4.6. The Extended Ps (HL Only)

  • People
    • One of the four main inputs of every business
    • All businesses have employees that help in conducting its daily operations
    • Much more important in service-based businesses since more employees come into contact with customers, as compared to product-based businesses
    • Customer relations
      • Employee that comes into contact with customers can create positive or negative effects on the image and reputation of the business
        • Service businesses require people who can interact positively with customers
        • People are important in service; they deliver and maintain transactional marketing
        • Recruiting and training the right employees are essential to create a competitive advantage
        • Usually most important in the hotel and restaurant industries where quality of service is valued quite highly
        • Measuring people’s effectiveness
          • Appearance
          • Attitudes and aptitudes
          • Efficiency
      • Link to HR
        •  Training
        • Customer feedback
        • Communication
    • People in the marketing mix
      • Personal/direct selling
        • People buy from people they like – attitude, skills and appearance need to be at the very best levels
        • Employees seek to:
          • Build goodwill with customers with the longer-term aim of generating orders
          • Advise customers on the best purchase for their needs
          • Persuade buyers to buy by identifying their needs and persuading them of previously unidentified needs
      • Customer service
        • Provide expertise, technical support, and coordinate the customer interface
          • Ways in which complaints are handled can affect a business’ reputation
          • Adds value by offering customers technical support, expertise and advice
  • Processes
    • Methods of delivering or providing the service
    • Processes that a business has in place to satisfy a customer’s wants reliably
    • Services need clearly defined and efficient processes to support it
      • Avoids confusion and promotes consistent service
    • Examples of processes
      • Payment methods
      • Waiting times
      • Customer services
      • Delivery
      • Post-sales care
    • Processes in the marketing mix
      • Direct Activities
        • Adds value at the customer interface as the consumer experiences the service
      • Indirect Activities
        • Helps support many processes, and the service itself before, during and after it has been consumed
      • Numerous processes integrate together to create an overall marketing process
      • Must strike a balance between customization and standardization
        • Both consistent service and unique experiences are important
      • Enhancements to the various processes can minimize costs and maximize profits, improving overall efficiency
  • Physical Evidences
    • The way the company appears from the outside
    • Shows the quality and origin of service
    • Can be used to charge a premium price
    • Potential customers will make judgments about the organization based on physical evidences before even having experienced the service at all
    • Physical evidences in the marketing mix
      • Given services are largely intangible, customers rely on physical aspects to judge
      • Tangible aspects have to be designed in order to sway customer perception
      • Physical environment
        • Ambience
      • Package of elements (e.g. color, music, smell, sound)
        • Helps in elevating the experience of the service
        • Ambience must be matched to the service that is being delivered
      •  Signages
        • Set of signs, symbols and artifacts of the business
        • Reflects the business’ image
      • Spatial layout/functionality
        • Way furniture and fixtures are set up or how machinery is spaced
        • The environment must help address the consumer’s needs
      •  Consistency
        • Physical evidences must be consistent with other elements of the marketing mix
        • Ex. Expensive restaurants must not only justify their prices based on the quality of the food, but with the type of cutlery, furnishings, and even the uniforms of the servers used

Kim De Leon4.6. The Extended Ps (HL Only)

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