Pitanje: In distinguishing between products and services marketing, please assist me by clarifying the general assumption that the later are of people factor, as if products are produced and conveyed to consumers by robots or machines (and not by humans) – Antonia Amadi
I clearly understand your perception of the extent of “people’s involvement” in the process of marketing both products and services. Before pointing out the justification of in this assumption of services marketing being more of people or human involvement than marketing for products, it is essential to outline what comes to play for this form of marketing. In this wise, please note these – That “product” in marketing sometimes does not stand for goods or the physical products which I perceive you are referring to. Also that in marketing (from the point of view of the consumer) “product” depicts every want-satisfying attribute a consumer receives in making an exchange (inclusive of psychological and physical benefits).
In the same vein, product should be seen as reflective of much more than physical or tangible attributes. For example, what you (the consumer) is buying when you purchase a mobile phone – If you made the purchase based on the impressive outlook of the phone’s casing, the special features that come with it; the brand name which portrays durability, status projection or prestige; guarantee or warranty; before or after sales services, itd.
What about the various “products” which banks these days have been bombarding the public with? This has not ruled out the fact that these are merely financial services (not manufactured goods), identified, marketed separately, and intended for specific target markets. The same holds for countless spades of offerings of several telecommunication service providers around. Even when these most times tag theirs “bundles”, it does not portend the creation of goods or physical products, as what are being offered to consumers.
I agree with you that the “product” you are referring to also come into existence (from manufacturing process, through distribution, then consumption) with people being involved, and not robots as you claimed. Try to have a clear distinction between my reference to “product” above and “good” or physical product (that is, a tangible and moveable item or property; merchandise, freight).
Henceforth, have these always in mind whenever “product” in being referred to in marketing, to afford you a better platform for evaluating the degree of people’s involvement: Everything (both favourable and otherwise) that one gets in an exchange. It bears a complexity of both tangible and intangible attributes (including functional, social and psychological utilities or benefits). Proizvod, in this regard, may be a good, a service, an idea or concept.
The features of services in marketing obviously help project more of people’s involvement, hence your perception (and rightly too) of services being of ‘people factor’. These two definitions of services substantiate this to a very large extent – (a) “An intangible that results from applying human mechanical efforts to people or objects” and (b) “Activities, benefits, or satisfactions which are offered for sale, or as provided in connection with sales of goods”. Također, consider these features of services from a marketing perspective:
– Intangibility [Services are hinged on performances, can not be seen, touched,
smelled, nor even possessed]. In this case, it is performed, not produced.
– Simultaneous production and consumption [Services are typically produced and consumed at the same.
– Less standardization [Each situation that requires a service is different and each provider conducts himself or herself differently].
– Perishability [A product can be stored for later use, not so for service. Service value exists at a specific time. Once it is performed, the service cannot be returned].
– Client relationship [The buyer in a service transaction is a client rather than a customer]. In this last situation, the client is “in the hands” of the seller (service provider); buyer is not free to simply use the service when he/she wishes (unlike for product); must abide by conditions established by the seller (npr. schedule, procedures or rules, and policies), which are often in the best interest of the consumer.
Antonia, you can see that the above are highly dependent on the human element, hence any assumption of “people” factor seems appropriate. There is no doubt that there are significant differences between the marketing of services and that for tangible products (physical goods). Goods provide benefits because of their physical characteristics, while services are hinged on actions which people carry out (npr. medical procedures; activities in beauty salons; accounting or consulting services; transport, education).
Above all, we must not overlook the value which service personnel provide because of their interaction with customers, as human beings (a typical example of “people” factor). Try to visualize what a typical service provision of an airliner could have been without the activities of the flight attendants towards customers. Services do not have physical properties to shape a customer’s perception, but human properties are vital. As a result, services require to be defined so that customers can understand and value such, and therefore carry out patronage. This is why service descriptions need to highlight “benefits.” It takes a managed approach to creating, assessing and developing a new service concept to ensure the company offers the right things, to the right customers, and for the right reasons.
Finally, the famous “Four Ps” of Marketing (Proizvod, Place, Price, and Promotion) can be expanded to suit the “People factor” in marketing of services, to include three additional Ps of “People,” “Process,” i “Physical Evidence”, which are all reflective of processes to facilitate a consistent level of service delivery. These factors are quite significant for a typical service provider when consideration is given to efficiency and quality management in the ‘eyes’ of the customer (that is, “Process” i “People” issues). The “Physical Evidence” aspect has bearing on the relevance of service being perceived by beneficiaries, while being delivered, as quite tangible so they can be charged for and ‘seen’ as something required to be purchased.