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Problem

What are the unique aspects of services and how does this affect the management and marketing of these services?

Step-by-step solution

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Step 1/4

For every successful business to business organization, there is combination of goods and services, and it is seen that services are more profitable than products. Improving skills in marketing services will improve performances in firms.

Step 2/4

Services are more vital in global business and is becoming more and more vital for every firm’s offering. The unique characteristics of services are as follows:

1. Intangibility: services cannot be felt, touched or tried out.

2. Consumed when produced: Consumption and consumption of services takes place at the same time.

3. Participation of user: Even when the user is absent where the service is being provided, users can participate in every production of services.

4. Perishability: Services cannot be inventoried.

5. Variability: Due to the labor-intensive nature of the services, and differences in quality of services for each person, so services vary.

Step 3/4

Managing and marketing of services can be profitable and helps firm to acquire a favorable relationship with customers. Management of the unique characteristics of services is carried out by firms in the following ways:

1. Intangibility characteristics requires improving and differentiating the tangible clues to establish service evidence.

2. Examining carefully during training and selection of marketers is required to manage the consumed and produced service characteristics efficiently.

3. Understanding customers’ expectation and involving more customers to participate in service performance is needed for effective management process.

4. Altering work for demand and supply to avoid extreme chase demand or strategies of capacity level to manage perishability characteristics of service better.

5. Standardizing low cost, low-capacity employees or recruiting high cost, high-skilled employees. Directing employees to meet customers expectation can manage variability of service characteristics.

Step 4/4

In case of marketing of services, identifying the relative segment is essential. Service segments in marketing are narrower than the product segment. The unique features of services affecting marketing of services in the following ways:

1. Services for businesses requires to be customized for every individual customer. Segmentation of service needs to be accomplished with satisfaction level of customers, as this is the key determinant of the success of service.

2. Products are the offerings of service, that customers see, including all processes and outcomes.

3. Distribution of services is usually not possible, except for highly important service.

4. Pricing of services moves around managing the demand of customers.

5. Promotion of services has vital aspects, like need for internal marketing to employees.

Hence, the unique characteristics of services affects marketing and management of services by the above ways.