Understanding Services: Characteristics, Quality, and More
Services: Definition and Examples
Services are deeds, processes, and performances provided, co-produced, or co-created by one entity or person for and/or with another entity or person.
Service Industries and Companies
- Within the service sector, the core product is a service. (Marriott Int. lodging, American Airlines Transportation, Charles Schwab Financial Services, Mayo Clinic Health Care)
Service as a Product
- Represents a wide range of intangible product offerings that customers value and pay for in the marketplace. Sold by service companies and non-service companies such as manufacturers and technology companies. (IBM, Hewlett-Packard, Macy’s, PetSmart)
Customer Service
- Is the service provided in support of a company’s core products. Can occur on-site, over the phone, or via the internet. Important for building customer relationships.
Derived Service
- The value derived from physical goods are valued for the services they provide. They suggest that the value derived from physical goods is really the service provided by the good, not the good itself.
Characteristics of Services
Intangibility
- Services are performances or actions rather than objects; they cannot be seen, felt, or tasted (e.g., health care services). Services cannot be inventoried, easily patented, readily displayed, or communicated; pricing is difficult.
Heterogeneity
- Because services are performances frequently produced, consumed, and often co-created by humans, no two services will be precisely alike. This also results because no two customers are precisely alike; each has unique demands or experiences. Service delivery and customer satisfaction depend on employees and customers. Service quality depends on many uncontrollable factors.
Simultaneous Production and Consumption
- Many services are sold first and then produced and consumed simultaneously (e.g., restaurant services). Customers will frequently interact with each other during the service production process and thus may affect each other’s experiences.
Perishability
- Refers to the fact that services cannot be saved, stored, resold, or returned (e.g., a seat on an airplane, an hour of a lawyer’s time).
Servicescape
Is a model developed by Booms and Bitner to emphasize the impact of the physical environment in which a service process takes place. The aim of the servicescape model is to explain the behavior of people within the service environment with a view to designing environments that accomplish organizational goals in terms of achieving desired behavioral responses.
Zone of Tolerance
The extent to which customers recognize and are willing to accept variation is called the zone of tolerance. If service performance is above the zone of tolerance at the top end, customers will be pleased. When it falls outside the range (low or high), the service gets the customer’s attention in either a positive or negative way (e.g., movie tickets, the time at the counter).
Desired service – zone of tolerance – adequate service
Service Quality
Service quality is a focused evaluation that reflects the cost, dependability, and customer’s perception of reliability, assurance, responsiveness, empathy, and tangibles.
SERVQUAL Service Quality Dimensions
Reliability
- Ability to perform the promised service dependably and accurately.
Responsiveness
- Willingness to help customers and provide prompt service.
Assurance
- Employees’ knowledge and courtesy and their ability to inspire trust and confidence.
Empathy
- Caring, individualized attention given to customers.
Tangibles
- Appearance of physical facilities, equipment, personnel, and communication materials.
Vs. Customer satisfaction is more inclusive; it is influenced by perceptions of service quality, product quality, and price, as well as situational and personal factors.