MBA Notes - Nature of Services

Question - What do you mean by Service Marketing? Discuss the Nature of Services.


What is Service Marketing?

A Service is an economic activity, that is intangible or not be touched, not be stored, and not be owned. Postal service Delivering mail is a Service, and the use of expertise like person visiting a doctor is also a service. A service is consumed at the point of sale and does not result ownership.

A product is material or tangible in nature, can be touched, can be stored, and a product can also be owned, but it is not so in case of a service.

Nature of Service

1. Lack of Ownership

One cannot own or store a service as it can be done in case of a product. Service is consumed at the point of sale and does not result ownership. Services are used or hired for a period of time. For example buying a movie ticket the service lasts for two or three hours, but customer want and expect complete entertainment and excellent service for that time period.

2. Intangible

Services are intangible in nature, you cannot touch it, cannot see it, cannot taste it. You cannot touch or hold a service as you can do with a product. For example one cannot touch or hold the services provided by his financial adviser. This makes it difficult to evaluate the quality of service prior to consuming it since there are fewer attributes of quality in comparison to a product. 

3. Inseparable

Service is inseparable in nature means to say that it cannot be separated from the service provider. A product when produced can be taken away from its producer whereas a service is produced at or near the point of purchase. For example visiting a restaurant, you order your meal, wait for the meal, meal delivered to you and services provided by waiter/waitress are all part of service production process and is inseparable. 

4. Perishable

Service last for specific time period, it cannot be stored as like a product for future use. Service production and utilization goes simultaneously. For example watching a movie in cinema hall, service will only last the duration of the show. Again because of this time constraint consumers demand more. 

5. Heterogeneous

It is very difficult to make each service experience identical, for example you travelling by plane the service quality may differ from the first time you travelled by that airline to the second, because the air hostess is less or more experienced. Systems and procedures are followed in service production process to minimize this heterogeneity and to provide consistent services all the time.

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