Types of New Services :Types of New Services major or radical innovations start-up businesses new services for the currently served market service line extensions service improvements style changes


New Service Development Process :New Service Development Process Sources: Booz-Allen & Hamilton, 1982; Bowers, 1985; Cooper, 1993; Khurana & Rosenthal 1997. Business strategy development or review New service strategy development Idea generation Concept development and evaluation Business analysis Service development and testing Postintroduction evaluation Commercialization Market testing Screen ideas against new service strategy Test concept with customers and employees Test for profitability and feasibility Conduct service prototype test Test service and other marketing-mix elements Front-end Planning Implementation


Building a Service Blueprint :Step 1 Identify the process to be blue-printed Step 2 Identify the customer or customer segment Step 3 Map the process from the customer’s point of view Step 4 Map contact employee actions, onstage and back-stage, and/or technology actions Step 5 Link contact activities to needed support functions Step 6 Add evidence of service at each customer action step Building a Service Blueprint


Process for Setting Customer-Defined Standards :2. Translate customer expectations into behaviors/actions 5. Develop feedback mechanisms Measure by audits or operating data Hard Soft Measure by transaction- based surveys 3. Select behaviors/actions for standards 6. Establish measures and target levels Process for Setting Customer-Defined Standards 7. Track measures against standards 8. Provide feedback about performance to employees 9. Update target levels and measures


Servicescape and its physical evidence :Servicescape and its physical evidence


Physical Evidence and the Servicescape :Physical Evidence and the Servicescape Role of physical environments Designing a servicescape strategy Degree of customer involvement in the servicescape


Physical evidence :Physical evidence Environment in which the service is delivered and where the firm and customer interact Includes any tangible commodities that facilitate performance or communication of the service Can be critical to the ultimate success or failure of the service


Elements of Physical Evidence :Elements of Physical Evidence


Role of servicescape :Role of servicescape Functionally: facilitate or hamper service delivery Helps to frame expectations Plays a communication and promotions role Strategically: Fosters approach rather than avoidance behaviour Provides a means of competitive differentiation Represents the quality and value of the service offering Can also establish particular ambient mood for customers and employees


The Effect of Physical Evidence and Atmosphere on Buyer Behaviour :The Effect of Physical Evidence and Atmosphere on Buyer Behaviour As an attention creating medium: the use of colour, noise, smell and so on (sensory impacts) As a message creating medium: the use of symbolic cues to communicate with the intended audience As an effect creating medium: using colours, sounds, spatial design and so on to heighten the buyer’s desire Kotler (1973)


Roles of the Servicescape :Roles of the Servicescape Package conveys expectations influences perceptions Facilitator facilitates the flow of the service delivery process provides information (how am I to act?) facilitates the ordering process (how does this work?) facilitates service delivery Socializer facilitates interaction between: customers and employees customers and fellow customers Differentiator sets provider apart from competition in the mind of the consumer Zeithaml & Bitner


Slide 12:A framework for understanding the impact of the physical environment Environmental stimuli Thoughts and feelings Behavioural responses


Other Behavioural Responses to Servicescape :Other Behavioural Responses to Servicescape Approach: propensity to stay, explore, engage in interactions, make purchases, and return Avoid: disinclination to make purchases or stay, desire to leave, little incentive to return


Environmental Stimuli in Service Delivery :Environmental Stimuli in Service Delivery Ambience: temperature, air quality, noise, colour, music, odour Space: design, layout, furnishings Signs, symbols and artefacts: style of décor, signage, personal objects Impact on customers’: Cognition: beliefs and thoughts Emotions: mood, feelings, likes/dislikes Physiology: discomfort, ease of movement


Degree of Customer Involvement in the Servicescape :Degree of Customer Involvement in the Servicescape Service organisations may be classified as: Self-service: ATMs, dispensing and vending machines Interpersonal Services: high contact, the service provider and customer must be together Remote services: mail order shopping, radio, telecommunications


Typology of Service Organizations Based on Variations in Form and Use of the Servicescape :Typology of Service Organizations Based on Variations in Form and Use of the Servicescape


Guidelines for Physical Evidence Strategy :Guidelines for Physical Evidence Strategy Recognize the strategic impact of physical evidence. Blueprint the physical evidence of service. Clarify strategic roles of the servicescape. Assess and identify physical evidence opportunities. Be prepared to update and modernize the evidence. Work cross-functionally.