happy and satisfied. When the customers are happy, they appreciate the employees and in turn the employees are happy. The employees have a sense of achievement and job satisfaction. Thus relationship building enables a firm to have a better internal environment and a healthier place for employees to work in. this instills more dedication and loyalty in the employees and they become more productive. This of course means better use of resources and more profit generation. 1. Write an essay explaining how the method of relationship marketing called customer relationship management can be applied. Give examples of issues involved in the implementation and maintenance of an effective CRM initiative to illustrate your explanation. Customer Relationship Management is an information technology initiative that is automated and internet driven which controls the entire customer service and customer interaction. It acquires, analyses and uses knowledge about customers. The purpose of CRM is to enhance customer satisfaction and give them pleasant experiences when doing business with the organization. This in turn will increase profits of the organization. Thus firms with more interaction with customers benefit from CRM. To apply CRM in the firm the firm, it has to firstly be in line with strategic objectives of the firm. The senior management should be committed and help in establishing the system. Firstly, in the planning phase, the points of interaction with the customer are noted and reassessed. The customer information from here has to be recorded into the information system which is the job of the IT managers. From this data, information about customers that will help managers make better decisions has to be identified. The firm then has to identify the needs of the organization to implement CRM. These include the organizational structure, hardware, software etc. Also, the data should be well organized, easily accessible by employees and support other systems like DSS, ESS and ES. CRM can only be implemented when the employees are well trained and know how to collect data and how to utilize the data collected. Many problems occur with the implementation of CRM. Firstly the employees may not be adequately trained and informed about its workings. They sometimes cannot handle large information and data which hampers operation. The employees do not understand the importance of technology and rely on old systems of collecting data like talking to customers and other people (even if the knowledge of the employees is limited). The kind of CRM has to be customized according to customers. A firm cannot have the same form of CRM for the customers at KFC and the suppliers of the firm. Also, it is not user friendly at times and the customers who are not comfortable with using technology may be hesitant. Employees and managers tend to overuse CRM and in the process harm instead of benefiting the firm. If the system is too automated, the customers may not feel comfortable especially when calling customer service of a bank, a customer may have to press several buttons and talk to an automated voice when he wants simple information. CRM has to be integrated into the business goals and objectives. The implementation of CRM may fail if there is no proper executive handling the responsibility of implementing the system in the firm. A person or a team has to direct the other employees and ensure that there is proper implementation of the system. Problems may occur when filtering information and the capability of the employees to use the data efficiently for effective decision making. The whole system becomes useless if the data is collected but is not utilized for strategic purposes. The data is accessible to all which means it poses a lot of security issues which a firm may ignore and thus important information could go in the wrong hands. Lastly, firms do not follow-up after the implementation of the system like customer feedback is not taken on the system and thus the system is not improved according to customer needs and customers remain dissatisfied. 2. Identify and discuss the importance of EACH of the seven elements of the services marketing mix. Use examples to illustrate how each one can be used to create value for the customer. The services marketing mix involves more than the traditional marketing principles. An intelligent marketer integrates all these principles to enhance his marketing efforts. A marketer should at least deliver its customer what his service promises to deliver. A promise or the product is defined as the offer that is made to the customer by the provider of the service. This is the expectations the customer will have once he goes to get the particular service. If the service provider fails to deliver what they promise, the consumer will have a negative image of the brand. For example Citi bank had the slogan “Citi never sleeps”. This built an image that the bank will provide services for 24 hours and the service will no doubt be consistent through the day. However, if no one answers a phone call of a customer at night, this will negatively impact the consumer and he will think that the organization will not keep their promise when they purchase their services. The customer will be disappointed and will not trust the brand. To build the confidence of the customer in the brand, the service provider should explain in detail the processes and procedures that are involved to deliver the service to him. For example, a customer will feel a lot safer in the hands of a doctor when his qualification and specialization is known and perhaps the procedures the doctor will use to diagnose and cure him. This builds the trust and confidence of the consumer. The price is the value of the service in monetary terms that the customer must pay in order to get the service. The price in a service industry may vary but it depends on the industry. For example a consultant may charge a loyal customer less and charge a new customer more. However, this can’t be true for a service industry like DHL where the rates are fixed. The customers may even be willing to pay more for better services. Like the fares of airline vary with different brands but regular flyers prefer their own brands and willingly pay more for better comfort. An important element of the marketing mix is the promotion of services. This is when the services are advertised and promoted to attract more customers. Since the product is not tangible promoting the service becomes essential and at the same time tricky. Different media like the electronic, TV and print are used to promote it. However, a very powerful mode of promotion is via word of mouth. Promotion of a brand also depends on how the staff makes customers aware of the features of the product and informs them of new product ranges. This builds a relation of the customer with the brand. The place where the service is available is of essence and easy accessibility and visibility will ensure more customers. The customers should know where all the products are available. This also includes the partners involved in providing the service. Physical evidence of the services involves the material part of the service. This is when the consumer relies on physical cues like packaging, web pages, brochures, business cards etc as there is no tangible form of the service itself. These play an important role in building a tangible feeling for the consumer and enables better association. People in a service industry are the most essential marketing element. The staff is the one who has direct interaction with the customers. They help in forming an impression of the brand. The consumers see them as one of the tangibles of the service itself. They can add the extra touch and enhance the value of the service providing customer satisfaction and thus brand loyalty. 3. Write an essay on why the integration of marketing, human resources and operations is important to the success of the production and delivery of services. Give examples to illustrate. Marketing of services is very important for the business. In fact services require more marketing efforts as there are no tangible goods and they are more challenging to market. For example, we see advertisements of banks insurance firms like American Insurance Group (AIG) everywhere. Marketing strategies have to be developed so that customers are aware of the services a firm is offering and what value he is getting for the money he spends. It is important to build a relationship with the customer and build a positive image of the service by promotions like advertising, brochures, word of mouth etc. representatives from beauty salons call clients to inform them of new packages and services available. How these services are made available to customer is also important for example online, in outlets etc. Marketing of service is essential to attract customer to the service and to survive in a competitive market. Marketing gives information about the behavior of consumers and customers like collecting information and feedback from customers. Marketing enables the firm to make future forecasts and ultimately grow the business in the right direction. The human resource is a key element in the service industry. This is because they are the ones who interact with customers and provide them information and enhance relationship with customers. The human resource has to be well trained for example in a beauty salon so that the customer feels comfortable and in safe hands. They should be well informed so that when a customer inquires they should give prompt information like employees of a Call Center. The human resource is what makes the service tangible. Since the service experience varies with every customer and service provider, how the HR interacts with the customer plays a crucial role in satisfying him and making him loyal to the brand. At the same time, the employees have to be satisfied in their job so that they can in turn make the customer happy. Thus for a service to be successfully delivered to the customer, employees have to have a congenial workplace. The operation is essential in making the firm keep the promise the product makes to the customer. For example a travel agent selling a holiday package to a customer promises a certain rate of hotels, with complementary breakfast, and rebated transport. Now the operations of the firm have to ensure that rooms in that hotel are available and that they give complementary breakfast to their customers. They also have to coordinate with transportation facilitators and arrange for discounts within the specified time. If the operations fall short, the service will not be delivered as promised and will not be timely which will make the customer dissatisfied leading to a loss for the firm. Thus marketing efforts, employees and the operations have to be integrated and work in conjunction so that the service is successfully produced and delivered to the customer building trust and satisfying the customer. Read More