The 7 P’s of Services (any) Marketing
Marketing like everything isn’t hard but a time-consuming process that requires diligence and a strive for excellence. There is a service marketing standard called the 7 P’s of marketing. There’s also an 8th P which we will also cover which extends the 7 P’s to include one more (go figure). By being patient, studying your market, and taking care of your customer’s needs marketing is something that can propel your business to a new level.
The first four elements of service marketing mix are the same as those of traditional marketing. Those are product, pricing, place, and promotion. Every business is a service business. You provide your products and services to others. When you are marketing the key is reading, learning, and definitely listening to the changing needs around you. The final three of people, process, and physical evidence are related to the service industry but we still feel pertains to traditional marketing as well. In fact, when all seven or eight) are used you will almost always have a better solution.
- Product – Your product is usually a tangible product, heterogeneous, and perishable. Moreover, its production and consumption are inseparable. Hence, there is scope for customizing the offering as per customer requirements and the actual customer encounter therefore assumes particular significance. However, too much customization would compromise the standard delivery of the service and adversely affect its quality.
- Pricing – Pricing of services is tougher than pricing of goods. While the latter can be priced easily by taking into account the raw material costs, in case of services attendant costs - such as labor and overhead costs - also need to be factored in. A restaurant not only has to charge for the cost of the food served but also has to calculate a price for the ambience provided. The final price for the service is then arrived at by including a markup for an adequate profit margin.
- Place – Service delivery is concurrent with its production and cannot be stored or transported, the location of the service product assumes importance. Service providers have to give special thought to where the service would be provided. Thus, a fine dine restaurant is better located in a busy, upscale market as against on the outskirts of a city. Similarly, a holiday resort is better situated in the countryside away from the rush and noise of a city.
- Promotion – Since a service offering can be easily replicated promotion becomes crucial in differentiating a service offering in the mind of the consumer. Thus, service providers offering identical services such as airlines or banks and insurance companies invest heavily in advertising their services. This is crucial in attracting customers in a segment where the services providers have nearly identical offerings.
- People – People are a defining factor in any business process, since a service is inseparable from the person providing it. Thus, a restaurant is known as much for its food as for the service provided by its staff. The same is true of banks, retail stores, and department stores. Consequently, customer service training for staff has become a top priority for many organizations today.
- Process – The process of service delivery is crucial since it ensures that the same standard of service is repeatedly delivered to the customers. Therefore, most companies have a service blue print which provides the details of the service delivery process, often going down to even defining the service script and the greeting phrases to be used by the service staff.
- Physical Evidence – Since services are intangible in nature most service providers strive to incorporate certain tangible elements into their offering to enhance customer experience. Thus, there are hair salons that have well designed waiting areas often with magazines and plush sofas for patrons to read and relax while they await their turn. Similarly, restaurants invest heavily in their interior design and decorations to offer a tangible and unique experience to their guests.
- Productivity and Quality – This has become the 8th P. Improving productivity is a requisite in cost management; but quality, as defined by the customer, is essential for a service to differentiate itself from other providers. Why this one has now emerged we will never know as productivity and quality if they don’t exist your product or service offering will ultimately fail.
Marketing of your business is never easy. Two similar businesses will produce two separate marketing plans. We utilize the above to develop every one of our clients marketing plans whether they are in the services industry or not as it allows us to cover more than the standard areas of marketing and allows a deeper understanding of the customer.