CU-SEM-III-MBA-Marketing of Services- Second Draft-converted

As well as setting out standards for the way service design will perform: • “Service Design aims to create services that are Useful, Useable, Desirable, Efficient & Effective • Service Design is a human-centred approach that focuses on customer engagement and the quality of service encounter as the primary value for success. • Service Design is a holistic approach, which considers in an interconnected way strategic, device, process and touchpoint design decisions. • Service Design is a systematic and iterative process that incorporates user-oriented, team-based, interdisciplinary approaches and processes, in ever-learning cycles.\" 4.2 SERVICE DELIVERY PROCESS Service Delivery Service delivery is a business term that refers to the relationship between providers and clients in which the provider delivers a service, such as information or a work, and the client gains or loses value as a result. Clients benefit from good service quality because their satisfaction is increased. Figure 4.1 ITIL, or information technology infrastructure library, is one of the most common methods of service delivery. Service providers work to clearly identify the content of services, the roles and responsibilities of customers and users, the roles and responsibilities of service providers, and service quality standards such as availability and timeliness in the ITIL service delivery process. 51 CU IDOL SELF LEARNING MATERIAL (SLM)

Health hospitals and IT companies, for example, use service delivery in a variety of professions and business systems. Most organisations have implemented Its own set of uniform service delivery specifications. Service level management is just as important as service level delivery in these activities. Service level management provides a framework for defining facilities and determining service support levels. Service level agreements (SLAs) and organisational level agreements (OLAs) are in place. In addition, service costs are defined. The IT and company responsibilities are determined by service level management, which establishes particular goals for both positions. Key elements of Service elements • Leadership principles, norms, work habits, and vision, mission, and values form the foundation of service culture. Culture is a set of overarching principles through which management rules, manages, and defines the social structure that manifests itself as service delivery and consumer value. There is no other part of a service organization's long-term survival that is more important than its community, even though it has a superior service delivery structure and a realistic service concept. • Employee engagement includes things like employee attitude, mission-driven leadership, and HR processes. Also the most advanced processes and procedures can only be effective if they are carried out by people who are more dedicated. The moderator between the definition and application of the service excellence model is engagement. • Processes, practises, and performance improvement programmes are all part of the service quality equation. The overall service management model is designed around the strategy and process design. Every service provider partnership should be built on assisting the client in completing their task and achieving their organisational goals. Customer experience necessitates customer intuition, account management, and ongoing development. Perception is everything, and it's important to keep track of how customers and end users perceive service delivery in order to keep working together. Effective service delivery assumes that the customer is involved in the production and delivery of the service, and then builds processes around that assumption – this is known as co-creation. Service delivery Process A service delivery mechanism is one that makes it easier to provide a service. It necessitates a connection between a provider and a client, as well as the availability of resources. As long as the coupling is present, the operation is restored. When it stops, the service comes to an end, and each stakeholder regains their autonomy. The consumer must elicit requirements before the coupling can begin. According to the above description, the service delivery process can only be led during the coupling. The relationship between the service provider and the customer is, without a doubt, the most important aspect of the service delivery process. However, in more complicated 52 CU IDOL SELF LEARNING MATERIAL (SLM)

situations, both actors would need to be prepared in the upstream phase (via some kind of pre-processing) before being free in the downstream phase (some sort of post-process). The measures that correspond are as follows: Getting Started: This stage does not necessitate the formation of the coupling, but it does necessitate the knowledge that the service must be restored. To start the process, you'll need information about the services you'll need. For the client, knowledge refers to the understanding of his specifications, while for the supplier, it refers to the identification of the demands he may meet. Customization and contextualization: if the service is not standard, a process of customization based on customer feedback should be considered. The contextualization of the service to be returned and the service delivery process focuses on adapting to the context (consumer, surrounding circumstances, etc.) of the service to be returned and the service delivery process. Closing and de-contextualization: phases in which all participants need a method to bring the activity to a close. This approach is the same as the one used during the setup process, but it is used after the service has been delivered. It can contribute to a change in the provider's ability to offer the same service. Figure 4.2 Steps in Designing a Blueprint Following are the steps in designing a Blueprint: - 1. Identify the method to be blueprinted: This indicates that blueprinting the entire service provider's processes in one format would be challenging. Individual processes must be established before blueprinting can begin. The number of such processes will be sent to the boss as a complete image. Each approach will be a challenge in and of itself, making identifying particular problems and formulating successful solutions easier. 53 CU IDOL SELF LEARNING MATERIAL (SLM)

2. Map the process from the customer's perspective: This method can be used to identify the customer's comfort zones. If it is discovered that customers are unfamiliar with such processes, they may be modified. During service interactions, customers have buying scripts that direct their thoughts and behavior. The blueprint creation method identifies phases in which the device could malfunction. The method entails deciding the duration of the process. 3. Draw the line of interaction: The lines of visibility and touch must be drawn clearly. The points of touch have the greatest effect on the service experience. 4. Draw a line of visibility: There are processes in zones that are visible to consumers and that they are most likely to communicate with. There are also invisible areas, which are systems and interactions that are critical to satisfying the consumer but are hidden from his view. In a bank, this will include credit checks on clients, document processing, and operations in the dispatch department, among other things. 5. Draw a diagram of the process from the perspective of the customer communication individual, distinguishing visible from invisible behaviors. 6. Draw an internal interaction line. 7. Link customer and contact person activities to help functions that are needed. 4.3 SERVICE ENCOUNTERS AND MOMENTS OF TRUTH Service Encounter Companies must be concerned with the whole experience a consumer has with a company in order to successfully manage customers. Customers' satisfaction is not limited to direct product benefits, even though much of the value they seek is derived directly from the consumption or use of the goods or services they buy (i.e., offers benefits that fulfil a need). Instead, the customer's shopping experience is a mix of product and non-product advantages that spans the entire purchasing process. Customers' experiences with a company's customer service can have a major impact on their overall view of the product in many industries. Companies that produce superior goods may have a negative effect if they back them up with poor service. Many companies, on the other hand, compete not because their goods are better than their rivals', but because they have better customer service. In fact, many people believe that customer service will eventually overtake product differentiation as global competition (i.e., an increase in similar products) makes it more difficult for a company's product to stand out. Customer service can take many forms, the most popular of which is a dedicated department to handle customer complaints. Whether a company establishes a separate department or divides the work among many departments, being responsive and delivering high-quality service is critical, and consumers will demand it in the future. The majority of consumer services are characterized by a customer's relationship with a provider of products or services. One of the distinguishing characteristics of the service act is 54 CU IDOL SELF LEARNING MATERIAL (SLM)

the customer's active participation. In a world dominated by the service organization, each of them has a role to play. The relationship between the three parties in the service of attention for customer service and treatment is captured by the service triad. While for-profit organizations have a vested interest in performing the service act as efficiently as possible, charitable organizations may be able to substitute effectiveness for efficiency if they are limited by funds. According to some writers, efficiency is defined as doing things correctly, while effectiveness is defined as doing the right things. Formally, efficiency can be defined as the efficient use of resources, whereas effectiveness can be defined as the degree to which objectives are met (some scholars argue that efficacy is the degree to which objectives are met, whereas effectiveness is the sum of efficacy and efficiency) (Some authors argued that efficacy is the degree of objectives reached while effectiveness is the combination of efficacy and efficiency). In order to maintain control in the delivery of the service act and in customer satisfaction, a tradeoff between efficiency and effectiveness is needed. Management applies rules and procedures to the contact personnel to limit their autonomy and independence when serving the customer in order to control service delivery. These same rules and procedures are frequently intended to limit the amount of service provided to customers and, as a result, the lack of customization that may lead to a dissatisfied customer. Finally, both parties experience control in the interaction between the client and the communication workers. The contact team attempts to keep track of the customer's behavior in order to make their own job easier; at the same time, consumers want to take charge of the service experience in order to get the best out of it. Working together to create a beneficial encounter benefits all three participants in the best- case scenario. When one party dominates the interaction solely through his or her own management of the experience, this relationship may not be functional. These conflicts can manifest themselves in one of three ways: - An encounter in which the company has the upper hand: A company should standardize service delivery to be competitive and potentially follow a cost leadership strategy by adopting strict operating procedures and severely restricting the discretion of the communication workers. Customers have a limited number of standard service options to choose from, and personalized service is not an option. Success is based on informing customers of what not to expect from their service, but disappointment is a result of communication staff's lack of autonomy. - Communication workers dominate the experience: In general, service workers try to keep the difficulty of the service experience to a minimum in order to reduce their own anxiety when dealing with difficult customers. When contact centre employees are given autonomy, they can perceive that they have a considerable amount of control over customers. Because of the provider's assumed competence, the client is forced to place a high level of confidence in the contact person's judgement. - Customer-centered encounter: The extremes of organized and customized services represent opportunities for customers to keep track of their interactions. Self-service is an option for standardized services that gives customers complete control over the limited 55 CU IDOL SELF LEARNING MATERIAL (SLM)

service available. When a customer needs or requires very little service, the result can be very positive and satisfying. In the case of a highly customized service, all of the organization's resources might be required, at a high cost in efficiency but with a high degree of effectiveness in meeting the customer's specific and unique needs. The need for control by all three participants in the service encounter phase should be balanced in a satisfactory and efficient service encounter. When communication personnel are well educated and the customer's wishes and role in the delivery chain are efficiently communicated, the organization's efficiency needs can be met. The following sections will include a more in- depth examination of the different aspects of the service experience. Service encounters and Moments of truth a) When a customer interacts with a brand for the first time, the first encounter will shape the customer's first perception of the company. b) Even if a customer has had many interactions with a company, each interaction is crucial in establishing a high-quality picture. c) A combination of positive and negative interactions can make a customer doubt a company's performance. d) Not every interaction is important. There are a few main places where you can concentrate your efforts. For example, in a hotel, visitors are given an early experience. Types of Service encounters: 1. Remote counter: It can happen even though there is no direct human contact. For example, an ATM, a website, or a billing statement. Despite the lack of direct human contact, each represents a chance for the company to reinforce/establish quality preferences in the customer. Quality is determined by measurable facts and the performance of technical processes. 2. Phone encounter: This will happen between a consumer and a company. This can be used for organizations such as insurance and telecom departments. Ex – Enquiry Here tone of voice, employee knowledge, effectiveness/efficiency in handling customer will judge the quality. 3. Face – Face encounter: Determining and interpreting service quality issues in face-to-face situations is the most complex of both verbal and nonverbal behaviors that are critical quality determinants. 56 CU IDOL SELF LEARNING MATERIAL (SLM)

EX: In a b2b environment direct encounter between the business customer and sales people would decide the standard. Sources of pleasurable and displeasure in service encounter: • Recovery - employee reaction to service delivery system failure: A service delivery system has failed, and an employee is responsible for dealing with customer concerns and disappointments. • Adaptability - Employees' responses to customer demands and needs: If the requirements are not met, the service company is able to adapt the distribution mechanism. Customers assess service here. • Unprompted and unsolicited employee action (spontaneity): Customers recall employees' spontaneity in providing memorable good or bad service. For example, being regarded as royalty; rudeness, theft, bigotry, and ignoring customers. • Coping - Employees' reactions to difficult customers: Customers were, in some cases, essentially uncooperative providers. In such situations, it is difficult to predict how the service provider will handle the situation. 4.4 EMPLOYEE ROLE IN SERVICE DELIVERY The importance of front-line service in any business cannot be overstated. They are in charge of defining customer needs and translating them into real-time requirements. Companies will begin to close the service efficiency gap by focusing on the critical role of service personnel and adopting strategies that lead to effective customer-oriented service. Employees play the following roles in service delivery: - • Service culture A service culture is one in which customer service is prioritized in all goals, actions, attitudes, and daily operations. Each employee is emotionally connected to a world-class service outcome when an organization has a heart for service. Even better, a service culture thrives when it becomes the foundation of everything that happens in the organization; when decisions, practices, policies, meetings, interactions, signs, formats, communications, and so on are all planned and implemented to help and sustain service delivery—to both internal and external customers. Exhibiting Service Leadership A good service culture starts with business leaders who are passionate about providing excellent service. Leadership is not about issuing a set of directives from a thick rule book, but rather about demonstrating one's worth on a regular basis. 57 CU IDOL SELF LEARNING MATERIAL (SLM)

Developing a service culture There is no simple way to create a service culture, and there is no simple way to sustain one. Over time, the human resource and internal marketing practices will contribute to the development of a service culture. Transporting a service community It's also difficult to transfer a service culture to new markets in other countries. Attempting to \"export\" a business culture to another country creates new issues. Although the global marketplace offers enormous opportunities, services that depend on human contact face numerous legal, cultural, and language barriers. • The Service Triangle The service marketing triangle, or Service triangle as it is more commonly known, highlights the relationships between various service providers and the customers who buy those services. In the services industry, relationships are especially important. All of the relationships that exist between the company, its staff, and its customers are defined by the service triangle. It also addresses the importance of systems in the service industry and how these systems aid in customer satisfaction. Figure 4.3 The service marketing triangle, as its name implies, can be used to advertise a service to customers. The marketing of a product or service is entirely dependent on the partnership that exists between the customer and the supplier. We'll go through each of these interactions in detail, as well as read about how to sell to your customer based on them. • Boundary Spanning roles 58 CU IDOL SELF LEARNING MATERIAL (SLM)

If you have a small business and don't have the same technological resources as a large organization, boundary spanning positions will help your company grow. It can also assist large companies in being more competitive as a side benefit. Boundary reaching roles collaborate with people and organizations outside the business in order to obtain valuable information to aid the innovation process. Boundary-spanning roles enable a company to learn more about innovation from other businesses. Obtaining feedback from other people that you might not be aware of is beneficial. Boundary stretching isn't just for management; any employee can get knowledge from one or more organizations and carry it back to their business to help fuel creativity. • Strategies for delivering service quality through people To ensure that service employees are willing and capable of providing quality services and that they remain motivated to work in customer-oriented, service-minded ways, a complex combination of strategies is needed. There are a number of complex sub-strategies for achieving the goal within each of these simple strategies. Employ the right people: Recruiting the right people is critical to a company's success, which is why business owners should follow a structured recruiting process when searching for new employees. By devoting time and effort to finding the best applicants, you'll maximize your chances of hiring top performers and avoiding costly and inconvenient errors. Develop staff to provide service quality: Staff need ongoing training in the necessary technical skills and experience, as well as process or interactive skills, in order to provide quality service. Dealing with accounting systems in hotels, cash machine procedures in retail stores, underwriting procedures in insurance firms, and any operating rules the organization has for running its business are examples of technological skills and experience. Most service providers are well aware of the importance of professional training and have had some success with it. Provide required support system: Service employees need internal support systems that are compatible with their need to be customer focused in order to be effective and efficient in their employment. Retain the best people: Employee involvement is critical. Failure to keep a key employee costs money and creates issues in the workplace, such as insecure coworkers, extra job responsibilities that coworkers must absorb, and time spent recruiting, hiring, and educating a new employee. According to various estimates, losing a middle manager will cost an organization up to 100% of their salary. A senior executive's departure is far more costly. This is not just because of the lost revenue, but also because finding and preparing a replacement is costly for your business. 59 CU IDOL SELF LEARNING MATERIAL (SLM)

• Customer oriented Service delivery A customer-oriented approach denotes that the organization places a high value on the customer and is customer-focused. Both of these companies' marketing strategies are aimed at the top of the pyramid's customers. The key to gaining market orientation is to add as much value to your products as possible. Customers appreciate a business that adds value to their lives. As a result, customer orientation necessitates four steps of value addition in order for customers to be satisfied and satisfied with the company. 4.5 SERVICE EMPLOYEE CRITERIA An employee appraisal is a great way to make sure everybody on the team knows how they're doing at work. You should concentrate on areas that they have excelled, areas that they need to improve, and whether or not they have met their objectives. It's critical to evaluate your employees' output against clear metrics so that you can establish a benchmark on which they can learn. Although each company's employee assessment will include elements unique to the industry and job requirement, there are certain overarching requirements that can be included in employee performance appraisals. • Quality of Work According to Workforce, one of the most critical metrics for evaluating an employee's efficiency is the overall quality of work. On a day-to-day basis, how is the employee's performance? The term \"quality of work\" refers to a broad category that includes factors such as teamwork, communication skills, and productivity. It may also provide information about the employee's goals. You may grade this category as a whole and include precise measurements for each of the requirements within it. Consider both the big picture and the small details when assessing the quality of work. In the appraisal, use examples such as how much of the company's goal the employee has met. Include brief information about a project where the employee excelled or a meeting that might have been better. • Goals and Target Achievement Quantitative elements such as expectations and target accomplishment should be included in the criteria for assessing employee results. Although much of a performance evaluation is qualitative and subjective, the goal-setting and accomplishment section is objective and quantifiable. For example, if your sales rep is supposed to close 25 new accounts per quarter but only manages to close seven, you can see that there is an issue. Include the hard numbers in the results assessment, but don't forget to understand the context. Is there anything outside of the employee's control that has influenced how much of the target 60 CU IDOL SELF LEARNING MATERIAL (SLM)

he or she has met? A shift in customer needs, for example, may explain why the employee was only able to close seven new accounts instead of the planned 25. • Level of Productivity According to Workable, the degree of productivity employee evaluation criterion is relevant because it looks at employee quality over a particular duration. To be effective in company, you need a team that is both efficient and creative, as well as fast and agile. If some members of your team take twice as long to complete simple tasks as others, you can lose out on valuable sales opportunities. Consider the industry average for particular roles or responsibilities for the work you're reviewing, to see how the workers stack up. When evaluating productivity, keep in mind that it doesn't matter how fast someone works if the job has to be redone due to poor results. • Initiative and Motivation One of the top five employee appraisal success requirements, according to Optimus Performance's business experts, is initiative. Employees that are successful must be able to inspire themselves to take action without having to be informed by their boss or coworkers. Managers can micromanage or spend too much time helping their employees complete their work if they need external encouragement to complete their tasks. Employees who take initiative will see what needs to be accomplished and complete tasks without having to wait for a nudge from their boss. Give an example of a time when your workers took the initiative to complete their assignments. This is another sign of initiative if they went above and beyond their job description. Explain how the employee's lack of initiative and motivation to complete assignments impacts the company's overall efficiency. • Teamwork and Leadership Skills Leadership skills are necessary whether or not an individual holds a leadership role. Employees, like presidents, must be able to collaborate efficiently with their coworkers. Include how well the employee demonstrates leadership during assignments or meetings in the performance evaluation. Are they capable of leading and motivating their team? Do they motivate and inspire other team members to succeed? Also, state whether the employee assists colleagues by providing advice or answering questions. A good leader, according to the Evaluation Forms website, is approachable by all to address problems and issues. It's also important to boost team members' morale by offering positive input and motivation whenever possible. • Ability to Problem Solve It doesn't matter what kind of work the employee has, they must be able to solve problems effectively. Employees must know what to do in a crisis without having to consult a boss or 61 CU IDOL SELF LEARNING MATERIAL (SLM)

senior employee. Ascertain that workers have the necessary training and tools to solve challenges in their employment. Discuss how well the employees respond to challenging circumstances in employee reviews. Is the employee aware of what to do if a product is defective? Do they know how to deal with a consumer complaint? If not, include steps in the assessment that your employee should take to demonstrate successful problem-solving. Keep in mind that until workers are able to handle tough circumstances on their own, they must have faith in themselves and their abilities. • Written and Verbal Communication Skills The employee's ability to interact with supervisors, colleagues, clients, partners, and other stakeholders should be considered when evaluating their performance. Is the employee willing to be open and frank with coworkers without coming across as aggressive? Do they know how to offer constructive criticism while being polite? Listening is an essential component of successful communication. How well does the employee pay attention to and carry out the leadership's instructions? Do they pay attention to the nuances while conversing with a colleague, or are they just waiting to say what they want to say? Employees who listen carefully learn about other positions in the business and how their duties fit into the bigger picture. • Comments from customers and coworkers Criteria for performance evaluations should also provide input from those in the company. If the employee is in a management role, inquire about their effectiveness as a leader from their subordinates. If the employee has a customer-facing role, you will want to solicit feedback from high-value customers. You cannot have the full picture of an employee's success as a business owner until you know how others perceive them. • Self-Evaluation of Results Enable the workers to assess their own performance and use this information in their performance appraisals. They will be able to give you a unique perspective on the quality of their work and their ability to meet deadlines. This is also a helpful way to figure out what staff consider to be their strengths and weaknesses. Employees at certain companies are given a full employee assessment to complete before meeting with their boss. The manager assesses the workers using the same criterion, and the gaps are discussed. It's best to find out the difference straight away if workers think they met all of their goals but the boss claims they didn't. Similarly, an employee may believe his or her leadership abilities are lacking, whereas a manager may believe they are excellent. Knowing this boosts the employee's self-assurance. 62 CU IDOL SELF LEARNING MATERIAL (SLM)

4.6 IMPORTANCE AND EMOTIONAL APPROACH The ability to understand and empathise with others' emotions, as well as react appropriately to those emotions, is known as an emotional approach. The fact that emotions are subjective, dynamic, and difficult to perceive is the most difficult part of coping with consumer emotions, whether positive or negative. However, we can address this problem by narrowly categorising emotions into positive and negative categories and considering how each category can be addressed on a basic level. • Appreciation, surprise, and pleasure are all positive emotions. You will have a highly impactful and relationship-enhancing interaction with a customer who seems chatty, pleased, surprised, or grateful when you call or chat with them. To do so, change your business tone to one that is more conversational and polite. If your customer is local, inquire about their well-being or crack a joke about the weather. Allow them to express themselves by showing them a little bit of your personality. This form of positive engagement can have a significant effect on consumers, resulting in repeat orders and referrals. Rage, annoyance, and disappointment are examples of negative emotions. It's easy to tell whether someone is upset, irritated, or disappointed if you pay attention. Customers are more likely than not to express negative feelings to you. It's important to be open-minded, patient, and empathetic when coping with such emotions. Recognize where they're coming from and what you can do to help them out. For example, if a customer complains about downtime that causes them to miss a deadline, you must understand their frustration. Adjust your tone, even if you're reading them a regular answer. Patience is needed. Enable them to express their dissatisfaction. Describe the situation in detail. Let them feel like they've been noticed. How do customer service reps use an emotional approach to offer the best service possible? Emotional intelligence is something that humans acquire over time as a result of learning in social situations. You can, however, immediately develop the skills of your customer service team by providing them with some basic information about how to improve their emotional intelligence. 63 CU IDOL SELF LEARNING MATERIAL (SLM)

Figure 4.4 There are 5 Basic elements: - • Self-awareness – the ability to recognize and understand your moods and emotions, as well as their effect on others. • Self-regulation – the ability to control disruptive impulses, to suspend judgment and to think before acting • Internal motivation – a passion to work for internal reasons that go beyond money and status (e.g., learning, experiencing, having a happy family). • Empathy – the ability to understand emotions of other people. • Social skills – the ability to manage relationships and build networks. Demonstrate these aspects with examples of the employees so that they understand what it means to be emotionally intelligent when working with customers. You may also share best practises and policies with them, even if they don't completely comprehend the idea of emotional intelligence. 4.7 ROLE OF SERVICE PROVIDER In today's dynamic market, service providers play a critical role in meeting consumer needs. It is essential to comprehend consumer needs in order to provide excellent service. Customers compare their preferences with their perceptions of the service provider's results to determine the level of service. If service providers want to earn customers' loyalty, they must consistently fulfil their needs by performing well. The service provider will pay a high price if the customer's preferences are misinterpreted. As a result, service providers should take extra precautions to ensure that consumer needs are met. Customer service standards can be divided into two categories: ideal service and satisfactory service. 64 CU IDOL SELF LEARNING MATERIAL (SLM)

Service that is desired It's known as the type of service that a customer wants and expects. In other words, a customer's ideal service preferences are a mixture of what he or she believes a service provider can and should deliver. When service efficiency meets or exceeds the customer's needs, they are ecstatic. When a customer is seasoned and has a clear understanding of what to expect from a service, their desired service expectations rise. 4.8 INTERMEDIARIES INVOLVED IN IN SERVICE PROCESS AND SERVICE DELIVERY Intermediaries involved in service process and service delivery Intermediaries, also known as distribution intermediaries, marketing intermediaries, or middlemen, play a critical role in a company's product distribution chain. It would be almost impossible for the company to operate without intermediaries. This is because intermediaries are third-party organisations, entities, or companies that help a company distribute its goods to the end consumer. Merchants, for example, are middlemen who purchase and resell goods. Intermediaries can be divided into four categories: brokers, wholesalers, dealers, and retailers. • Brokers/agents Individuals or firms that operate as an extension of the manufacturing business are known as agents or brokers. Their primary responsibility is to represent the manufacturer to the end consumer when selling a product. Although they do not personally own the product, they do take ownership of it during the distribution process. They make money by charging fees or commissions. • Distributors and wholesalers Wholesalers, unlike agents, own the products and services for which they act as middlemen. They are a privately held company that owns the goods it sells. Wholesalers do not deal with small quantities of product; instead, they purchase in bulk and store the products in their own warehouses and storage facilities until they are ready to resell. Wholesalers seldom sell to end users; instead, they sell to other middlemen, such as supermarkets, at a higher price than they charged. As a result, unlike agents, they do not function on a commission basis. • Retailers and distributors Distributors, including wholesalers, take ownership of the product, store it, and then resell it to retailers or other intermediaries for a profit. The main distinction is that distributors align themselves with complementary goods. Coca-Cola dealers, for example, would not sell Pepsi products, and vice versa. They can keep a closer relationship with their suppliers this way than wholesalers can. 65 CU IDOL SELF LEARNING MATERIAL (SLM)

• Shopkeepers From the corner grocery store to major chains like Wal-Mart and Target, retailers come in all shapes and sizes. Retailers, regardless of their size, buy goods from market intermediaries and resell them to end users for a profit. • Channel Layout In its networks, a company can have as many intermediaries as it wants. A “level zero” channel, which is characteristic of direct marketing, has no intermediaries at all. A single intermediary, normally from the manufacturer to the supplier to the customer, makes up a \"level one\" channel. • Improving Distribution Streamlining delivery entails the strategic preparation and effective use of supply chain tools, as well as the use of intermediaries. Streamlining delivery entails making full use of all tools used in logistics and distribution centres' operations. It should be noted that the scope of logistics and delivery process planning is not limited to manufacturing, transportation, or distribution planning. It includes any aspect of the logistics and distribution process. Without a question, the role of logistics and distribution centres has a significant impact on the entire logistic chain (supply chain), so their optimum operation is critical. To optimise the function of logistics and distribution centres, one must first specify the parameters that will be used to carry out the optimization: • Sales planning • Stock planning • Supply chain planning • Production planning • Distribution planning • Transport planning • Delivery schedule. • Strategic and Long-term Planning This element provides answers to the following questions: • Which products do we want to manipulate? • What market are the products intended for? • In which manner can we avoid the conflict of the given objectives? 66 CU IDOL SELF LEARNING MATERIAL (SLM)

• In what way can we best use the assets and infrastructure in order to achieve maximal profit? • Establishment of a supply chain network This feature optimises the use of required resources in the current logistic network, which includes vendors, manufacturing facilities, distribution hubs, and end users. Analyses and simulations allow for the testing of different combinations, such as the impact of opening a facility or transferring existing infrastructure facilities on overall revenue and service level. The locations of new infrastructure facilities that best meet the needs of customers can be calculated by using different methods of logistic network planning. These approaches are commonly used to determine whether greater amounts of stock should be stored in one location or whether the costs of more frequent deliveries should be increased. • Forecasting and Planning Demand Statistical data and mathematical functions are used in market forecasting and planning with empirical information (forecasts based on demand from the previous period). Market forecasting may be defined as a one-sided method, since forecasts are used to plan only potential consumer demand, rather than the quantity of products that can be generated over the long term. • Sales forecasting Sales planning can be described as the process of converting a demand forecast into a viable operational plan that producers and salespeople can use. This method can involve production planning and/or supply chain optimization in order to assess the likelihood of meeting demand. • Inventory management Stock preparation allows for the optimum level and position of finished goods to satisfy end- user demand and service levels. Stock planning is used to determine the optimum amount of safety stocks at each location in theory. • Supply Chain Management Based on multi-level sources and essential resources, supply chain planning compares demand forecasts with real demand to create a \"master plan\" (schedule). With the objective of synchronising and maximising output, distribution, and transportation, the master plan-built spans the points of production and distribution destinations. • Production Scheduling Production planning refers to the development of a master plan for a particular factory (producers). The master plan takes into account material supply, plant capability, demand, and other operational factors. 67 CU IDOL SELF LEARNING MATERIAL (SLM)

The production planning cycle is a complicated phase that, in most cases, is seen as the beginning of the logistics and delivery processes. When these processes are viewed from the other perspective (i.e., semi-products and raw materials are required for the manufacture of such products and are shipped to the factory), they reflect the factory's final products and the end of one segment of the logistics chain. • Distribution Strategy The creation of a feasible and viable plan for distributing end products from manufacturers to end users (via logistics and distribution centres, warehouses, or crossdocking) is referred to as distribution planning. The real transportation costs and conditions that reflect single goods locations are used to plan distribution. • Transportation Arrangements For dispatch cost minimization, transportation planning uses current transport rates. Transport planning entails optimising both the external and internal goods movement in order to reduce transportation costs and optimise fleet utilisation. Allowing and conducting collective (bundled) transport of goods, as well as the integration of intermodal transport networks into logistics and distribution processes, are two of the most important transport planning functions. • Timeline for delivery The purpose of a delivery schedule is to develop a feasible (realistic) plan that meets the producer's time requirements for product delivery. The manufacturer chooses the best distribution methods and times based on the number of orders received, the production schedule, and the availability (planning) of transportation. 4.9 SUMMARY • In conjunction with service providers (both public and private), community stakeholders, and departmental officials, the service plan must articulate the above priorities in the sense of the local situation. • It's critical that goals for related organisations can be analysed and calculated in terms of achieving expected improvements in customer programmes, service structure, and profile. • A \"catchment\" is a geographical area that is specified. • Administrative boundaries, service delivery patterns, and transportation networks will be used to describe the catchment boundaries. 68 CU IDOL SELF LEARNING MATERIAL (SLM)

4.10 KEY WORDS • Blueprinting: maps the process of service delivery • Line of Interaction: customer interactions with people in service • Line of Visibility: line of onstage contact employee actions • Positioning: battle for the consumer’s mindshare • Positioning Map: depicts what the consumers think of available brands with their features 4.11 LEARNING ACTIVITY Create a Blueprint of the service delivery process of a Restaurant. Study motivation levels of any public sector bank is employees. Compare them with that of new private banks and foreign banks. Find out ways and means to increase the entrepreneurial qualities, which would lead to enhanced competitiveness ___________________________________________________________________________ ___________________________________________________________________________ 4.12 UNIT END QUESTIONS A. Descriptive Questions Short Questions 1. Services sector is playing the role of growth driver in many developed and developing economies. Discuss. 2. Market has variety of offers ranging from pure goods to pure services. In light of this statement explain the product-service continuum. 3. Do you think that classification of services can help in developing the marketing strategy better? How? 4. In which category would you put the following services? Give reasons also: (a) A day care centre (b) Chartered bus service (c) Tele-shopping 5. Explain briefly about intermediaries involved in service process and delivery Long Questions 69 CU IDOL SELF LEARNING MATERIAL (SLM)

1. Define the concept service marketing and its characteristics? 2. Distinguish between goods and service? 3. What are the classifications of services? 4. Explain the paradigms in service marketing? 5. Mention any five services that have significant tangible elements attached to them and five goods that have service element attached to them? B. Multi Choice Questions 1. Service marketing is the same as ________ a. Digital Marketing b. Retail Marketing c. Ambush Marketing d. Relationship Marketing 2. A triangle of Company, Customers, Employees, Internal Marketing, External Marketing communications and Interactive marketing is known as…………. a. Marketing Triangle b. Service Triangle c. Communication Triangle d. Both a and b 3. Tata Sky is the joint venture of Tata and ……………. a. Sony b. Star c. IBN d. Zee 4. Which of the following refers to marketing channel? 70 a. Integrated Marketing Communication b. Distribution CU IDOL SELF LEARNING MATERIAL (SLM)

c. Marketing Myopia d. Retailing Answers 1 – d, 2 – b, 3 – c, 4 – a 4.13 REFERENCES Text Books: • Zeithaml V. A. ,Bitner M. J. and Pandit, A., Services Marketing, 5th Edition, Tata McGraw Hill Publishing Co. Ltd. New Delhi. • Lovelock C. H., Wirtz, J. and Chatterjee, J., Service Marketing: People, Technology, Strategy, 6thEdition, Pearson Education, New Delhi. Reference Books: • Hoffman, K. D. & Bateson, J. E.G., Marketing of Services, Cengage Learning, • Kurtz D. L. and Clow K. E., Services Marketing. Biztantra, New Delhi. • Nargundkar, Rajendra, Services Marketing Text and Cases, 3rd Edition, Tata McGraw Hill Publishing Co. Ltd. New Delhi 71 CU IDOL SELF LEARNING MATERIAL (SLM)

UNIT 5 : STP STRATEGY FOR SERVICES Structure 5.0 Learning Objectives 5.1 Introduction 5.2 Need for Segmentation of Services 5.3 Bases of Segmentation Services 5.4 Segmentation Strategies in Service Marketing 5.5 Need for Targeting and Positioning of Services 5.6 Positioning Strategies for Services, 5.7 Positioning Through Product/Service Delivery Strategies, 5.8 Positioning Through Pricing Strategies, 5.9 Positioning Through Distribution Strategies, 5.10 Positioning Through Sales Promotion and Advertising, 5.11 Service Differentiation Strategies. 5.12 Summary 5.13 Keywords 5.14 Learning Activity 5.15 Unit End Questions 5.16 References 5.0 LEARNING OBJECTIVES After studying this unit, you will be able to: • Identify the nature of Segmentation, Targeting, Positioning (STP) Strategy for Services • To measure the level of importance and scope of STP Strategy for Services • To evaluate the key positioning and Benefits of STP Strategy for Services • To identify and measures the Process involved in STP Strategy for Services 5.1 INTRODUCTION The STP model is a fundamental marketing philosophy that is critical to effectively servicing a market. Segmentation, targeting, and positioning are the three practises that 72 CU IDOL SELF LEARNING MATERIAL (SLM)

make up STP. Until designing appropriate positioning strategies and allocating resources to prioritise marketing efforts, marketers segment markets and identify appealing segments to target. Because of the growing prevalence of mature markets, greater variety in consumer needs, and the potential to target niche segments, the STP model is becoming increasingly common. Figure 5.1 Segmentation The STP model begins with market segmentation, which is the division of the market. The division of a mass market into recognisable and distinct categories is referred to as market segmentation (segments). - of these groups shares similar characteristics and needs, as well as similar responses to marketing efforts. Various segmentation metrics, such as demographic, regional, psychographic, and behavioural factors, may be used to divide the market. Targeting The STP model's second component is targeting. This relates to deciding which, if any, of the exposed segments should be targeted and made the focal point of a systematic marketing campaign. According to the popular “DAMP” approach to targeting, as defined by Philip Kotler (1984), for market segmentation to be effective, all segments must be: • Distinct: each segment must clearly differ from other segments, which makes different marketing mixes necessary. • Accessible: buyers must be able to be reached through appropriate promotional activities and distribution channels. • Measurable: the segment must be easy to identify and measure. • Profitable: the segment must be sufficiently large to provide a stream of constant future revenues and profits. Positioning The final component of the STP model is positioning, which entails ensuring that a brand is positioned correctly in the minds of target customers. Positioning is the process of 73 CU IDOL SELF LEARNING MATERIAL (SLM)

distinguishing products and services from one another in order to give customers a reason to purchase. It consists of two major components. The first is concerned with a brand's physical characteristics, features, and capability, such as a car's engine specification and design. The second factor is how a brand is communicated, as well as how customers view it in comparison to other products on the market. 5.2 NEED FOR SEGMENTATION OF SERVICES Previously, the emphasis was on mass-producing products and services and getting them to people. As a result, products and services used to be more or less uniform. The old and pioneering principle of ‘mass marketing,' in which a seller participates in mass manufacture, distribution, and promotion of any products and services for all consumers, believed that all customers are the same and have the same needs. However, things began to change gradually. A market today is rarely homogeneous, since it is made up of different groups of varying natures or an aggregation of buyers of any goods and services. Later, however, the trend of selling various goods and services to different groups/classes of customers, referred to as segments, has emerged. Customers and the location where marketing campaigns take place are referred to as the market. Customers are taken for the purpose of segmentation. No one can please all of the people all of the time, any of the people all of the time, or all of the people for a period of time. Market segmentation reflects this idea. 1. Allows for adequate target market selection. 2. Aids in the differentiation of one consumer segment from another within a market. 3. Facilitates successful consumer tapping by tailoring the bid to the target. 4. The idea of \"divide and rule\" as a tactic for \"dividing the markets in order to dominate them.\" 5. Assists in crystallizing the needs of target customers and eliciting more consistent responses from them; assists in the development of marketing campaigns on a more predictable basis; assists in the development of marketing deals that are best tailored to each group. 6. Assists in the specialization needed in products/services, delivery, promotion, and pricing (marketing mix) in order to balance customer groups and create marketing and appeals that meet their needs. 7. Makes marketing efforts more productive and cost-effective – assists in identifying less satisfied segments and focusing on them to increase satisfaction levels. 8. Assists in focusing attention on the most valuable and profitable segments rather than wasting time on obsolete, unproductive, or unprofitable segments. 9. Provide benefits to the consumer in a variety of ways. 74 CU IDOL SELF LEARNING MATERIAL (SLM)

Customers and businesses will select each other and remain together when segmentation has reached a high level of maturity. 5.3 BASES OF SEGMENTATION SERVICES Market segmentation is the process of breaking down the entire consumer market into subgroups, with consumers in each category sharing a common set of needs and wants and having more or less similar or related characteristics. The firms can segment the market on the following bases: Figure 5.2 • Regional Segmentation: In this case, the segmentation is based on the customers' geographic area. The regional segmentation is founded on the assumption that people in one region of the country have different shopping or buying preferences than people in other parts of the country. People live in rural and urban areas, for example, have different banking needs. As a result, various banking products and services are created to cater to the various needs of each customer group. Geographic segmentation is also defined by factors such as climatic zone, state, and area. • Demographic Segmentation: Demographic segmentation is the process of dividing a consumer market based on a variety of factors such as age, gender, occupation, income, education, marital status, family size, culture, social status, and so on. This segmentation is based on the assumption that a customer's purchasing behaviour is heavily affected by his demographics, and that these variables are relatively easy to quantify as opposed to other factors. • Psychographic Segmentation: Psychographic segmentation refers to an individual's personality, lifestyle, and attitude. It is thought that a customer's purchasing behaviour is influenced by his attitude and lifestyle. Personality refers to an individual's characteristics, behaviours, and habits, and the market is divided into segments based on personality attributes such as introvert, extrovert, competitive, aggressiveness, and so on. 75 CU IDOL SELF LEARNING MATERIAL (SLM)

The way a person lives his life and spends his money is referred to as his lifestyle. Companies segment the market based on the individuals' interests, habits, values, and views. • Behavioural Segmentation: In this case, the marketer divides the market based on the individual's understanding of the commodity and attitude toward its use. Occasions, advantages, user status, use rate, buyer readiness level, loyalty status, and attitude are all behavioural variables. Buyers may be divided into two groups: those who buy the product or service on a regular basis, and those who only buy goods from which they profit. Buyers can also be classified as ex-users, future users, first-time users, or regular users; advertisers can classify the market based on this classification. Customers' consumption rates, such as light, medium, and heavy consumers, are often used to segment the industry. As a result, market segmentation enables businesses to separate prospective consumers into small groups with common needs and tailor marketing strategies accordingly. Instead of catering to the demands of the whole sector, which has various needs and preferences, this allows a company to focus more on a small group and gain more income. 5.4 SEGMENTATION STRATEGIES IN SERVICE MARKETING Evaluation and selection of business parameters – once a company has established its market segment potential, it must determine how many and which to target. Two considerations must be considered by the company: • Market segment size and growth potential: The size of different market segments should be compared based on their current ability and future growth potential. • The segment's overall attractiveness and profitability: marketers should consider factors such as current and future rivalry, the existence of alternatives, and current and future availability. Then, based on the crucial evaluation, this targeting should be determined. • The company's goals and resources: businesses vary in scale, style, resources, specializations, skills, standings, and goals. The company's overall goals and resource philosophy should be reflected in the goal selection. • Targeting strategies – after evaluating various markets, the organization can choose from one of five target market selection patterns: • Focus on a single segment (concentration strategy) – only one segment is targeted, and focused effort is given. • Selective specialization (selective segmentation strategy) – based on company requirements, only a few segments are targeted and focused effort is given. • Specialization strategy for goods and services – all available consumer segments are targeted for a single category of products and services. 76 CU IDOL SELF LEARNING MATERIAL (SLM)

• Industry specialization strategy – all product and service segments are aimed at a single market segment. • Complete consumer penetration – all available market segments are targeted for all product and service categories. Counter segmentation – The market and its segmentation are constantly changing. Over time, the differences between the segments will become negligible, and some segments will cease to exist. This is the product of multiple independent or dependent variables shifting. In this case, two or more segments are grouped together to create a standard marketing mix strategy. Counter segmentation is the term for this. 5.5 NEED FOR TARGETING AND POSITIONING OF SERVICES A target market is a certain group of people (customers) to whom a business wishes to sell its goods and services and to whom it directs its marketing efforts. The marketer must first determine the target market before developing a marketing strategy. By geography, purchasing power, and psychographics, a target market can be distinguished from the overall market. Following the evaluation of the segments, the sector to be targeted can be chosen based on the following criteria: • Undifferentiated marketing: Undifferentiated marketing focuses on the entire consumer market rather than a specific segment. To attract the greatest number of customers in that target market, this approach uses a single marketing mix - one product, one price, one placement, and a single promotional effort. \"Marketing,\" by William M. Pride and O. C. Ferrell, gives commodities says sugar and salt are examples of products that might be marketed effectively through an undifferentiated strategy, as many consumers in the overall market have similar needs for the products. • Differentiated marketing: This is a tailored strategy that caters to consumers' specific needs. A differentiated marketing approach focuses on particular market groups, with marketing mixes tailored to their specific needs. Each mix includes a product, price, placement, and promotional strategy that is tailored to a specific market segment. A vitamin supplement manufacturer, for example, might recognise gender-based market segments. It could make two multivitamin formulas, one for women and one for men. It could distinguish even further by segmenting gender groups by life stage and developing different marketing strategies for each. Differentiated marketing works well in markets with easily recognisable segments, each with their own set of requirements. • Focused marketing: A third-way approach that enables advertisers to reach a specific consumer segment with a single marketing mix is concentrated marketing. The ability to specialise to this degree has the advantage of allowing a business to concentrate its resources 77 CU IDOL SELF LEARNING MATERIAL (SLM)

on meeting the needs of a single, well-defined, and well-understood market, allowing it to compete more effectively against larger firms. A focused marketing strategy, on the other hand, can pigeonhole a business into a single product and sector, leaving it exposed to the impact of evolving market conditions. • Micromarketing: Micromarketing is a marketing technique that focuses promotional efforts on a select group of highly targeted customers. Micromarketing entails an organisation defining a specific demographic based on a single attribute, such as ZIP code or job title, and tailoring promotions to that segment. Because of the customization and lack of economies of scale, it can be a more costly strategy. Need for Positioning Positioning entails both the introduction of new brands to the market (new brand positioning) and the repositioning of existing brands. It is concerned with the distinction of goods and services in order to prevent them from being commodities. A business should place itself in its core market segments, where it is objectively or subjectively distinguished in a favourable way from rival products, to optimise its potential. Positioning is especially important in the market for services. As a result of increased competition, the customer is being increasingly perplexed by the vast array of services available within each business sector. These services are promoted through a slew of promotional messages emphasising various aspects of the services. The key to a good positioning strategy is to highlight the function that the business excels at and that perfectly meets the customer's needs. Consumers find that differentiating services is more complicated and complex due to intangibility and other characteristics associated with services. Successful positioning allows customers to see a company's offerings as distinct from others and precisely what they need. Positioning is a strategic marketing method that helps managers to assess their current position, their desired position, and the behaviour required to achieve it. By considering positions that are not met by competitors' goods, business opportunities can be found. As a result, it has an effect on both product growth and product redesign. It also allows for analysis of potential competitor moves and reactions. The term is often applied to products, but it is also applicable to commodity sectors and organisations. Positioning entails giving the target market group a justification to purchase your services, and it thus serves as the foundation for the entire marketing campaign. It also includes instructions for creating a marketing mix, with each aspect of the it aligned with the positioning. 5.6 POSITIONING STRATEGIES FOR SERVICES, A thorough understanding of the market you want to participate in is essential for an effective positioning strategy. It determines how the business differs from rivals, as well as market 78 CU IDOL SELF LEARNING MATERIAL (SLM)

dynamics and opportunities. Many companies make the mistake of thinking of positioning as merely a marketing tactic. It should be one of the company strategy's pillars. After all, you can't advertise a product as a high-quality service unless the product itself can back up those statements. Customers can tell whether a company is competing on price or quality if it has a consistent positioning strategy. The corporate plan, sales and marketing strategies, and positioning must all work together. It's a lot more than just a marketing tactic. This is the only way for the product or service to meet consumer expectations and deliver on its positioning commitments. Organizations must clearly identify their positioning in the value chain; otherwise, communication can become disjointed and ambiguous. There are five main strategies upon which businesses can base their positioning. Figure 5.3 1) Positioning based on the characteristics of the product When you use product features or advantages as a positioning tactic, you're associating your brand with a beneficial feature for consumers. In the automotive industry, for example, Toyota's place in the market is reliability, Porsche's is efficiency, and Volvo's is safety. Consumers are constantly informed about the product's most distinguishing feature or value. 2) Price-based positioning Associating your brand with fair pricing means positioning your goods or services based on price. Typically, a brand's pricing positioning strategy seeks to be the cheapest or one of the cheapest in the industry, with value being their place. Supermarket chains, for example, often have a house brand of very low-cost products in a variety of product categories. Since they have lower logistics and delivery costs than their rivals, price-sensitive consumers will always purchase them without understanding the price because they know it is always the cheapest choice. If they see a void in the market at a certain price point, brands may also 79 CU IDOL SELF LEARNING MATERIAL (SLM)

place themselves based on price. Your market position is established when you are the only choice in a given price range. Brands also expand their product lines to fill consumer gaps. 3) Choosing a place based on efficiency or luxury The price and quality of a commodity often coincide, at least in the minds of consumers, since a high price is often correlated with high quality. However, positioning a product on the basis of its high quality or \"luxury\" is distinct from positioning a product on the basis of price. Sometimes, these brands do not express their price point, instead emphasising high quality or reputation to elicit demand and make consumers want the product regardless of price. Note that while luxury does not necessarily imply higher quality, consumers assume it does because of the brand's prestige and long-term brand positioning strategies. A $200,000 Rolls Royce, the pinnacle of luxury, is likely to be of poorer build quality than a $30,000 Hyundai. 4) Positioning depending on the use or use of the product Another way to put the brand in the market is to associate it with a specific use. Meal replacement supplements, for example, can help people who are short of time or want a fast and easy meal. Meal replacements that are high in calories and added vitamins and minerals are made especially for people who want to do better in the gym. Other meal replacements are designed for dieters, so they're low in calories and won't give you much energy for your workout. Males are often targeted by the former meal replacement, while females are often targeted by the diet low-calorie alternative. Both are meal substitutes, but they are positioned differently. 5) Competition-based positioning The emphasis of competitor-based positioning is on using the competition as a point of distinction. In order to appear favourable and exclusive in comparison to other alternatives in the marketplace, brands emphasise a crucial distinction their product/service provides in their marketing. The item or service becomes one-of-a-kind. Brands should also use the market as a model for developing their own approach. If a brand has a large market share, its positioning strategy must appeal to a large number of consumers, so you try to convert some of their customers by selling a similar product with similar benefits at a similar price. 5.7 POSITIONING THROUGH PRODUCT/SERVICE DELIVERY STRATEGIES A mechanism is involved in determining the right positioning and differentiation approach. The process' aim is to create an identity that reinforces the importance of the product, service, or brand in the minds of customers while also explaining why and how the offering is superior to the competition. Marketers usually follow a positioning process that includes the following five steps to achieve that goal: 80 CU IDOL SELF LEARNING MATERIAL (SLM)

• Confirm your understanding of market dynamics • Identify your competitive advantages • Choose competitive advantages that define your market “niche” • Define your positioning strategy • Communicate and deliver on the positioning strategy Step 1: Confirm Your Understanding of Market Dynamics You'll need a solid understanding of your target market and answers to the following questions to begin the positioning process: • How can you apply this positioning to which product, service, or business category (also known as the \"frame of reference\")? • For the positioning you're building, which target segment is your primary focus? • What are the considerations that these consumers consider when making a purchase? • What do these consumers think of the category's competitors? Step 2: Identify Your Competitive Advantages A competitive advantage is a quality, skill, or characteristic that helps you to outperform your competitors. It gives your product, service, or brand an edge over the competition when it comes to buying decisions. Any or more of the following will provide a competitive advantage: • Price: You can be able to deliver equal value at a lower cost than rivals due to something in the manufacturing process or supply chain. • Features: You can offer tangible or intangible advantages over your competitors, such as more colours, better taste, a more elegant design, faster delivery, personalised service, and so on. • Advantages: You can be able to provide consumers with exclusive benefits that your rivals cannot match. Benefits are intangible strengths or results that your customer receives as a result of using your product or service. Time savings, comfort, improved power, pleasure, relaxation, more options, feeling better about oneself, becoming more attractive, and so on are just a few examples. Create a list of the aspects that set you apart from your competition in a good way. Then figure out which of these factors are also competitive advantages: the factors that influence consumers to select your product, service, or brand over others. Competitive pricing and feature matching are relatively straightforward for rivals to match, making it difficult to establish a sustainable competitive edge in any of these fields. 81 CU IDOL SELF LEARNING MATERIAL (SLM)

Benefits—intangible strengths and results that are difficult for rivals to match—are most likely to distinguish market-leading goods, services, and brands. Many car makers, for example, receive high scores in safety tests, but driving a Volvo gives the driver an additional, intangible advantage of feeling safer due to Volvo's long history and reputation for safety. Several amusement parks in Southern California offer thrilling attractions and family entertainment, but only Disneyland's Magic Kingdom transports visitors to the Happiest Place on Earth. Step 3: Choose Competitive Advantages That Define Your Niche The list of competitive advantages reflects a range of positioning tactics for your product, service, or brand that you might use. The next step is to look at how these variables integrate into consumer expectations of your competitors as a whole. The aim is to choose a positioning strategy that gives you a distinct and valuable market place that your rivals aren't addressing. This is where a perceptual map comes in handy. Perceptual maps depict how various players are placed in the market based on key factors that have a significant impact on consumer decisions. Below are some examples of perceptual maps. The first plots car brands according to consumer expectations of price and quality. Figure 5.4 82 CU IDOL SELF LEARNING MATERIAL (SLM)

Step 4: Define Your Positioning Strategy You're able to analyse and choose your positioning strategy now that you've established your strategic advantages and learned how your main rivals are positioning themselves. This is the decision you make on how you want to put your product in relation to the competition. What would you do to set yourself apart and improve? It's simple: strong positioning focuses on a single, effective idea that matters to the consumer. It takes advantage of the most promising competitive advantage to carve out a niche that no one else can occupy. This competitive advantage is placed in the sense of your competitive set by your positioning strategy, which illustrates what sets you apart from the competition. Perhaps you have an emotional advantage that your target audience does not have access to elsewhere (escape? balance?) Perhaps you are the best option for a nerdy, gearhead crowd (bikers, coders). Perhaps you have exceptional customer service in a field where it is unheard of (cable TV, contractors). Step 5: Communicate and Deliver on Your Positioning Strategy Creating a positioning statement and sharing it internally through the company to ensure that everyone understands how and where the offering can work in the market is the first step in communicating the positioning strategy. Your positioning is based on a competitive advantage, and it is critical that you meet the standards that your positioning creates in the minds of your customers. Your positioning strategy should be built to last over time, but it can and should be tweaked as needed to reflect changes in the competitive landscape, your target segment, market dynamics, and so on. For example, if your positioning is focused on being an ideal \"lifestyle\" match for your target audience, you must show how your product is tailored to their needs and experiences. This involves adapting to the changing needs of your target market. If your positioning is based on “owning” a key benefit such as stability, dependability, or delight, you should think about how you can offer that benefit better than any competitor who may try to copy you. The marketing mix is a set of organised resources that you can use to carry out your positioning strategy. Consider your positioning technique to be the song you want your target market to hear. The marketing mix is how you orchestrate and harmonise the melody so that it becomes unforgettable and preferred by your target audience. 5.8 POSITIONING THROUGH PRICING STRATEGIES The act of putting a price on a good or service that is within a certain price range is known as price positioning. The price positioning of a product shows where it stands in comparison to its rivals in a given market, as well as in the minds of various consumers. The perception of a commodity as cheap (low price) is often influenced by its price positioning (high price). A price-value matrix is one way to imagine this. (see below) 83 CU IDOL SELF LEARNING MATERIAL (SLM)

Figure 5.5 Your products' place in the matrix is determined by your brand promise, rivalry, and pricing goals. A different location and a different price point result in different customers being targeted. Internally, positioning statements are used. These statements serve as a reference for the company's marketing and operational decisions. A positioning statement aids you in making important decisions that influence how your customers perceive your brand. Companies who are seeking to persuade consumers to purchase a product or service must consider price positioning. If a company wants to sell low-cost smartphones, it must keep its prices low enough to fit its price positioning. If, on the other hand, a brand's branding revolves around \"being premium\" or \"wanting to be known as a luxury brand,\" the goods must be priced to reflect those statements. The following are strategies that will allow you to place your products and services in accordance with your chosen position: • Low-cost pricing Businesses with lower overheads and costs than their rivals can find an economy pricing strategy to be very successful, as their low-cost base enables them to sell at a discount to gain a large market share. Small companies are less likely to use this positioning strategy because they may find it difficult to achieve the number of sales needed to stay profitable when selling at the lowest price. Selling a similar product or service at a lower price will help you gain a competitive advantage over your business rivals. One of the marketing problems is convincing consumers that the price is the best in the market as opposed to the competition. Another downside of this approach is that it exposes you to more competition, as economy buyers are still searching for the best offers, so you won't be able to build consumer loyalty with economy pricing. Finally, there is only space in the market for one winner of the \"lowest price\" name. • Price snooping 84 CU IDOL SELF LEARNING MATERIAL (SLM)

The act of setting a product or service's price high enough so that no customers are skimmed is known as price skimming. Companies set their prices higher than their rivals to attract consumers who are willing to pay a higher price. This technique is only successful if companies ensure that their consumers understand why they are paying more for a specific product. In markets with a large volume of new product launches, price skimming is common. Setting a high initial price allows you to cover production and product development costs. Dropping the price later, on the other hand, could irritate consumers who paid a premium for the product when it was first introduced, resulting in a loss of brand loyalty. • Cost-effectiveness A business may use dynamic pricing for price positioning in a few different ways. It can either match the price of a competitor's offering or adjust the offering to give the company an advantage over its competitors. Companies may match their competitors' offers by setting their product's price to a level that is equivalent to their competitors'. Companies may also encircle their competitors, which encircles the middle market. This entails delivering the most affordable product or service on the market while also incorporating products that are more similar to their rivals' initial offerings. Another strategy is to discount a competitor's costs in those categories. Companies may achieve this by offering a price that is comparable to that of their competitors, as well as a cheaper price than that of their competitors. Being the cheapest choice in a market has its advantages and disadvantages, but it's a perfect way to pique a customer's interest in a product or service. Although this strategy encourages consumers to try their goods, it reduces profit margins and sets a bad precedent for a company. • Pricing for Penetration This is the quickest way to take market share from competitors and then defend it against new competitors. It focuses on establishing a low initial price and then gradually rising it by using skimming or premium pricing strategies. It relies on customers appreciating your brand and moving to your low-cost, high-quality product, enabling the company to break into the market. A problem is that setting a price that is too low will damage your brand because it would be seen as low quality. Since price elasticity enables companies to launch goods at a cheaper price to compete with market competitors, this pricing strategy is effective when launching products in markets where demand fluctuates significantly as prices shift. • High-end pricing Premium pricing can help businesses with a high brand consideration achieve a higher margin. A high price must be justified by providing a high-quality product. Although a high price does not indicate that a product is luxury or expensive, if advertised correctly, it may help to strengthen the brand's identity and perception of value. Under-delivering on the 85 CU IDOL SELF LEARNING MATERIAL (SLM)

premium you promise will wipe out your profits, particularly if you're likely to be undercut by market rivals. Pricing strategy must correctly consider a consumer's willingness to pay, which reflects the brand's equity and value perception in the consumer's mind. A firm pricing strategy can improve brand value, while a weak strategy can have the opposite effect. 5.9 POSITIONING THROUGH DISTRIBUTION STRATEGIES Distribution strategies A distribution channel isn't necessarily where you sell items, like a website, a Corte Ingles display counter, or an Amazon page. A distribution channel, on the other hand, is the series of steps that a product or service must take to meet its final customer. This chain can have a few or several phases and intermediaries, and it can be both offline and online, with dealers, wholesalers, retailers, and/or agents as part of it. It's classified as a direct or indirect distribution platform depending on the number of participants. It isn't a question of which is better or which is worse; it simply depends on the company's priorities, as well as the type of audience and product. A sales channel plan considers how to better place goods in order to increase demand for them. Your main aim is to find the right buyers and demand locations in order to speed up and benefit from the process of connecting goods and customers. Distribution networks cover a wide range of business decisions aimed at increasing customer demand. They extend their scope beyond the group, evaluating the market environment and adjusting business operation accordingly. The distribution chain for goods and services, on the other hand, is focused on internal factors, primarily inventory: deciding the best way for the business to manufacture and deliver products or services, taking into account factors like cost and available resources. Channels of distribution include: The number of participants in the chain determines the form of distribution channel. Participants or agents can be divided into five categories: • Director of Photography • Distributor • Manufacturer or seller • A representative • Clientele 86 CU IDOL SELF LEARNING MATERIAL (SLM)

Channels are made by combining them in various ways. The following are the four most common distribution types: Zero-level or direct-to-market sales: The manufacturer sells directly to the consumer, bypassing any middlemen. The quickest path is not always possible, and it may not be the most cost-effective or appropriate. Level one channel: Between the manufacturer and the customer, an intermediary, such as a wholesale distributor or, more generally, a retailer, is introduced. Level two channel: The process requires two intermediaries; for example, the manufacturer distributes goods to a customer base through a wholesaler. Level three, also known as the indirect channel, is the most time-consuming since intermediary agents are involved, either to reach wholesalers or end-consumers. While an indirect distribution channel may appear to be more costly and complicated at first glance, a direct distribution channel is more expensive to manage and does not always ensure effective product and service distribution. The most successful approach would incorporate direct and indirect delivery networks, with a constant emphasis on meeting the needs of a particular group of consumers. However, we can go even further in classifying different forms of distribution channels since, in addition to the chain of intermediaries, we can use a quantitative strategy: • Intensive distribution entails using as many distribution channels as possible in order to give goods or services a wide market positioning. This is the most widely used. • Strict distribution: Products or services are only available via those networks. For instance, a brand that only sells in a specific geographic area or that only sells goods through its mobile app. • Exclusive distribution: In order to project a high-end brand image, items are only sold through a small number of outlets and in limited quantities, such as own stores or a counter in a chain of department stores. There are many more types of distribution channel routes and marketing, online and offline, that can be added to a strategy, as defined by Gabriel Weinberg, CEO of DuckDuckGo: • Advertising • Search Engine Marketing • Social network ads • Ads in printed media (or press) • SEO Optimization • Content Marketing 87 CU IDOL SELF LEARNING MATERIAL (SLM)

• Email Marketing • Viral Marketing • Affiliate Programs • Fairs and congresses • Offline events • Talks and presentations Ways to create a distribution channel strategy • Choose the appropriate delivery networks As we've shown, not every approach works with every product or service delivery scenario. The channels you select should add value to the customer's experience and make it better. What are their preferred shopping locations, times, and methods? What kind of knowledge, direction, or training do they need before being persuaded? Don't expect your networks to adapt to your customers, and don't expect it to function the other way around – it won't. • Implement a corporate plan When it comes to choosing a distribution channel, it's important to consider costs and profit margins, particularly when third parties and intermediaries are involved. You should make sure the distribution is feasible and that it can be carried out according to the agreed-upon terms, with the ability to scale up or down depending on demand. The company's, distributors', and consumers' goals and benefits should all be aligned. • Have education and training Maintaining a high level of product or service awareness within the organisation takes a lot of work, but it's also crucial to pass it on to the other parties involved. Teach your intermediaries what they need to know about your goods so they can be effective salespeople who know how to speak with customers about them. • Make your channels B2C and B2B friendly. B2C distribution channels are typically longer and easier to identify, while a B2B approach may entail fewer steps because the company interacts directly with other businesses. The procurement method, on the other hand, would be somewhat different, possibly slower or with demands for large quantities of merchandise. • Make product details more consistent. When there is a lack of product information that is homogeneous and adequate for reference purposes, one of the key causes of issues between intermediaries and consumers is when there is a lack of product information that is homogeneous and adequate for reference 88 CU IDOL SELF LEARNING MATERIAL (SLM)

purposes. Your organisation should have a system in place, such as a Product Information Manager (PIM), that provides a source of integrity for product data in each distribution channel. You can only guarantee that all members in a chain have the same up-to-date information and that consumers can still find the same data across all networks if you use a PIM. • Work on both publicity and sales at the same time. While the sales staff can also engage in the promotion of a distribution channel, the management of distribution channels is normally the responsibility of the company's marketing department. Sharing knowledge is often useful and saves time when planning a distribution channel's marketing. The position of your sales staff, for example, would be critical if the service or product being sold necessitates the presence of more complicated agents and contract signing procedures. Your product delivery marketing team, on the other hand, would be able to simplify more of the processes if the sale is virtually direct, via online platforms such as websites and apps. • Make sure the number and types of distribution channels are balanced. It's critical to strike a balance between distribution channels in order to avoid price, positioning, launch, and promotional campaign disparities. If your customers realise that they can get goods at different rates in different networks, it will cause friction between your intermediaries and partners, as well as a loss of profit. • Develop a distribution partner network Begin by searching for \"normal\" partners, who are retailers or brands who already have a relationship with your current or target customers. Forming strategic partnerships with these types of partners is essential for and the network and securing lucrative deals that balance pre-existing supply to demand. Companies must set mutual goals and plan advertising activities, agree on methods of analytics sharing, and, if necessary, provide training on the product or service as well as assistance with inventory provision to ensure the effectiveness of a partner partnership. 5.10 POSITIONING THROUGH SALES PROMOTION AND ADVERTISING Sales promotion is an effective promotional tool that works in tandem with personal sale and advertisement. Sales promotion, according to the American Marketing Association, “includes those marketing activities, other than personal sale, advertisement, and publicity, that stimulate customer buying and dealer effectiveness, such as displays, shows and expositions, 89 CU IDOL SELF LEARNING MATERIAL (SLM)

demonstrations, and various non-recurrent selling efforts not in the ordinary routine,” such as displays, shows and expositions, demonstrations, and various non-recurrent selling efforts not in the ordinary routine. Free samples, premiums on sale, sales and dealer rewards, competitions, fairs and exhibits, and public relations events are all examples of sales marketing strategies. Other than advertisement and personal selling, sales promotions are events that increase product demand. The main goal is to encourage on-the-spot purchases by potential customers using short-term offers. These benefits are basically one-time and non-repeatable. Personal marketing, which is when salespeople persuade consumers to purchase such goods, is not the same as sales promotion. It's also not the same as ads. Except for direct mail, all advertising is done by media that the company owns and controls. In comparison to personal selling or advertisement, sales promotion usually involves non- recurring and non-routine methods. Sales promotion practises, in particular, are designed to complement and coordinate personal selling and advertisement. Sales promotion involves non-routine events such as sample delivery, discount vouchers, tournaments, product displays, fairs and exhibits, and so on. It excludes, however, advertising, publicity, and personal sale. Objective of Sales Promotion • It boosts middlemen's productivity and serves as a complement to ads and personal sale. • It encourages salespeople to focus on new clients, latent accounts, new goods, and new territories. • It boosts revenue and accelerates the selling of slow-moving products, as well as stabilising a fluctuating sales pattern. • It encourages channel representatives to join the manufacturer's promotional efforts. • Encouraging dealers to purchase large quantities of goods and promote the labels that are currently on sale. • Assisting and supplementing the activities of ads and personal selling. • Persuading customers to switch labels in favour of the company. • To deal with seasonal product fluctuations. • Using local advertisements and point-of-purchase displays to persuade retailers to advertise the brand. • Sales incentives encourage salespeople to sell more and sell the whole product line. • To reduce the perceived risk associated with a product purchase. Need and importance of Sales promotion 90 CU IDOL SELF LEARNING MATERIAL (SLM)

Between advertisement and personal selling, sales promotion serves as a connection. The role of sales promotion has risen dramatically as a result of consumer adversity. Sales promotion aids in the removal of customer frustration with a specific product or manufacturer, as well as the development of a brand image in the minds of customers and users. The only promotional items available at the point of sale are sales promotional items. An advertising medium reaches prospects at their homes, workplaces, and other locations, but it is quickly forgotten. Customers are encouraged to make purchases right away through sales promotional devices at the point of sale. Business firms use promotional tools to achieve the following benefits: • Getting People's Attention: The first goal of a sales promotion is to get people's attention and educate them about a product's availability, features, and applications. • Emphasizing the Product's Usefulness: Promotion aids in informing the public of the benefits of new goods. It also explains how the items in question would help them meet their unique needs. • Stimulation of New Product Demand: Promotional activities are used to pique people's interest in a new product and convince them to purchase it. This aids in the launch of a new product. • Differentiation of Products: Promotion aids in the differentiation of a company's product from rival goods from other companies. A company may also use data to see how the product stacks up against the competition. • Promotional Activities Synergy: Personal selling and promotional efforts of the company are supplemented by sales promotion activities. They improve the overall efficiency of the company's marketing efforts. • Sales Volume Stabilization: In today's competitive world, one of the most critical functions of marketing is to help stabilise sales volume by assuring consumers of the product's quality and price. It is likely that a consumer who is already using one brand would switch to another if the other brand is advertised effectively. • Marketing Control or Performance Appraisal: Since it can analyse the costs incurred and the profits gained, a company's management can keep a close eye on the outcomes obtained by sales promotion schemes. Sales Promotion Benefits: 91 CU IDOL SELF LEARNING MATERIAL (SLM)

• Differentiates you from the competition – When you introduce a new product or ask consumers to interact with your company in a new way, you set yourself apart from the competition. Planning a promotion forces you to think about something new or innovative that can add value to your customers. • Generates new content and networking opportunities – Using sales marketing to generate new content for the consumers is one of the simplest ways to do so. • Provides opportunities for upsells and cross-sells – When you package or bundle goods around a theme or solution, you will also create sales of several items rather than just one. • Influences consumer decision-making – Limited availability deals will instil in your consumers a sense of urgency, prompting them to act. You will build compelling reasons to purchase if you add sampling of your promotional item to the mix. • Encourages word-of-mouth marketing – Promotions can give your regular customers a new reason to be surprised and pleased by your company, encouraging them to tell their friends about it. • Provides employees with training opportunities – Promotions include an opportunity to train, plan, and re-engage sales staff in what's new in the market. • Provides opportunities for experimentation – Promotions include a limited time window in which to evaluate and quantify new concepts and goods. This will aid in determining if they are worthy of additional time and resources to become permanent goods or services. • Increases revenue – Sales promotions are a perfect way to increase revenue year over year and month over month. Role of Advertising in Brand positioning Advertising plays a crucial role in the creation of a brand's reputation. It tells customers about the brand's practical capabilities while also instilling abstract ideals and meanings that are meaningful to them. Brand strategists, designers, and creatives in ad agencies are on the lookout for new emotional values to bring to a brand. They seek out ways to elicit emotional interaction because it indicates a deeper relationship between the brand and the target consumer. Businesses use ads to both distribute their brand among the masses and to market goods and services directly to the general public. The brand becomes more recognisable as the company's message is repeated. Since advertising is an efficient medium for mass marketing and communication, it is critical for businesses attempting to influence consumer behaviour. 92 CU IDOL SELF LEARNING MATERIAL (SLM)

Figure 5.6 ROLE OF ADVERTISING IN BRAND POSITIONING • It raises awareness. One of the most important functions of advertising is to raise awareness of the product or service, such as the brand name and price. Highlighting the brand's distinctive features will help to raise awareness of the product or service. Owing to today's fierce rivalry, recognition is more important than ever. • Persuasion is a skill that allows you to persuade Marketers attempt to persuade consumers that their goods are superior to those of rivals on the market by using compelling advertisements. Persuasion can be accomplished by imaginative promotional messages, product demonstrations at trade shows, free gifts, exclusive deals, and competitions. • A friendly reminder If target customers already have a favourable opinion of a company's product or service, a reminder goal might be appropriate since happy customers may become targets for competitors' appeals. They should remind them of their position in the market on a regular basis. The ‘Raymond – the Full Guy' campaign, for example, is meant to remind consumers. • Picture of the company Advertising aids in the development of a positive picture of the brand in the minds of the target market. Several factors may aid in the development of the brand image in the minds of the target audience, including the celebrity who endorses the brand, the quality of the promotional message, the design and style of packaging, and the type of programmes or events supported. • Loyalty to a brand Advertising aids in the development of brand loyalty, which leads to repeat sales and positive referrals from existing customers. Brand loyalty can also be developed by sales promotion, successful personal selling, timely and productive direct marketing, and other techniques. 93 CU IDOL SELF LEARNING MATERIAL (SLM)

Service differentiation strategy In today's world of cutthroat rivalry, the idea of being unique is critical. The revenue generated by a product distinguishes it from its competitors. To stay ahead of the competition, products must be special. It is not only domestic rivalry that exists, but also international competition, as one country produces and sells in another while others produce and sell in our country. Customers who are being targeted have a lot of choices. Choosing between options is often based on implicit and explicit variations. As a result, in order to attract a customer and persuade him or her to purchase a commodity, one must stand out. A great way to reduce competition is to create distinction of one's own goods and services. Customers will be presented with a wide range of product choices. Every consumer will find a product that he or she enjoys. Customers at all price points, whether low-end, mid-range, or high-end, can have a product to choose from. Pace, efficiency, consistency, responsiveness, availability, ease of use, and integration are all examples of common differentiations. All of the above points apply to a tangible product. But how do we distinguish services? It is simple to differentiate variables when they are tangible, such as in the case of a product, but it is more complicated in the case of services. If the product does not have many practical features, one way is to add value-added services to it. This is referred to as service differentiation. Service Differentiation in Marketing The main features of service differentiation include: • Buying convenience: Companies like Dell and Baxter Healthcare, as well as web-based services like peapod and net grocer, have made it easier to place an order. The product can be purchased without leaving the home. • Delivery: this refers to how quickly and accurately a product or service is shipped to a customer. Again, one of the best examples is Dell, which delivers its goods to customers' doorsteps. • Installation: this is the work that is done to get the product up and running at the specified site. Buyers of heavy machinery demand professional installation. For companies that sell complex goods like computers and machinery, differentiation by installation is especially significant. • Customer training: This is the process by which the seller instructs the buyer on how to use the product. General Electric not only sells and instals costly X-ray machines in hospitals, but it also provides rigorous instruction to hospital personnel about how to use them. • Customer consulting: The documentation, information systems, and advising services that the seller provides to buyers are referred to as customer consulting. The Vitamin Institute, for example, is a communication network run by the Rite Aid drugstore chain that provides 94 CU IDOL SELF LEARNING MATERIAL (SLM)

consumers with information so they can make more informed decisions and feel secure asking for help. Rite Aid has partnered with drugstore.com to provide much more detailed health information on the internet. • Maintenance and Repair: This applies to after-sale facilities, which usually involve maintenance and repair. Automobile manufacturers are often seen offering free services when the vehicles are first purchased. 5.11 SERVICE DIFFERENTIATION STRATEGIES In today's world of cutthroat rivalry, the idea of being unique is critical. The revenue generated by a product distinguishes it from its competitors. To stay ahead of the competition, products must be special. It is not only domestic rivalry that exists, but also international competition, as one country produces and sells in another while others produce and sell in our country. Customers who are being targeted have a lot of choices. Choosing between options is often based on implicit and explicit variations. As a result, in order to attract a customer and persuade him or her to purchase a commodity, one must stand out. A great way to reduce competition is to create distinction of one's own goods and services. Customers will be presented with a wide range of product choices. Every consumer will find a product that he or she enjoys. Customers at all price points, whether low-end, mid-range, or high-end, can have a product to choose from. Pace, efficiency, consistency, responsiveness, availability, ease of use, and integration are all examples of common differentiations. All of the above points apply to a tangible product. But how do we distinguish services? It is simple to differentiate variables when they are tangible, such as in the case of a product, but it is more complicated in the case of services. If the product does not have many practical features, one way is to add value-added services to it. This is referred to as service differentiation. Service Differentiation in Marketing The main features of service differentiation include: • Buying convenience: Companies like Dell and Baxter Healthcare, as well as web-based services like peapod and net grocer, have made it easier to place an order. The product can be purchased without leaving the home. • Delivery: this refers to how quickly and accurately a product or service is shipped to a customer. Again, one of the best examples is Dell, which delivers its goods to customers' doorsteps. • Installation: this is the work that is done to get the product up and running at the specified site. Buyers of heavy machinery demand professional installation. For companies that sell complex goods like computers and machinery, differentiation by installation is especially significant. 95 CU IDOL SELF LEARNING MATERIAL (SLM)

• Customer training: This is the process by which the seller instructs the buyer on how to use the product. General Electric not only sells and instals costly X-ray machines in hospitals, but it also provides rigorous instruction to hospital personnel about how to use them. • Customer consulting: The documentation, information systems, and advising services that the seller provides to buyers are referred to as customer consulting. The Vitamin Institute, for example, is a communication network run by the Rite Aid drugstore chain that provides consumers with information so they can make more informed decisions and feel secure asking for help. Rite Aid has partnered with drugstore.com to provide much more detailed health information on the internet. • Maintenance and Repair: This applies to after-sale facilities, which usually involve maintenance and repair. Automobile manufacturers are often seen offering free services when the vehicles are first purchased. 5.12 SUMMARY • Marketing is a method of reaching out to customers to build awareness about products, and STP (segmentation, targeting, and positioning) is a marketing strategy that helps marketers distinguish, attract, maintain, and expand their customer base for their respective products in STP strategies of various companies. • STP is made up of three stages, the first of which is determining what kind of customers exist. Choose the ones that advertisers should be attempting to serve. Implementing segmentation by optimising goods or services for that segment and promoting the fact that \"we are different.\" • Market analysis and marketing research are also related to STP. STP uses industry and marketing analysis to collect information about existing market size, market shares, consumer base concentration for specific products, potential buyers, and customer purchasing decision processes in order to make the product competitive. • According to the findings, human-related aspects of service quality (reliability, responsiveness, assurance, and empathy) have a greater effect on customer satisfaction than non-human-related aspects of perceived service quality (tangibles). There are two perspectives on service quality: internal and external to the service company. • The GAP Model of Service Quality assists the business in determining customer satisfaction. The GAP Model is commonly used in the service industry to explain the multiple variations that arise in the process of providing service to potential customers. • The GAP Model provides a blueprint for the overall service delivery process and defines the gaps between processes, ensuring that the entire model runs smoothly. This assists service providers in identifying inefficiencies in the service delivery process. 96 CU IDOL SELF LEARNING MATERIAL (SLM)

5.13 KEY WORDS • STP: Segmentation, Targeting and Positioning of services • AIDAS: Attention, Interest, Desire, Action and Satisfaction • B2B: Business to Business • B2C: Business to consumer • Facility Design: buildings, furniture, layout, decor, etc. • Brand: Identify the product and compare with other products in name, term stc • Logo: name, symbol, or trademark designed for easy and definite recognition 5.14 LEARNING ACTIVITY 1. Collect ads of services that have positioned themselves well on the basis of price, benefits, competition and quality. ___________________________________________________________________________ ___________________________________________________________________________ 5.15 UNIT END QUESTIONS A. Descriptive Questions Short Questions 1. Develop market segmentation strategies for healthcare services. 2. Develop suitable positioning strategies for a brand-new airline service. 3. Describe the various classifications of services strategies positioning with suitable Market opportunities. 4. What do you think brand positioning strategy on the basis of which attribute would yield maximum results? Explain your answer 5. How a brand can be a repositioning for two or more attributes? Give reasons to explain your answer. 6. How the service firm do without a positioning statement or can a firm skip the positioning process? Explain your answer. Long Questions 97 CU IDOL SELF LEARNING MATERIAL (SLM)

1. Explain the options available for a firm to repositioning a service? If you want to repositioning airline services, how would you do it? 2. What are the three types of analysis to consider when developing a market positioning strategy? 3. Success will breed imitators. What can a firm do toward them off? Give examples to support your answer. 4. Prepare a blueprint of service market repositioning strategy. 5. Explain in detail about Service differentiation strategies B. Multi Choice Questions 1. In marketing terms, ____________ means providing a relatively narrow product mix for a particular market segment. a. cantor b. synopsis c. focus d. phyla e. class 2. Which of the following is NOT one of the four basic focus strategies? a. Service focused b. Unfocused c. Fully focused d. Refocused e. Market focused 3. A ____________ is composed of a group of buyers who share common characteristics, needs, purchasing behaviour, or consumption patterns. a. target class b. class c. focal segment d. market segment e. target segment 98 CU IDOL SELF LEARNING MATERIAL (SLM)

4.A(n) ____________ is one that a firm has selected from among those in the broader market and may be defined on the basis of several variables. a. general segment b. segmentation field c. target segment d. holistic segment e. mass customization Answers 1 – c, 2 – d, 3 – d,4-c 5.16 REFERENCES Text Books: • Zeithaml V. A. ,Bitner M. J. and Pandit, A., Services Marketing, 5th Edition, Tata McGraw Hill Publishing Co. Ltd. New Delhi. • Lovelock C. H., Wirtz, J. and Chatterjee, J., Service Marketing: People, Technology, Strategy, 6thEdition, Pearson Education, New Delhi. Reference Books: • Hoffman, K. D. & Bateson, J. E.G., Marketing of Services, Cengage Learning, • Kurtz D. L. and Clow K. E., Services Marketing. Biztantra, New Delhi. • Nargundkar, Rajendra, Services Marketing Text and Cases, 3rd Edition, Tata McGraw Hill Publishing Co. Ltd. New Delhi 99 CU IDOL SELF LEARNING MATERIAL (SLM)

UNIT 6: CONSUMER BEHAVIOR IN SERVICES MARKETING Structure 6.0 Learning Objectives 6.1 Introduction 6.2 Customer Expectations in Services 6.3 Service Costs Experienced by Consumer 6.4 The Role of Customer in Service Delivery 6.5 Conflict Handling in Services 6.6 Customer Responses in Services 6.7 Concept of Customer Delight 6.8 Summary 6.9 Keywords 6.10 Learning Activity 6.11 Unit End Questions 6.12 References 6.0 LEARNING OBJECTIVES After studying this unit, you will be able to: • Explain the consumer behaviour that influences consumers' buying decisions • Measure and identify key elements in decision making process • Evaluate the key factors affecting consumer buying process • Measure and develop the buyer motive Behaviour process 6.1 INTRODUCTION Consumer behaviour is the study of people and the mechanisms they use to choose, use (consume), and discard goods and services, as well as their social, mental, and behavioural responses. In the advancement of the service sector, consumer behaviour combines concepts from many disciplines, including psychology, sociology, chemistry, and economics. 100 CU IDOL SELF LEARNING MATERIAL (SLM)