What are the characteristics of services that make them unique from product?

According to this article, you could get marketing assignment help to implement in the further development of the growth pf service markets.

In our last post, we discussed “How you can Successfully Market your Services“. Today, we are going to examine the 5 major unique characteristics of services or classification of services in service marketing which are;

• Perishability,  
• Intangibility,  
• Variability,  
• Inseparably and
• Non-ownership

Perishability

Perhaps of all the suggested special characteristics of service products or classification of services, this is one of the most difficult to appreciate. Why? Services are highly perishable compared to physical products. But how could, for example, the services of say, an airline be considered to be more perishable than, say, fresh food and vegetable products?

The reason is that, unlike most physical products, many services cannot be stored. For example, if an airline does not sell all the seats on a particular flight, then those seats, or rather the sales revenue of filling of them would have carried, has immediately and irreversibly gone.

Intangibility

Physical products in the store are widely displayed for customers to see, feel, touch, weigh, or sniff at before deciding whether or not to buy.

Comparing this with the choice of the service of say, an insurance policy. You cannot touch, see or smell the products before choosing, although clearly, you can make some assessment based on past experience, word of mouth, or even the location and decor of the insurance office. The intangible nature of most services gives rise to special problems both for suppliers and consumers.

Variability

In the production and marketing of physical products, companies have increasingly paid special attention to ensuring consistency in quality, feature, packaging, and so on.

More often than not all customers can be sure that every bottle of Coke he/she buys, even in a lifetime of purchases, will not vary. The provision of services, however, invariably includes a large measure of the “human element”

Indeed, with many services, we are purchasing nothing else but the skills of the suppliers. Because of this, it is often very difficult for both supplier and consumer to ensure a consistent “product” or quality of service.

Inseparability

A key distinguishing feature of service marketing is that the service provision and provider are inseparable from the service consumption and consumer.

For example, we cannot take a hotel room home for consumption; we must “consume” this service at the point of provision. Similarly, the hairdresser needs to be physically present for this service to be consumed.

This has implications both for channels of distribution and scale of operations.

Non-ownership

The final distinguishing feature of a service is that, unlike a physical product, the consumer does not secure ownership of the service. Rather the customer pays only to secure access to or use of the service.

Again the hotel room is a good example. Similarly, with banking services, although the customer may be given a Cheque book, credit cards, etc, they serve only to allow the customer to make use of what he or she is actually buying, namely, bank services.

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The service sector is growing rapidly worldwide. Majority of developed and developing countries experience the development of many service industries, which participate significantly in the national economies.

P. Kotler suggested that ”service is an activity or benefit that one party can offer to another that is essentially intangible and does not result in the ownership of anything. Its production may or may not be tied to a physical product”.

There are four characteristics of service: Intangibility, Inseparability, Variability, and Perishability (Kotler and Keller, 2007).

• As service's nature is intangibility, therefore manufacturing and service delivery is more complex than a product.
• Inseparability is a significant characteristic that distinguishes a service from a     product according to the simultaneous production and consumption.
• Due to the service's variability, it's difficult to be controlled, because it greatly relies on the service's provider, moreover when, where and how it's provided.
• Perishability is one of the major characteristics of service, that it can't be stored for later use or sale (No inventory).

In order to deliver the overall service offer to a target market, the marketing mix elements should be coherent, coordinated, integrated and consistent with each other to produce the synergistic effect of them. (Lovelock, 2001).

The main objective of service marketers is to create and provide service that satisfies consumer needs and expectations, therefore achieving organizational goals.  Consequently, marketers should work on understanding how people make their buying decisions and what determines their satisfaction during the service consumption stages: pre-purchase, service encounter, and post-encounter.

To gain  a competitive advantage in the  global market, successful organization should adopt the marketing strategy (overall cost leadership / differentiation / focus) that is based on the marketing concept which holds that the key to achieving company’s organizational goals is being more effective than competitors in creating, delivering, and communicating superior customer value to target customers, and therefore ensuring profits through customer satisfaction.

The positioning of services is even more important than the positioning of goods because services tend to be intangible, so differentiation becomes a key issue in making the service distinctive in the perception of the customer's mind. Positioning is concerned with the identification, development, and communication of the attributes which a service company intends to use to make its market offering recognizable and superior to the competing services.

A customer-focused organization requires improving service quality as a critical element of differentiation. It's related to the long-term evaluation of the service performance and is crucial to customer satisfaction which is the difference between perception and expectation, moreover, customer satisfaction will become a key factor for business success in the future.

In order to develop long-term relationships, it is necessary to build customer involvement, commitment, and trust. In service companies focused on building loyalty, customer service plays an important role in their marketing strategies and is an essential element in creating service quality and customer satisfaction.

An organization which strategy focuses on delivering service excellence was more successful. This era is the era of customers and for the success and survival in this competitive market, organizations should emphasize on quality service and this should be integrated into the strategy (Chowdhary and Prakash, 2007).

Author: Hend Hassan, lecturer at LIGS University

References

Chowdhary, Prakash, (2007) "Prioritizing service quality dimensions", Managing Service Quality: An International Journal, Vol. 17 Issue: 5, pp.493-509, https://doi.org/10.1108/09604520710817325

Kotler, P., and Keller (2007) A Framework for Marketing Management 3rd ed. New Jersey: Prentice Hall.

Lovelock, C.H., Patterson, P.G. and R.H. Walker, (2001). “Services Marketing: An Asia-Pacific Perspective”, 2nd edition, Prentice Hall, NSW.

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