Services and Customers: Promoting Educating

Services Marketing 7e, Global Edition
Chapter 7:
Promoting Services
and Educating
Customers
Slide © 2010 by Lovelock & Wirtz Services Marketing 7/e Chapter 7 – Page 1
Overview of Chapter 7
 Role of Marketing Communications
 Challenges of Services Communications
 Marketing Communications Planning
 The Marketing Communications Mix
 Role of Corporate Design
 Integrating Marketing Communications
Role of Marketing
Communications
Specific Roles of Marketing
Communications
 Position and differentiate service
 Help customer evaluate offerings and highlight differences

that matter
 Promote contribution of personnel and backstage

operations
 Add value through communication content
 Facilitate customer involvement in production
 Stimulate or dampen demand to match capacity
Help Customers to Evaluate
Service Offerings
 Customers may have difficulty distinguishing one firm from

another
 Provide tangible clues related to service performance
 Some performance attributes lend themselves better to

advertising than others
 e.g., Airlines
 Firm’s expertise is hidden in low-contact services

 Need to illustrate equipment, procedures, employee activities that
take place backstage
Promote Contributions of
Service Personnel
 Frontline personnel are central to service delivery in high-

contact services
 Make the service more tangible and personalized
 Show customers work performed behind the scenes to

ensure good delivery
 To enhance trust, highlight expertise and commitment of
employees
 Advertisements must be realistic
 Messages help set customers’ expectations
 Service personnel should be informed about the content of new
advertising campaigns or brochures before launch
Facilitate Customer Involvement
in Production
 Customers are actively involved in service production; they

need training to perform well
 Show service delivery in action
 Television and videos engage viewer

 e.g., Dentists showing patients videos of surgical procedures
before surgery
 Streaming videos on web and podcasts are new channels to

reach active customers
Stimulate or Dampen Demand to
Match Capacity
 Live service performances are time-specific and can’t be

stored for resale at a later date
 Advertising and sales promotions can change timing of customer
use
 Examples of demand management strategies:

 Reducing usage during peak demand periods
 Stimulating demand during off-peak period
Challenges of Services
Communications
Overcoming Problems of
Intangibility
 Intangibility creates 4 problems:

 Generality
- Items that comprise a class of objects, persons, or events
 Abstractness
- No one-to-one correspondence with physical objects
 Non-searchability
- Cannot be searched or inspected before purchase
 Mental impalpability
- Customers find it hard to grasp benefits of complex,
multi-dimensional new offerings
Overcoming Problems of
Intangibility
 To overcome intangibility
 Use tangible cues in advertising
 Use metaphors
 Tangible metaphors help to communicate benefits of

service offerings, e.g.,
 Allstate – “You’re in good hands”
 Prudential Insurance –uses Rock of Gibraltar as symbol of
corporate strength
 Metaphors communicate value propositions more

dramatically and emphasize key points of difference
Advertising Strategies for
Overcoming Intangibility
Marketing Communications
Planning
Checklist: The “5 Ws” Model
 Who is our target audience?
 What do we need to communicate and achieve?
 How should we communicate this?
 Where should we communicate this?
 When do communications need to take place?
Target Audience: 3 Broad
Categories
 Prospects
 Employ traditional communication mix because prospects are not
known in advance
 Users
 More cost effective channelsutilized
 Employees
 Secondary audience for communication campaigns
 Shape behavior
 Part of internal marketing campaign using company-specific
channels
Educational and Promotional
Objectives in Service Settings
 Create memorable images of specific companies and their

brands
 Build awareness and interest for unfamiliar service
 Compare service favorably with competitors’ offerings
 Build preference by communicating strengths and benefits
 Reposition service relative to competition
 Reduce uncertainty or perceived risk by providing useful
info and advice
 Provide reassurance (e.g., promote service guarantees)

 Encourage trial by offering promotional incentives
 Familiarize customers with service processes before use
 Teach customers how to use a service to best advantage
 Stimulate demand in off-peak, discourage during peak
 Recognize and reward valued customers and employees
Create memorable Compare service Build preference by

Build awareness
images of specific favorably with communicating
and interest for
companies and competitors’ strengths and
unfamiliar service
their brands offerings benefits
Reduce uncertainty Provide

Reposition service Encourage trial by
or perceived risk by reassurance (e.g.,
relative to offering promotional
providing useful info promote service
competition incentives
and advice guarantees)
Familiarize Teach customers Stimulate demand Recognize and

customers with how to use a in off-peak, reward valued
service processes service to best discourage during customers and
before use advantage peak employees
The Marketing
Communications Mix
Marketing Communications Mix
for Services
Sources of Messages Received by
Target Audience
Source: Adapted from a diagram by Adrian Palmer, Principles of Services Marketing, London: McGraw-Hill,4th ed., 2005, p. 397
Traditional Marketing Channels
Channel Aim Challenges

Advertising: Done via Build awareness, inform, Needs to be unique as less
media channels persuade, and remind than half of all ads generate a
positive ROI
Public relations: Efforts Builds reputation and credibility Form relationships with its
to stimulate positive to secure an image conducive employees, customers, and
interest through third to conduct business the community
parties
Direct Marketingsuch Send personalized messages Advance in on-demand

as mail, e-mail& text to highly targeted micro- technologies (e.g., spam
messages segments; use permission filters, cookie busters, pop-up
marketing where customers blockers) empower
“raise their hands” and agree consumers to decide how and
to learn more about a company when they prefer to be
and its products reached, and by whom
Traditional Marketing Channels
Channel Aim Challenges

Sales Promotion: Generate attention and Motivating customers to usea
Communication attached to speed up introduction service sooner, in greater
an incentive that is specific and acceptance of new volume, or more frequently
to a period of time, price, or services especially during periods when
customer group demand would be weak
Personal Selling: Educate customers and Relationship marketing strategies

Common in b2b and promote preferences for based on account management
infrequently purchased particular brand or programs incur high staffing
services product costs; telemarketing is a lower
cost alternative
Trade Shows Stimulate extensive Opportunity to learn about latest
media coverage with offerings from wide array of
many prospective buyers suppliers
Internet Marketing Offers Powerful
Opportunities
 Supplement traditional marketing channels at a reasonable

cost
 Part of an integrated, well-designed communications

strategy
 Can market through the company’s own website or through

online advertising
Website Design Considerations
 Used for a variety of  Design should address

communication tasks attributes that affect website
 Promoting consumer “stickiness”
awareness and interest  High in quality content
 Providing information and  Ease of use
consultation
 Quick to download
 Facilitating 2-way
communication  Frequency of update
 Stimulating product trial

 Memorable Web address helps
 Enabling customers to place
attract visitors to the site
orders
Effective Advertising on Internet:
Banner Advertising
Banner Advertising: Placing advertising banners and buttons

on portals such as Yahoo and other firms’ websites to draw
online traffic to own site
 Easy for advertisers to measure how many visits to its own

website are generated by click-throughs
 Limitations
 Obtaining many exposures does not necessarily lead to increase in
awareness, preference, or sales
 Fraudulent click-throughsdesigned to boost apparent effectiveness
Effective Advertising on Internet:
Search Engine Advertising
Search Engine Advertising (Reverse broadcast network):

search engines let advertisers know exactly what consumer
wants through their keyword search
 Target relevant messages directly to desired consumers
 Advertising options:
 Pay for targeted placement of ads to relevant keyword searches
 Sponsor a short text message with a click-through link
 Buy top rankings in the display of search results
 E.g., Google – The New Online Marketing Powerhouse via

Adsense and Adwords
Messages Transmitted through
Service Delivery Channels
• Messages reach customers through the

Service outlets service delivery environment
• Servicescape: Physical design
• Shape customer’s perceptions

Front-line • Delivers supplementary services
employees • Cross-selling of additional services
• ATM, vending machines and websites

Self-service • Require clear signage and instructions on
delivery points how to use the service
Customer • Familiarize customers with service

product and teach them how to use it to
training their best advantage
Messages Originating from Outside
the Organization
 Word of Mouth (WOM)

 Recommendations from other customers viewed as more credible
 Strategies to stimulate positive WOM:

 Creating exciting promotions that get people talking about firm’s
great service
 Offering promotions that encourage customers to persuade others
 Developing referral incentive schemes
 Referencing other purchasers and knowledgeable individuals
 Presenting and publicizing testimonials
Messages Originating from Outside
the Organization
 Blogs – A new type of online WOM
 Twitter
 Media Coverage
 Compares, contrasts service offerings from competing
organizations
 Advice on “best buys”
Ethical Issues in Communication
 Poor internal communications between operations and

marketing personnel concerning level of service
performance
 Deliberately exaggerated promises to secure sales
 Deceptive promotions
 Unwanted intrusion by aggressive marketers into people’s

personal lives
Role of Corporate Design
Strategies for Corporate Design
 Many service firms employ a unified and distinctive visual

appearance for all tangible elements
 e.g., Logos, uniforms, physical facilities
 Provide a recognizable theme linking all the firm’s

operations use of physical evidence
 e.g., BP’s bright greenand yellow service stations
 Use of trademarked symbol as primary logo, with name

secondary
 McDonald’s “Golden Arches”
Strategies for Corporate Design
 International companies need to select designs carefully to

avoid conveying a culturally inappropriate message
 Easily recognizable corporate symbols important for

international marketers in markets where:
 Local language is not written in Roman Script
 Significant portion of population is illiterate
FedEx: Use of Company Name In
Corporate Design
 Created “FedEx Family of companies” consisting of subbrands

for different services; carried its positive FedEx Express image to
other, often low cost services.
 FedEx Express  FedEx Custom Critical
 FedEx Ground  FedEx Supply Chain Services
 FedEx Home Delivery  FedEx Kinko’s
 FedEx Freight
 Each subbrand has different color scheme for second word to

create differentiation for subbrands, e.g.,
 Express is red/orange
 Ground is green
Developing An Integrated Marketing
Communications Strategy
 IMC ties together and

reinforces all
communications to deliver
a strong brand identity
 Communications in
different media should form
part of a single, overall
message about the service
firm
Summary
 Marketing communications adds value through its content
 Overcome problems of intangibility – use metaphors to

communicate value proposition
 Communication planning involves knowing (5Ws)
 Marketing communications originate from within the

organization through production and marketing channels
Summary
 Service delivery channels include

 Service outlets
 Front-line employees
 Self-service delivery points
 Marketing communications originating from outside

organization include
 Word of mouth
 Blogs
 Twitter
 Media coverage
 Corporate design strategies are part and parcel of

communication mix

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Services Marketing 7e, Global Edition

 Role of Marketing Communications

 Challenges of Services Communications

 Marketing Communications Planning

 The Marketing Communications Mix

 Role of Corporate Design

 Integrating Marketing Communications

 Position and differentiate service

 Help customer evaluate offerings and highlight differences

 Promote contribution of personnel and backstage

 Add value through communication content

 Facilitate customer involvement in production

 Stimulate or dampen demand to match capacity

 Customers may have difficulty distinguishing one firm from

 Some performance attributes lend themselves better to

 Firm’s expertise is hidden in low-contact services

 Frontline personnel are central to service delivery in high-

 Show customers work performed behind the scenes to

 Customers are actively involved in service production; they

 Show service delivery in action

 Television and videos engage viewer

 Streaming videos on web and podcasts are new channels to

 Live service performances are time-specific and can’t be

 Examples of demand management strategies:

 Intangibility creates 4 problems:

 Tangible metaphors help to communicate benefits of

 Metaphors communicate value propositions more

 Who is our target audience?

 What do we need to communicate and achieve?

 How should we communicate this?

 Where should we communicate this?

 When do communications need to take place?

 Create memorable images of specific companies and their

 Provide reassurance (e.g., promote service guarantees)

Create memorable Compare service Build preference by

Reduce uncertainty Provide

Familiarize Teach customers Stimulate demand Recognize and

Channel Aim Challenges

Direct Marketingsuch Send personalized messages Advance in on-demand

Channel Aim Challenges

Personal Selling: Educate customers and Relationship marketing strategies

 Supplement traditional marketing channels at a reasonable

 Part of an integrated, well-designed communications

 Can market through the company’s own website or through

 Used for a variety of  Design should address

 Stimulating product trial

Banner Advertising: Placing advertising banners and buttons

 Easy for advertisers to measure how many visits to its own

Search Engine Advertising (Reverse broadcast network):

 Target relevant messages directly to desired consumers

 E.g., Google – The New Online Marketing Powerhouse via

• Messages reach customers through the

• Shape customer’s perceptions

• ATM, vending machines and websites

Customer • Familiarize customers with service

 Word of Mouth (WOM)

 Strategies to stimulate positive WOM:

 Blogs – A new type of online WOM

 Poor internal communications between operations and