products, services cannot be seen, tasted, felt, heard or smelled before they are
bought”. This represents a problem for the service marketer in that he or she must
convince consumers about the advantages of a service, something which is much
harder to achieve when the consumer cannot see, taste, feel, hear or smell the service
being offered. “Overcoming this can be achieved by making a service more palpable
by creating a tangible representation of it. This is what occurred with the development
of the bank credit card. By representing the service with a specially encoded plastic
card that when used triggers the service, Visa and others have been able to overcome
many of the handicaps normally associated with marketing an intangible”.
Another way in which services marketing differs from product marketing is through
inseparability in that services are produced and consumed at the same time whereas
products are produced and consumed at a latter date. Here “because services are
produced and consumed at the same time (simultaneity) customers may not be able to
adequately evaluate their services purchases until after they have received the service
and committed payment. Further, because service providers and customers are so
often in such close proximity to one another during the production/consumption
process, their interaction and the nature of their relationship takes on an added
element of importance”. Tools used in product marketing become ineffective when
used in services marketing. Gary Knisely realised this with the U.S. Postal Service.
He found that “in package goods marketing, the marketing management group
doesn’t have anything to do with managing checkout clerks. When marketing people
went to the Postal Service, they set up marketing management that wasn’t focused
enough on that person at the counter. And the backlash was enormous”.
Services are also variable as the level of service a customer receives from the service
provider varies depending on who provides it, when it is provided and where it is
provided. Customers may receive good service from a company one day but on
another occasion may receive inadequate service from the same company. “Because
employee performance is likely to vary from unit to unit, from employee to employee,
and even from minute to minute for the same employee, managing quality in a service
business means managing human behaviour. Training, standards, motivation and
management by example are helpful”. Services marketing may also counteract
variability by giving employees an incentive to help retain existing customers.
The final characteristic of services marketing that make it differ from product
marketing is perishability. Whereas products can be stored and sold at a later date, a
service cannot be stored, meaning that the service provider losses out on income and
profits which can never be regained. For the services marketer “one of the crucial
challenges is to find ways to better synchronize supply and demand as an alternative
to recurring conditions of severe overdemand and underdemand”.
It is not just in relation to variability, intangibility, perishability and inseparability that
services marketing differs from product marketing. When dealing with goods, product
marketers use the traditional four P’s of place, promotion, price and product. While
this works well for goods, for services marketing the four P’s alone will not suffice so
we also use the three additional P’s of people, physical evidence and process. So what
are the three additional P’s and why do service marketers need them? The first
additional P that service marketing needs is people who “are all human actors who
play a part in service delivery and thus influence the buyers perceptions. This service
provider or contact person can be very important and these providers may be the focal
point of service encounters that can prove critical for the organisation”. Physical
evidence concerns itself with “the environment in which the service ids delivered
and where the firm and customer interact. Physical evidence cues provide excellent
opportunities for the firm to send consistent and strong messages regarding the
organisations purpose, the intended market segments, and the nature of the service.
The final additional P which services marketers need over products is process which
“involves the actual procedures, mechanisms, and flow of activities by which the
service is delivered – the service delivery and operating systems”. To someone using
a service these three additional P’s are very important as the quality of these P’s can
lead us to choosing one service over another while when purchasing a product, price
tends to be the most important factor for someone deciding which product to buy.
Services marketing and product marketing are different with the traditional product
mix not working when it is applied to the services industry. Instead services
marketing requires extra ingredients such as the three additional P’s and innovative
ways to solve the problems of intangibility, variability, perishability and
inseparability. To overcome these problems services marketers must use more of their
imagination than if they were marketing a product.
Berry Leonard L. – SERVICES MARKETING IS DIFFERENT – Pg.278
Kotler Philip – Marketing Management, 11th Edition, Yr.2002 – Pg.444
Berry, op cit (1), – Pg.284
Martin Charles L. – The history, evolution and principles of services marketing: poised for the new millennium – Pg. 325
Knisely Gary – COMPARING MARKETING MANAGEMENT IN PACKAGE GOODS AND SERVICE ORGANISATIONS – Interview with Thomas R. Engel
Martin, op cit (6) – Pg.327
Berry, op cit (1) – Pg.285
Bitner, Mary Jo and Zeithaml, Valarie A. – SERVICES MARKETING, International Edition, 1996, Pg.26