6.5.5 Characteristics of Service¶
In the world of services, there are four significant characteristics that differentiate services from tangible products. These characteristics also help in developing service strategies to enhance customer experience and satisfaction. Let's delve into each of these characteristics:
1. Intangibility¶
What is Intangibility?¶
Intangibility refers to the fact that services cannot be physically touched, seen, or experienced through the sensory organs (eyes, ears, nose, tongue, skin) before the purchase. This is different from tangible products, where customers can touch and feel the product before deciding to buy it. Examples of intangible services include: - Haircuts - Massage therapy - Consulting - Medical services
Implications:¶
Because services are intangible, customers face a perceived risk as they cannot evaluate the service beforehand. To mitigate this risk, businesses need to develop strategies to make the service more tangible: - Testimonials: Success stories and feedback from past customers can help build confidence. - Employee Expertise: Highlighting the qualifications or training of the service providers, like hairstylists or doctors. - Brand Presence: Strong brand associations (e.g., a reputable brand like Walmart or Tesco) can provide assurance of quality.
2. Inseparability¶
What is Inseparability?¶
Inseparability means that services are produced and consumed at the same time. Unlike physical products, where production and consumption are separate processes (manufacture, inventory, and then sale), services are produced and consumed simultaneously. This means that: - The service provider and the customer interaction are essential elements of the service experience. - The process of production, the person providing the service, and the equipment used all play an important role in the service delivery.
Implications:¶
Since services cannot be separated from their production and consumption, businesses need to focus on ensuring that the process is smooth and consistent. For example: - Personalized service: The experience largely depends on the service provider (e.g., hairstylists, doctors, teachers). - Service environment: The setting, ambiance, and quality of interaction are key to customer satisfaction.
In industries like entertainment (movies, concerts), customers cannot know the quality of the service (movie or performance) until after consumption, which makes the service provider’s reputation even more important.
3. Variability¶
What is Variability?¶
Variability refers to the fact that the quality of a service can vary greatly depending on: - Who provides it (e.g., different hairdressers, doctors, or hotel staff) - When it is provided (e.g., peak vs. off-peak times) - Where it is provided (e.g., location differences)
Since service delivery is often influenced by human elements, it is highly susceptible to fluctuations. Even within established brands, variability can occur due to differences in how services are performed.
Implications:¶
To reduce the negative effects of variability and maintain consistent quality, businesses focus on: - Hiring the right people: The service employees should be well-trained and capable of delivering the desired level of service. - Standardizing processes: Developing Standard Operating Procedures (SOPs) or service blueprints helps in ensuring consistency in delivery. - Customer feedback: Continuously monitoring customer satisfaction and acting on their feedback helps improve and standardize the service over time.
4. Perishability¶
What is Perishability?¶
Perishability refers to the fact that services cannot be stored for later use. Unlike physical products, which can be produced, stored in inventory, and sold when needed, services are consumed as they are produced. This characteristic creates a challenge in managing supply and demand. If there are too many service resources (like employees or capacity) during certain periods and not enough during others, businesses face either: - Underutilization (too few customers during certain periods) - Overutilization (too many customers and not enough capacity to serve them)
Implications:¶
Because services cannot be stored, managing fluctuating demand becomes a key challenge. To address this, companies employ various strategies: - Demand-side strategies: - Differential pricing: Charge higher prices during peak hours and offer discounts during off-peak times to encourage demand during quieter periods. - Advanced reservations: Systems like hotel bookings or doctor appointments help in managing demand by guaranteeing a set number of customers at a specific time.
- Supply-side strategies:
- Part-time staff during peak hours: This helps in managing demand during busy times.
- Efficiency routines: Training employees to handle peak periods effectively ensures better service delivery.
- Customer participation: In models like IKEA, customers assemble their own furniture, thus reducing the company's service time and increasing customer engagement.
How can I help you today?