Chapter 7:Promoting Services and Educating Customers PDF

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Chapter 7:Promoting Services and Educating Customers...

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Pr omo t i ngSer vi c es& Educ at i ng Cus t omer s Rol eofmarket i ngcommuni cat i ons Through communications markets can explain and promote the value proposition in the offering. Goes beyond media, PR, and salespeople.  Location and atmosphere of delivery  Corporate design features; colors  Behaviors of employees Roles include… 1. Position and differentiate the service Used to convince of potential and current customers that the firm is superior on determinant attributes.  Use obvious clues to communicate service performance by highlighting attributes such as quality, employee attitudes, facilities, equipment, etc. Important to advertise what customers are concerned about.  Advertising things that could make customers uncomfortable; safety on planes. 2. Promote the contribution of their service personnel and backstage operations. Promotion of frontline staff (employees at tills) it makes the service more concrete and personnel – helps to understand the service encounter. Promoting backstage staff and increase customer trust in the company’s competence and commitment to quality. 3. Add value through communication content Information & Consultation  Information; What services are available, functions, features, benefits  Consultation; Advice on which service best fits the customer 4. Facilitate customer involvement in service production Customers need to be trained in order to improve productivity to the firm.  Showing how service delivery occurs to show customers what to expect and how to act. 5. Stimulate or dampen demand to match capacity. Advertising and sales promotions help change the time customers use services – helping match demand to capacity.

Chal l engesofs ervi cecommuni cat i ons Intangibility Creates 4 problems for promoting attributes and benefits… 1. Abstractness – abstract concepts don’t correspond directly with physical objects; challenging to link service to concepts. 2. Generality – Most customers know what they are so its difficult for marketers to create a unique value proposition to communicate competitiveness. 3. Nonsearchability – Attributes can’t be searched or inspected prior to purchase; more credence and experience attributes > search attributes 4. Mental Impalpability – Sufficiently complex, multi-dimensional, or new; customers cant understand or interpret service. Overcoming Intangibility Using tangible cues and metaphors to help clearly communicate intangible attributes/benefits.  Tangible cues – Include information that catches the customer’s attention and produce a strong and clear impression.  Metaphors – Tangible metaphors to communicate benefits and emphasize key points of differentiation; highlight HOW service benefits are provided.

Market i ngcommuni cat i onspl anni ng 5 W’s – Used for marketing communications planning Who is the target audience? What do we need to communicate and achieve? How should we communicate this? Where should we communicate this? When do the communications need to take place? 1. Who  Prospects – Not known in advance so traditional communications mix is used; media advertising, PR, email.  Users – Cost effective channels used; point of sale promotion, targeted mailing list.

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Employees – Serve a secondary audience through public media & shapes employee behaviors.

2. What Communication objectives identify what we need to communicate and achieve. (shaping and managing customer behavior at any stage) Educational and Promotional objectives include…  Creation of memorable images  Build awareness and interest in unfamiliar brands  Compare a service favorably with competitor’s offerings.  Reposition a service relative to competitors  Provide reassurance such as guarantees etc.

Market i ngcommuni cat i onsmi x Access to numerous forms of communication is known as the marketing communications mix.

Split into two main channels; 1. Those controlled by the organization 2. Those not controlled by the organization

MESSAGES VIA TRADITIONAL CHANNELS Advertising – Build awareness, inform, persuade, and remind. Provides factual information about the service and educates about capabilities and facilities. Customers resistance to advertising is at an all time high  65% of people feel constantly bombarded with ad’s  59% feel the ads have little relevance to them  Less than half of ads generate a positive return on investment

Advertisements are becoming more creative in the way they are produced and placed to become more of an appeal; Video games, through humor etc. PR – Efforts to generate positive interest in an organization and its products by sending news releases, press conferences, etc.    

Recognition and reward programs Community involvement Fundraising Sponsorship at large events; sports, science.

Direct marketing – Allowing personal messages to be sent to highly targeted segments of customers – most effective when possessing detailed databases of customer information. Permission marketing on the rise – Customers ability to decide how and by who they would like to be contacted by.  Permission marketing objective  persuade customers to volunteer their attention reaching only individuals who expressed prior interest in those types of messages.  Email & websites can be merged into a one to one permission based medium. Sales Promotion – Communication with an incentive; get customers to make a purchase decision faster or encourage use sooner in greater volume or frequency. Viewed in coupons, promotions, discounts, and competitions.  Increase during low demand periods  Leads to the attraction of customers with lower intention of repurchase and loyalty. EX. SAS International Hotels Provided discounts to seniors equivalent to their age; above the age of 65. One guest aged 102 came and requested a 2% cashback – put the hotel in a humorous positive light. Personal selling – Interpersonal encounters made to educate and promote a certain brand/good. Telemarketing is used as a lower cost alternative to face to face selling. Trade shows – Used as publicity including personal selling opportunities.

MESSAGES VIA THE INTERNET Company’s Website – Improve attractiveness and usefulness to customers  Create awareness and interest  Provide information and consultation  Allow two way communications via email and chat rooms  Encourage trials  Allow order placements Marketers try to increase the ‘stickiness’ of the site – how willing customers are to spend time on the site and revisit. A sticky site has…  High quality content  Easy to use features  Quick download speeds

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Updated frequently

Online advertising – Two main types; banner advertising and search engine advertising. Banner advertising; Placement of banners and buttons on portals like other firms websites to attract online traffic to their own site.  Banner – Thin horizontal ad running across all or part of the site.  Skyscraper – A long skinny ad running vertically down one side of the site  Button Search engine advertising; Reverse broadcast network – Let firms know what customers want though their keyword search.  Helps target marketing communications. Both allow for a clear and measurable return on investment. New media and their implications on marketing communications TiVo – Digital video recorder (DVR)

Mobile advertising

Web 2.0

June 2004 – 30 second spot featuring Phil Mickelson allowing people to move from the ad into a 4-minute video about more information  Enabled order information directly from the commercial. Greater convenience to customers through targeted advertising  Receive discounts to stores and restaurants that you are near or in via global positioning. Umbrella term for Wikipedia, Flicker, YouTube, Twitter, etc. Content is generated  updated  revised by multiple users and freely shared; marketers cannot control this.

MESSAGES VIA SERVICE DELIVERY CHANNELS Service outlets – Impersonal messages distributed in the form of servicescapes.  Servicescape is designed to coordinate visual elements of both interior and exterior to communicate the positioning of the firm and shape customer’s experiences. Frontline employees – Their communication takes the form of the core service and supplementary services; information, reservations, payments, etc.  Creates the experience. Service delivery points – Requires step by step instructions to ensure its user friendly.

MESSAGES ORIGINATING FROM OUTSIDE THE FIRM WOM – Powerful influencer on customer’s decisions to use or not to use a service.  Other customer’s reviews are more credible than the firms  Important predictor of top line growth.

Important to services due to high credence and experience attributes; reduces risk to the customer. Strategies to encourage positive and persuasive WOM includes…  Creating promotions to get people talking Ex. Richard Branson skydived off a 400ft building in Los Vegas to promote his new airline.  Offering promotions to encourage persuasion to use the service to friends Ex. Bring 2 friends the 3rd eats free  Develop referral schemes such as rewarding existing customers for introducing new ones. Word of mouse – Virtual marketing Blogs (Online WOM) – Monitored as a form of market research and feedback. Twitter – Social networking and microblogging platform used in various forms by firms.  Answer questions quickly.  Interaction with customers and followers

Et hi calandConsumerpri vacyi ssuesi ncommuni cat i ons Unrealistic promises result from poor internal communications between operations and marketing concerning service performance customers can expect.  Sometimes overpromising occurs by unethical advertisers in order to secure sales.  Customer protection agencies, trade associations, and journalists seek to expose them. Personal privacy concerns on the rise due to the increase in…  Telemarketing  Direct mail – email In the US – The Federal Trade Commissions National Do Not Call Registry  Allows customers to remove themselves from telemarketing lists for 5 years.  Direct Marketing association does the same.

Rol eofcorporat edesi gn Key to ensure that a consistent style and message is communicated through all communications mix channels. Created by external consulting firms – stationary, promotional material, retail signage, uniforms, color schemes, interiors, etc. Companies can stand out by…  Colors in their corporate design – recognizable combination.  Trademarked symbols > names; McDonalds golden arches.  Creation of tangible recognizable symbols to associate their brand name; US postal service....