Difference-between-marketing-of-services-and-marketing-of-goods

1、Difference Between Marketing of Services and Marketing of GoodsIntroductionMarketers often use the expression goods and services/experience to distinguish between products that have physical form and those that dont. Goods are simply any physical or tangible products that can be seen and touched ( K

2、otler, Adam, Denize & Armstrong, 2008) while services are are deeds, processes, and performance(Zeithaml，Bitner & Gremler, 2009), whose core product being marketed is performance. With comparing of Toyota, the famous car manufactory and the accounting firm Ernest & Young, this report dis

3、cusses four distinctive characteristics of services compared to goods. It also represent what implications these characteristics will bring to services and how marketers respond to them. Tangibility VS IntangibilityDefinitionCompared to tangible goods that have physical and chemical property, servic

4、e product can not be seen, tasted, or touched in the same manner (Mudie & Pirrie, 2006). Cars in Toyota is tangible goods that can be seen and touched while the accounting service in Ernest & Young can not. The service only is proved have happened when consumer get benefit after consuming.In

5、tangibility is the basic characteristic to distinguish between services and goods in the real world. However, one can not differentiate services and goods clearly in a situation since most of the time conducting services should be supported by goods. For instance, health care is service that include

6、s a series of actions such as surgery, examination and treatment. Performance conduct by doctors 推荐精选or nurses and then directly toward patients, which can not see and touch by the patients. However, the patient may be able to see and touch certain tangible components of the service like equipment o

7、r hospital room.ImplicationsIn generally, Tangible goods are merchandise that you can put your hands on. Therefore, it is easy to observe the appearance of the car, have tactile experience from it and even compare to other cars to evaluate whether it is good or not. On the contrary, the intangibilit

8、y of services presents several challenges to marketers. First, services can not be displayed and communicated, so that it is hard for consumer to assess the quality. Second, services can not be easily patented, and therefore new service concepts can be easily copied by competitors. Third, services a

9、re difficult to pricing. (Palmer, 2005) For consumers, to buy the intangible services is of high risk since they can not recognise the service products before consuming. Marketer ResponseAlthough can not see and touch of services, consumers really can feel and enjoy of it. The mystique of starbuck c

10、offee is helpful in its marketing. Consumer is not only to drink a cup of coffer but also is attracted by its mystique and enjoy the feeling. Therefore, marketers of Ernest & Young can take measures to deal with the intangibility property of its accounting service. 推荐精选1, make it relative tangib

11、le （Yang, M.S. 2005） Service marketing should stress the benefit one can get after consuming service since no physical form of service can be provided. Ernest & Young can provide previous cases and celebrated company clients, to show what benefit consumer get from the service. Potential consumer

12、 can see the tangible result and get impression of the concept of intangible legal service.2, establish good reputation：Good reputation in services section is always come from word of mouth. Many consumers are tired of being bombarded with sales messages and are turned off by advertising. they are m

13、ore rely on word of mouth from neighbors, especially when purchasing service product（Belch & Belch, 2009）. Ernst & Young's publicity activity includes its worldwide Entrepreneur of the Year program, run in 50 countries.EY UK also publicizes itself by sponsoring exhibitions of works by fa

14、mous artists(Ernst & Young, nd). Theses activities help the communication of word of mouth.3, build trust Organisations good reputation and image are used for consumers to build trust to it. They are the critical factors that influence purchasers decision as well. For example, Ernst & Young

15、use grand buildings and bright office to deliver the message of confidence and reliance.Homogeneity VS HeterogeneityDefinitionGoods come from mass production can be the vary same. However, there have no two services will be precisely alike because services are performances and it is frequently produ

16、ced by humans.For one thing, 推荐精选services provider may vary their performance at all time; For another thing, services receiver will have unique demands and experience the service in a different way. Therefore, the quality standard of service is fluctuated and hard to unify. In addition, service pro

17、viders and consumers satisfaction are determined by actions taken by personnel and feedback from consumers.This human interaction result to heterogeneity property of services. For example, Toyato can provide two or a number of cars that exactly alike, while the same staff in the Ernest & Young m

18、ay provide different accounting services to two different visitors on the same day, depending on their individual needs and personalities, and also depend on the accountant state of mind.ImplicationThe marketing implication of heterogeneous of services has two side. The benefit is that marketers can

19、 concern about the differences of customer and market, and then take different marketing strategy and plans. In other words, service marketer can pay close attention to market change, market differntiation and market personalisation. In addition, service is always creative and flexible and is easy t

20、o have flexible price. The shortage is that organisations, and people ensure consistent service quality is challenging. Service deliver can not fully control complicating factors that affect the quality, and they can not for sue that the service is delivered in a manneer consistent with what was ori

21、ginally planned and promoted.Marketer Response推荐精选 Marketers can reduce the bad effect of heterogeneity by:1, differentiate service types Service can be divided into two types depend on the service provided by labour force directly ( labour intensive) or equipment directly ( capital intensive) （Yang

22、, M.S. 2005）. For the capital intensive service, marketers can try to standardise quality. For instance, marketers can estimate the service level of automatic carwash in advance and then evaluate a certain one by compare to the standard. For the labour intensive service, such as the Ernest & You

23、ng, it is really hard to standardise and control. Over 500 programs (more than 4,000 training hours) are offered to train staffs as technical skills, leadership development, teamwork, and interpersonal skills. (Gale.2002)2, turn heterogeneous into opportunity heterogeneous provide opportunity to cus

24、tomized product. Marketer should develop and enhance the ability to provide personalised service and make it to be a competitive advantage. For Ernest & Young, of cause clients situation and requirement is different with each other, since the internal and external environment are different. Acco

25、untant can not conduct the same service to more than one clients. Asynchronous VS Simultaneous of production and consumptionDefinitionUnlike phsical goods can be produced first, then sold and consumed, services are sold first and then produced and consumed simultaneously (Palmer, 2005). Mostly consu

26、mer only get access to a ultimate physical product, Toyato will not sell its semi-manufactured推荐精选 car to customers, and the car cannot consume when it is producing. But consumer who purchase service product should involves in the production process so that he or she will affect the service and to h

27、ave large satisfaction. The example in our daily life is that clothes can be producted without consumers awareness and then shipped to another place. These clothes may be sold one months later can then consumed some day later. But for the haircut services, the situation is quite different. Services

28、can not be provided until consumer requires, and the haircut service are produced and consumed at the same time. During the haircut process, consumer may communicate to the barber about his style requirement that can affect the following action of the barber. In addition, simultaneity also means tha

29、t customers seated next to will frequently ineract with each other during the haircut process and thus may afffect each others experience. ImplicationGoods separating of production and consumption of physical goods can achieve economies of scale result from mass production and examine products quali

30、ty before consuming it. However, service should direct at a certain consumer in one time. An accountant is available for limited number of clients and a barber can provide services to few customers in a day. Quality of service and consumers satisfaction will depend on what happens in “ real time”, w

31、hich has opportunities to customize offerings for individual consumers. Marketer Response1, focus on the relationship market Marketers can increase the quality of service at the “real time”推荐精选. 2, develop Viral marketing Ernst & Young's entrepreneurial services practice put the viral market

32、ing to work. Working with MindBlazer, a Charlotte, N.C.-based provider of Webcasting products and CRM services, the consulting firm created a multimember partnership with six other expert firms to deliver a series of Webcasts called "Winning strategies for Fast Paced Ventures." ( Gale.2001

33、) 3, use high technology With high technology in electron and internet, vending machine and E-mail decrease the degree of simultaneity between service production and consumption. Ernst & Young's has invested heavily in developing high quality, customized internal learning activities and adop

34、ting state-of-the-art learning technologies (Myers,2002). Imperishability VS PerishabilityDefinitionEven physical goods may be perishable, they really can produce first can then saved, stored in inventory or resold another day, or even could be returned if the consumer is unhappy.(Zeithaml，Bitner &a

35、mp; Gremler, 2009). Toyato produces car in Japan and then shippes to China and stored in car dealers. However, Consumer can not save or resell accountants service and they cannot return the service back to accountant if they are not satisfied with their services. Other examples can be a vacant seat

36、in theatre after the show beginning, and a length of vacant telephone wire. Benefit of consuming these services can not be stored for the further needs.推荐精选ImplicationValue of service will not be available if it can not be used timely. Therefore, demand forecasting and creative planning are challeng

37、ing decisions. In addition, service can not be returned and resold, which make it hard to recovery if things do go wrong. For example, a bad hair cut cannot be returned to the original.Marketer responseResponse can be taken to make up for the perishability include:1, build reservation system Use res

38、ervation system to manage service demand and supply, which can help in demand forecasting and creative planning.2, provide supplemental service When consumers are waiting for the service, marketers can provide supplemental service in order to avoid leaving. Consumers come to Ernest & Young can s

39、it in a waiting room to have a cup of coffee and read newspapers before the required staff is available.3, flexible work for service staff Staffs working hour is depend on the service demand. Staffs in Ernest & Young can work at home, increase the working time during the financial year of most c

40、ompany.ConclusionComparing to phsical goods, services have the characteristics of intangibility, heterogeneity, simultaneous of production and consumption and perishability. These Characteristics bring challenges as well as certain opportunities to service marketers. Marketers can manage services with flexibly use of marketing mix, including product, promotion, place, price as well as people. They 推荐精选r