Chapter 10 Services: The Intangible Product

Chapter 10 - Services: The Intangible Product Chapter 10 Services: The Intangible Product Multiple Choice Questions Any intangible offering that involves a deed, performance, or effort that cannot be physically possessed is called a(n): A artefact B commodity C service D pure good E inventory A service is any intangible offering that involves a deed, performance, or effort that cannot be physically possessed Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 10-01 Describe how marketing a service differs from marketing a product by applying the principles of intangibility; inseparability; inconsistency; and inventory Topic: 10-01 Services Marketing Differs from Product Marketing All the followings are unique characteristics of a service EXCEPT: A Intangible B Perishable C Variable D Durable E Inseparable The main four characteristics are: Intangible, Inseparable, Inconsistent, and perishable 10-1 Chapter 10 - Services: The Intangible Product Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Moderate Learning Objective: 10-01 Describe how marketing a service differs from marketing a product by applying the principles of intangibility; inseparability; inconsistency; and inventory Topic: 10-01 Services Marketing Differs from Product Marketing Marketing a service is more challenging than marketing a product because a service is: A intangible B separable C invariable D consistent E durable The marketing of services differs from product marketing because of four fundamental differences unique to services: they are intangible, inseparable, variable, and perishable Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 10-01 Describe how marketing a service differs from marketing a product by applying the principles of intangibility; inseparability; inconsistency; and inventory Topic: 10-02 Intangible The most fundamental difference between a product and a service is that a service is: A personalized B intangible C consistent D durable E separable The most fundamental difference between products and services is that services are intangible; they cannot be touched, tasted, or seen like a pure product can 10-2 Chapter 10 - Services: The Intangible Product Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Moderate Learning Objective: 10-01 Describe how marketing a service differs from marketing a product by applying the principles of intangibility; inseparability; inconsistency; and inventory Topic: 10-02 Intangible A high-end restaurant tries to create a niche for itself in the urban market by providing its customers exotic food, themed interiors, and a cozy atmosphere Which of the following characteristics has been emphasized by the high-end restaurant? A Separability B Consistency C Durability D Tangibility E Perishability A service is any intangible offering that involves a deed, performance, or effort that cannot be physically possessed Food and interiors are tangible attributes of the service Accessibility: Keyboard Navigation Blooms: Apply Difficulty: Moderate Learning Objective: 10-01 Describe how marketing a service differs from marketing a product by applying the principles of intangibility; inseparability; inconsistency; and inventory Topic: 10-02 Intangible The term "inseparable" refers to a characteristic of service, which states that: A services cannot be touched, tasted, or seen B the quality of service may vary because it is provided by humans C services cannot be held in inventory D services are produced and consumed at the same time E services are perishable and cannot be stored for future use Services are produced and consumed at the same time—that is, service and consumption are inseparable 10-3 Chapter 10 - Services: The Intangible Product Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 10-01 Describe how marketing a service differs from marketing a product by applying the principles of intangibility; inseparability; inconsistency; and inventory Topic: 10-03 Inseparable Production and Consumption When marketers refer to the fact that services cannot be held in inventory or stored for future use, they are stating that services are: A intangible B durable C variable D perishable E standardized Services are perishable because they cannot be held in inventory or stored for use in the future Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 10-01 Describe how marketing a service differs from marketing a product by applying the principles of intangibility; inseparability; inconsistency; and inventory Topic: 10-05 Inventory When service providers state that services are produced and consumed at the same time, they are referring to the fact that services are: A inconsistent B intangible C inseparable D standardized E perishable Services are produced and consumed at the same time—that is, service and consumption are inseparable 10-4 Chapter 10 - Services: The Intangible Product Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 10-01 Describe how marketing a service differs from marketing a product by applying the principles of intangibility; inseparability; inconsistency; and inventory Topic: 10-03 Inseparable Production and Consumption A car service provider allows customers to decide on the services they want to avail and to be directly involved in the service The service provider has employed this measure to overcome which of the following characteristics of services? A Intangibility B Inseparability C Durability D Perishability E Inconsistency Services are produced and consumed at the same time—that is, service and consumption are inseparable Because service production can't be separated from consumption, astute service marketers provide opportunities for their customers to get directly involved in the service Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Moderate Learning Objective: 10-01 Describe how marketing a service differs from marketing a product by applying the principles of intangibility; inseparability; inconsistency; and inventory Topic: 10-03 Inseparable Production and Consumption 10 No chef will be able to reproduce the same taste with the same dish every time regardless of using the same recipe and technique Which of the following characteristics of services is being exemplified in the given scenario? A Tangibility B Variability C Perishability D Durability E Separability The more humans that are needed to provide a service, the more likely that the service's quality will be inconsistent or variable 10-5 Chapter 10 - Services: The Intangible Product Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Moderate Learning Objective: 10-01 Describe how marketing a service differs from marketing a product by applying the principles of intangibility; inseparability; inconsistency; and inventory Topic: 10-04 Inconsistent 11 Which of the following characteristics of services is most likely to be reduced through training and standardization? A Intangibility B Inconsistency C Perishability D Durability E Inseparability Marketers of services strive to reduce service inconsistency through training and standardization Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Moderate Learning Objective: 10-01 Describe how marketing a service differs from marketing a product by applying the principles of intangibility; inseparability; inconsistency; and inventory Topic: 10-04 Inconsistent 12 Which of the following is true of services offered by business organizations? A The tangibility of services can be reduced through training and standardization B Marketing of services is less challenging compared to marketing of products C The inconsistent nature of services does not provide an opportunity for marketers to use it to their advantage D The perishability of services is a challenge for marketers as they have to match the demand and supply E Services cannot be produced and consumed at the same time The perishability of services provides both challenges and opportunities to marketers in terms of the critical task of matching demand and supply 10-6 Chapter 10 - Services: The Intangible Product Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Moderate Learning Objective: 10-01 Describe how marketing a service differs from marketing a product by applying the principles of intangibility; inseparability; inconsistency; and inventory Topic: 10-05 Inventory 13 Empty seats in airlines and empty rooms in hotels might be sold for a fraction of the original price This is due to which service characteristic? A Intangibility B Inconsistency C Perishability D Durability E Inseparability Services are perishable because they cannot be held in inventory or stored for use in the future In low seasons, airlines and hotels reduce price to stimulate demand Accessibility: Keyboard Navigation Blooms: Apply Difficulty: Moderate Learning Objective: 10-01 Describe how marketing a service differs from marketing a product by applying the principles of intangibility; inseparability; inconsistency; and inventory Topic: 10-05 Inventory 14 Which of the following is NOT true about service gap? A It could be due to firm's misperception of customers' expectations B It results when delivery of a service fails to meet customers' expectations C Service providers can close the gap by offering consistent service D It could be due to the difference between the firm's standards and customers' expectation E It results in customer dissatisfaction Offering consistent service is not good enough A service provider could consistently offer the gap to the customers! Service providers must understand all four gaps and try to close the gap 10-7 Chapter 10 - Services: The Intangible Product Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Moderate Learning Objective: 10-01 Describe how marketing a service differs from marketing a product by applying the principles of intangibility; inseparability; inconsistency; and inventory Topic: 10-06 Providing Great Service: The Gaps Model 15 Which of the following is a straightforward and inexpensive method of collecting consumers' perceptions of service quality? A Bridging the standards gap B Gathering information at the time of a sale C Defining the zone of tolerance D Making effective use of customer complaint behaviour E Establishing specific marketing metrics A very straightforward and inexpensive method of collecting consumers' perceptions of service quality is to gather them at the time of the sale Service providers can ask customers how they liked the service—though customers often are hesitant to provide negative feedback directly to the person who provided the service—or distribute a simple questionnaire Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Moderate Learning Objective: 10-02 Outline the four gaps in the Gaps model used to understand and manage customer expectations Topic: 10-11 Service Quality and Customer Satisfaction and Loyalty 16 The difference between customers' expectations and a firm's perception of those customer expectations is reflected in the: A standards gap B communication gap C delivery gap D zone of tolerance E knowledge gap The knowledge gap reflects the difference between customers' expectations and the firm's perception of those customer expectations Firms can close this gap by matching customer expectations with actual service through research 10-8 Chapter 10 - Services: The Intangible Product Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 10-02 Outline the four gaps in the Gaps model used to understand and manage customer expectations Topic: 10-06 Providing Great Service: The Gaps Model 17 A retirement home has provided bicycles to its residents to help them move around the housing area However, the residents are not keen on using this service and prefer to use golf carts instead This is an example of which type of gap? A Communication B Delivery C Standards D Knowledge E Common The knowledge gap reflects the difference between customers' expectations and the firm's perception of those customer expectations Firms can close this gap by matching customer expectations with actual service through research Accessibility: Keyboard Navigation Blooms: Apply Difficulty: Moderate Learning Objective: 10-02 Outline the four gaps in the Gaps model used to understand and manage customer expectations Topic: 10-07 The Knowledge Gap: Knowing What Customers Want 18 A state-of-the-art gym provides a separate recreation area where customers can play chess, scrabble, and table tennis Not many customers use this facility Which of the following reflects the lack of perception of customer expectation on the part of the gym? A Communication gap B Delivery gap C Standards gap D Knowledge gap E Zone of tolerance The knowledge gap reflects the difference between customers' expectations and the firm's perception of those customer expectations Firms can close this gap by matching customer expectations with actual service through research 10-9 Chapter 10 - Services: The Intangible Product Accessibility: Keyboard Navigation Blooms: Apply Difficulty: Moderate Learning Objective: 10-02 Outline the four gaps in the Gaps model used to understand and manage customer expectations Topic: 10-07 The Knowledge Gap: Knowing What Customers Want 19 When a firm is trying to match customer expectations with actual service through research, it is attempting to reduce the: A knowledge gap B standards gap C delivery gap D communication gap E time gap The knowledge gap reflects the difference between customers' expectations and the firm's perception of those customer expectations Firms can close this gap by matching customer expectations with actual service through research Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Difficult Learning Objective: 10-02 Outline the four gaps in the Gaps model used to understand and manage customer expectations Topic: 10-07 The Knowledge Gap: Knowing What Customers Want 20 Service providers at a hair salon notice that most customers prefer reading fashion magazines The salon then decides to subscribe to more fashion magazines and cancel its subscription to other non-fashion magazines This approach shows that the salon is trying to reduce the: A communication gap B delivery gap C knowledge gap D standards gap E zone of tolerance The knowledge gap reflects the difference between customers' expectations and the firm's perception of those customer expectations Firms can close this gap by matching customer expectations with actual service through research 10-10 Chapter 10 - Services: The Intangible Product Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 10-01 Describe how marketing a service differs from marketing a product by applying the principles of intangibility; inseparability; inconsistency; and inventory Topic: 10-01 Services Marketing Differs from Product Marketing 94 The marketing of services is more challenging than the marketing of products as services are intangible and inseparable from their providers TRUE The marketing of services differs from product marketing because of four fundamental differences unique to services: they are intangible, inseparable, variable, and perishable These differences make marketing services considerably more challenging than marketing products Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 10-01 Describe how marketing a service differs from marketing a product by applying the principles of intangibility; inseparability; inconsistency; and inventory Topic: 10-01 Services Marketing Differs from Product Marketing 95 The inconsistent nature of services can be used by marketers to their advantage TRUE Marketers can use the inconsistent nature of services to their advantage Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Easy Learning Objective: 10-01 Describe how marketing a service differs from marketing a product by applying the principles of intangibility; inseparability; inconsistency; and inventory Topic: 10-04 Inconsistent 96 The Gaps model is designed to prescribe the steps needed to develop an optimal service strategy TRUE The Gaps model is designed to encourage the systematic examination of all aspects of the service delivery process and prescribe the steps needed to develop an optimal service strategy 10-49 Chapter 10 - Services: The Intangible Product Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 10-02 Outline the four gaps in the Gaps model used to understand and manage customer expectations Topic: 10-06 Providing Great Service: The Gaps Model 97 The knowledge gap pertains to the difference between a firm's perceptions of customers' expectations and the service standards it sets FALSE The knowledge gap reflects the difference between customers' expectations and a firm's perception of those customer expectations Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Moderate Learning Objective: 10-02 Outline the four gaps in the Gaps model used to understand and manage customer expectations Topic: 10-07 The Knowledge Gap: Knowing What Customers Want 98 Firms can close the delivery gap by being more realistic about the services they can provide to customers FALSE The delivery gap is the difference between the firm's service standards and the actual service it provides to customers This gap can be closed by getting employees to meet or exceed service standards Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Moderate Learning Objective: 10-02 Outline the four gaps in the Gaps model used to understand and manage customer expectations Topic: 10-09 The Delivery Gap: Delivering Service Quality 99 The delivery gap is the difference between a firm's standards and the actual service it provides to customers TRUE The delivery gap is the difference between the firm's service standards and the actual service it provides to customers This gap can be closed by getting employees to meet or exceed service standards 10-50 Chapter 10 - Services: The Intangible Product Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 10-02 Outline the four gaps in the Gaps model used to understand and manage customer expectations Topic: 10-09 The Delivery Gap: Delivering Service Quality 100 Responsiveness refers to the caring and individualized attention provided to customers FALSE The dimension of responsiveness refers to the willingness of service providers to help customers and provide prompt service Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 10-02 Outline the four gaps in the Gaps model used to understand and manage customer expectations Topic: 10-11 Service Quality and Customer Satisfaction and Loyalty 101 The dimension of reliability refers to the knowledge of employees and their ability to convey trust and confidence FALSE The dimension of reliability refers to the ability to perform a service dependably and accurately Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 10-02 Outline the four gaps in the Gaps model used to understand and manage customer expectations Topic: 10-11 Service Quality and Customer Satisfaction and Loyalty 102 The zone of tolerance is an important marketing metric used to evaluate the performance of firms on the five service quality dimensions TRUE An important marketing metric to evaluate how well firms perform on the five service quality dimensions, the concept of the zone of tolerance refers to the area between customers' expectations regarding their desired service and the minimum level of acceptable service— that is, the difference between what the customer really wants and what he or she will accept before going elsewhere 10-51 Chapter 10 - Services: The Intangible Product Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 10-02 Outline the four gaps in the Gaps model used to understand and manage customer expectations Topic: 10-07 The Knowledge Gap: Knowing What Customers Want 103 To deliver consistently high-quality service, firms should allow service quality goals to be general to accommodate various needs of consumers FALSE To deliver consistently high-quality service, firms must set specific, measurable goals based on customers' expectations; to help ensure that quality, the employees should be involved in the goal setting Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Moderate Learning Objective: 10-03 Describe strategies that firms can use to help employees provide better service Topic: 10-11 Service Quality and Customer Satisfaction and Loyalty 104 Employee empowerment is an ineffective way to reduce the delivery gap FALSE In this context, empowerment means allowing employees to make decisions about how service is provided to customers When front-line employees are authorized to make decisions to help their customers, service quality generally improves Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Easy Learning Objective: 10-03 Describe strategies that firms can use to help employees provide better service Topic: 10-09 The Delivery Gap: Delivering Service Quality 105 The managers of firms will increase the delivery gap by providing incentives to service providers FALSE The managers of firms can reduce the delivery gap by providing consistent support and incentives to service providers 10-52 Chapter 10 - Services: The Intangible Product Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Moderate Learning Objective: 10-03 Describe strategies that firms can use to help employees provide better service Topic: 10-09 The Delivery Gap: Delivering Service Quality 106 The communication gap pertains to the difference between a service promised and a service actually delivered TRUE The communication gap refers to the difference between the actual service provided to customers and the service that the firm's promotion program promises Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 10-03 Describe strategies that firms can use to help employees provide better service Topic: 10-10 The Communication Gap: Communicating the Service Promise 107 In a service failure situation, some customers just needs to be heard TRUE In many service failure cases, customers may just want to be heard and the service provider should give the customer all the time he/she needs to get it out! Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Moderate Learning Objective: 10-04 Identify three service recovery strategies Topic: 10-12 Service Recovery 108 An important way to control the communication gap for firms is by promising only what they can deliver TRUE Promising only what you can deliver, or possibly even a little less, is an important way to control the communication gap 10-53 Chapter 10 - Services: The Intangible Product Accessibility: Keyboard Navigation Blooms: Remember Difficulty: Easy Learning Objective: 10-03 Describe strategies that firms can use to help employees provide better service Topic: 10-10 The Communication Gap: Communicating the Service Promise 109 Service providers should avoid failure as service recovery won't impact customer satisfaction much FALSE Effective service recovery efforts can significantly increase customer satisfaction Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Moderate Learning Objective: 10-04 Identify three service recovery strategies Topic: 10-12 Service Recovery 110 In a service failure situation, the representative must listen to the customer and offer him what seems to be a fair solution from the company's perspective FALSE Fairness relates to a customers' perception Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Easy Learning Objective: 10-04 Identify three service recovery strategies Topic: 10-14 Finding a Fair Solution Short Answer Questions 111 Medassure is a health care service provider How can Medassure add tangibility to its services? Student answers will vary Medassure can add tangibility to its services by providing things such as a waiting room stocked with TV sets, computer games, toys for children, upscale beverages, and comfortable chairs to create an atmosphere that appeals to the target market 10-54 Chapter 10 - Services: The Intangible Product Accessibility: Keyboard Navigation Blooms: Apply Difficulty: Moderate Learning Objective: 10-01 Describe how marketing a service differs from marketing a product by applying the principles of intangibility; inseparability; inconsistency; and inventory Topic: 10-01 Services Marketing Differs from Product Marketing 112 How service providers reduce service inconsistency? Provide one example to support your answer Service providers strive to reduce service inconsistency through training and standardization They can also tackle this issue by replacing people with machines Providing online services has also helped in reducing inconsistency Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Moderate Learning Objective: 10-01 Describe how marketing a service differs from marketing a product by applying the principles of intangibility; inseparability; inconsistency; and inventory Topic: 10-04 Inconsistent 113 Why is the perishability of services a challenge for marketers? Provide one example to support your answer The perishability of services provides both challenges and opportunities to marketers in terms of the critical task of matching demand and supply Balancing the ups and downs of demand and capacity is challenging For services companies, excess demand results in having to turn customers away in peak periods, while excess capacity may mean less desirable expense to revenue ratios Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Moderate Learning Objective: 10-01 Describe how marketing a service differs from marketing a product by applying the principles of intangibility; inseparability; inconsistency; and inventory Topic: 10-05 Inventory 114 Write a brief note describing the Gaps model The Gaps model is designed to highlight those areas where customers believe they are getting less or poorer services than they expect (the gaps) and how these gaps can be closed It is designed to encourage the systematic examination of all aspects of the service delivery process and prescribe the steps needed to develop an optimal service strategy 10-55 Chapter 10 - Services: The Intangible Product Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Moderate Learning Objective: 10-02 Outline the four gaps in the Gaps model used to understand and manage customer expectations Topic: 10-06 Providing Great Service: The Gaps Model 115 What is the knowledge gap? How can it be reduced? Provide one example The knowledge gap reflects the difference between customers' expectations and the firm's perception of those customer expectations Firms can close this gap by matching customer expectations with actual service through research Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Moderate Learning Objective: 10-02 Outline the four gaps in the Gaps model used to understand and manage customer expectations Topic: 10-07 The Knowledge Gap: Knowing What Customers Want 116 What is a voice-of-customer program? A voice-of-customer program is an ongoing marketing research system that collects customer insights and intelligence to influence and drive business decisions Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Easy Learning Objective: 10-02 Outline the four gaps in the Gaps model used to understand and manage customer expectations Topic: 10-07 The Knowledge Gap: Knowing What Customers Want 117 How firms define customers' zone of tolerance? Provide one example to support your answer To define the zone of tolerance, firms ask a series of questions to customers about each service quality dimension that relates to:  the desired and expected level of service for each dimension, from low to high  customers' perceptions of how well the focal service performs and how well a competitive service performs, from low to high  the importance of each service quality dimension 10-56 Chapter 10 - Services: The Intangible Product Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Moderate Learning Objective: 10-02 Outline the four gaps in the Gaps model used to understand and manage customer expectations Topic: 10-07 The Knowledge Gap: Knowing What Customers Want 118 Craig Jones is a manager at a hotel that is receiving complaints from its customers regarding the services provided How can Jones reduce this standards gap in his hotel? Student answers will vary To deliver high-quality service, Jones should set specific goals based on customers' expectations, explain to his employees what is expected of them, and train the employees on how to perform their tasks to the required standards He should also lead by example and demonstrate high service standards, and expect the same from his employees Accessibility: Keyboard Navigation Blooms: Apply Difficulty: Moderate Learning Objective: 10-03 Describe strategies that firms can use to help employees provide better service Topic: 10-08 The Standards Gap: Setting Service Standards 119 Kingfish Systems is a supplier of electronic and computer hardware equipment The firm is receiving a lot of orders but does not have sufficient staff to track the orders and deliver the goods on time How can the firm close this delivery gap? Student answers will vary Kingfish Systems can use technology to close this delivery gap It can create an online portal through which customers can place orders and use self-service mechanisms to resolve customer issues This technology will free up some Kingfish staff to concentrate on order fulfillment 10-57 Chapter 10 - Services: The Intangible Product Accessibility: Keyboard Navigation Blooms: Apply Difficulty: Moderate Learning Objective: 10-03 Describe strategies that firms can use to help employees provide better service Topic: 10-09 The Delivery Gap: Delivering Service Quality 120 Brenda, a manager at a hotel, is trying to solve a complaint from one of the customers who is made to wait for a long time to check into his room How can Brenda find a fair solution to this service failure? Student answers will vary Brenda can provide compensation to the customer by providing additional facilities apart from what had been promised, or she can compensate the customer with a free night's stay She can also increase the customer's satisfaction levels by solving the problem immediately and by promising that the error will not be repeated 10-58 Chapter 10 - Services: The Intangible Product Accessibility: Keyboard Navigation Blooms: Apply Difficulty: Moderate Learning Objective: 10-04 Identify three service recovery strategies Topic: 10-14 Finding a Fair Solution 121 Explain the four characteristics of services that differentiate them from products How marketers deal with the challenges resulting from these characteristics? Provide one example for each characteristics These are the four characteristics of services:  Intangible: The most fundamental difference between products and services is that services are intangible; they cannot be touched, tasted, or seen like a pure product can Marketers must therefore creatively employ symbols and images to promote and sell services  Inseparable: Services are produced and consumed at the same time—that is, service and consumption are inseparable Hence, service marketers provide opportunities for their customers to be directly involved in the service  Inconsistent: The more humans who are needed to provide a service, the more likely that the service's quality will be inconsistent or variable Marketers of services strive to reduce service inconsistency through training and standardization or by replacing people with machines  Inventory: Services are perishable because they cannot be held in inventory or stored for use in the future The perishability of services provides both challenges and opportunities to marketers in terms of the critical task of matching demand and supply 10-59 Chapter 10 - Services: The Intangible Product Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Moderate Learning Objective: 10-01 Describe how marketing a service differs from marketing a product by applying the principles of intangibility; inseparability; inconsistency; and inventory Topic: 10-01 Services Marketing Differs from Product Marketing Topic: 10-02 Intangible Topic: 10-03 Inseparable Production and Consumption Topic: 10-04 Inconsistent Topic: 10-05 Inventory 122 Universities and colleges are offering service to students Explain the four characteristics of services for your university/college  Intangible: service provided by universities/colleges is education It is intangible, cannot be touched, smelled, seen, or tasted  Inseparable: when an instructor teaches a course, service produced and consumed at the same time  Inconsistent: instructors who are teaching courses are not all alike  Inventory: Universities cannot store a program, if they not admit enough students, and sell it later Accessibility: Keyboard Navigation Blooms: Apply Difficulty: Moderate Learning Objective: 10-01 Describe how marketing a service differs from marketing a product by applying the principles of intangibility; inseparability; inconsistency; and inventory Topic: 10-01 Services Marketing Differs from Product Marketing 123 The Clare Group of hotels is known for its impeccable service How can the company ensure that there is no variability in the quality of service across its hotels in different locations? Student answers will vary The Clare Group can use training and standardization to reduce variability in its services It can standardize the service delivery process and provide extensive training to employees on how to greet customers, interact with them, and help them with their queries The Clare Group could also enforce a special dress code for its employees so that customers will associate Clare Group employees as a uniform group 10-60 Chapter 10 - Services: The Intangible Product Accessibility: Keyboard Navigation Blooms: Apply Difficulty: Moderate Learning Objective: 10-01 Describe how marketing a service differs from marketing a product by applying the principles of intangibility; inseparability; inconsistency; and inventory Topic: 10-04 Inconsistent 124 What is service quality? Describe the five distinct dimensions that customers use to determine the overall quality of a service Provide one example for each dimension Service quality refers to customers' perceptions of how well a service meets or exceeds their expectations Customers generally use the following dimensions to determine overall service quality:  Reliability: The ability to perform the service dependably and accurately  Responsiveness: The willingness to help customers and provide prompt service  Assurance: The knowledge of and courtesy by employees and their ability to convey trust and confidence  Empathy: The caring, individualized attention provided to customers  Tangibles: The appearance of physical facilities, equipment, personnel, and communication materials Accessibility: Keyboard Navigation Blooms: Understand Difficulty: Moderate Learning Objective: 10-02 Outline the four gaps in the Gaps model used to understand and manage customer expectations Topic: 10-11 Service Quality and Customer Satisfaction and Loyalty 125 Use the five service quality dimensions and explain how Air Canada can offer a high quality service Student answers will vary They need to explain each dimension of service quality for Air Canada 10-61 Chapter 10 - Services: The Intangible Product Accessibility: Keyboard Navigation Blooms: Apply Difficulty: Difficult Learning Objective: 10-03 Describe strategies that firms can use to help employees provide better service Topic: 10-11 Service Quality and Customer Satisfaction and Loyalty 126 Christine is the head of operations in an electronics retail chain Explain any two methods that Christine could use to close delivery gaps that could result in a service failure Student answers will vary Delivery gaps can be reduced when employees are empowered to act in the customers' and the firm's best interests and are supported in their efforts so they can their jobs effectively  Empowering service providers: Christine can empower the service providers in her organization by allowing them to make decisions about how service is provided to customers and to make necessary adjustments  Providing support and incentives: Christine can provide consistent and coherent support to service providers by showing concern and being supportive of their decisions She can also encourage employees to perform well by rewarding them for excellent service Accessibility: Keyboard Navigation Blooms: Apply Difficulty: Difficult Learning Objective: 10-03 Describe strategies that firms can use to help employees provide better service Topic: 10-09 The Delivery Gap: Delivering Service Quality 127 Alice is a manager at a grocery retail store One of the customers who placed an order for groceries at the store received low-quality products What strategies can Alice use to recover this service failure? Student answers will vary  Listening to the customer: Alice should listen carefully to the complaints of the customer and should assure the customer that it will not happen again  Finding a fair solution: Apart from replacing the low-quality products with good ones, Alice can also provide compensation to the customer in the form of a discount or shopping coupons that can be used at a later date She can explain to the customer that employees follow a standard procedure to respond to a service failure so that the customer can feel that he or she has been treated fairly  Resolving problems quickly: Alice should be quick to resolve the issue by providing immediate compensation so that the customer feels satisfied and continues to shop at the store 10-62 Chapter 10 - Services: The Intangible Product Accessibility: Keyboard Navigation Blooms: Apply Difficulty: Difficult Learning Objective: 10-04 Identify three service recovery strategies Topic: 10-12 Service Recovery Topic: 10-13 Listening to the Customer Topic: 10-14 Finding a Fair Solution 128 Why is it important for service provider to give a chance to customers to complaint? Customer complaint is a procedure for service providers to understand a service failure It is a feedback mechanism Whether the provider has a formal complaint department or the complaint is offered directly to the service provider, the customer must have an opportunity and the firm must listen carefully to what the customer has to say In many cases, customers just wanted to be heard! Accessibility: Keyboard Navigation Blooms: Apply Difficulty: Difficult Learning Objective: 10-04 Identify three service recovery strategies Topic: 10-12 Service Recovery 129 Discuss a service failure that you experienced personally Based on what you learned in this chapter, evaluate service provider attempts of service recovery What was your level of satisfaction at the end of the recovery process? If you were the marketing manager of that company, how would you deal with the situation differently? Student answers will vary Accessibility: Keyboard Navigation Blooms: Apply Difficulty: Difficult Learning Objective: 10-04 Identify three service recovery strategies Topic: 10-12 Service Recovery 10-63 ... assured Mark and Julia that they could use these facilities the next time they visited the resort 10- 42 Chapter 10 - Services: The Intangible Product 82 Which of the following service gaps did... gap refers to the difference between the actual service provided to customers and the service that the firm's promotion program promises 10- 14 Chapter 10 - Services: The Intangible Product Accessibility:... ensuring that their employees recognize the value the firm places on customer service, offering VIP clubs and "employee of the month" service awards 10- 33 Chapter 10 - Services: The Intangible Product