Service Marketing Solved Paper May 2019, Dibrugarh University B.Com 6th Sem CBCS Pattern

Service Marketing Solved Question Paper May' 2019
2019 (May)
COMMERCE (Speciality)
Course: 403 (Service Marketing)
Time: 3 hours
The figures in the margin indicate full marks for the questions
(NEW COURSE)
Full Marks: 80
Pass Marks: 24

1. State whether the following statements are True or False:      1x8=8

a) Services refer to social efforts which generate the satisfaction of an individual.

Ans: False

b) The marketing environment is the external environment.

Ans: False, it includes both internal and external environment

c) SWOT stands for strengths, weaknesses, opportunities, and threats.

Ans: True

d) Customer perception is not main factor that determines the customer evaluation of services.

Ans: False

e) SLC stands for the service life cycle.

Ans: False, Software Life Cycle

f) Market segments are measurable.

Ans: True, Market segments are measured in terms of sales value or volume

g) Perceptual mapping produces a picture or map of a market.

Ans: True

h) Selling the services by contacting customer through telephone is known as telemarketing.

Ans: True

Also Read:

2. Write short notes on any four of the following: 4x4=16

a) Perception.

Ans: The term “perception” can be defined as the ability to derive meaning. Derived from the word “perceive”, it refers to the ability of giving meaning to whatever is sensed by our sense organs. It is the process through which an individual interprets ones’ sensory impressions to give meaning to them. Schiffman defines it as “the process by which an individual select, organizes, and interprets stimuli into a meaningful and coherent picture of the world.”

Perception is the process of selecting, organizing and interpreting information inputs to produce meaning. A person receives information through the senses: sight, taste, hearing, smell and touch. How and what consumers perceive strongly affect their behaviour toward products, services, prices, package designs, salespeople, stores, advertisements and manufacturers.

Nature of perception:

1. Perception is a complex process. After a stimulus is detected by the sense organs, the perception process comes into play and involves the interplay of three processes, viz., selection, organization and interpretation. It is a dynamic process.

2. It is also an intellectual process; it involves a lot of cognitive effort. Once sensation takes place, the perception process involves the selection, organization and interpretation of data.

3. Perception is broad in nature; it includes a physiological component (through sensation), as well as sociological and psychological components.

b) Market sophistication.

Ans: Market Sophistication: Changes in the information sector is driving the sophisticated changes in the market where customer expectations are all time high. Changing westernized life styles has changed the hierarchy of needs and requirements of the individuals. The living conditions, food habits, the dresses and hair styles are changing. In nut shell the customers today are facing a whole new range of services available to them. Example – Opening up of fast food eating joints such as McDonalds, KFC, Domino’s and family day care are the end results of market sophistication.

c) Professionalism in education.

Ans: Professionalism in Education: Success of any organization more or less depends on the human assets which that organization has, hence the concept of employee reliability and performance orientation is gaining ground. The changing corporate culture advocates the presence of excellence in the work force which can only be achieved by imparting professional knowledge through professionally trained employees. The organizations that impart professionalism and the institutions preparing professionally sound human resources would get a profitable opportunity in this changing scenario. Excellence, perfection, professionalism would be the attractions which would require development of world class educational institutions for almost all the disciplines. Examples, Harvard Business School University of Leeds, IIM figure 1.6. This has encouraged the development of tourism services, hotel services, banking services, insurance services, communication services, entertainment services, educational services Medicare services, consultancy services, and personal care services to gain ground.

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d) Customer expectation of services.

Ans: Customer Expectations are the needs, wants, and preconceived ideas of a customer about a product or service. Customer expectation will be influenced by a customer’s perception of the product or service and can be created by previous experience, advertising, word of mouth, awareness of competitors, and brand image. The level of customer service is also a factor, and a customer might expect to encounter efficiency, helpfulness, reliability, confidence in the staff, and a personal interest in his or her patronage. Knowing what the customer expects is probably the most critical step in delivering service quality. If an organization is able to understand and meet customer expectations, then customer satisfaction may be easily attained.

Types of Customers Expectations: Customer’s service expectations largely depend upon the reference points of an individual customer that is why from a single point of service different customers hold different expectations. Depending upon varied reference points, service expectations can be divided into different levels or types that are:

a)      Ideal service level: Ideal level of a service may be explained as a “dream service”. This is the kind of a service a customer would expect in ideal situation and will generate a delightful service experience.

b)      Desired service level: Desired service is the “wished for” level of service quality that a customer believes can and should be delivered. This is the level of service a customer would expect in normal circumstances.

c)       Adequate service level: It is the minimum level of service that a customer will accept without being dissatisfied. It may not be the best but bare minimum a customer would accept.

d)      Predicted service level: It is the level of service quality a customer believes a firm will actually deliver.

e) The service concept.

f) Features of tourism.

Ans: Marketing in tourism is the systematic and coordinated execution of business policy by tourist undertakings. The tourist undertakings may be private or state owned at local, regional, national and international levels. In the words of Burkart and Medlick "tourism marketing activities are systematic and coordinated efforts extended by National Tourist Organisation and or tourist enterprises at international, national and local levels to optimise the satisfaction of tourist groups and individuals in view of sustained tourist growth”.

From the above, the following points can be understood:

(i) Tourism marketing is a process of creating a product or service.

(ii) It comprises fact finding and marketing research.

(iii) Tourism marketing aims at transforming potential tourists into the actual tourists.

(iv) It is confined to generating demand and increase of market share.

(v) Tourism marketing is a managerial process involving a sequence of activities aiming at customer satisfaction.

3. (a) What is services? Discuss approaches to study services.    3+11=14

Or

(b) Describe the reasons for growth of service sector in India.    14

Ans: Reasons for growth of Service market in India

Phenomenal growth has been witnessed in the service sector in the past one decade. Both the developed as well as the developing countries have been making multidimensional efforts to market services in a right fashion. Innovative efforts have been devised both by the public and the private sector organizations to market services. The multi-faceted developments in the service sector and intense competition generated by the well-established multinational and global corporations have been engineering a strong foundation for the application of modern marketing principles in the service marketing. Some of the potential reasons that have encouraged the growth of service sector are:

1.       Increased disposable income: Over the years as the Indian economy has grown the disposable income of masses has also shown an upward trend. Such a trend is also found in the developed as well as the developing countries. Developing countries like ours where the development oriented sector has opened new job opportunities and the liberalization of economy is opening new vistas, service marketing has become even more pertinent. The development of corporate sector makes way for the transformation of industrial economy because as the economy grows masses get an opportunity to earn more and when they earn more, it is quite natural that they want to spend more. The positive developments in the development sector thus open doors for an increase in the disposable income e.g. Theme Parks such as Essel World.

2.       Specialization: Specialization is the end result of the Division of Labour where individuals specialize in their respective fields. The in depth analysis of business shows that in reality it is the specialization and perfection that is driving the global economy. As the level of sophistication in the economic transformation process is increasing, advanced specialization in respective fields is the need of the hour. The organizations have now no option but to promote specialization since this helps them in making possible cost effectiveness. Exports and professionals like the management consultants, legal advisers, financial experts, technocrats play a decisive role in managing the affairs of an organization. Thus it would be right to mention that due to increasing specialization, a new breed of the service generating organizations is emerging, e.g. Tata consultancy agency provide tailor made solutions for top corporate problems. Another example can be of the consultancy services which provide expert guidance to corporate clients.

3.       Upcoming Fashion trends: New development in the corporate culture and the emergence of a well-established services sector has influenced and changed the lifestyles of masses. People are receptive towards the new trends in the fashion that has resulted in the emergence of new tailor made service sectors such as hair dressing saloons, beauty parlour, jogging and fitness centres. It is not only the globalization of the industrial sector but even the globalization and westernization of culture, craze for western living conditions, temperament and values that show a big impact on the society, e.g. professionally organized fitness centres such as Health clubs.

4.       Information Boom: Recent inventions and innovations in the field of communications have bridged the gap in the global markets. It is the developed countries that are making efforts to build a superhighway for communications. The tremendous opportunity generated by new developments in the field of communications has influenced almost all the sectors, specifically the service sector. Dramatic changes have emerged in the advertising, fashion and professional services due to the developments in the information sharing and broadcasting. Example Interest & e-mail.

5.       Market Sophistication: Changes in the information sector is driving the sophisticated changes in the market where customer expectations are all time high. Changing westernized life styles has changed the hierarchy of needs and requirements of the individuals. The living conditions, food habits, the dresses and hair styles are changing. In nut shell the customers today are facing a whole new range of services available to them. Example – Opening up of fast food eating joints such as McDonalds, KFC, Domino’s and family day care are the end results of market sophistication.

6.       Professionalism in Education: Success of any organization more or less depends on the human assets which that organization has, hence the concept of employee reliability and performance orientation is gaining ground. The changing corporate culture advocates the presence of excellence in the work force which can only be achieved by imparting professional knowledge through professionally trained employees. The organizations that impart professionalism and the institutions preparing professionally sound human resources would get a profitable opportunity in this changing scenario. Excellence, perfection, professionalism would be the attractions which would require development of world class educational institutions for almost all the disciplines. Examples, Harvard Business School University of Leeds, IIM figure 1.6. This has encouraged the development of tourism services, hotel services, banking services, insurance services, communication services, entertainment services, educational services Medicare services, consultancy services, and personal care services to gain ground.

4. (a) What is customer expectation? Explain the factors that influence customer expectation of service.   3+11=14

Ans: Customers Need and Expectations

Customer Expectations are the needs, wants, and preconceived ideas of a customer about a product or service. Customer expectation will be influenced by a customer’s perception of the product or service and can be created by previous experience, advertising, word of mouth, awareness of competitors, and brand image. The level of customer service is also a factor, and a customer might expect to encounter efficiency, helpfulness, reliability, confidence in the staff, and a personal interest in his or her patronage. Knowing what the customer expects is probably the most critical step in delivering service quality. If an organization is able to understand and meet customer expectations, then customer satisfaction may be easily attained.

Factors affecting Customers expectations

1)      Internal Factors: the internal factors that impact consumer expectations include individual needs, level of involvement, past experience, and service philosophy. Individual needs influence the consumption values a consumer will expect from a service. For example, someone who is extremely hungry will expect more in terms of quantity of food that is the functional value, than someone who is dining with a significant other. In the latter case, quality of service and aesthetics will be more important. He or she may be looking for social or even emotional consumption benefits. Level of involvement will impact consumer expectations.

2)      Situational factors: Consumer expectations are often modified by situational factors. For example, the reason for the purchase will often modify expectations. A business that uses a commercial employment agency to hire a high level executive will have different expectations than if they were hiring a dock worker to load trucks. Their ideal, desired, and adequate service levels will all be higher. They will expect the firm to spend more time in screening applicants in the former case. Consumer mood will affect expectations. Individuals who are in a joyful, positive mood normally have lower adequate service expectations than an individual who is in a bad, negative mood. The ideal and desired levels of expectations are not normally affected. The predicted level may be a person in a bad mood will often predict they will receive poor service. Weather may be a factor for a couple of reasons. One reason is that weather affects peoples, mood, which in turn, will affect what they expect. Second, weather itself will modify expectations. In foggy, snowy, or heavy rain, passengers expect airline flights to be delayed.

3)      Firm produced factors: Firm-produced factors include promotions, pricing, distribution, service personnel, tangible cues, other customers, firm image, and pre-service waiting. Examples will vary but here are the ways that expectations would normally be effected. Promotions by a service organization will affect the predicted level of expectations. It may have an impact on the desired level, but seldom will it affect the ideal level. Adequate level of expectations may be raised if consumers are promised a certain level of service by advertisements or sales personnel. Pricing normally has a direct impact on expectations. As price increases, expectations increase. Distribution will affect the predicted service level and may impact the adequate, but seldom impact the ideal or desired. Service personnel can affect all four. Promises or communication by the service personnel of the service can modify any of the expectations either upward or downward. Tangible cues normally only affect the predicted. Other customers normally impact only the predicted although they may have an impact on the other level of expectations depending on what they say or do.

4)      Competition Factors: The competitive options available to consumers will impact their desired and adequate level of consumer expectations. Normally the ideal and predicted levels are not impacted. A business firm that has ten competent accounting firms from which to choose will normally have higher expectations than a business firm which has only four from which to choose. The desired level will change because there are alternative available that can supply the service. The minimum level of expectations will increase because there are other competent firms than can perform the service at a higher level. Thus, competition normally drives expectations upward.

Or

(b) Define Target Market. Explain various approaches towards target market.                   4+10=14

5. (a) What is Pricing? Explain various strategies used for pricing the services.                    4+10=14

Ans: Price is defined as the amount we pay for goods or a service or an idea. Price is the only element in the marketing mix of a firm that generates revenue. All other elements generate only cost. Price is a matter of importance to both seller and buyer in the market place. Only when a buyer and a seller agree on price, we can have exchange of goods and services leading to transfer of ownership.

The term ― Price need not be confused with the term ― Pricing. Price is the value that is put to a product or service and is the result of a complex set of calculations, research and understanding and risk taking ability. But pricing is different from price. It refers to decisions related to fixing of price of a commodity. A pricing strategy takes into account segments, ability to pay, market conditions, competitor actions, trade margins and input costs, amongst others. It is targeted at the defined customers and against competitors. 

Pricing Methods

There are several methods of pricing and they can be grouped into few broad categories: -

(1) Cost Based Pricing

(2) Demand Based Pricing

(3) Competition Oriented Pricing

(4) Value Pricing

(5) Product Line Oriented Pricing

(6) Tender Pricing

(7) Affordability Based Pricing

(8) Differentiated Pricing.

(1) Cost Based Pricing: Under the cost based pricing, different methods used are: -

Ø  Mark Up Pricing

Ø  Absorption Cost Pricing

Ø  Target Rate of Return Pricing

Ø  Marginal Cost Pricing

Mark Up Pricing: It refers to the pricing methods in which the selling price of the services is fixed by adding a margin to its cost price. The mark ups may vary depending on the nature of the service and the market. Usually, the higher the value of the service, the larger is the mark up.

Absorption Cost Pricing: ACP rests on the estimated unit cost of the service at the normal level of production and sales. The method uses standard costing techniques and works out the variable and fixed costs involved in manufacturing, selling and administering the product. By adding the costs of operations, we get the total costs. The selling price of the product is arrived by adding the required margin towards profit to such total costs.

Target Rate of Return Pricing: It is similar to absorption cost pricing. The rate of return pricing uses a rational approach to arrive at the mark up. It is arrived in such a way that the ROI criteria of the firm are met in the process. But this process amounts to an improvement over absorption costing since it uses a rational basis for arriving at the mark up.

Marginal Cost Pricing: It aims at maximizing the contribution towards fixed costs. Marginal costs include all the direct variable costs of the product. In marginal cost pricing, these direct variable costs are fully realized. In addition, a portion of the fixed costs is also realized under competitive market conditions marginal cost pricing is more useful.

(2) Demand Based Pricing: The following methods belong to the category of demand / market based pricing:

Ø  What the Traffic Can Bear’ Pricing

Ø  Skimming Pricing

Ø  Penetration Pricing

What the Traffic Can Bear’ Pricing: The seller takes the maximum price that the customers are willing to pay for the product under the given circumstances. This method is used more by retail traders than by manufacturing firms. This method brings high profits in the short term. But in the long run it is not a safe concept, chances of errors in judgment are very high.

Skimming Pricing: This method aims at high price and high profits in the early stage of marketing the product. It profitably taps the opportunity for selling at high prices to those segments of the market, which do not bother much about the price. This method is very useful in the pricing of new products, especially those that have a luxury or specialty elements.

Penetration Pricing: Penetration pricing seeks to achieve greater market penetration through relatively low price. This method is also useful in pricing of new services under certain circumstances. For e.g. when the new product is capable of bringing in large volume of sales, but it is not a luxury item and there is no affluent / price insensitive segment, the firm can choose the penetration pricing and make large size sales at a reasonable price before competitors enter the market with a similar product. Penetration pricing in such cases will help the firm have a good coverage of the market and keep competition out for some time.

In all demand based pricing methods, the price elasticity of demand is taken into account directly or indirectly.

(3) Competition Oriented Pricing: In a competitive economy, competitive oriented pricing methods are common. The methods in this category rest on the principle of competitive parity in the matter of pricing. Three policy options are available to the firm under this pricing method:

Ø  Premium Pricing

Ø  Discount Pricing

Ø  Parity Pricing

Premium pricing means pricing above the level adopted by competitors. Discount pricing means pricing below such level and parity pricing means matching competitors pricing.

(4) Value Pricing: Value pricing is a modern innovative and distinctive method of pricing. Value pricing rests on the premise that the purpose of pricing is not to recover costs, but to capture the value of the service perceived by the customer. Analysis will readily show that the following scenarios are possible with the cost value price chain:

Ø  Value > Price > Costs

Ø  Price > Value > Costs

Ø  Price > Costs > Value

Ø  Price > Value > Costs

(5) Product Line Pricing: When a firm markets a variety of services grouped into suitable product lines, a special possibility in pricing arises. As the service in a given line are related to each other, sales of one influence that of the others. They also have interrelated costs of manufacturing and distribution. It can fix the prices of the different service in such a manner that the line as a whole is priced optimally, resulting in optimal sales of all the services put together and optimal total profits from the line.

(6) Tender Pricing: Business firms are often required to fix the prices of their services on a tender basis. Such customers usually go by competitive bidding through sealed tenders. They seek the best price consistent with the minimum quality specification and thus bag the order.

(7) Affordability Based Pricing: The affordability based pricing is relevant in respect of essential commodities, which meet the basic needs of all sections of people. Idea here is to set prices in such a way that all sections of the population are in a position to buy and consume the products to the required extent.

(8) Differentiated pricing: Some firms charge different prices for the same services in different zones/ areas of the market. Sometimes, the differentiation in pricing is made on the basis of customer class rather than marketing territory.

Or

(b) Discuss the causes behind service quality problems.                14

Ans: Service Quality: Service quality is the degree of excellence and perfection achieved in performing a service. Quality in services is basically a customer-oriented phenomenon. It must begin with customer needs and end with customer satisfaction. Customers are satisfied when their expectations are met, and delighted when their expectations are exceeded. Quality of service is the key to creating customer value and satisfaction. Quality is achieved when customers are provided with the best solutions or the best value for money.

Quality is subjective and hence it is difficult to give a precise definition. However, "the quality of services is the degree of conformance of all the relevant features and characteristics of service to all the aspects of the customer's needs limited by the price and delivery he or she will accept". Service quality when defined in terms of customer satisfaction is the degree of conformance of the perceptions of the service received to the expectations of the service desired. It is the totality of the features and characteristics of a service that bear on its ability to satisfy-stated or implied customer needs.

SERVICE QUALITY GAPS/GAPS MODEL OR REASONS AFFECTING SERVICE QUALITY

Assessing the quality of the services is the most important as well as the most cumbersome process to be carried out by any organization. Service Quality may be defined as “The difference between customer expectations of service and perceived service.”

If expectations are greater than performance, then perceived quality is less than satisfactory and hence it results in customer dissatisfaction. The most lucid and well explained approach towards measuring the service quality is given in the GAPS MODEL, of service quality. Five major gaps have been identified that affect the service quality.

a) GAP – 1: CUSTOMERS’ EXPECTATIONS VERSUS MANAGEMENT: In simple terms this gap is the difference between the expectations that the customers have about the service and service provider and the understanding that the service provider develops about the customers’ expectations. Customer Perceptions are the subjective views carried by the customers about the service quality, whereas customer expectations are the standards or reference against which the experiences of the service would be compared. This Gap may exit due to of the lack of marketing research orientation, inadequate upward communication and too many layers of management in the organization. The customer expectations are generated by the image that is created by the organization through advertisement, CRM, Promotion etc., due to which the management develops a different perception about customer’s expectation resulting in this gap.

b) GAP – 2: ORGANIZATION’S PERCEPTIONS VERSUS SERVICE SPECIFICATIONS: Customer driven standards and service specification may not be same as the organizations view about customer expectations and this result in the Existence of Gap no II. This gap may develop due to following reasons.

1)      Unrealistic customer expectations: Organization believes that the customer expectations are unrealistic in nature and cannot be fulfilled at any cost.

2)      Lack of commitment: Management believes that service quality is difficult to maintain and does not show commitment of any kind towards the service quality.

3)      Infeasible: Feeling and perception of Infeasibility.

4)      Lack of Goal Setting: Inadequate task standardization and absence of formal goal setting.

c) GAP – 3: SERVICE SPECIFICATIONS AND STANDARDS VERSUS: This gap arises due to mismatch between the Service specification and actual service delivery. The most common reasons for this type of mismatch are:

1)      Role ambiguity and conflict among the employees: Employees are not clear about the role they need to play is the effective delivery of services to the customers thereby causing confusion among the customers.

2)      Poor Employee-job: the requirements of the job and the skills of the person do not match with each other.

3)      Poor Technology-job fit: Employees have not been upgraded and are unable to provide the services through the technologically advanced systems.

4)      In appropriate supervisory control systems: The system that is needed to access the performance of the employees and generate control over them is not as desired by the employees.

5)      Lack of teamwork: Employees lack the feeling of team work hence they are unable to work as teams.

6)      Inadequate service delivery intermediaries: All the intermediaries that are responsible for the service delivery are either inadequate or unable to provide the desired levels of the service.

7)      Inability to address to the need of variability: Variability means providing different format of services according to the varying needs of the customers.

d) GAP – 4: SERVICE PERSORMANCE VERSUS PROMISES: This is a gap that occurs when there is a difference between the service delivery and service provider’s external communication. Promises that the service organizations have made to the customers through the advertisements, sales force and other media raise the potential expectations of the customers regarding the service quality whereas when it comes to the actual delivery of the promises the service performance is not up to the mark. The reasons for this kind of gap are:

1)      Inadequate horizontal communication: The horizontal communication among the peer group may be inadequate that may lead to miscommunication and hence wrong promises.

2)      Propensity/Tendency to over-promise: Employees in order to achieve their targets sometimes over promise the customer about the service which actually does not exist or cannot be delivered hence this leads to the failure of service.

e) GAP – 5: DIFFERENCE BETWEEN THE PERCEIVED SERVICE AND EXPECTED SERVICE: Customers always carry a perception regarding certain levels of the service that they think would be getting whereas in reality their expectations from the services may be altogether different, this mismatches results in the form of a gap that needs to be bridged to make a service a quality service.

6. (a) Discuss about the meaning and role of branding in marketing of services.                 4+10=14

Ans: Branding in Services

Brand is a perceptual activity. It resides in the mind-set of the customer. It is the brand on the basis of which the customer is able to distinguish the services of one provider from another. Brand means an image that the customer carries about a particular product/service. Branding deals with perceptual mapping and the virtual perceptual space. It is the brand that commands the particular price and hence its position as compared to its competitors.

According to AMA branding has been defined as the “The name, term, sign, symbol, design or a combination of them to identify the goods and services of one seller or group of sellers and to differentiate them from those of the competitors.”

Branding besides providing the differentiation also helps in recognition this also aids in the value reinforcement which ultimately leads to the repeat purchases by the customers. Branding is the end result of the customer relationship building.

Role of Branding in Service marketing

Brand value is the value that the brand commands in terms of the customer loyalty, Franchise, customer commitment. In other words, the brand is said to exhibit the brand value when no other rival brand comes close to it to substitute or displaces it from its current market positions. The best example for brand value among the Insurance sector is the Indian public sector organization LIC. It is the trust of customers in LIC that carries the highest brand value amongst the competitors. Discussing about the brand value is quite easy but the fact remains that how to gel and bond with the customers. Role of Branding are mentioned below”

a)       GENERATE SERVICE FUNCTIONALITY: It is the benefits that the customers are looking for while purchasing the services of a particular service provider. Any service provider that has the ability to provide these functional benefits is the one that would command the competition. Some brands develop customer loyalty and commitment on the strength of their ability to deliver superior functional benefits. Actually the service is the bundle of ingredients, attributes, technology and form. Some brands draw their relevance and distinction from the services which they are offering such as Airtel that commands the no number position among the various competitors. 

b)      PROVIDE THE EMOTIONAL BENEFITS: Emotions ride and finally shape the behavior of the individual. It is responsible for the way a person perceives the brand. More often the brand is able to provide the emotional satisfaction to the customer better it is considered. Beyond the physical side of human there is an integral and important side of emotions. Like functional satisfaction customers also seek emotional satisfaction. People care for love, empathy, romance, security, achievement, and humour. Brands delivering emotional benefits engender specific feeling during purchase and use. The idea is to trigger those feelings that the brand is designed to trigger in the emotional psyche of the customer. For instance, Maruti Suzuki brand is designed to make its owner feel Proud, safe and above all provide the much required service backup even in the remotest of the areas.

c)       SELF IDENTIFICATION BENEFITS: As per the Maslow need hierarchy people need to identify themselves in the society which they are the part of they need to express self-identity on others. For instance, a person likes to express himself, confident, strong or adventurous. Brands achieve this association with the customers by becoming a means for such self-expression. Certain brands really command the respect and of course the customers who own such brands would be the proud ones. Talking about the big shot Institutions such as Harvard, LBS MIT all these are the big brands in the professional education and the students who have been associated with these brands command respect and are considered to be par excellence. Inherent to any strong brand is promise of delivery of satisfaction. Brands are carriers of unique value or benefits coveted by the target customer group. Brands become trustworthy for their consistent delivery of promised value. Consistency of delivery is crucial in any brand building effort.

Or

(b) What do you mean by service package? State the features of service package. How does the servicescape play the role of packaging?  4+5+5=14

Ans: Service Package: Due to the intangible nature of services, it is difficult for service manager to describe their services. This problem prevents prospective buyers to buy services. Also buyers are interested in buying services in bundle for all their need. This problem can be solved with the help of service package. Service package is defined as a bundle of goods and services with detailed information that are sold together as a unit by a company to acquire more and more prospective buyers. For example, Hotels and restaurants now a day provides not only means but also suitable atmosphere for occasional celebration or get-together.

Features of Service Package:

1.    Information. Data that is available from the customer or provider to enable efficient and customized service. Examples include electronic patient medical records, airline Web site showing seats available on a flight, customer preferences from prior visits, GPS location of customer to dispatch a taxi, and Google map link on a hotel Web site.

2.    Supporting facility. The physical resources that must be in place before a service can be offered. Examples are a golf course, a ski lift, a hospital, and an airplane.

3.    Explicit services. The benefits that are readily observable by the senses and that consist of the essential or intrinsic features of the service. Examples are the absence of pain after a tooth is repaired, a smooth-running automobile after a tune-up, and the response time of a fire department.

4.    Implicit services. Psychological benefits that the customer may sense only vaguely, or the extrinsic features of the service. Examples are the status of a degree from an Ivy League school, the privacy of a loan office, and worry-free auto repair

5.    Facilitating goods. The material purchased or consumed by the buyer, or the items provided by the customer. Examples are golf clubs, skis, food items, replacement auto parts, legal documents, and medical supplies.

Role of Servicescape in Packaging:

Servicescape refers to that environment in which the service provided and clients interact and services are rendered. It plays a significant role in packaging of services. Since services are intangible, it is difficult for service manager to describe their services and packaged it into one unit. The servicescape, like tangible products, essentially “wrap” the service and convey an external image of what is “available inside” for the consumers. Product packages are designed to portray a particular image as well as to evoker particular sensory or emotional reaction. The physical setting of a service does the same thing through the interaction of many complex stimuli.

The servicescape is the outward appearance of the organisation and thus can be critical in forming initial impressions or setting up customer expectations. This packaging role is particularly important in creating expectations for new customers and for newly established service organisations that are trying to build a particular image.

The packaging role extends to the appearance of contact personnel through their uniforms or dress and other elements of their outward appearance. Interestingly, the same care and resource expenditures given to package design in product marketing are not generally provided for services, even though the service package serves a variety of important roles. There are many exceptions to this generality, however.

Smart companies like Starbucks, FedEx, and Marriott spend a lot of time and money relating their servicescape design to their brand, providing their customers with strong visual metaphors and “service packaging” that conveys the brand positioning.

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