Ch7. Services and B2B Marketing — Service Characteristics and Business-to-Business Marketing

Unique Characteristics of Services

Intangibility:
  Cannot be experienced or inspected before purchase
  Difficult to evaluate quality in advance
  → Provide tangible cues (facilities, staff appearance, brochures)

Inseparability:
  Production and consumption occur simultaneously
  Cannot be separated from the service provider
  → Staff selection and training are critical

Heterogeneity (Variability):
  Inconsistent quality of delivery
  Varies by employee and situation
  → Standardize, train, and leverage technology

Perishability:
  Cannot be inventoried; hard to absorb demand fluctuations
  → Manage demand (dynamic pricing, reservations)

Service Quality — SERVQUAL

5 Dimensions:
  Tangibles:      physical facilities, equipment, staff appearance
  Reliability:    ability to perform the promised service dependably
  Responsiveness: willingness to help and provide prompt service
  Assurance:      knowledge and courtesy inspiring trust and confidence
  Empathy:        caring, individualized attention to customers

Service Quality Gap Model:
  Service quality = Perceived service − Expected service
  Sources of gaps: management perception, service design,
                   service delivery, communication

Service Recovery:
  Acknowledge the failure → resolve immediately → offer compensation
  Service recovery paradox: customers sometimes become more satisfied
                            after a recovery than if nothing went wrong

The Services Marketing Mix: 7Ps

The traditional 4Ps plus three additional Ps:
  People:           employees and customers both shape the service
  Process:          the methods and flow of service delivery
  Physical Evidence: environment, facilities, uniforms — tangible cues

B2B Marketing

B2B Characteristics:
  Professional buyers
  Multi-level decision-making (Buying Center)
  Long-term relationships and partnerships are critical
  Primarily economic and functional criteria

Buying Center Roles:
  Users:       the actual end-users of the product/service
  Influencers: technical experts and advisors
  Buyers:      formally responsible for the purchase
  Deciders:    have the final authority to approve
  Gatekeepers: control the flow of information (e.g., executive assistants)

Relationship Marketing:
  Trust, commitment, and mutual dependence
  Long-term contracts and strategic partnerships

4 Service Characteristics: Intangibility · Inseparability · Heterogeneity · Perishability ★★★★★ : The four properties that distinguish services from physical goods. Memory tip: IIHP — services can’t be touched, separated, standardized, or stored

SERVQUAL = Tangibles · Reliability · Responsiveness · Assurance · Empathy ★★★★★ : Five dimensions used to measure service quality. Memory tip: TERRA — the ground on which great service is built

Services 7Ps = 4Ps + People · Process · Physical Evidence ★★★★☆ : The extended marketing mix for services. Memory tip: add the 3 human-facing Ps on top of the classic 4

Practice Quiz

Q. How does the perishability of services affect marketing strategy?

Cannot be inventoried → supply-demand mismatch is a major problem. Solutions: raise prices during peak times to spread demand, implement reservation systems, manage queues. Examples: airlines raise fares during holidays, hospitals use appointment systems, restaurants use waitlist apps. Demand management is the central challenge in services marketing.

Q. How should B2B marketers deal with the gatekeeper?

The gatekeeper controls information flow — executive assistants, purchasing department staff. Bypassing the gatekeeper makes it impossible to reach the actual decision-makers. Strategy: provide value to the gatekeeper as well. Share professional resources and industry information. Complement this by reaching decision-makers directly through online content. Relationship-building is the core approach.