Challenges Of Service Marketers In Changing Business Environment
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The document discusses the challenges faced by service marketers in a changing business environment. It outlines traditional challenges like intangibility, inconsistency, inseparability, and perishability of services. Modern challenges include managing the gaps between customer expectations and perceptions, setting standards due to customization, adopting a 4th dimensional approach, managing social media, dealing with prosumer customers, transitioning from mass to niche marketing, and managing interactive markets. The document concludes that service marketers must learn more about customers, be clear and authentic, create engagement programs, leverage social media, and address complaints to succeed in today's challenging environment.
Challenges Of Service Marketers In Changing Business Environment
- 1. Challenges of Service Marketers in Changing Business Environment Submitted To: Submitted By: Prof. Sanjeev Kumar Singh Partha Sinha Subject: C-301; Services Marketing Roll No. : M2011086 PGDM (G) 2011-13
- 2. Certificate of Authenticity I, Partha Sinha, roll no. M2011086, student of 1st year Post Graduate Diploma In Management (PGDM) at Apeejay Institute of Technology hereby certify that the following paper is my original work and it is not copied from any source of literature, books or articles. Regards, Partha Sinha (M2011086)
- 3. Abstract Services marketing include an ever expanding wide range of personal services and business services focusing on the interaction of customer and service provider. Due to the ever changing environment and the features of services marketing, it is challenging for service marketing professionals to deliver in a consistent manner. This paper discusses challenges faced by service marketers in changing business environment. Introduction Challenges are integral part of any business environment. It gets more complex with services because of its nature and the participants in it. Therefore, the features of services are its challenges itself. To begin with, let us look at the traditional challenges or the challenges that are imbibed in the nature of services itself. 1. Intangibility: The service is not physical in nature, thus service marketers have no physical evidence to support their claim of the services. Example: A Portfolio manager has only empirical data to prove his words of service levels and not anything in substance. 2. Inconsistency: Services delivered generally vary in quality based on different situations so they are not always consistent. Example, A pizza delivery boy may deliver pizza at your home in 20 minutes and also sometimes on 30th minute. 3. Inseparability: Services and customers cannot be separated. Thus service marketer has to transact or be present at the time of service delivery because it is produced and consumed at the same time. Thus service marketers face a big challenge to deliver on time due to this feature. 4. Perishibility: Services perish with the delivery. Thus service marketers do not have evidence of the service provided. They rely on feedback from customer which may vary due to customer’s mood. Further there are various other traditional challenges of service marketing such as ownership issue, as there is no ownership transfer in ownership.
- 4. Modern challenges for service marketers are the concepts that play an important role in service delivery by a service marketer. 1. Gaps Model: Gaps model discusses the gap between customer’s expectation of services and service marketer’s perception of the customer. This results in incorrect designing and standards of service product. Further, this results in inappropriate service delivery and finally communication gap due to incorrect service product design and delivery. This makes service marketer overvalue or undervalue customer expectations. 2. Setting standards due to customization: It is very difficult for a service marketer to define standards due to customization of the service product. For example, we have ISO standards in products and Egmark for products that define standardization. However, for services, the service delivery varies from place to place, from person to person. The topic focuses on challenges due to changing business environment. Thus let us now look at the emerging challenges of the service marketing and how the modern service marketer handles these challenges. 1. 4th Dimensional approach to management: Service marketers need to be proactive and focused on all aspects of customer perception, whether internal or external. Fourth dimensional approach is the suppliers, distributors, customers, employees all are to be cared and focused with responsiveness. 2. Managing Social media: Social media influence is very contagious. For the matter of fact : “78% of people trust recommendations of other consumers”- AC Nielson; Trust in advertisement report, 2009. Thus making it challenging for service marketers to influence customer behaviour by facts and advertisement as people have a platform now to communicate and discuss brands and products. 3. Prosumer Concept: Consumer is not just consumer now, with social media and mass media development, service marketer cannot ignore the customer. Customer now participates in production of goods. Example; customer feedback forums over social media, complaints all are tracked and focused by service marketers to understand customers and their requirements. 4. Mass marketing becomes Niche marketing: As markets are getting saturated, selection of right mode of marketing is extremely important due to focus on “R.O.I “in advertisements. Example: Dell Generated $6.5 million sales from twitters in 2010.
- 5. 5. Managing interactive markets: Markets are interactions now, not merely transactions. Thus service marketer has to focus on reputation management, complaint resolutions etc to make sure service disruptions are not exaggerated in media and to other consumers. This service marketer needs to be proactive in handling reputation and complaints. We can see development of programmes related to reputation management. Example: “Om Logix, a marketing consultancy company has programmes such as Online Reputation Management“ to meet these challenges of organisations. Thus we discussed about few of the emerging issues that service marketer face in the challenging business environment. Service marketer should keep few aspects in mind in this challenging business environment to be successful. A few of them are briefly discussed here. 1. Learn more about consumers: It’s time that service marketer knows their customer even better. Run Customer relationship programmes (CRM), gather customer feedback, knowledge, tastes, after sales service etc. 2. Be clear and authentic: False claims and big brand ambassador do not earn huge bucks anymore. It’s interactive market due to development in communication networks. Example: Airtel rebranding failed even after 200 cr. of advertisement budget, where as their HFZ (Har Ek Friend Zaruri) campaign of Airtel at a cost of 35 cr. made gave higher viewer penetration and R.O.I as compared. 3. Create audience driven engagement programmes: This will promote healthy interactions among customers and also customers feel engaged with the brands. This creates loyalty. Example: In March 2010, when HBO planned Bond month focusing on Bond movies for the month of march, It attracted popularity by having “Dress the Bond girl concept” online, which engaged people visiting HBO website with average user engagement of 15 minutes. 4. Make social media work for organization: Understand the potential of social media and leverage it sophistically to make it work positively for the business.
- 6. Case: In 2011, HP focused engagement of commercial clients and to encourage business professionals to recommend HP products to their peers. So it in association with Linkedin affiliates programme, created a company page to engage professionals in business context. Results were impressive; 2,000 product recommendations in two weeks, 20,000 new followers on HP company page, 5,00,000 Viral updates about HP products and services. 5. Honour Complaints: Complaints and feedbacks need to be respected immediately by the service marketers in order to retain business and maintain it’s reputation as a brand. Conclusion Service marketer faces big challenges now with the 4th dimension of marketing teasing the marketers with surprises. Communication network has grown manifold in last 5 years. Internet penetration, online shopping, online complaints and customer expectation have changed the service marketing scenario rapidly. Like it or hate it, a service marketer cannot ignore the emerging challenges in this environment. Therefore, being quick, on the toes, being flexible to changes in the markets, being alert to customer voice, feedbacks etc. are the forerunners of the 4th dimension. Bibliography 1. Govind Apte, Services Marketing, Oxford University Press, 2. Services Marketing,15/e, Zeithaml V A, TATA MC-GRAW HILL PUBLISHING CO.LTD 3. Linkedin Case studies, Linkedin.com (HP case study) 4. Ac Nielson research report on "Trust in Advertisement", 2009. 5. Speech by “Mr. Kapil Gupta, CEO, OM LOGIC” in National Marketing conference 2012, Held on March 17th, 2012 at LBSIM, New Delhi. (Airtel Case)