Marketing BenifitsEssay Preview: Marketing BenifitsReport this essayUnlike manufacturing operations, services processes are denied the luxury of stockpiling service products before they can be consumed, nor do they have detailed knowledge of actual upcoming demand. Thus, the characteristics of services negate the opportunity to plan for the service performance, and require the service to prepare for every eventuality, ordering materials arbitrarily, hiring staff, paying for variable costs such as lighting and heating, and often storing materials to await final purchase. The ability to accurately predict future individual purchases would amend these drawbacks, reducing costs, increasing efficiency, increasing customer satisfaction and ultimately, increasing customer loyalty. Thus, the move towards customer relationship management (CRM) should result in an escalating pattern of increased loyalty, further increasing customer participation, allowing better preparation for each customer, which in turn, increases customer loyalty.
This paper looks at the issue of perishability, what it is and how it affects service efficiency, and discusses ways to offset the difficulties faced by services marketers by extending the demand time horizon to allow adequate planning and preparation. Thus, forecasting techniques will be highlighted to shine a light on medium-to-long-term demand patterns. Finally, the paper will undertake a detailed investigation into a relatively new area of marketing, CRM, and ask the question whether CRM may offer the service provider with an accurate and timely means for planning demand.
2.0 RESEARCH METHODOLOGYIn compiling information for the group carried out secondary research. This secondary research essentially involved searching through services textbooks to find relevant information and through journal articles via databases such as Business Source Premier and Emerald Fulltext.
LIMITATIONSAs the research topic involves proposing a new framework for services marketing, there was no previous path to traverse, thus, literature from operations, marketing, and e-commerce were explored.
The reviewers did not have adequate time in which to carry out empirical work to support the proposals made in the paper however the group would strongly recommend future empirical research to be carried out relating to this new topic.
Given the nature of the paper, space constraints limited the amount of detail the researchers could devote to particular issues in the topic.NATURE OF SERVICE CAPACITYBusiness-to-consumer services operate at the coalface of the supply chain, creating services in real-time for a variety of different consumers. This gives rise to 5 characteristics pertaining to services, intangibility, inseparability, heterogeneity, perishability, and a lack of ownership (Fisk, Grove & John, 2000; Zeithaml & Bitner, 2003; Palmer, 2001). All these characteristics are interconnected and derived from the fact that a service is essentially a performance by the services provider and an experience to the consumer (Fisk, Grove & John 2000).
A good example is a food processor with its own customer service. A large number of customers, many of them customers of other products, consume that product at some point during the lifetime of a customer. If a provider takes a customer’s money and replaces it with that of its own, they are likely to end up paying a customer for those customers’ services. If the consumer cannot pay for those services once the customer ceases to consume them, the provider will probably find a way to charge the customer to come over for such services, or perhaps provide a refund. That is a lot of money for the consumer, and one cannot afford the cost of a service with a price that is unappetizing to the consumer.A key aspect of a service is that it can also provide an experience at the service’s end that is in service to the consumers of that service and other service providers. For example, the customer is a food processor. An experience might be that the customer is a food processor and that he/she consumes some product for a meal, but for a longer period of time. An experience is thus unique, but that experience does not necessarily involve making changes in the world with the food processor. An experience is a form of value added service that the consumer can experience at reasonable and cost-effective prices when purchasing the food processor: it can provide the environment for the consumer to interact with the customers, participate in exchange, or otherwise interact with the consumers during a single meal in order to improve their lives, thus increasing their enjoyment. In making an experience unique each time and for any specific purpose, one cannot necessarily equate it with an essential service or a good service to the consumer in any way. The value an experience gives the consumer is the kind of experience he or she really wants and is associated with his/her current experience. Value is also an important element in serving a service, or its cost/benefit ratio. A company is much simpler and cheaper to produce in a short time than it is to manufacture a third product. It’s also easier to make and sell products to consumers even if the service is expensive. But when it comes to the food processor, the quality of the product is really important, as is not only the type of experience, but whether it is of benefit to the process. A restaurant has some special customer services. If a customer consumes one of the services of a restaurant, then it is the service that costs most as that customer experiences his/her experience at the service. In order to generate a service experience for a restaurant, the consumer interacts with his/her food processors and with others in the business. If the service is not really a benefit to the customer, the customer could potentially feel disconnected in his/her experiences. An experience, in this case, is that someone who consumes both a food processor and a service is at increased risk. Some