Chapter 8. Services Marketing
Ray Freeman and Kelley Glazer
Learning Objectives
- Explain the meaning of services marketing
- Describe the differences between marketing services and marketing products
- Describe the characteristics of a marketing orientation and its benefits
- Define key services marketing terminology
- Explain the PRICE concept of marketing
- Provide examples of the 8 Ps of services marketing
- Gain knowledge of key service marketing issues and trends
Overview
Marketing is a continuous, sequential process through which management plans, researches, implements, controls, and evaluates activities designed to satisfy the customers’ needs and wants, and meet the organization’s objectives. According to Morrison (2010), services marketing “is a concept based on a recognition of the uniqueness of all services; it is a branch of marketing that specifically applies to the service industries”(p. 767).
Marketing in the tourism and hospitality industry requires an understanding of the differences between marketing goods and marketing services. To be successful in tourism marketing, organizations need to understand the unique characteristics of their tourism experiences, the motivations and behaviours of travelling consumers, and the fundamental differences between marketing goods and services.
The Evolution of Marketing
Until the 1930s, the primary objective of businesses was manufacturing, with little thought given to sales or marketing. In the 1930s, a focus on sales became more important; technological advances meant that multiple companies could produce similar goods, creating increased competition. Even as companies began to understand the importance of sales, the needs and wants of the customer remained a secondary consideration (Morrison, 2010).
In 1944, the first television commercial, for Bulova watches, reached 4,000 sets (Davis, 2013). The decades that followed, the 1950s and 1960s, are known as an era when marketing began to truly take off, with the number of mediums expanding and TV ad spending going from 5% of total TV revenues in 1953 to 15% just one year later (Davis, 2013).
The era from approximately 1950 to around 1970 was known as a time of marketing orientation (Morrison, 2010). Customers had more choice in product, this required companies to shift focus to ensure that consumers knew how their products matched specific needs. This was also the time where quality of service and customer satisfaction became part of organizational strategy. We began to see companies develop internal marketing departments, and in the 1960s, the first full-service advertising agencies began to emerge.
Societal marketing emerged in the 1970s when organizations began to recognize their place in society and their responsibility to citizens (or at least the appearance thereof). This change is demonstrated, for example, by natural resource extraction companies supporting environmental management issues and implementing more transparent policies. T