Services Marketing: Concepts, Strategies, & Cases 4th Edition

Book Preface

The primary objective of Services Marketing: Concepts, Strategies, & Cases is to provide materials that not only introduce the student to the field of services marketing, but also acquaint the student with specific customer service issues. In addition to traditional busi-ness knowledge, the business world now demands increasing employee competence in developing effective service processes, constructing meaningful servicescapes, customer satisfaction and service quality measurement, as well as service recovery skills that are essential in growing and sustaining the existing customer base.

Approach

Following the same philosophical approach used in earlier editions, the fourth edition of Services Marketing: Concepts, Strategies, & Cases purposely examines the use of services marketing as a competitive weapon from a broadened perspective. Consequently, we view services marketing not only as a marketing tool for service firms, but also as a means of competitive advantage for those companies that market products on the tangible side of the product continuum. As a result, business examples used throughout the text reflect a wide array of firms representing the nine service economy supersectors, including education and health services, financial activities, government, information, leisure and hospitality, professional and business services, transportation and utilities, wholesale and retail trade, and other services—as well as firms that produce tangible products.

Ultimately, the service sector is one of the three main categories of a developed economy—the other two being industrial and agricultural. Traditionally, economies throughout the world tend to transition from an agricultural economy to an industrial economy (e.g., manufacturing, mining, etc.) to a service economy. The United Kingdom was the first economy in the modern world to make this transition. Several other coun-tries including the United States, Japan, Germany, and France have made this transition, and many more will join this group at an accelerated rate.

We continue to live in interesting times! The increased rate of transformation from an agricultural to a manufacturing to a service based economy has generally been caused by a highly competitive international marketplace. Simply stated, goods are more amenable to international trade than services, thereby making them more vulnerable to competitive actions. In other words, countries that industrialized their economies first eventually come under attack by other countries that are newly making the transition from an agri-cultural to an industrial economy. These “newcomer” countries offer lower production costs (especially labor), which is attractive to industry. Consequently, as industrial sectors flow from one country to the next, the countries they abandon begin to rely more heavily on the growth of their service sectors as the mainstay of their economies. This whole pro-cess repeats itself over and over as other less-developed countries enter the fray, conse-quently facilitating the transformation from agriculture to industrial to service-based economies.

Structure of the Book
Services Marketing: Concepts, Strategies, & Cases is divided into three main sections.

Part I: An Overview of Services Marketing
Part I concentrates on defining services marketing and discusses in detail the fundamen-tal concepts and strategies that differentiate the marketing of services from the marketing of tangible goods. The primary objective of Part I is to establish a core knowledge base that will be built upon throughout the remainder of the text.
Chapter 1, An Introduction to Services Marketing, provides just what it says—an intro-duction to the field of services marketing. It establishes the importance of the service sec-tor in the world economy and the need for services marketing education. Chapter 2, The Service Sector: Supersectors and Ethical Considerations, provides an overview of the ser-vice sector and focuses on the nine service industry supersectors and the most substantial changes taking place within the service sector. In addition, Chapter 2 takes an in-depth look at ethics in the service sector. Because of the differences between goods and services, unique opportunities arise that may encourage ethical misconduct. Chapter 3, Fundamen-tal Differences between Goods and Services, focuses more deeply on the differences be-tween goods and services—namely intangibility, inseparability, heterogeneity, and perishability—and their corresponding managerial implications. Possible solutions to mini-mize the negative consequences of these unique service characteristics are also discussed.

Thus far, Chapters 1, 2, and 3 introduce the fundamentals of the service experience, provide an overview of service industries and ethical considerations, and detail the un-ique challenges associated with the marketing of services. The remainder of this text is organized around the framework provided in Figure 3.5. The consumer must be at the heart of services marketing, and Chapter 4, Services Consumer Behavior, focuses on building your understanding of the behavior of service consumers as they select service providers and evaluate their satisfaction with the service they have received. Chapter 4 provides concepts and frameworks that permeate the rest of this book as service firms adapt their marketing mixes to reflect the changing needs of their customers.

Part II: The Tactical Services Marketing Mix
One of the most basic ideas in marketing is the marketing mix. The marketing mix re-presents the levers that the organization controls. These levers can be used to influence consumers’ choice processes as well as their evaluation of service satisfaction. The tradi-tional marketing mix is often expressed as the four Ps—product, place, price, and pro-motion. As Figure 3.5 illustrates, due to the fundamental differences between goods and services, the services marketing mix can be redefined and expanded, offering the three additional marketing mix variables of process, the physical environment, and people.

Given the importance of the services marketing mix, Part II of this text focuses on The Tactical Services Marketing Mix, spotlighting the marketing mix variables that must be the most modified when competing in service marketing environments. More specifically, Chapter 5 focuses on The Service Delivery Process; Chapter 6 examines The Pricing of Ser-vices; Chapter 7 investigates Developing the Service Promotion Strategy; Chapter 8 addresses Managing the Firm’sPhysicalEvidence; and Chapters 9 and 10 explore the “people issues” surrounding services marketing, including People as Strategy: Managing Service Employees and People as Strategy: Managing the Service Consumer, respectively.

Part III: Assessing and Implementing Successful Service Strategies
Marketing’s role with the rest of the organization is the theme for Part III of the book, which focuses on Assessing and Implementing Successful Service Strategies. Marketing is at the heart of each of these strategies, but their execution is dependent on harnessing all of the functions: Operations, Human Resources and Marketing. As such, Chapter 11, Defining and Measuring Customer Satisfaction, expands the consumer behavior chapter to explore ow it is possible to satisfy a customer in a particular service experience and how to mea-sure and manage satisfaction. Chapter 12, Defining and Measuring Service Quality, builds upon Chapter 11 and increases our understanding of how consumers evaluate services and the longer-term concept of service quality. Due to the complexity of the various rela-tionships that comprise a typical service encounter, service failures are inevitable; but because of inseparability, it is often possible to recover from a failure situation during the service encounter. Chapter 13 discusses how to successfully master the art of Complaint and Service Recovery Management.

Given the current competitive situation among many service firms, Chapter 14 deals with Customer Loyalty and Retention as an important strategy for service firms to consider seriously. Finally Chapter 15, Pulling the Pieces Together: Creating a World-Class Service Culture, examines the role of marketing within the service organization. It juxtaposes the industrial management model and the market-focused model, and shows how important the latter is for a service business. This final chapter also discusses the key components of creating a world-class service culture.