FUNDAMENTALS OF MARKETING MANAGEMENT

CHAPTER 03

PRODUCT DECISIONS 10 hrs

Product Meaning, Classification of products, Levels of product, Product Mix decisions,

Product assortment strategies, Product life cycle, New product development, Product
quality and customer service , Reasons for failure of product, Branding of product,
Types of Branding, Packaging and labelling, Marketing of services.

PRODUCT MEANING,
The product may be a good, a service, a good plus service, or just an idea. A
product is all things offered to a market. Those things include physical objects,
design, brand, package, label, price, service, supportive literature, amenities and
satisfaction not only from physical product and services offered but also from
ideas, personalities and organisations.

CLASSIFICATION OF PRODUCTS,
Goods or products are classified as either consumer goods or industrial goods.
Consumer goods are produced for the personal use of the ultimate consumer, while
industrial goods are produced for industrial purposes. There are many goods, such
as typewriters and stationery can be classified as both industrial and consumer
goods.
Marketers have traditionally classified products on the basis of three
characteristics – durability, tangibility and use.
Products can be classified as:-
A. Consumer Products.
B. Industrial Products.
1. Consumer Products:
Consumer products are those products that are bought by the final customer for
consumption.
Consumer products are of four types:
i. Convenience Products:
Convenience Products are usually low priced, easily available products that
customer buys frequently, without any planning or search effort and with
minimum comparison and buying effort. Such products are made available to the
customers through widespread distribution channels-through every retail outlets.
This category includes fast moving consumer goods (FMCG) like soap, toothpaste,
detergents, food items like rice, wheat flour, salt, sugar, milk and so on.

ii. Shopping Products:

Shopping products are high priced (compared to the convenience product), less
frequently purchased consumer products and services. While buying such products
or services, consumer spends much time and effort in gathering information about
the product and purchases the product after a careful consideration of price,
quality, features, style and suitability.
Such products are distributed through few selected distribution outlet. Examples
include television, air conditioners, cars, furniture, hotel and airline services,
tourism services.
iii. Speciality Products:
Speciality Products are high priced branded product and services with unique
features and the customers are convinced that this product is superior to all other
competing brands with regard to its features, quality and hence are willing to pay
a high price for the product. These goods are not purchased frequently may be once
or twice in lifetime and are distributed through one or few exclusive distribution
outlets. The buyers do not compare speciality products.
iv. Unsought Products:
Unsought product is consumer products that the consumer either does not know
about or knows about but does not normally think of buying. In such a situation the
marketer undertakes aggressive advertising, personal selling and other marketing
effort. The product remains unsought until the consumer becomes aware of them
through advertising. The price of such product varies. Examples of unsought
product are cemetery plots, blood donation to Red Cross, umbilical cord stem cell
banking services.

2. Industrial Products:
Industrial Products are purchased by business firms for further processing or for
use in conducting a business .The distinction between consumer product and
industrial is based on the purpose for which the product is bought. Like a kitchen
chimney purchased by a consumer is a consumer product but a kitchen chimney
purchased by a hotel is an industrial product.

Business products include:

i. Material and parts – Material and parts include raw material like
agricultural products, crude petroleum, iron ore, manufactured materials include
iron, yarn, cement, wires and component parts include small motors, tires, and
castings.
ii. Capital items – Capital items help in production or operation and include
installations like factories, offices, fixed equipment’s like generators, computer
systems, elevators and accessory equipment’s like tools office equipment’s.
iii. Supplies – Supplies include lubricants, coal, paper, pencils and repair
maintenance like paint, nails brooms.
iv. Services – Services include maintenance and repair services like computer
repair services, legal services, consultancy services, and advertising services.

LEVELS OF PRODUCT,

1. Core benefit:
The fundamental need or want that consumers satisfy by consuming the product
or service. For example, the need to process digital images.

2. Generic product:
A version of the product containing only those attributes or characteristics
absolutely necessary for it to function. For example, the need to process digital
images could be satisfied by a generic, low-end, personal computer using free
image processing software or a processing laboratory.

3. Expected product:
The set of attributes or characteristics that buyers normally expect and agree to
when they purchase a product. For example, the computer is specified to deliver
fast image processing and has a high-resolution, accurate colour screen.

4. Augmented product:
The inclusion of additional features, benefits, attributes or related services that
serve to differentiate the product from its competitors. For example, the
 computer comes pre-loaded with a high-end image processing software for no
extra cost or at a deeply discounted, incremental cost.

5. Potential product:
This includes all the augmentations and transformations a product might
undergo in the future. To ensure future customer loyalty, a business must aim
to surprise and delight customers in the future by continuing to augment
products. For example, the customer receives ongoing image processing
software upgrades with new and useful features.

PRODUCT MIX DECISIONS,

A product mix is the combination of all product lines and items that a
particular seller offers for sale.
For example, toiletries break down into shampoo, soap, and so on. Each line and
subline has many individual Principles of Marketing items.
Width

A company’s width of the product mix consists of different product lines carried by
the company. The width of the product mix measures the number of product lines in
the company.

Length

The length refers to the total number of items in its product mix. For example, if a
particular detergent powder comes in three sizes and two formulae, it has a depth
of six.

Depth

Depth of the product mix, on the other hand, refers to the number of variants that
are offered of each product line of the company. The depth of a product mix is
measured by the number of products offered in each product line.

Consistency

A product mix can be termed as consistent if there are similarities in terms of end-
use, production requirements, distribution channels, etc.
PRODUCT ASSORTMENT STRATEGIES,  
Assortment strategies are used by retailers in brick-and-mortar and ecommerce to
decide on a daily basis how to allocate inventory to their stores as part of their
merchandise planning processes. Such strategies are integral for retailers because
they directly affect how their customers interact with their merchandise, and
therefore, their brand. The decisions that these strategies help make are what to
sell, where to sell it, when to sell it, whom to sell it to, and how much to sell.

COMPONENTS OF ASSORTMENT STRATEGIES

1. Product Width

Product width refers to the range of product lines that a retailer offers. For
example, a supermarket may offer product lines ranging from food items to
cosmetics and over-the-counter medical supplies. They are all the product
lines that are available to customers and combine to make up the product
width offered by the retailer.

2. Product Depth

Product depth is the variety of products offered under each product line.
For example, if the retailer in question is a specialized cereal store, they are
likely to offer hundreds of options for cereal. The variety determines the
product depth
TYPES OF ASSORTMENT STRATEGIES

1. Wide assortment

A wide assortment strategy is used when retailers aim to offer a lot of

different product lines or categories, but with lesser depth in each category.
It aims to provide more variety in the types of product lines offered but
does not provide a high number of products in each product line.

For example, a grocery store that provides a lot of different products, but
only stocks one or two brands for each type of product, is employing a
wide assortment strategy

2. Deep assortment

A deep assortment strategy aims to provide a large number of options

within a particular product category. It is common for specialty stores that
focus on one or a few products to utilize a deep assortment strategy.

For example, a supplement store is likely to offer many options for buyers
of protein powders – it is using a deep assortment strategy by focusing on
fewer product lines but with high depth and variety within each product
line.

3. Scrambled assortment

Retailers using scrambled assortment strategies aim to offer products that

are outside of their core business operations in order to attract more clients
from different markets.

For example, a store that is famous for its smoothies starts selling fresh fruit
and packaged food, which allows it to target a wider audience, including
people who wish to make smoothies at home.

4. Localized assortment
A localized assortment strategy allocates the product mix based on the
preferences of the local population and the characteristics of the
geographical region. This allows the retailer to cater to different demands
according to geography and thereby increase sales.

For example, a clothing retailer like Zara does not sell the same clothing
inventory in a store in Mumbai, India, as it does in Vancouver, Canada. This
is because the population in Vancouver requires warmer clothing for snow
and the winter season, whereas the population in India exhibit different
clothing preferences and requirements

5. Mass-market assortment

Mass-market assortment strategies are used by stores with large physical

storage capabilities, such as Walmart and Amazon. They aim to appeal to
the mass-market and offer as many products and varieties as possible,
catering to a much bigger customer base.

PRODUCT LIFE CYCLE,

A product life cycle is the amount of time a product goes from being
introduced into the market until it's taken off the shelves.
The conditions in which a product is sold changes over time and must be managed
as it moves through its succession of stages.

1. Development Phase of the Product Life Cycle

Product development is always a very sensitive stage.
The project is still able to be iterated. You can have great expectations for it,
but before the product starts generating revenue, you still need to improve
your proposal, carry out tests, validate the hypotheses, and make necessary
changes.

This stage is naturally integrated into the process of start up companies but is
not restricted to them.

For example, an automobile manufacturer does not launch a new car without
first having a consistent project and studying its insertion and acceptance in
the market .

2. Introduction Phase of the Product Life Cycle

The Walkee Paws example is about the introduction.

That’s when the product goes through all development stages and is
considered ready to be launched in the market.

Every day we are introduced to new items in this stage of the cycle.

For big brands, TV is a choice for promotion.

Proof: you only need to turn on the TV for a few minutes to see ads for a new
flavor of soda, a different motorcycle model, a smartphone that promises new
and superior features, etc.

It is no accident that this stage of the Product Life Cycle is the one that
demands the most marketing investment from the company.

In fact, it is not uncommon to get negative financial results at this stage, even
if sales have already started.

This is also a result of the production costs related to product distribution.

To reduce the damage, it is imperative to  define the target audience   and
persona that represents the ideal customer profile for your products.
This exercise makes it possible to optimize your marketing investments, using
the right platforms to convey the best message and reach the exact audience
you want.

A good practice is to bet on inbound marketing and, by means of relevant

content, ensure the user discovers the company and what it offers

This strategy is also how potential consumers are persuaded to confirm sales
3. Growth Phase of the Product Life Cycle
If the Product Life Cycle works as it should, the next step is the growth stage.

The main characteristics of this stage are scalable sales and the maintenance
of  the amounts invested in marketing .
It is not possible to predict precisely when it happens, because that depends a
lot on the details of the product and the market it’s in.

But it is worth repeating: if you follow the plan correctly, you are likely to
reach your goals even if it takes a while.

So don’t get discouraged before you get to the growth stage.

Your investments must continue, either because of expanding your

participation in the market or keeping production/output up with your sales
rates.

This applies to sales of anything from marketing services, to salespeople

training, to physical products.

Many companies fail at this stage and their products’ sales decline without
having ever experienced maturity.

You might remember a beer brand that made fun tv ads with a short and
chubby actor with a mustache as the protagonist.

For a long time, it was one of the leading brands, and the advertisements
generated comments in the only social network in existence back then: word-
of-mouth.

The product is still in the market, and there is no news of changes to its
formula, but it was swallowed by the strong competition that is peculiar to
the industry.

Lower investment in marketing would certainly be high in a list of possible

reasons for this change.

So the lesson is clear: if a product is in the growth stage, it is important to

have a strategy to keep it there even as new competitors start fighting for its
audience.
4. Maturity Phase of the Product Life Cycle
Maturity is the peak, the highest point of the Product Life Cycle.

It’s when the product reaches its maximum potential and sales stabilize.

Once the summit is reached, it is no longer possible to grow, but the company
can act to avoid significant setbacks.

The challenge at this stage is to maintain good results over time.

There isn’t a simple way to make this happen.

All the famous brands that come to mind now are where they are today
because they invested in this stage.

For example, Coca-Cola doesn’t leave the media even though it “doesn’t
depend on marketing.” The company understands that brands are not
forever, being subject to market instabilities and behavioral changes in the
audience.

Imagine if a competitor developed a new soft drink and people discover that
that flavor is essential for their weekend family lunches.

With no visibility, Coca-Cola would lose space in the market, and in that
situation, possibly even its place as the leading brand

5. Decline Phase of the Product Life Cycle

It’s interesting to even imagine the end of Coca-Cola, a company with over
100 years of existence and so much financial success.

But even Coca-Cola will end one day. Maybe not the company, but its main
product.

This might take 100, 200, or even 1000 years. It’s impossible to predict.

But every product reaches the end and concludes its life cycle.

When that happens, the company must recognize the painful truth shown in
its  performance indicators   and prepare a replacement product.
If everything contributes to the idea of discontinuing the product, investing
heavily in marketing to try to revert the situation tends to be too dangerous.

It might work, of course. But what if it doesn’t?

 The company as a whole, and not just the product, may be endangered

NEW PRODUCT DEVELOPMENT,

The new product development is a systematic guide for all budding businesses and
entrepreneurs that will help them come up with a customer-oriented, high-quality
product that has the best chance of doing well in the highly competitive markets .

8 STAGES OF PRODUCT DEVELOPMENT PROCESS

It is important to understand that there is no one generic product development
process and that each rendition of such a process will vary depending on the depth
and detail that each explanation covers. This article explains 8 stages of the
product development process and these are listed below.

1. Idea Generation: The first stage in the product development process is idea

generation. In this stage, the company comes up with many different and unique
ideas based on both internal and external sources. Internal idea sources more often
than not refer to the in-house research and development teams of the company and
external sources refer to competitor innovations, the customer wants, distributors
and suppliers, and so on. The company thereby focuses on coming up with as many
feasible ideas as possible. 
2. Idea Screening: The next stage involves the screening of this often-large set of
ideas. The primary objective of this stage is to focus on ideas that are in line with
the company’s customer value and financial goals. The stage focuses on the filtering
out of ideas that are poor or are not feasible and retain those that have good
potential. This is to ensure that the company does not face losses by moving ahead
with fickle ideas that do not promise adequate returns.
3. Concept Development and Testing: The third of the product development
process steps is concept development and testing. In this stage, the good product
ideas must be developed into detailed product concepts that are conveyed in
consumer-oriented terms. The concept must be made in order to project the product
in terms of how it is perceived by consumers and how it will potentially be received
in the market and by which set of potential customers. This concept must then be
tested by presenting it to the target consumers and their response must be taken
into account.
4. Development of Marketing Strategy: The new product development process
in marketing is covered in stage four. In this step, the company tries to come up
with strategies to introduce a promising product into the market. The company
 must therefore come up with the price, potential revenue figures as well as
advertising and distributing channels in this step.

5. Business Analysis: The product concept is put through a vigorous business

analysis or test in order to ascertain projected sales and revenue and also assess
risk and whether the production of the product is financially feasible. The
company’s objectives are considered and if these are satisfied, the product is moved
on to the next step.
6. Product Development: This is the step that comes after the management of a
company declares a product concept to be in line with the goals of the company and
issues green light for development. The research and development wing of the
company then works on the product concept for many months and even years in
some cases, to come up with a working and functional prototype of the product
concept.
7. Test Marketing: This is the penultimate stage of the new product development
process and involves the testing of the product and its suggested marketing
program in realistic market settings. This stage provides an insight into how the
product will be introduced into the market, advertised, produced, packaged,
distributed, and eventually sold to the customers, and therefore any optimizations
if required can be made by the company. 
8. Commercialization: The final step of the product development process is that of
commercialization. Based on the information gathered during the test marketing
process, the business management may either decide to go ahead with the launch of
the product or put it on the backburner. In case the go-ahead is given, the product
is finally introduced into the market and this process is called commercialization.
This stage often leads to massive costs in terms of initial infrastructural
investments as well as sales promotions and advertisements
PRODUCT QUALITY AND CUSTOMER SERVICE,
Product quality refers to how well a product satisfies customer needs,
serves its purpose and meets industry standards. When evaluating product quality,
businesses consider several key factors, including whether a product solves a
problem, works efficiently or suits customers' purposes.

These may be reflected in the following features of the product:

(i) The dimensional specification and operating characteristics of the product.

(ii) Reliability and life of the product.

(iii) The cost of production of the production.

(iv) The production conditions required for the manufacture of product,

(v) Installation and maintenance objectives and related costs

Customer service is the provision of service to customers before, during, and after a purchase.
types of customer service include the following:

 digital channels, including chat- or email-based communications, chatbots,

interactive voice response systems, any online communications or web self-
service; and

 live agents, including call center communications, in-person assistance, live

chats, video chats or social media correspondence

REASONS FOR FAILURE OF PRODUCT,

Product failure is the product’s inability to establish itself well and persist in
the market which could be a result of poor performance or poor marketing of the
product.

Product flops lead to the withdrawal of the product from the market due to
different reasons such as
  A product not being able to realize the required market share to sustain its
presence in the market
 A product not being able to get the anticipated life cycle as defined by the
organization
 The ultimate failure of a product in not achieving profitability at all

1. Lack of product uniqueness

If a product produced has features exactly as products that are already available, it
leads to its failure.

2. High price tag

The price tag factor is one of the biggest reasons for the failure of a product. A
product with a very high price is very difficult to be sold in a market. People prefer
alternative products that have a lesser price than high priced products.

3. Poor timing

For a product to be successful, it is important for it to be released at the correct

time. If the product is introduced when the product is not needed, then this leads to
the product’s failure.

4. Poor planning

Failure of a company to make plans about every stage of a product’s life will lead to
the product’s failure. They must plan to take care of their customers

5. Lack of promotional measures

It is important to promote or popularize the product in its introduction stage.

Failure in doing so would cause a great loss to the organization

BRANDING OF PRODUCT, TYPES OF BRANDING,

Product branding is the application of branding strategy principles to a
specific item or product. It's the associating of a symbol, name, and design with
a product to create a recognizable identity for that item. ... It can be as simple as
designing a logo and choosing a name and packaging colour.

1. Personal branding

2. Product branding

3. Service branding
 4. Retail branding

5. Cultural and geographic branding

6. Corporate branding

7. Online branding

8. Offline branding

Personal Branding

Personal branding is very common among politicians, celebrities, athletes and

other people who have niche followership. This type of branding makes it easier for
these people to create an image for themselves among their followers. This brand
image not only helps them in creating new business opportunities for themselves
but also benefits the brand associated with them.

Product Branding

Product branding is one of the most common types of branding where the offering
is given an identity and a personality to make it identifiable and differentiable in
the market. Even though it is called product branding, it isn’t limited to just
products. Product branding refers to the branding of any offering be it product or
service.

An example of product branding could be Mountain Dew. Mountain Dew has its
own name, colour, voice, and personality. One can recognise the brand even when
the generic product is not even there

3. Service branding

Unlike products, which are easy to brand in visible and tangible ways, services are
a little more challenging to brand. But that doesn’t mean brands can’t do it
effectively—they just have to be willing to think outside the box.

4. Retail branding

When you walk into a brick and mortar store, its physical appearance has a look
and feel specific to that brand. That’s retail branding in action. Deliberate design
choices like its layout, the light fixtures, the decor, the music played, the display
fixtures and even the type of flooring are all carefully selected to build a living
brand experience for every shopper who enters the store
Geographic

Many places or areas of the world seek to brand themselves to build awareness of
the essential qualities they offer. Branded places can range from countries
and states to cities, streets, and even buildings. Those who govern or represent
these geographies work hard to develop the brand. Geographic branding is used
frequently to attract commerce and economic investment, tourism, new residents,
and so on.

A tea company that ships teas from India all over the world might tap into some
cultural branding by using the Indian flag’s colors in their logo, or an up-and-
coming watch brand might exploit the clout associated with Swiss watches by
incorporating illustrations of the Alps into their website design

Corporate Branding

Branding the organisation is as important as branding the offering it’s selling.

Corporate branding gives an identity to the offering provider and opens new
opportunities for him to extend his offerings portfolio easily.

Corporate branding is also of vital importance when it comes to hiring as

employees always desire to work with a company with a known brand.

PepsiCo is a good example of corporate branding. The company has several

products lines in its product mix including Frito-Lay,  Pepsi, Diet Pepsi, Mountain
Dew, Lay’s, Gatorade, Tropicana, etc. all of which are owned and operated by the
parent brand- PepsiCo
Online branding

Online branding, as the name implies, is branding that happens online. Unlike
specific types of branding, like personal or product branding, online branding is a
broad category that refers to all types of branding that happens on the internet. It’s
how an individual positions themselves on social media, it’s the kind of online ads a
service provider runs, it’s all the design choices that go into email newsletters,
landing pages, responsive web design and automatic message replies

Offline branding

In case it isn’t obvious from the name, offline branding is branding that
happens offline. Much like online branding can encompass types of branding like
personal branding, product branding, corporate branding and cultural and
geographic branding, offline branding can encompass these as well

PACKAGING AND LABELLING,

Packaging means the wrapping or bottling of products to make them safe from
damages during transportation and storage. It keeps a product safe and
marketable and helps in identifying, describing, and promoting the product.
“Packing is the preparation of product or commodity for proper storage and/or
transportation. It may entail blocking, bracing, cushioning, marking, sealing,
strapping, weather proofing, wrapping, etc

The following are the objectives of packing and packaging:

1. To Provide Physical Protection:

Packaging of objects insures that they are protected against vibration,
temperature, shock, compression, deterioration in quality etc. Packing and
packaging also protect the products against theft, leakage, pilferage, breakage,
dust, moisture, bright light etc
2. To Enable Marketing:
Packing and packaging play an important role in marketing. Good packing and
packaging along with attractive labelling are used by sellers to promote the
products to potential buyers. The shape, size, colour, appearance etc. are designed
to attract the attention of potential buyers.

3. To Convey Message:
There is so much of information about the product that a manufacturer would like
to convey to the users of the product. Information relating to the raw materials
used, the type of manufacturing process, usage instructions, use by date etc. are all
very important and should be conveyed to the users. Manufacturers print such
information on the packages.

4. To Provide Convenience:
Packing and packaging also add to the convenience in handling, display, opening,
distribution, transportation, storage, sale, use, reuse and disposal. Packages with
easy to carry handles, soft squeezed tubes, metallic containers, conveniently placed
nozzles etc. are all examples of this.

5. To Provide Containment or Agglomeration:

Small objects are typically put together in one package for reasons of efficiency and
economy. For example, a single bag of 1000 marbles requires less physical
handling than 1000 single marbles. Liquids, powders, granular materials etc. need
containment

6. To Provide Portion Control:

In the medicinal and pharmaceutical field, the precise amount of contents is needed
to control usage. Medicine tablets are divided into packages that are of a more
suitable size for individual use. It also helps in the control of inventory.

7. To Enable Product Identification:

Packing and packaging enable a product to have its own identity. This is done by
designing a unique and distinct package through the effective use of colours,
shapes, graphics etc. Such identification and distinction are very essential in the
present situation of intense competition and product clutter.

8. To Enhance Profits:
Since consumers are willing to pay a higher price for packaged goods, there will be
higher profit realization. Moreover packaged goods reduce the cost of handling,
transportation, distribution etc. and also cut down wastage and thereby increase
profits.

9. To Enable Self-Service Sales:

The present trend in retailing is effective display and self-service sales. Products
require effective packing for self-service sales.

10. To Enhance Brand Image:

Attractive packing and packaging in a consistent manner over a long time
enhances the brand image of the product.
LABELLING:
Labelling is the display of label in a product. A label contains information about a
product on its container, packaging, or the product itself. It also has warnings in it.
For e.g. in some products, it is written that the products contain traces of nuts and
shouldn’t be consumed by a person who’s allergic to nuts. The type and extent of
information that must be imparted by a label are governed by the relevant safety and
shipping laws.

Importance of Labelling

Labelling is an important part of the marketing of a product. Labelling is essential as

it helps to grab the attention of a customer It can be combined with packaging and
can be used by marketers to encourage potential buyers to purchase the
product. Packaging is also used for convenience and information transmission.
Packages and labels communicate how to use, transport, recycle or dispose of the
package or product.

Labelling is also used to exaggerate the product. Also, it is used for identification. This
kind of labelling helps a viewer to differentiate the product from the rest in the shelves
of the market.  A person can find out about the ingredients of a product. This helps to
spread awareness among the customers about the item they are consuming and
labelling also helps to mention ingredients.

Labelling is another very important factor in a product. It should show the correct
information about the product. This is all the more important in products such as
pharmaceuticals. Labelling should also contain information relating to whether the
product has harmful chemicals, especially if it is a product that is meant for children

MARKETING OF SERVICES.
Service marketing is a strategy which promotes and showcases the intangible
benefits and offerings delivered by a company to drive end customer value. This
can be for standalone service offerings or complementary services to tangible
products. Service marketing is a concept which focuses mainly on the business of
non-physical intangible goods. It is done for company given benefits which cannot
be seen, touched, felt etc.
1. Intangible
services are non-physical unlike physical products which can be touched, felt, seen.
This makes services different from products and hence the marketing approach
would also be different.
2. No ownership
Services cannot be owned but can only be experienced. This is a holistic concept
which is related to customer experience.
There is ownership in service in form of evidence like plan, bills, invoice etc. but you
cannot own it like a product.
3. Inseparability
Service marketing is driven by a concept of moment of truth, i.e. the services are
created & used at the same moment.
They cannot be stored like products in an inventory, they are produced and
consumed at the same time.
4. Variability
Services vary in nature despite the same people, process, type of work etc., unlike
standardized products. Different customers can get different experience for exactly
the same service used.
e.g. a telecom customer might get different experience for the same plan.
5. Perishability
Unlike products which can be stored, services are consumed at that very moment.
But there is another way to look at it as well. These days many services or plans do
have expiry date. They are not similar to best before dates in products but these
dates are more in terms of validity of service.
e.g. free warranty service after 2 years of purchase.
6. People involvement
Service marketing is driven by people who provide benefits & solutions to the needs
of the customers. These days lot of automatic service solutions are coming up but
people play the most important role in service marketing.
Service marketing planning involves taking care of 7Ps. Price, Place, Promotion,
Product, People, Process and Physical evidence.

Types of Service Marketing

There are broadly 3 types of service marketing:
1. B2C
This is the main customer service provided by companies to its end customers.
These can be telecom, hospitality, financial services, repair provided by providers.
The main focus of the company can be selling service. E.g. Vodafone provides
telecom services to consumers and markets it as its core offering.
2. B2B
Many companies provide services to enterprises and organizations. These can be
networks, finance, travel, technology services etc. The motive is to show business
value to an organization through usage of their service. This forms the core part of
the b2b service marketing.
E.g. Many technology services firms showcase their references and case studies
where they derived value for similar organizations as the target customer. The
value can be in terms of cost savings, revenue increase.
3. Post Purchase Service
This category if service marketing focuses on the add on and complementary
services offered by companies in addition to the core product (or service in some
cases). These can be warranty services, customer support, service request
resolution, helpdesk, repairs etc. These services can be differentiating factor for
customers when they buy the core offering. E.g. When a person buys a phone but
gets 2 years of free warranty service and support. This can become a differentiator
and forms part of the service marketing done by the phone manufacturer.