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E-Marketing & Service Marketing

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INFINITY

MANAGEMENT & ENGINEERING COLLEGE,


SAGAR

E - Marketing & Service Marketing


Paper No.:301

Department of Management Studies

Prepared By: Dr. Mohd. Ashfaq Siddiqui


Maharaja Chhatrsaal Bundelkhand University
Chhatarpur
SYLLABUS
M.B.A. – Third semester
Paper No.:301
Title- E - Marketing & Service Marketing

UNIT-I
Introduction to the Resources of electronic Marketing. Electronic Marketing Resources that can be integrated
into the traditional marketing process.
Value added uses and perception to the product and service of E-Commerce.

UNIT-II
Marketing Planning for online Activities e-marketing mix elements of electronic Ps.

UNIT-III
Electronic marketing implementation, Electronic marketing mix strategies. An introduction to the internet,
various preparations in the process of electronic marketing and e-commerce.
The future of online electronic marketing resource, Ethics of Electronic marketing, long term marketing
relationship, securing on the E-marketing site.
1. Ongoing customer communication.
2. Customer profile and data management

UNIT-IV
Services; Service Sector and Economic Growth, Service Concept, Characteristics and Classification of Service,
Challenges in Service Marketing, Applications of Service Marketing: Marketing of Financial, Hospitality,
Health, Educational and Professional Services, Marketing for Non-Profit Organisations, Creating and delivering
services: Planning, design, development and delivery of services. Product support services. Relationship
Marketing concept, process and importance.

References:
1. E-commerce, The cutting edge of the business by: Kamlesh K. Bajaj & Debjani Nag, Tata McGraw-Hill
Publishing Company Limited, New Delhi.
2. E-Business with Net Commerce, Samantha Shurety, Addision Wesley Longman, Singapore, Pvt. Ltd.
3. Hand Book of Electronic of essaging, Nancy Cox, Editor CRC Book Private Limited, New Delhi.
4. V.A. Zeithamal and M.J. Bitner, Service Marketing: New Delhi, McGraw-Hill.
5. Christopher H. Lovelock, Service Marketing, New Delhi : Prentice Hall of India Pvt. Ltd.
6. Ravi Shankar, Service Marketing, New Delhi Global Press.
Department of Management Studies
E - Marketing & service Marketing (301)

Lecture Plan
Unit Lecture Topic to be Covered

1 What is E-Marketing and how is it better than traditional marketing?


Why is it important?

2 Difference between e-business, e-commerce & e-marketing.

3 What is the difference between E-Marketing and internet or web


marketing? What are the E-Marketing tools?

4 Introduction to the Resources of electronic Marketing.


Unit-1
5 E-Marketing Environment. Importance of Electronic Marketing
Resources.

6 Electronic Marketing Resources that can be integrated into the


traditional marketing process.

7 Value added uses and perception to the product and service of E-


Commerce.

8 Unit Test – 1
9 Overview of Online Activities.

10 Marketing planning for online activities.

11 Preparing for new product introduction advertising.


Unit-2
12 E-marketing mix elements of electronic P’s

13 Unit Test – 2
14 Electronic marketing implementation

15 Electronic marketing mix strategies

16 An introduction to the internet. How can internet add value to a


business?
Unit-3
17 Various preparations in the process of electronic marketing and e-
commerce
18 The future of online electronic marketing resource

19 Ethics of Electronic marketing.

20 Securing on the E-marketing site.

21 Ongoing customer communication.

22 Customer profile and data management.

23 Unit Test – 3
24 What is Service Marketing? Introduction to Service Marketing.

25 Definition of Services, The Special Characteristics of Services.

26 Service Sector and Economic Growth

27 The service concept outlines how a service provider can realize the
value and desired outcomes of its services.
Unit-4
28 Challenges in Service Marketing

29 Applications of Service Marketing: Marketing of Financial, Hospitality,


Health, Educational and Professional Services

30 Applications of Service Marketing: Educational and Professional


Services

31 Marketing for Non-Profit Organisations

32 Creating and delivering services: Designing, Planning, Creating and


Evaluation.

33 Product support services.

34 Relationship Marketing concept

35 Relationship Marketing Process

36 The Characteristics and Importance of Relationship Marketing:

37 Unit Test – 4
E - MARKETING & SERVICE MARKETING – NOTES
(UNIT WISE)
UNIT – I

What is E-Marketing and how is it better than traditional marketing?

Marketing has pretty much been around forever in one form or another. Since the day when humans first started
trading whatever it was that they first traded, marketing was there. Marketing was the stories they used to
convince other humans to trade. Humans have come a long way since then, (Well, we like to think we have) and
marketing has too.

The methods of marketing have changed and improved, and we've become a lot more efficient at telling our
stories and getting our marketing messages out there. eMarketing is the product of the meeting between modern
communication technologies and the age-old marketing principles that humans have always applied.

That said, the specifics are reasonably complex and are best handled piece by piece. So we’ve decided to break
it all down and tackle the parts one at a time. This week
we’ll be looking at the "what" and "why" of eMarketing, outlining the benefits and pointing out how it differs
from traditional marketing methods.

By the end of the series we're pretty sure you'll have everything you need to tell better marketing stories.

What is eMarketing?

Very simply put, E-Marketing or electronic marketing refers to the application of marketing principles and
techniques via electronic media and more specifically the Internet. The terms eMarketing, Internet marketing
and online marketing, are frequently interchanged, and can often be considered synonymous.

E-Marketing is the process of marketing a brand using the Internet. It includes both direct response marketing
and indirect marketing elements and uses a range of technologies to help connect businesses to their customers.

By such a definition, eMarketing encompasses all the activities a business conducts via the worldwide web with
the aim of attracting new business, retaining current business and developing its brand identity.

Why is it important?

When implemented correctly, the return on investment (ROI) from eMarketing can far exceed that of traditional
marketing strategies.

Whether you're a "bricks and mortar" business or a concern operating purely online, the Internet is a force that
cannot be ignored. It can be a means to reach literally millions of people every year. It's at the forefront of a
redefinition of way businesses interact with their customers.

E-Marketing:- E-marketing is the application of a broad range of information technologies for :-

- Transforming marketing strategies to create more customer value through more effective segmentation,
targeting, differentiation and positioning strategy.
- More effectively planning and executing the conception, distribution and pricing of goods, service and
ideas.

- Creating exchanges that satisfy individual consumer and organization customer’s objective.

“E-marketing is the result of information technology applied to traditional marketing.”

“E-marketing is the application of digital information technologies to add value & marketing strategies.”

E-Business:- e-business is imp, powerful and unstoppable tool of continuous optimization of a firm business
activities thorough technology.

Introduction:- electronic commerce is the conducting of business communication and transmission over
network and through computer. The buying and selling of goods & services and the transfer of funds through
digital communication. Also includes all inter company and intra company function such as marketing, finance,
manufacturing, sales that enable commerce. The use of electronic mail, EDI (electronic data interchange), file
transfer, fax, video conference, work flow or includes buying & selling area the world wide web and the
internal electronic fund transfer, smart cards, digital cash and other way of doing business over digital network.

e-marketing is the integration of information technology & the internet into marketing.

Electronic Marketing is on the online & electronic based marketing that facilitates manes of goods & services
by the producer to satisfy the wants & needs of the consumer.

e-marketing means heavily on network technology to coordinate marketing research and product development,
develop strategies and tactics to present consumer to buy, provide for online distribution maintain customer
records, conduct customer satisfaction service and gather feedback.

Electronic Marketing advance the over all marketing program that in term support the corporate objective of
electronic commerce.

Difference between e-business, e-commerce & e-marketing

E-Business:- e-business means utilizing electronic medium in every day business activities.
- Web based technologies.
- Broad entity.
- Dealing with the entire (suppliers, customers) complex system.
- Assist overall or specialized business activities.
- Ex.- E-Business with mixed presence of product, services in organization.

E-Commerce:- Part of a business.


Best decried in a transactional context.

Ex.- electronic transaction of funds.


- Information
- Entertainment
- Public relations
- Social media
- Market research
- Small marketing
- Direct sales etc.

E-Marketing:- E-Marketing can also be defined as a subset of e-business that utilized electronic medium to
perform marketing activities and achieve desired marketing objectives for an organization.

Ex.- Internet marketing


Interactive marketing
Mobile marketing.

E-Marketing also referred to as online marketing or internet marketing.


- Low costs in distributing information & media to global audience.
- Search engine marketing – display advertising.
- email marketing
- interactive advertising.
- E-marketing is the process of growing and promoting organisation.
- It dose not mean simply building a website or promoting a wet site.
Strategies of online marketing includes:-
Online advertising product, Services, Websites, Search engine marketing.

What is eMarketing?
eMarketing is essentially part of marketing. But what is the difference between eMarketing and Internet or web
marketing? What are the eMarketing tools? And how do marketers plan for eMarketing? This lesson aims to
answer these questions.

So the place to begin defining eMarketing is to consider where it fits within the subject of marketing. So let's
start with a definition of marketing. The American Marketing Association (AMA) definition (2004) is as
follows:

Marketing is an organizational function and a set of processes for creating, communicating and delivering
value to customers and for managing customer relationships in ways that benefit the organization and its
stakeholders.

Therefore eMarketing by its very nature is one aspect of an organizational function and a set of processes for
creating, communicating and delivering value to customers and for managing customer relationships in ways
that benefit the organization and its stakeholders. As such an aspect, eMarketing has its own approaches and
tools that contribute to the achievement of marketing goals and objectives.

This also helps us to differentiate between eMarketing and E-commerce, since E-Commerce is simply buying
and selling online.
What is the difference between eMarketing and internet or web
marketing?
There is no real difference between eMarketing and internet or web marketing. However, with the arrival of
mobile technologies such as PDA's and 3G mobile phones, as well as Interactive Television, both terms tend to
be stretched to include these new media technologies. On the other hand, others would see eMarketing and
internet or web marketing as subtly different, for example Chaffey (below):

internet [or web] marketing is achieving marketing objectives through applying digital technologies. (Chaffey
2006)

eMarketing is achieving marketing objectives through use of electronic communications technology. (Chaffey
2006)

Whilst this distinction is wholly acceptable, it is difficult to see where the distinction lies between digital
technologies and electronic communications technologies, especially with the convergence of technologies such
as mobile devices.

What are the eMarketing tools?


The Internet has a number of tools to offer to the marketer.

• A company can distribute via the Internet e.g. Amazon.com.


• A company can use the Internet as a way of building and maintaining a customer relationship e.g.
Dell.com.
• The money collection part of a transaction could be done online e.g. electricity and telephone bills.
• Leads can be generated by attracting potential customers to sign-up for short periods of time, before
signing up for the long-term e.g. which.co.uk.
• The Internet could be used for advertising e.g. Google Adwords.
• Finally, the web can be used as a way of collecting direct responses e.g. as part of a voting system for a
game show.

E-Marketing Resources:-

Are those technological or e-marketing tools that are used to complete the marketing direction. E-marketing
Resources are primarily implementation oriented for communication information processing or commerce
transaction technology marketing resources involves the World Wide Web interactive web site. Interactive
website, shopping agents, cyber shopping, mail, fax on demand information or cd-ROM presentation. Many
electronic marketing resources are future multi media etc.

1. www (world wide web)


2. fare or demand information
3. CD ROM presentation.
4. Multimedia
5. Interactive websites shopping.
6. cyber shopping malls
7. E-Business
8. E-Commerce.

The term resources can be defined in a number of ways. In one of the way is the action or strategy adopted
in advance circumstances.
E-Marketing flows from an organisation overall e-
business strategies selected business models. However the following are the factor which acts as resources of E-
Marketing.
1. Business Environment
- Legal
- Technological
- Market Related Factor
2. E-Business Strategy model
3. Performance metrics.

This can be represent in the form of ESP model (Environment, Strategy, Performance model) as below.

E-Marketing Environment:- consist of 3 key environment factor.


- Legal
- Technological
- Market Related Factor

Legal:- chief laws have are laws, privacy, digital property, copyright expressions, fund privacy is difficult to
legislate.

Technological:- Technological developments are alleging the composition of internal audiences as well as
quality of material that can be delivers to them, in US 20% population enjoy high bandwidth connection.

Technology lowers the costs reduces staff paperwork via electronic order processing, billing, e-mail, example of
technology are:

Web – which support the graphical user interface hypertext internet exporer.
Intranet – intranet corporate consumption.

Extranet – An intranet to which value chain partners have admission for strategies reasons. The access to
normally portion.

Strategies:-
1. General programme of action and development of resources to attain comprehensive objective.
2. The programme of objective of an organisation and policies governing the acquisitions views and
disposition of this resource.
3. The delimitation of the basic long term objective of an enterprise and the adoption of courses of action
and allocation of recourses accuracy to achieve these goals.

E-business can be divided into these areas:

I. intranet:- It can be within the organisation using so called intranet. The intranet user internet standouts for
electronic communication. People on the intranet are able to see organisation specific web sites. People form
outsides of organisation are not able to see these private pieces of information.
II. Business to Business (B2B):- Deals that are done over the extranet. The Extranet consists to two intranet
connected via the intranet, where by two organisation are allowed to see confidential data of the other.

III. Principle in Electronic marketing:


1. Situation Analysis.
2. Marketing Planning.
3. Marketing Implementation.

1. The objective setting of the marketing process & the implementation stage can be better executed with
newly a available marketing tools.
2. Replacement of communication tools is telegram to telephone, pager to video conferencing.
3. The pay offs each stage of innovation were related to saving time, saving money.

Importance of Electronic Marketing Resources: (in Business Today)

Company communication: - these are two type of message. (i) internal (ii) external.
Electronic mail or e-mail in an in-expensive and wide reading communication tools. E-mail can
connect group of people with touch of a single key using an e-mail.
Integrated marketing:
Traditional organisational chart

1. Top mgt. 1. Customers


2. Middle 2. Front line
3. Front line 3. Middle
4. Customers 4. Top mgt.
(Morden chart)

What is out grated marketing?

When are the company department work together to serve the customers interest the result is integrated
marketing not all employee are trained and motivated to work for the customers.

Integrated marketing take place on tow level.

The various marketing function like sales force, advertising, customer services, product management, marketing
research, these all must work together. And all these marketing function must be point of view. To faster
teamwork among all departments the companies caries out internal marketing as well as external marketing.
Internal marketing as the task training and motivating able employee who want to serve customer wealth.

1. Marketing Research:
(a) Test attitudes.
(b) Maintain dialogues with various marketing constituencies an record opinion that can be monitored over
long period of time.
(c) Websites management such as the number of visitors to a site or two long the visitors use the sites or on
a particular page , why people use the internet?
(d) Marketing organisation are frequently polling views or listens on their preferences using web address.

2. Marketing Planning: Marketing Planning & sales support are other business situation in which on line
marketing resources are appropriates. As more & more are exposed to on internet macro people will
look to that medium for marketing information. This method dissemination can be either internal or
external audience.

3. Productivity innovation:- productivity innovation are still other situation that utilizing on tree
marketing resources. Sales people in the field are benefiting form online recourse because electronic
tools or devices speed sales people response time to customers questions such as inventory levels,
product details and other business enquiries.

4. Business to business exchange:- As business department pave the way consumers well begin to
curbrace on line transaction with move trust and greater expectation.
(i) Personnel computer bonding.
(ii) Financial transaction online.
(iii) Of consumers are comfortable in transferring their hard earned assets on line, activities such as
purchasing automobile even purchasing residential homes will not be for behind.

5. Time to assess the commercial sites:- An automated tax response system can reply to questions,
technical sheets specifications or technical support most likely generated from a fax back system. (for
order generation, supply, maintain)

6. Customer loyalty:- many company are interested in their customer purchase habits and preference are
developing detailed database to track purchase activity. Past behaviour will predict future action and
information. Behaviour patterns such as expenditure amounts brand or item preference day or hours of
the week, when shopping occurs common time of payment method.

7. Globalize reach:- A Globalize reach business situation in which online marketing resources can be
beneficial because internet in an international connection of network computer.
Eg. A small company with no additional office can appear to be a multinational firm if given the
appropriate attention to website design, product or service offering and linking to complementary site to
extend this reach.

8. Competitive intelligence’s :- Some organisation have convened of techno-watch, delegating different


people with in a department to track specific area of ecology that are important to their company. If the
company is computer oriented then are staff members might be responsible for reading made magazines
monitoring discussion list or attending industry slowly about server. Another employee might observe a
close competitors action or innovations.

9. Cost management:- Employing on line marketing resources can help a company utilize cost
management. E-mail is an excellent substitution for long distance changes or the cost of a postage stamp
and the stationary.
Electronic tools such as video conferences or electronic data interchange can replace expensive travel
and lodging cost. Any marketing manager will confirm that given equal level of effectiveness. After
initial equipment installation electronic marketing resources and most, cost efficient. The installation
cost of the introduction of the electronic marketing resources is very cost effective compared to
customer marketing benefits achieves.

10. Logistic: - Logistics become easier to maintain online marketing resources, Electronic marketing
resources and to that perception and reality because people can act desirably and quick by being
electronically link. Linkage may include internal, internet or externals. And external partnership or
collaborations without sources companies. To operate effectively communication amount in companies
must be quick and accurate. These collaboration must be able to share data quickly.
11. Corporate Recruitment :- In market technology worker are in short supply company’s can locate
potential employees, as well as search for consultant, govt. documents, speciality traits or general
contractors.
“Net savvy students”
“Ask a cyber recruiter”

Relationship marketing & net working:-

Relationship marketing has the aim of building long term mutually satisfying relations with key portion like
resources, supplies and distributors in order to coin and retain long term preference and in business.
Relationship marketing build strong economy. It cuts down transaction cost & time. Relationship marketing in
the building of unique company asset world a marketing network.

Value added uses and perception to the product & service and e-commerce:-

Value isn’t all about inflation. While the constantly changing weight of currencies certainly plays a part in
pricing, human and social factors also have an impact.

Let’s take a brief look at what value really is, and try to come to terms with how we as a global community
understand the concept of it.

• What is Perceived Value?


• The Responsibility of Businesses
• Getting the ‘right’ Pricing

WHAT IS PERCEIVED VALUE?

This is for all intents and purposes the gut feeling you get when looking to purchase an item. Most people don’t
really ‘know’ how much something is worth, so the only way they can make a judgement call is via their own
intuition.

Several factors will play a hand in boosting perceived value, including:


• Brand – A respected or well-known name

• Luxury – Products like wine, diamonds and anti-aging products (which offer very little long-term
benefits, but are still coveted owing to their ‘class’)

• Consumer utility – Items which buyers will get satisfaction from and provide a real use

In some instances, you’ll even find consumers willing to pay more for the exact same product if there are
secondary benefits. In these cases, the value addition can come in several different forms:

• Product is easier to buy


• Items arrive more quickly with certain providers
• It’s from an elite brand
• Lower cost of ownership
• Friendlier customer service
Psychology plays a huge role in practically every aspect of life – and that’s certainly no truer than when it
comes to valuation.

THE RESPONSIBILITY OF BUSINESSES

Along that line of thinking, customers have been proven to be willing to make a purchase if a company or brand
have made a concerted effort to give back to the community – be it locally, nationally or globally.

In a recent study it was found 50% of consumers aged between 40 and 44 are willing to make a purchase if they
know the company are giving back.

In different countries, this figure does vary somewhat, but there is always an added boost regardless:
• Thailand, Philippines and Indonesia – two in three consumers think it makes a difference
• Europe – one in three consumers think it makes a difference
• India – three in four consumers think it makes a difference

If a company can prove they care about the community as a whole, they’re guaranteed to boost their value in the
eyes of the general populous.

GETTING THE ‘RIGHT’ PRICING

Paradoxically, pricing also plays a huge part in how much we’re willing to pay. You may think that sounds
obvious, but it isn’t true that the lower the value, the more likely we are to make a purchase.

The same study has found ‘Charm Prices’ are able to increase the value of an item by roughly 24%.

When a test was conducted which saw $34, $39 and $44 items put up for purchase, the middle-value ($39) was
found to be the item which routinely sold the best.
Interestingly, it was also found prices which contained a lot of nines – such as $19.99 or $9.99 – would also sell
better.

When it comes to valuation, lots of different variables can play a part. From brand presentation to commercial
psychology, there are a myriad of factors which define prices.

If you’d like to discover more about the varying price of value over the years, take a look at the amazing
infographic below.

Online retailing as left the experimental phase and his accelerating into the main server merchant and business
man are reporting Grammatical grow in sales and services site. Traffic over passes year 12 or months. This
patterned will become common phenomenon or cyds as more consumer comes online to shop retailers will
compile more aggressively for sales quotas & prediction are easily enough made.

Reconstructing the value chain


Resolving the channel conflicts.
1. Market check.
2. Channel strategy.
3. Conflicts documentation
4. Time limit. (define a limit if the partners in the channel conflicts does not respond to your
complaints abmdm the product set.)
UNIT – II

(Marketing planning for online activities e-marketing mix elements of electronic P’s)

E-marketing has become synonymous with information.

Marketing polish their online research skill by assessing deep and rich information system form a variety of
public and private sources.

Situation Analysis: - input on the market.


1. Market condition.
2. Potential competitors
3. Economic factors that affect decisions concerning the market planning toward goals.
4. Feasibility.
5. Timing
6. Ultimately marketing success for the product or services.

The constitutors of imaginative marketing mix


Electronic components – Computer aided prospect selection
- Customer database favrbrety.
- Pricing models that allow forecasting

Research wit situation analysis provides the input on the market condition creativity puts personality on to the
flat land scape. Analysis a electronic marketing research put in the construction of an imaginative marketing
mix. E-components could include computer aided prospect selection or customer data based familiarity, pricing
mode that allow forecasting of the effects of situation change & distributor software to product option delivery
routes & workflow practices. Last is an important strategy planning aspect is promotion. The new electronic
capabilities of www the accessibility the appearance & the reliability of website provide fresh dimension
interactivity & customer communications for marketers. Website offers combination of graphic, colours,
motion, sound, visual reality environment to support customer interactivity. As to way communication for
marketers & the way customer add speed & accessibility to e-commerce transaction by wing web
communication & transaction system marketing planning in the serve activity for retail or business to business
markets.

Research with situation analysis provides the input on the market conditions creatively puts personality on to
the flat land scape. Analysis a electronic market research put on the construction of an imaginative marketing
mix. E-components could include computer aided prospect selection or customer data based familiarity, pricing
mode that allow forecasting of the effects of situation changes & distribution software to project optional
delivery routes & workflow practices. Last is important strategic planning aspect is promotion. The new
electronic capabilities of www- the accessibility, the appearance & the reliability of web site provide fresh
dimension interactivity & customer communication for marketers. Website offer combination of graphics,
colours, motion, sound & visual reality enrolment to support customer interactivity. Or to way communication
is the marketers & the way customer add speed & accessibility to e-commerce transaction by wing web
communication & transaction system. Marketing planning is the carve activity for retail or business to business
marketer.
Planning with E-ps (1994)
Distribution software to project optimal delivery routes & workflow factices.

Promotion:- Electronic capabilities of www. Personal selling, sales promotion, public relation, direct mail, trade
fairs & exhibitions, advertising sponsorship.
1. Accessibility.
2. appearance
3. Visibility of website.
Website provide fresh dimensions in interactively & customer communication.
Market → Customer
Speed + Accessibility to: - commerce transaction

By using web communication & trisections system marketing planning will never be the same activity for retail
or business to business marketers.

Planning with E-Ps


Situation analysis
Marketing process model
Marketing implementation
Marketing planning

Establishing facts & opinion


I- situation Analysis
(a). State the objective (s) of your marketing investigation.
(b). Relevant market research / research:- industry association website, discussion groups user NET, Govt. data
sources, electronic news letter CD-ROM storage.
(c) Proposed prospect / market description – company database, industry website, Govt. sources, survey e-mail.
(d) New product and Service explanation customers database survey e-mail discussion group, industry
newsletters.
(e) Demographic & other characteristics → Demographic software, industry web site govt. data sources.
(f) Competitive analysis & evaluation competitors website.
(g) Company history & competence interval documents employee interviews.
(h) Assessment of opportunity analysis of all factors.

Industrial Age Information Age


1. Mass production Mss Customisation
2. Labour Server tools Tools serve labour
3. Labour performs repetitive task Labour applies knowledge
4. Command & control structure Common control structure
5. Capital intensive Knowledge intensive
6. Capitalists own production means Labour owns production means.
7. Capital is primary driver Knowledge is primary driver.

Evaluation the online marketing situation:-


1. Uncarpeted changes in market analysis.
2. Demand of product or service may shift slightly external factor: - competition →Distribution channel
attacking dealer relationship.

Preparing for new product introduction advertising.


Competitive pricing studies:→ Shopping your rivals’ new super stores interviewing consumer on a
qualifying basis.

Checking electronic indication for your market are preparing draining program for your employee.

Market environment
Demographic environment
Economic environment
Natural environment
Technological environment
Political environment
Legal environment
Social & cultural environment

Marketing mix is a set of marketing tools the firm use to pursue its marketing objective in the largest
market/marketer use numerous tools elicit sponsor for their largest market these tools constitute a market
mix.

Me-carthy classified these tools into 4 based group.


Product price promotion place
Product variety list price sales, promotion channels
Quality discount advertisement assortment
Design allowance public relation location
Features payment period sales force inventory
Brand name credit terms direct marketing transport
Packaging Personal selling retailers
Size Wholesalers
Service warranties
Return

Offering mix -------------→Sales promotion--------------------→Distribution channel


Product----------------→ Advertising
Service----------------→ sales force
Price------------------→ public relation
Direct mail
---→ The marketing interval-----------→target customer

Drafting :- if the marketers strategy is to introducer an existing product to the web then company prepare an
audit of the advantages and disadvantages of the product compare with the advantage and disadvantage of
web exposure regarding the
-Brand name
• Brand name
• The value of product quality durability & rellabitly
• Faster and friendly service.
• Technicians with high level of expertise
• Money back guarantee
• Building the marketing plan

Ps represent the seller’s view of marketing tools available for influencing buyers.
ROBERT LAUTEBORN suggested that lips correspond to the customers lic’s
Lips Lic’c
Product customers needs & want
Price cost to the customer
Place conveniences
Promotion communication

Organisation, implementing & controlling the marketing effort.

Ist SDP in marketing process is organising the Marketing Research & implementing & controlling the
market plan.

Marketing tasks:- Marketing research, selling advertising, customer service.

Review their performance, their strengths point out, and their weakness & suggest way to improve.

Feedback & control procedures


Marketing control →1. Annual plan control
→ 2. Profitability control
→3. Strategic control
1. Annual control:- sales, profit & other goal
2. Profitability control:- measuring actual profitability of product marketing profitability analysis.
3. Strategic control:- rapid changes in the marketing environment

Objectives:-
1. what is to be achieved
2. The objective of the online marketing effort
3. Numeric goals. (The % of market shires, Sales volumes
Sales quota, per representative, sales volumes per territory)
Additional objective can be established
1. Target description
2. Communication objective
3. Sales
4. Media
5. Public Relations objective

Planning

Establish numeric objective:- the market will be able to compare the programs performance at years end. This
review will provide input into the nest year planning.

Maturity
1. it improve product quality & add new product features.
2. it adds new models ( product of different size flavour)
3. it adds new market segment.
4. it increase its distribution coverage and enters new distribution channels.
5. it shifts from product awareness advertising to product performance advertising.
6. lower price to attract the next layer of price sensitive buyers.
Declining stage:
a). increasing the firms investment.
b). maintaining the firms investment level until the uncertainties about the industry realised.
c). Decreasing the firms investment level selectively by dropping unprofitable customer groups.
d). Harvesting the firms investment to recover cash quickly.

E-marketing mix

The biggest advantage of e-marketing is that the Internet makes it possible


to provide services at every stage of selling the product: before selling the product, during the sales and after the
sales transaction.

To achieve marketing objectives, after the target group i.e. customers have been identified, the next step is to
foresee marketing measures and actions and their application. Following traditional marketing strategy model a
company develops integrated marketing tools and set of actions which are called marketing mix. In the
traditional marketing case it includes product, price, promotion and distribution. However,
transferring this set into the Internet, the power of decision-making moves from seller to buyer. The main focus
is on the communication with the customer, who has the power of decision-making. That is why the
manufacturer has to figure out the needs of the customer even before the production stage.

Traditional marketing mix does not posses elements of interactivity, consequently e-marketing, unlike
traditional, is characterised by a wider scope.

Figure 5.4 E-marketing mix

Various authors treat e-marketing and its elements differently. What is more, some treat it at different levels and
to different degrees.
Figure 5.5 E-marketing mix – 2P-2C-3S

E-marketing is attractive and useful because it enables to establish communication with customers, and
therefore, it requires special attention.

Figure 5.6 E-marketing mix 4S

In e-marketing it is advisable to stick to the 4C model:


• Customers needs and wants
• Cost to the customer
• Convenience
• Communication

When coordinating web marketing 6I system should be followed

Figure 5.7 E-marketing based on a 6I system

E-marketing – is a set of actions which are used to strengthen business position according to 4P model,
incorporating interactivity and its elements, but not excluding them as separate elements and evaluating when
making marketing decisions.

• Web design matches product packaging.


• Navigation, ease of use and content reflects quality.
• Website addresses are often consistent with the trademark
• The speed of communication channel enables the user to receive the product or service at any time and
therefore it characterises the product not the place.

More information about the impact of IT on the basic elements of marketing mix is presented in Part 3.2.

There can be distinguished two main features in e-marketing mix:

1. Controlled area within the company’s scope


2. Properly coordinated marketing mix gives company synergistic effect

- overall result of marketing mix impact is bigger than the effect of separate constituent elements. If a
synergistic effect does not occur it means that marketing mix (actions and decisions) is managed badly.

Information and globalisation have radically changed marketing goals – from strongly homogenous actions,
tailored for masses, marketing is becoming heterogonous and focuses on specific target markets. It means that
all marketing mix elements need to be adapted not for the masses but for specific target market segments.

In e-marketing key elements of marketing are implemented –product, price, distribution,


communication/promotion. All other elements such as interactivity, personification and so on are considered as
complementary to the basic elements, although they are sometimes distinguished as separate elements.

Product/Service. Products in a virtual environment are divided by nature:

• Physical products – tangible goods – household appliances, books, cars, etc. Drawback –when buying
on the Internet there is no possibility to test them.
• Digital products – goods existing only in cyberspace. They include software, e-books, pictures, audio
and video e-products, etc.
• Services – this produce cannot be separated from the service provider, it is intangible, they are used and
supplied at the same time when two parts, i.e. the service provider and the user, are present. These services
include travelling, distance learning, virtual games and so on.

IT allows the customer to save money, time, and this in turn contributes to a higher value of goods on the
Internet. It is very important to provide the most complete information about the product on the website.

Pricing. The Internet is seen as an efficient market, since it is marked by such features as lower prices,
increased price flexibility, frequent but less significant changes in prices. Lower costs of commercial activities
on the Internet lead to lower prices – reduces need for staff, no expenses for premises rent and maintenance, etc.
Buying agents contribute to lowering the price (public presentation of benchmarking results), reverse auctions
(buyers set the price and the supplier tries to meet the offer), tax-free zones (lower taxes are imposed as there
are no state borders), venture capital (most e-businesses are funded by venture capital funds and the latter is
focused on the long-term rather than faster and higher profits), active competition (a large number of market
participants, easy price comparison, simple replication of commercial offers, etc.). Price flexibility is caused by
variety of purchasing behaviour and price changes. Aspiration to attract price-sensitive customers, easy and
simple process of price changing, experimentation and possibility to compare prices lead to frequent and less
significant changes in prices.

Prices increase determinants on the internet:

• Distribution – retail trade participants on the Internet are exposed to significant product distribution
expenses since the goods are transported to various places. Very often customers themselves cover
delivering costs to the indicated address. In this case the cost of the product online increases.
• Partnership programmes - the vast majority of websites selling their products online carry out
partnership programmes, so they pay from 7% to 15 % interest rate for each transaction. These costs
contribute to the price rise of the product and reduce company’s profit.
• Website design and maintenance – requires considerable financial resources. Maintenance includes
such expenses as hardware, software, the Internet, etc.
• E-marketing and e-advertising – the Internet is dominated by harsh competition thus it requires heavy
fixed costs on advertising to attract and retain customers online. According to world studies up to 40 % of
the Internet revenue is allocated to e-marketing.

Price types on the Internet:

• Tangible price – it is physical, i.e. price shown in figures next to the product on a website. According to
this type of price, the Internet user knows the value of the product.
• Intangible price – it is a price that is usually attributed to cyber products. The Internet user has an
impression that the information online is free, but in reality the company providing the product receives in
return user’s attention and consumers traffic. Thus it is possible to direct user’s attention to the online
advertisement, which is paid by a company which ordered to put it on a website offering free information for
a user. The core point of this price type strategy is to attract as many users as possible and make them spend
a lot of time on the website.
• United price – it is use of both tangible and intangible price strategy. On informative websites a part of
information is free, the other – not. (e.g. www.vz.lt)
Internet pricing strategy:

• Penetration price – to enter easier and occupy the biggest part of a market a lower price for a new
product is set.
• Market skimming – to attract consumers who like Internet innovations a high price is set. Subsequently,
the price is gradually lowered.
• Estimated profit and cost recovery – pricing is based on a simple methodology – markup is added to the
price of a product.
• Achievement of projected earnings growth – pricing is based on product cost. Project profit
achievement is possible by reducing costs, increasing sales and price.

• Price as a quality indicator – an appropriate pricing strategy when the customer is not well acquainted
with product features. In this case, high price sends a signal to the customer that a product or service is good
and of high quality.
• Promotional price – this pricing method is used to stimulate sales and thus to lure and attract customers.
This method is usually used for a short time in order to achieve sales growth effect.
• Leadership price – according to this method the lowest price is set for a particular product or service
category. In this case it is necessary to cut the costs to the minimum.
• Segmented price – pricing approach, focusing on a specific, target group of customers in order to better
meet their needs.
• Prestigious price – some consumers feel comfortable paying high price. By doing this they seek to
obtain a valuable product or service.

Due to constantly changing customer needs online prices are dynamic and active. Therefore, it is necessary to
combine and apply complex pricing methods, principles and strategies.

Distribution/Supply. Product distribution channels are identified by the


following aspects – the type of an intermediary involved in the distribution
channel and the functions carried out by an intermediary in the same
distribution channel.
In e-marketing similarly to traditional marketing there are the same channel intermediaries – wholesalers (buy
product from manufacturers and sell to retailer), retailers (purchase products from wholesalers and sell them
online directly to customers), brokers (help to conduct transactions between buyers and sellers) and agents (help
to conduct e-transactions, but unlike brokers they represent either buyer or seller.)

The internet, i.e. virtual space, allows transforming the mediation process efficiently – inefficiently acting
agents are removed from the distribution channel and functions are transferred to other intermediaries.

• Customer relations – the Internet technology makes it possible to form relations and keep in touch with
customers. The Internet is considered to be 4th channel after personal selling, mail and telephone.
• Marketing communication – advertising and product promotion measures are often distributed between
distribution channel participants – e.g. a manufacturer may carry out an advertising campaign and an e-
retailer offers e-coupons.
• Physical distribution – a vast majority of products sold in e-shops are distributes and disseminated using
traditional channels – courier services and so on. However, digital conversion of product allows
transforming distribution channel and delivering the product directly to the customer’s computer. Such
products as text, video and audio content, e-books, e-magazines, software, etc. can be delivered in this way.
• Product accumulation – produce suppliers/manufactures are more likely to supply/produce high volume
production. The Internet users, on the contrary, want to buy smaller quantities but have a wide choice of
products. In this case distribution channel intermediaries play a very important role – they collect produce
from many different suppliers. In this way, consumers are offered a wide range of options.
• Transactions – e-channels enable to great extent to reduce costs of ongoing transactions.
• Third party logistics – conflicting objectives, i.e. to deliver the product on time quickly and cheaply, at
the same time not storing large production supply is usually the biggest logistics/distribution challenge and
problem in b2b market. This opportunity may be created by transferring whole produce to the third party. In
this case, a logistic company may be more involved in the delivery chain and its management – managing
process of orders, stock replenishment, etc.

Companies carrying out online sales can allocate the produce they sell through different distribution channels:

• Online channel
• Hybrid channel, which includes both traditional and online channels

Hybrid distribution channel has some advantages – it


increases marketing reach and each customer segment can
be served separately.

Another important element of e-marketing –


communication and support/incentives.
UNIT – III

Electronic Marketing Implementation:-


Introduction: - This implementation stage means action the carry out of the design plans to execution.
Implementation skills are critical to a successful marketing program, while communication design can produce
memorable impact and services, unless these designs are placed on television or in magazines. Marketing
implementation cover more than web communications equally are the electronic tool for collecting and
recording customer performance and for staying in touch with the client.

Marketing implementation should be considered for measuring performance, questioning thither the marketing
effort and expenditures are producing cost efficient result. An implementation overview of this marketing phase
is a consumer behaviour of the primacy question of who, what, when, where and why. The implementation
steps are:-

1. Keep in touch with the customers:- Marketing expert has estimated that it is seven time more costly to
attract new customer then selling and servicing to company existing customer. To reduce marketing cost
even further successful marketers recognize that happy satisfied customer tell their friends and relatives
about these purchasing activities.

2. Setting priorities for action:- As was discussed previously marketing implementation can be simple or
complex, It can require national, regional or local effort. Many marketers start every implementation
effort by outlining the task and determining who will implement this task.

3. Assigning program responsibilities:- Again in applying logic, the marketers decides who is best to
implement the various elements of the programme and why they are best suited to carry out the
marketing action.

It is being found that many online or electronic systems require high


level of expertise. These technology application best handled by knowledgeable supplier who might cost
more in the short term but could save dollars, reputation, time and probably prevent customer defections as
new marketing communication and fulfilment services are added over the long term.

E-Marketing Mix Strategy:-


E-Marketer needs data to guide decision about creating and changing marketing mix elements. These
marketing strategies are framed with certain elements. Goal indicate what a business unit want to achieve,
strategy is a game plan for getting there. It is preferred meaner to achieve the desired ends or objective in
the face of competition. Marketing strategy includes a variety of functions which are follows:-
1. Marketing Knowledge
2. Consumer Behaviour
3. Targeting Market segmentation & communication
4. Differentiation & positioning strategy.

1. Marketing Knowledge:-
The data are collected form a myriad of sources, filtered into database and turned into marketing knowledge
that is then use to develop marketing strategy. The MIS is the process by which marketer manage
knowledge using a system of assessing information needs, gathering information, analyzing it, and
disseminating it to decision makers. These decision makers may be partners, distribution channel, member
and sometimes customers. Thus marketing knowledge is the digitized “group mind” or “collective memory”
of marketing personnel, consultants, partners or former employees as well.
Marketer can tap these sources of marketing knowledge:-
(a) Internal record:- Accounting, finance and production personnel collect and analyze data provide
valuable information for marketing planning.
Marketing data: - relevant information about customer characteristics & activities or distribution
channels.
Non-marketing data: - Data about sales, cash flow, marketing expences and profitability that e-
marketer can use to evaluate marketing effectiveness.
Sales force data: - Result of sales calls to both prospects & current customers.

(b) Secondary data: - It is publicity and privately generated form online database and for competitive
intelligence. When specific information not available in company or partner database, then e-marketer
looks for secondary data, which can be collected more quickly and less expensively. But the quality of
such data may not meet the e-marketers information needs and they are often out of data. This includes
demographic trends, competitors, social and local economics, technological forces, legal and political
environments.
Publicly generated data:- industry or profession specific information is available at the site of
professional associates, getting extensive information thorough libraries.
Privately generated data: - company web site provides a great awareness of the firm’s mission,
products, partners and current events.
Online database: - publicly awardable data as online covering news, industry data, encyclopaedias,
yellow page directories, e-mail addresses and much more.
Competitive intelligence: - it involves analyzing the industries in which a firm operates as input to the
firms strategic positioning.

(c) Primary Data: - information gathered for the first time to solve a particular problem. More expensive
and time consuming but data are current and more relevant to marketer’s specific problem.
Techniques: - experiments, focus groups, observation, in-depth interviews and survey research.

Steps of primary data collection:-


1. Define the research problem
2. Develeop a research plan
3. Collect data
4. Analyze the data
5. Distribute the result

Internet based research approach:-


-Creative test
-Customer satisfaction
-Product development
-Online Experiment
-Online focus group
-Online observation (monitoring consumer chatting and e-mail posting through chat rooms, bulletin
boards or mailing)
-Online in-depth interaction (semi- structure conversation with a small number of subject)
-Online survey research (sending questionnaires by email)

Other sources:-
Clint side data collection: - it refers to collecting information about consumer surfing right at the user’s Pc.
Server side data collection: - website or software generates reports or numbers of users who view each
page, location of site visited prior to the firm’s site and what were buy at site.

Data analysis and distribution:- 4 types of analysis for marketing decision making include:-
(i) Data Mining.
(ii) Customer Profiling.
(iii) RFM Analysis (regency, frequency, monetary)
(iv) Report Generating.

2. Consumer Behaviour: -
The internet has grown more quickly then any other medium in history. In 2002, 531 million people had access
to the internet, representing 8.5% of the global population yet 5.5 billion other people are not online due to:-
1. Social & Cultural issues:- Some countries do not have a tradition of direct mail and few people order
from catalogue. At some market places as social meeting place can not be replaced & cash payment
habits.
2. Technological Issues:- Low P.C. Penetration in some countries, Communication infrastructure problem,
Postal service not reliable.
3. Legal & Political Issues:- Govt. ownership and regulation, tight rein on internet cafes.

Gender affects attitude towards technology and be more adapt and experienced with internet usage.
The four main costs that consumer exchange for benefits are money, time, energy and psychic costs. The
internet exchange can be facilitated by browser, bookmarks, e-mail message with hyperlink and automated
e-mail from web site seeking to attract visitors.
The main consumer activities online can be categorized by these general outcomes relationship,
entertainment, media consumption, information gathering and transactions.

3. Targeting Market segmentation & communication


Strategies covered for targeting segments. Marketing segmentation is the process of aggregating individuals
and businesses along similar characteristics that pertain to the use consumption or benefit of product or
service..
Targeting is the process of selecting the market segments that are more attractive to the firm and selecting
an appropriate segment coverage strategy.
Base of consumer market segmentation:-
1. Geographic segments:- Product distribution is a drawing force behind geographic segmentation. Eg.-
beer in Japanese restaurant by McDonalds. In e-marketing USA is largest internet usage in the world.
2. Demographic segmentation:- young male college education with a high income. All professions find
something of use on internet. The blue caller marketer represents a major marketing opportunity because
segment members have not developed site loyalty and have some difference product users to other
professions.
3. Psychographic segments:- Personality, values, lifestyle, activities, interests and opinions, attitudes &
behaviour.
4. Behaviour segments:- Benefits sought and product usage. Groups of customers based on the benefits
they desire form the product. Product usage is applied as light, medium and heavy.

E- Marketing may select from among four different approach for segment coverage:

1. Mass marketing: - firm offers one marketing mix for entire market.
2. Niche marketing: - when a firm selects one segment and develops one or more marketing mix to meet
the needs of the segment.
3. Multi-segment marketing:-firm select two or more segments and design marketing mix strategies
specifically for them.
4. Micro marketing: - (individualized targeting) firm carry and design marketing mix for small number of
people.

Targeting can be achieved by building community through online chat rooms, discussion groups, bulletin
boards etc.

5. Differentiation & positioning strategy.:-


Differentiation is what a company does to the product. Positioning is what it does to the customer mind. “A
process of adding a set of meaningful and valued differences to distinguish the customer offering form
competitors offering”.

The proliferation of information, product and services available in the internet means companies must find
ways of differentiation their product and services in order to attract customer and build long term
relationship.

Manny traditional differentiation method can be applied to an e-marketing strategy, including early market
entry, product ownership, product leadership, impressive company history and ability to demonstrate and
communicate the differentiation strategy. Traditional product or service positioning strategies also apply to
the internet.

A Company can differentiate its market offering along five dimensions.


1. Channel differentiation: - The internet is itself a distribution channel, a communication channel and
ultimately with individual customers, any time ordering and delivery.
2. Service differentiation:- 24 hrs. E-mail, rapid response, quick distribution, online banking and security
trading etc.
3. Image differentiation and the customer experience:-
Experience branding – occurs when a company differentiates itself by experience such as superior
customer service.
Image – ambulance………differentiation has to be built upon the ability to create huge perceptual
difference from other aspects of the brand position.
4. Product differentiation: - it includes customization and bundling- offering a combination of products or
services that the individual customer needs at prices that are attractive on internet markets.
5. Personnel differentiation: - reducing customer dependence or personnel , the internet leads to lower
transaction & marketing costs.

List of specific differentiation strategies:-


1. Being the first to enter the market.
2. During a product attribute or quality in the customers mind.
3. Demonstrating product leadership.
4. Utilizing an impressive company history or heritage.
5. Supporting and demonstrating the differentiating idea.
6. Communicating the difference.

Unique differentiation strategies:-


1. Site/Environment /Atmospherics –
• Look and feel of site.
• User friendly
• Accurate portrayal of company & product
• Tangibles and intangible.
• Trust.
• Efficiency and timeliness.
• Pricing
• CRM
2. Images, virtual lows, realistic descriptions.
3. Clearly state policy, use encryption for secure transactions.
4. Deliver what is promised to customers and in timely manner.
5. Be aware of competitor pricing, potential customer saving.
6. Customer tracking, seamless, communication, greater relationship efficiency.

Other strategies:-
Enhancing the selling process, customer buying process & customer usage experience.

Positioning strategies:-
Positioning is what it does to customer mind. Process of creating desired image for a company and position is
the resulting view of the firm or brand from the consumer perspectives.

Basis of positioning on the web:-


1. Product or Service Attributes:- Features such as size, colour, ingredients, speed and so forth. Eg.-
Amazon.
2. Technology Positioning:- online services. Eg.- cell phone handle e-mail.
3. Benefit Positioning: - the customer’s perspective out the feature will do for them. (things fits in your
pocket)
4. User Category:- Relies on customer segmentations. It is successful when the segment has some unique
quality that ties product benefits more closely to the group than to other segments.
5. Competitor positioning: - Position by touting specific benefits that provide advantages over
competitors offerings.
6. Integrator Positioning: - Some customer wants to be known for providing everything a consumer
needs in a particular product category, industry or even in general.
7. Repositioning on the web:- Process of creating a new or modified brand, company or product position.
Customer offline and online face a long term challenge when attempting to use repositioning strategy to
change the way customers practice their brand.

ICFAI – E-Marketing Strategies:-


1. Developing Micro Brands:-
• Adopt new ways of enhancing brand equity.
• Consent based e-mail marketing.
• Monitoring Customer grievance.
• Use of an e-mail relationship management programs.
• Develop a viral marketing application.
2. Customer Loyalty Building:-
• Online Promotion.
• Developing loyalty programs.
• Join online communities.
• Integrate online and offline customer service.
• Implement customer self service.
• Avoid customers care robots.
• Collaboration filtering.
• Focus on education and not on marketing.
• Pricing- product & price deferential.
- Direct to customers selling efforts
- Product data should be made accessible to customers.
3. Collaboration:-
- Define on enabling infrastructure.
- Replace non-performing process.
- Development of new product and services.
- Defining roles & responsibility.
- Evaluating partners support for collaboration.

An Introduction of Internet:-
Meaning & Definition of Internet:- The internet is a network of networks. Thus internet is a collection
of interconnected networks. Form a handful of computer and users, today the has grown to thousands of
regional network that can connect millions of users. This global network is not owned by nay single individual,
company or country.
Hence applications are run on the internet (eg, e-mail, file transfer protocol (FTP), the
hub).

Definition of internet:- Internet consists of an incredible number of participants, connected machines, software
programs and a masseur quality of information spread all over world.

Service: - The internet that provide services to other machines servers and those identified application – web
server, e-mail server ant so forth.

Client:- The machine which are used to connect services taken form server is client.

Technology used in internet:- In internet packet switching technology is used. A packet is a small peace of
information that includes a portion of message and destination address.

Routers:- A router is a hardware device that forwards information in a network and usually determines the next
step in the path that the packet must take.

Web system:- The web is a system that provides access to documents formatted in hypertext that user
languages such as hypertext mark up language (HTML) or the extensible mark up language.
Web site:- A website is a location on the web that contains documents written in hypertext. Each website is
identified by unique address called the uniform resource locator (URL) such as – http://.

Browser:- A browser is an application that allows users to locate websites. The leading browser is internet
explorer.

Chat:- Chat refers to the real-time communication between any two or more users on the internet. When an
instant message arrives, a pop-up screen appears to alert the user, who can initiate a chat at that point.

Origin of internet:- ARPANET (Advanced Research Projects Administration NET) is the ancestor of the
internet. The project was an experiment in reliable networking and to link defence & military research
contractors. The funds were provided by the (DOD) Department of defence.

The designers of the internet created the system using the following principles:-
1. No central control.
2. All the nodes in the network would be equal in status to all other nodes.
3. Each node has the authority to originate, pass and receives message.
4. Messages are divided into packets.
5. Each packet begins at some specified source node and ends at some specified destination node.
6. Packets are not needed to any particular route.

The key step in the internet progression was the development of gapher..
The aim of gapher was organize all the information on the internet in a hierarchical manner using internet
connected means.

How can internet add value to a business?


1. Enhancing the value proposition to customers:- Eg. Amagon.com providing wide product assortment, a
product recommendation engine, e-mail alert technology and access to product reviews. Customization,
easier transactional capability, the better value added services as a result of the internet.
2. Reducing operational inefficiencies within the organisation:- Many organisation have implemented
virtual teams for customer service, sales and product development. Salespeople are using internet to give
remote presentations to prospects, saving time & money. Eg.- IBM.
3. Streamlining supply chains- Sharing information with suppliers and customers across the globe,
allowing it to plan & forecast better. eg.- ford
4. Increasingly connectivity:- e-marketing place, e-mail, e-buy. This creates a dense network leading to
quicker communication among individuals and company. One consequence of this is that large scale
virtual collaboration is possible among individuals who are specially distributed.
5. Making everything faster: - Making data, supply lines, increasing productivity.
6. Eliminating distance.

Point to remember:-
(i) Internet is both web - distribution or communication channel (elaborate thee concept).
(ii) The impact of internet technology on costs and resources.
Various Preparations in the process of E-Marketing & E-
Commerce:-
Introduction:- There is a parallel between the process of online or electronic marketing and the traditional
marketing process. Both first call for a situation analysis to establish from this foundation of opinion and fact
the ensuring steps, marketing planning and marketing implementation can be established. E-Marketing
recourses assist the situation analysis in providing more readily accessible research in more timely and
convenient manner for the markets in essence the statistics of government and private research offices come to
you whenever you may be.

Think about the e-marketing process as a tool activities start with the situation analysis and then the discoveries
forge the future strategies of marketing planning. Planning leads to action, the marketing implementation steps
and from the implementation result of the program are learned it this positive or negative.

Before the discussion of electronic commerce begin first who is using the www (which is
the commercial component of the internet) for shopping or buying purpose. The estimates of the number of
internet uses vary widely and give the nature of this youthful communication vehicle, it is easy to understand.

Why should companies consider using E-Marketing?

You should recognize by now that internet marketing requires effects for more situation than one standard
approach. Decision to embrace the internet can be made by using established companies looking for fresh
approach. Another possible option is that an ongoing domestic company see a product or service that fits to a
selected market within a selected country or region to each case the marketer must realize a new kind of
intelligence is necessary that of e-information to match e-marketing.

Before washing a large amount of money and time, ask yourself these simple questions about online marketing.

• What is the company purpose for engaging in online communication?


• Why should the company go online?
• What do we hope to achieve with on online presences?
• Who will set the budget for web site production and implementation?
• Does the company have the talent and patience to allow the sets to grow into a mature and production
communication?

Comparing the traditional marketing process model:- it is possible and certainly advantageous to introduce
electronic marketing resources in each of the steps of the marketing process. why? Because electronic resources
provide more accurate data, with greater speed at both level of the micro and macro level of the marketplace.

It has been said that without a direction and road will get you there. But with
planning you can arrive at your destination more directly. The traditional marketing process model will be
discussed here first before the new e-marketing resources will be introduced.

Marketing process model:-


Situation analysis – marketing planning – marketing implementation.
1. Situation analysis (SRMNEDCCA)

(a) State the objective of your marketing investigation.

(b) Relevant market research.


(i) Define what information you require?
(ii) Is that information available?
(iii) Where you can obtain this necessary information?

(c) Market description: company data base, web site, government source, e-mail, CD-ROM.

(d) New product or service explanation: - customer database, e-mail, group discussion.

(e) Environmental factor and market trends: - government database, survey, e-mail, industry sites.

(f) Demographic and other characterises: - Demographic software, industrial website, government data
source.

(g) Company history for competence (if applicable):- internal document.

(h) Competitive analysis & evaluation: - competitive web site.

(i) Assessment of niche opportunity: - analysis of all factor.

Electronic Marketing Resources:-


1. Online Information & Research: - it is made through public & private data base for domestic and
international information needs.

2. Computer and Software based: - this includes web-based advertising and sales promotion, proprietary
inventory management network and software, geo-demographic and psychographic software,
proprietary database management, online customer service and fulfilment, customer & prospect surveys,
videoconferencing smart card and virtual reality environment.

3. Telephony Resources: - include fax-based system, pagers and telemarketing.

4. Network Based Resources: - www sites, internet, external, new release network,. Electronic data
interchange and transactions and authentication network.

5. In-store Resource:- which includes optical scanner, electronic coupon disposes, low frequency radio
broadcasting, electronic price sheet tags and video shopping costs.
The Future of Online Marketing Resources:-
All told, utilizing e-marketing resources equally to competitive advantage in the marketplace. Following the
objective of speed accessibility and accuracy is the best way of staying close to the customer. Electronic market
gives the marketer a dual ability.
(i) to reach the markets customers
(ii) To react quickly to customers need and desire.

Electronic marketing resources also enhance the strategic and tactical advantages of online
marketing with accuracy that lead to better decision making.
Customer aspect special treatments form the management of the product and services they buy. These
marketing tool that have been introduced all enabling markets to be better equipped for the information age that
so surround us all. E-commerce also provides consumer convince enhanced by speed, accessibility and
accuracy.

Hare are some business situations for which online marketing resources are very appropriate.

1. Company Communication: - for both internal and external message, is a good example where online
marketing resources could be utilised.
2. Another previously dreaded chore:- that of marketing research, has been enriched by online
communication. The market researcher can test attitude, maintain dialogues with various market
constituency and record opinions that can be monitored over long period of time.
3. Marketing planning & sales support: - As more and more people are exposed to the internet, more
people well look to that medium for marketing information.
4. Productive innovation: - sales people in the field are benefiting from online resources because once
again electronic tools speed as inventory level, product delivery and another business enquiry.
5. For the immediate future: - business to business exchanges.
6. Looking form the consumer’s support: - Time & access to commercial site become hectic.
7. Customer Loyalty:- Many Companies are evaluated in their customer habits and preference and all
developing database to track purchase activities.
8. Global Reach:- A small company with no additions offices can appear to be a multinational form if
given the appropriates attention to web site design, product service offering and linking to
complementary sites to extend this reach.
9. Competitive intelligence.
10. Employing online.
11. Partnering logistics
12. Corporate recruitment
13. Task automation
14. Knowledge management is key.
15. Network externally.
16. Zero distance
17. Interdisciplinary focus
18. User comparison.

Ethic of E-Marketing:-
Ethic is concerned with the value and practice of professional and experts as well as the values of society. Law
is also an experience of values but created for the broader goal of addressing national or even global population.
Growths of individual with special skills or knowledge have established ethical codes over the years. Differing
values exist of the role of law and self regulation in ethical online behaviour.

1. Privacy:- it incurred during the 20th century, as a key ethical and legal concern. Key aspects include
seclusion access control and autonomy.

2. Online Privacy:- H issue in the USA and other country related to how data should be collected and
used. USA firm can participate in a safe harbon plan to protect data from European Union internet users.

3. The federal trade commission (FTC):- it set ethical norms use of consumer information, including
provision for bases notice, consent, access, security and enforcement.

4. Intellectual property: - it protected with there basic legal mechanisms.


(i) Copyrights.

Security on the E-Marketing Site:-


Introduction:- During the rise of E-Marketing on the internet, security had been the primary source of
trepidation among would be customers of many online sites. In appearances the internet may have started as a
non-commercial network of computers, was not designed with security as a paramount effective.

The primacy goal of online shopping and other sites has been to provide
the same level of quality and conveniences as that experience by a consumer in a real world setting.

The security from two vantage points:-


1. Consumer information.
2. Merchant’s transaction.

Specially the basic four component of E-Marketing are:-

1. cryptography (the key to security on the internet)


2. Digital certificate.
3. SSL (Secure sockets layer)
4. SET (secure electronic transaction)

The brief descriptions about point are:-

1. Cryptography (the key to security on the internet):- cryptography results in the reaction of
cryptography method also known as cryptosystems. There are two kind of cryptosystem. (i) symmetric
(ii) asymmetric

Symmetric cryptosystems use the same key or the secret key to co crypt or scramble and decrypt or
unscramble message.
Asymmetric cryptosystems as the other hand same key to encrypt a message and different key to decrypt
it.

Asymmetric cryptosystems are also called public key cryptosystem are rely on technology in which two
key the public key and the private key, are used to encrypt or decrypt data. Typically a uses gives his
public key to other users, keeping the private key to him.
Symmetric cryptosystems are the caner of the two the implement,
since only are key is required.

2. Digital certificate: - Beyond privacy and confidentially with report to digital communication,
cryptography has been extended to the area of authentication. Authentication or what they claim to be.
A typical digital certificate is a data filed of information
digitally signed and scaled by the CA and encrypted using RSA encryption techniques than can be verified
by anyone. This certificate includes.

- The name of the holder and other identification information such as e-mail address.
- A public key which can be used to verify the digital signature of a message sends previously signed with
the catching mathematically unique private key.

3. SSL: - Secure Sockets Layer of a broad range of information. SSL depend on several cryptographic
technologies. As mention previously RSA, public key encryption is used for the exchange of the session
key and direct persons authentication, while various cryptographic algorithm are used for the session
cipher.
While this approach is carrier than cracking
the cryptographic technologies for all possible message. SSL tries to make the cost of such an attack greater
than the benefits gained from a successful attack, thus making it a waste of money and some to perform
such an attack.

4. Secure Electronic Transaction:- Through the use of digital certificates . SET seeks to bolster confidence
in the payment process by ensuring that merchants are authorized to accept credit card payments, thus
reducing risk associated with merchant frond and ensuring that the purchasing in an authorized user of the
payment card.

Ongoing customer communication:-


Introduction: - chances are that if your company is a successful online marketer. It will be receiving great
comment of customer and supplied communication. These might come in the form of letters, postcard,
telephone calls, fax and e-mail. The subject of these might be order, compliment or complaints. Many
customers judge a company on its response are to their communication. Responsive companies are installing e-
mail software system to acknowledge that the company has at least receiving your message.

The Value of repeat customer: - it is the retailer or service responsibility or produces products and service
attractive to a niche market and then retain then customer through product satisfaction and customer service.
Less expensive to sell to existing customer than to attract new ones. Why? Just think about the many expended
on production of new lines of goods and on media advertising, particularly the television expense of air time
and production, the expense of briefing up the service and modern capacities. The price of designing and
printing vast amount of brochures and other collected material.

Where do you stand?


Therefore in a customer relation effort, the marketer should establish a benchmark as to
what customers and potential customers think of your site and its offering. Why the customer attitudes and
opening important?
Electronic marketing tools allow the customer extensive knowledge about a product or
about a company through information on a company web site. After all the purpose of marketing and customer
service is to facilitate the customer I doing business with you and hopefully only you.

Establishing the Electronic Customer Service Program:- You might begin establishing your electronic
customer service program by asking yourself. How would I like to treat if I well the customer. You might then
investigate competitor’s customer service page and programs, particularly the service for competitor.

Evaluating the Source of Feedback:-

1. Customer complaints.
2. Direct Customer Contact.
3. Your Own E-mail.
4. Formal Customer Survey.
5. Suppliers and Manufacturer.
6. Employee and associates sessions.
7. You’re Neighbourhood.
8. Community Investment.
9. The Online Community Involvement.

Customer Profile and Data Management:-


The best tactical decision is to create customer database to record these almost exclusive facts and profile to
which your marketing programmes can targeted. With database management, the marketers can keep track of
items purchased, dollar values purchase, patterns of purchase, infrequent purchasing, zip codes, lesser tracts,
and area of purchasing. Creativity in database design and management can be highly prized quality of top flight
marketers.

The main steps in acquiring and relating customers are:-

1. Identifying target customer.


2. Establishing a Rapport with them.
3. Servicing their needs.
4. Maintaining the relationship.
Online customer database are now widely used for storing vital information. They help organization to
develop future marketing plans. These database acts as tools that help in the marketing faction.

Relevant customer data include-


(i) Affinity: - it is the indicator of the personal preference of customers.
(ii) Frequency: - helps in marketing schedules. Denotes the interval bet consecutive purchase by a customer.
(iii) Innovation to buy: - denotes the time when the latest purchase transaction took place. It helps to company
to resume a dialogue with customers who have not made purchases in recent period.
(iv) Total expenditure: - This is refers to the amount spent by a customer on a particular product or service
over a period of time.

Approaches to cultivating a database:-


(i) Defense:- This programme is designed to retain the company’s loyal customer. These
individuals are rewarded and provided special access not offered to others.
(ii) Longer offence:- Deigned to entire the loyal customers of the competitor to switch.
(iii) Easy Offence:- Design to capture the “low hanging fruit” price switcher are attracted.
Once database is in place the company can try to encourage customers to buy more or in other
categories.

Three point of Entry for information gathering over the internet.

1. Gathering Data:- To accomplish effective database marketing application, the marketer must develop
source data strategy to maximum the collection of the right for his application.
2. Utilizing Technology:-
3. Research Technology: - Segmentation and modelling techniques complete the final building block
via research; marketers Len lock the power of data they capture and more.
I. Measuring the value of the database:- Today increasingly, customized product and service,
new distribution and communication channel and pricing option are making the marketing
process dramatically more complex and difficult to manage.
II. Building a transactional database:- Probably the best database for e-marketing is the
transactional database, which is assembled by ongoing transactions with customers. With a
transactional database that has are enabled or linked data capture system.
III. Designing a Proprietary Marketing Database:- The marketers is wise to have a system
input from other department, which might be integrated into the customer or prospect
database

UNIT – IV

What is Service Marketing?


• Everything you need to know about service marketing. A service is an act, deed, performance or a
rendering offered by one person to another.

• In a literal sense a service does not involve the transfer of any tangible commodity. Service is integral
part of human life in modern day.

• In the light of liberalization, privatization and globalization, services have been commercialized and
have become more professional in nature. Services can be defined as human efforts, which provide
succour to the needy.
• It may be food to a hungry person, water to a thirsty person, medical services to an ailing person,
education to a student, loan to a farmer, transport to a consumer, communication aid to two persons who
want to share a thought, pleasure or pain.

• Services refer to social efforts which include government to fight five giant evils, which are wants,
disease, ignorance, squalor and illness in the society.

• Services are activities, benefits or satisfactions which are offered for sale or are provided in connection
with the sale of goods.

• Services include a wide range varying from education, transportation, hospitality, finance, real estates,
accounting, banking, insurance, taxation, consultancy, health care etc. These services are together called
the services sector or the tertiary sector.

INTRODUCTION TO SERVICE MARKETING


The world economy nowadays is increasingly characterized as a service economy. This is primarily due to the
increasing importance and share of the service sector in the economies of most developed and developing
countries. In fact, the growth of the service sector has long been considered as indicative of a country’s
economic progress. Economic history tells us that all developing nations have invariably experienced a shift
from agriculture to industry and then to the service sector as the main stay of the economy. This shift has also
brought about a change in the definition of goods and services themselves. No longer are goods considered
separate from services. Rather, services now increasingly represent an integral part of the product and this
interconnectedness of goods and services is represented on a goods-services continuum.

Agriculture Industry Service sector

Definition of Services
“Activities, benefits and satisfactions, which are offered for sale or are provided in connection with the sale of
goods” (American Marketing Association, Committee of Definitions 1960).

“Services include all economic activities whose output is not a physical product or construction, is generally
consumed at the time it is produced, and provides added value in forms (such as convenience, amusement,
timeliness, comfort or health) that are essentially intangible concerns of its first purchaser” (Quinn, Baruch and
Paquette,1987).

Service is the action of doing something for someone or something. It is largely intangible i.e. not material). A
product is tangible (i.e. material) since you can touch it and own it. A service tends to be an experience that is
consumed at the point where it is purchased, and cannot be owned since is quickly perishes. A person could go
to a café one day and have excellent service, and then return the next day and have a poor experience.

The Special Characteristics of Services:-


• Intangibility
• Inseparability of production and consumption
• Heterogeneity
• Perishability

Intangibility:- Services are activities performed by the provider, unlike physical products they cannot be seen,
tasted, felt, heard or smelt before they are consumed. Since, services are not tangibles, they do not have features
that appeal to the customers’ senses, their evaluation, unlike goods, is not possible before actual purchase and
consumption. The marketer of service cannot rely on product-based clues that the buyer generally employs in
alternative evaluation prior to purchase. So, as a result of this, the services are not known to the customer before
they take them.

The service provider has to follow certain things to improve the confidence of the client. The provider can try to
increase the tangibility of services. For example, by displaying a plastic or a clay model showing patients an
expected state after a plastic surgery.

The provider can emphasize on the benefits of the service rather than just describing the features. Not all the
service product has similar intangibility. Some services are highly intangible, while the others are low i.e. the
goods (or the tangible component) in the service product may vary from low to high. For example: Teaching,
Consulting, Legal advices are services which have almost nil tangible components; While restaurants, fast food
centers, hotels and hospitals offer services in which their services are combined with product (tangible
objective) , such as food in restaurants, or medicines in hospitals etc.

Inseparability:- Services are typically produced and consumed simultaneously. In case of physical goods, they
are manufactured into products, distributed through multiple resellers, and consumed later. But, in case of
services, it cannot be separated from the service provider. Thus, the service provider would become a part of a
service. For example: Taxi operator drives taxi, and the passenger uses it. The presence of taxi driver is
essential to provide the service. The services cannot be produced now for consumption at a later stage / time.
This produces a new dimension to service marketing. The physical presence of customer is essential in services.
example: to use the services of an airline, hotel, doctor, etc a customer must be physically present.

Heterogeneity:- Services are highly variable, as they depend on the service provider, and where and when they
are provided. Service marketers face a problem in standardizing their service, as it varies with experienced
hand, customer, time and firm. Service buyers are aware of this variability. So, the service firms should make an
effort to deliver high and consistent quality in their service.

Perishability:- This is attained by selecting good and qualified personnel for rendering the service. Services are
deeds, performance or act whose consumption take place simultaneously; they tend to perish me the absence of
consumption. Hence, services cannot be stored. The services go waste if they are not consumed simultaneously
i.e. value of service exists at the point when it is required. The perishable character of services adds to the
service marketers problems. The inability of service sector to regulate supply with the changes in demand;
poses many quality management problems. Hence, service quality level deteriorates during peak hours in
restaurants, banks, transportation etc. This is a challenge for a service marketer. Therefore, a marketer should
effectively utilize the capacity without deteriorating thequality to meet the demand.
Meaning and definition of Service Marketing
Services marketing is marketing based on relationship and value. It may be used to market a service or a
product Marketing a service - base business is different from marketing a product - base business. Services
marketing is a sub-field of marketing, which can be split into the two main areas of goods marketing (which
includes the marketing of fast-moving consumer goods (FMCG) and durables) and services marketing. Services
marketing typically refer to both business to consumer (B2C) and business-to-business (B2B) services, and
include marketing of services such as telecommunications services, financial services, all types of hospitality
services, car rental services, air travel, health care services and professional services.

Definition
Service marketing is defined as “the integrated system of business activities designed to plan, price, promote
and distribute appropriate services for the benefit of existing and potential consumers to achieve organisational
objectives”. The perception of services marketing focuses on selling the services in the best interest of the
customers. It is a systematic and coordinated effort of a service organisation to expand its market by delivering
the best possible services. The objects of services marketing are the achievement of organisational goals like
making profits, establishing leadership, long term survival and growth and the satisfaction of consumers by
rendering excellent services. The concept of services marketing covers the following aspects: selling services
profitably to target consumers and prospects delivering maximum satisfaction to consumers of services; and
positioning the service firm in the market. Marketing is thus an integral part of service management. The
managerial decisions are not found to be effective in the absence of a time bound implementation of marketing
principles. Of late, customer satisfaction is found to be a focal point of the marketing decisions service the
marketing process--can help in offering the right services to the right persons at the right time. Marketing
simplifies the process of transforming prospects into actual customers of services.

GROWTH AND EVOLUTION OF SERVICE MARKETING

REASONS FOR THE GROWTH OF SERVICES IN INDIA:


1. Economic affluence:
One of the key factors for the growth of demand for services is the economic affluence. According to the
NCAER study the size of the middle income consumer is raising fast and the percentage of the very poor
household’s declining. The rural household in the upper income category is growing at a much faster pace than
the urban households in the corresponding categories. The Economic liberalisation Process has had a positive
impact on the Indian households. Their income as well as their expenditure has been pushed, creating a demand
for many goods and services.

2. Changing Role of Women:


Traditionally the Indian woman was confined to household activities. But with the changing time there has been
a change in the traditional way of thinking in the society. Women are now allowed to work. They are employed
in defence services, police services, postal services, software services, health services, hospital services,
entertainment industries, Business Process Outsourcing and so on.
The percentage of working women has been growing rapidly. The changing role of women has created a market
for a number of product and services. Earning women prefer to hire services in order to minimise the
innumerable roles that they are required to perform. The demand by woman is forcing service organisations to
be more innovative in their approach.

3. Cultural Changes:
Change is the underlying philosophy of culture place of change in Indian culture is not uniform. However,
during the last century the factors of change are prominent. The emergence of the nuclear family system in
place of the traditional joint family system creates a demand for a host of services like education, health care,
entertainment, telecommunication, transport, tourism and so on. There has’ been a marked change in the
thought Processes relating to investment, leisure time perception and so on which has created a huge demand
for services.

4. I.T. Revolution:
For the last 15 years India is occupying a vital position in the area of Information Technology. IT became one
of the key service businesses of the country. India has the largest software skilled population in the world. The
domestic market as well as the international market has grown substantially. Realising the potential for this area
many state governments have made IT as their most, prioritized segment states such as Karnataka, Andhra
Pradesh, Madhya Pradesh, Maharashtra and Delhi have already achieved substantial progress in Information
Technology the In Ile years to come ‘Lille IT enabled se Aces will have a bright future. The growths of
population, industrialisation and indiscriminate consumptions have affected the, natural resources, environment
and the ecological balance. Due to this there is an imbalance of the ecology various service organisations have
been promoted in order to take up social marketing. Thousands of crores of rupees are being spent on
safeguarding the rare animals and birds, water pollution, conservation of oil & energy and research to develop
new technologies that can promote effective use of natural resources and safeguard the environment.

6. Development of Markets:
During the last few decades the wholesaler and the retailer population has grown in the country. Urban India
has become a cluster of wholesaling and retailing business. In the Semi – urban areas, retailing has spread to the
nooks and corners of the streets and in the rural areas retail business is significantly present. A new breed of
organisations, offering marketing services has come up. The government also offers marketing services to the
small-scale agricultural farmers, artisans and other traditional business sectors such as promotion of regulated
markets, export promotion councils, development boards etc.

7. Market orientation:
The changing competitive situation and demand supply positions has forced the manufacturing organisation to
shift their philosophy from production orientation to market orientation. Market is a service function that has
been added in the organisation. The pressures in the market has further forced the manufacturing organisations
to have marketing research, accounting, auditing, financial management, human resource management and
marketing research divisions all of which are services functions.

8. Health-Care Consciousness:
In India, the healthcare market has grown substantially. The increased life expectancy is the result of the
consciousness of the people regarding the health issues. The growth of fitness clubs, diagnostic centres, medical
counselling, health-related information sites are the reflections of the growing demands for health care services.
The government as well as the social organizations has taken up the mass campaigns in order to create
awareness among the illiterate persons and the rural population on health service. Hence, the growth of health
related services.

9. Economic liberalisation:
The economic liberalisation of the 1991 has brought many changes in the Indian scenario. With the
Disinvestment and the Privatisation policies the state owned monopolies in many service areas came to an end
Multinationals were permitted to enter the Indian market. Liberal lending policies and lower interest rates
motivated many people to become self-employed. Different sectors like Banking, Insurance, Power projects,
Telecommunication, Hospitality sector, Health Services, Entertainment, Air transport, and Courier services
witnessed intense competition, due to the entry of multinationals. The flow of time-tested service technology
from various parts of the world changed the attitude of the Indian consumer towards sources.

10. Rampant migration:


One of the important reasons for the growth of services in India is the rampant migration of rural to semi-urban
and urban areas. Migration to urban areas for the want of jobs and livelihood has resulted in the expansion of
cities and townships due to which businesses like real estates, rentals, transportation and infrastructure services
are rapidly expanding.

11. Export potential:


India is considered to be a Potential source for services. There are a number of services that India offers to
various parts of the world like banking, insurance, transportation co data services, accounting services,
construction labour, designing, entertainment, education, health services, software services and tourism.
Tourism and software services are among the major foreign exchange earners of the country and that the growth
rate is also very high as compared to the other sectors.

Service Concept:
The service concept outlines how a service provider can realize the value and desired outcomes of its services.
The service concept can best be described as the way in which an organization would like to have its services
perceived by its stakeholders. It describes the non-tangible aspects of service delivery and is an integral part of
the value proposition of service providers. Whereas with tangible objects the final product is mostly the sum of
its parts, this is certainly not the case with services.

The service concept consists of the holistic combination (i.e. all element should be considered equally) of four
dimensions:
1.Service operation: the way in which the service is delivered;
2.User experience: the user’s direct experience of the service;
3.Service outcome: the benefits and results of the service for the user;
4.Value: the benefits the user perceives as inherent in the service, weighed against the cost of the service.
The four dimensions of the service concept form a key to defining how the stakeholders in an organization
perceive the value of services, minimizing the gap between user expectations and the service delivery operation.
The service concept plays an important role in determining the Service Automation strategy for organizations,
and the subsequent design and development activities. It is positioned as a high-level and overarching concept
that gives input to the overall strategy of the service provider.

Classification of Service:
In order to be able to make a clear and relevant classification of services, we would first need to understand the
concept of the word itself. Services usually refer to processes and not physical products. To understand more,
read this article on difference between goods and services. Some services may include people whereas other
services (like online services) may including objects which are managed by people.

Examples of services which include people can be a hair salon, education, theater, restaurants, public
transportation. On the other hand services that include objects include repairs and maintenance, dry
cleaning, banking, legal services, insurance, etc.

The service processes can be either manual or mechanized or both.

It is possible to carry out a classification of services based on two general dimensions such as what is being
processed, whether is it a person or an object, and how is it being processed? In other words, what is the nature
of the process (tangible or intangible actions).

In terms of the people processing activities, the level of involvement of the people can vary significantly.
Managers must think about processes/outputs in terms of what happens to customers and what is being created.
For pricing this category of services, the non-financial costs, time mental effort as well as fear and pain level
must be identified.

Having your computer broken and taking it to a repair facility is one example of service included in this
category. Customers’ are less physically involved in this category of services and usually there is no real need
for them to enter the service once he requested the service, explained the problem and pays the respective
service.

Classification of services can be done on the basis of two points. These two points or factors, are further sub
divided into 2 further variables. All in all, service classification considers four types of people or objects.

1) Classification of service based on tangible action


Wherever people or products are involved directly, the service classification can be done based on tangibility.
a) Services for people – Like Health care, restaurants and saloons, where the service is delivered by people to
people.
b) Services for goods – Like transportation, repair and maintenance and others. Where services are given by
people for objects or goods.
2) Classification of services based on intangibility
There are objects in this world which cannot be tangibly quantified. For example – the number of algorithms it
takes to execute your banking order correctly, or the value of your life which is forecasted by insurance agents.
These services are classified on the basis of intangibility.
a) Services directed at people’s mind – Services sold through influencing the creativity of humans are
classified on the basis of intangibility.
b) Services directed at intangible assets – Banking, legal services, and insurance services are some of the
services most difficult to price and quantify.

The most intangible form of service output is represented by information processing. The customer’s
involvement in this type is service is not required. Generally, customers have a personal desire to meet face to
face but there is no actual need in terms of the operational process. Consultancy services can be an example of
this type of services where the relationship can be built or sustained on trust or telephone contact. However, it is
more indicated to have a face-to-face relationship in order to fully understand the needs of the customer.

A more general classification of services based on the type of function that is provided through them can be as
follows:
1. Business services.
2. Communication services.
3. Construction and related engineering services.
4. Distribution services.
5. Educational services.
6. Environmental services.
7. Financial services.
8. Health-related and social services.
9. Tourism and travel-related services.
10. Recreational, cultural, and sporting services.
11. Transport services.
12. Other services not included elsewhere.

THE CHALLENGES OF SERVICE MARKETING


Service Marketing emerged as a separate field of study only in the early 1980s, when the distinct characteristics
of service marketing finally dawned on marketers.

Simply put, service marketing deals with the actions and processes that enable a service provider to deliver
services to end consumers.

The services sector includes industries like banking, insurance, communications, consulting, non-profits, travel
and transportation, and all other businesses that do not produce tangible goods.

1. INTANGIBILITY
Consumers can see and touch goods—they’re a physical product. They know exactly what they’re buying when
they’re spending their money. They may even be able to carry the item away with them—although they have to
drive off the lot when they buy a car.

This portability is not the case with services. The effects of services may not be apparent immediately, and
what’s done is not always obvious. The client of a management consultant, for example, may have to wait for
months (or years) before they can see the results.

Lack of Emotion: Physical products can trigger an emotional impulse compelling the customer to buy. Color,
shape, and style are important for physical products—especially those aimed at the general public.

No such built-in emotional appeal exists in the intangible world of services. The consumer might have a hard
time even imagining all the details involved in what is done for them by a service business.

No product or service can be completely tangible or intangible, of course. For example, a law firm selling legal
services needs business cards, computers, and other tangible objects to practice law—but the firm’s clients
aren’t paying for them. Similarly, a hardware store will need salespeople, guarantees, and operating manuals
and lessons to sell drill machines or table saws.

Even so, it’s easy to tell the difference between a service business and a tangible goods business.

2. LACK OF OWNERSHIP
You can buy a product, take it home, own it for years, and perhaps even resell it. But you can’t do the same
with a service. You can avail it only for a specific period of time and then it’s over--unless you pay again. The
lack of physical ownership makes it harder to sell services.
Even companies don’t own and control services the way they can control tangible products. It’s because service
delivery depends on human interactions between the service provider’s employees and customers.

3. PERISHABILITY
Another defining quality of services is that they are perishable. I don’t mean that they will spoil, but they are
time-bound. You can’t build an inventory or store services like you can with physical products. Services are
usually performed at specific times and on stated dates.

A dentist cannot start a procedure until the patient is in the chair. An airline cannot sell a seat on a flight that has
already left the gate.

4. HETEROGENEITY
Services are heterogeneous. Service businesses operate through several diverse elements and interactions. A
bank may offer customer service through a helpline or website and cash withdrawals through ATMs and
counters.
In most industries, the service delivery process involves a lot of human interaction. As human behavior is
subjective and unpredictable, no two sets of services can be identical in their details and results.

5. INTERACTIVITY
Service delivery depends on a chain of interactions between customer and service provider, as well as between
the people working inside the service provider. The customer is central to the whole process and all activities
must aim at their satisfaction.

Prosumership: For the service to be delivered, the consumer needs to cooperate and coordinate with the
service provider. For example, if you’re offering bill payment over the internet—the service—the consumer
must have a valid payment method and a working internet connection, and be able to use both of them.
Service marketing experts call it “prosumership”. Service consumers (or prosumers) have to proactively
participate in the service delivery process.

The degree of this cooperation will vary among different types of services. But it must be present to make
service delivery possible. No such cooperation is required for delivering physical products.

Applications of Service Marketing


Marketing a service-base business is different from marketing a product-base business. Services marketing is
marketing based on relationship and value. Marketing services and other intangibles is considered as valid as
the marketing of products and commodities, as the key future of the marketing model is its emphasis not on
maximising profits, but on sensitively and satisfying human need (Kapoor,1988).Services marketing concepts
and strategies have developed in response to the tremendous growth of service industries resulting in their
increased importance to the U.S and world economies (Zeithaml, 2000). Services marketing is a comprehensive
term that describes all the processes and interactions that result in satisfaction for customers and revenue for the
organisation. As Kotler (1995) points out, organizations such as museums, universities, libraries, and charities
need to market their causes and their products to gain political and social support as well as economic support.
Marketing of Financial Services
In general, all types of activities, In general, all types of activities, which are of a financial nature could which
are of a financial nature could be brought under the term 'financial be brought under the term 'financial services'.
The term financial services ‘services'. The term financial services ‘in a broad, sense means "mobilizing in a
broad, sense means "mobilizing and allocating savings". Thus it and allocating savings". Thus it includes all
activities involved in the includes all activities involved in the transformation of savings into transformation of
savings into investment.

Financial services can also be called 'financial intermediation'. Financial intermediation is a process by
mediation'. Financial intermediation is a process by which funds are mobilizing from a large number of savers
which funds are mobilizing from a large number of savers and make them available to all those who are in need
of and make them available to all those who are in need
of it and particularly to , corporate customers.it and particularly to , corporate customers.

Thus, financial services sector is a key area and it is. thus, financial services sector is a key area and it isvery
vital for industrial developments. A well developed very vital for industrial developments. A well developed
financial services industry is absolutely necessary to financial services industry is absolutely necessary to
mobilize the savings and to allocate them to various mobilize the savings and to allocate them to various invest
able channels and thereby to promote industrial invest able channels and thereby to promote industrial
development in a country.

Hospitality:
Hospitality marketing is marketing efforts directed towards the increase of revenue in the hospitality industry.
Learn about education and careers in the hospitality marketing industry.

Hospitality Marketing Defined


Marketing is the process for getting a company's product or service out to consumers. Hospitality marketing
takes a look at how segments of the hospitality industry, such as hotels, restaurants, resorts and amusement
parks, utilize marketing techniques to promote their products or services.

The hospitality industry is a multibillion-dollar industry that depends on the availability of leisure time,
disposable income, and complete customer satisfaction. There are four segments of the hospitality industry:
Food and beverages, Travel and Tourism, lodging, and recreation.

1. Food and Beverages


The food and beverage sector which is professionally known by its initials as F&B is the largest segment of the
hospitality industry. The F&B industry is estimated to provide 50% of all meals eaten in the US today. It
comprises of establishments primarily engaged in preparing meals, snacks, and beverages for immediate
consumption on and off the premises. When a restaurant is part of a hotel, services it renders can enhance the
guest experience by providing excellent food and first-class customer service. It can symbiotically function as
part of other businesses, such as in bowling alleys or movie theaters.

2. Travel and Tourism


Travel and tourism deal with services related to moving people from place to place. Buses, cabs, planes, ships,
trains and so on are all part of the travel industry. Leisure travel is when a person spends money on lodging,
food, and recreation while taking a vacation trip, and business travel is when a person travels for work and
spends money on lodging and food. Some people also spend on recreation while on a business travel. The major
function of the tourism is to encourage people to travel. When people travel, either for business or leisure, they
spend money on hospitality.
3. Lodging
Lodging means accommodation for a period or a place to sleep for one or more nights. Fancy hotels, youth
hostels, elder hostels, campgrounds, motels and other businesses that provide a place for people to sleep
overnight are all in the lodging industry. Lodging businesses markets to other market segments such as business
travelers, leisure travelers, long-stay travelers, budget travelers, and special travelers like people working with
the government, airlines, and military.

4. Recreation
Recreation is any activity that people do for rest, relaxation, and enjoyment. The goal of recreation is to refresh
a person's body and mind. Any business that provides activities for rest, relaxation and enjoyment, to refresh a
person's body and mind is in the recreation business. Entertainment businesses which provide shows such as
movie or theater, attractions which are places of special interest of visits such as zoos and museums, spectator
sports and participatory sports are all parts of the recreation business.

Health:
Healthcare marketing is a process of strategic outreach and communications designed to
attract healthcare consumers, guide them through their healthcare journey, and keep them engaged with
the health system.

Health marketing or Medical Marketing is a specialized branch of marketing. Medical marketing was born
from the necessity for private health professionals to attract new patients, the characteristics of the health
market makes it a unique kind of marketing. Medical marketing is usually a business to consumer (B2C)
services. The primary customers for these medical marketing companies are Generation Z. About 85% of Gen
Zers said they are open to alternative healthcare options like telemedicine, dispatch services and membership-
based services. Marketers and medobal healthcare provides offline/online medical services for healthcare
seekers. Healthcare professionals using this type of marketing usually offer beauty related services, such
as aesthetic medicine, plastic surgery, dental surgery or dermatology and much more.

Health marketing is an approach to public health promotion that applies traditional marketing principles and
theories alongside science-based strategies to protect and promote the health of diverse populations. It involves
creating, communicating, and delivering messages for the public on prevention, health promotion and health
protection. Health marketing is one of the ways advancements in medicine and in health-protecting services,
such as insurance, are made widely known.

The marketing strategy would follow the traditional "4Ps" of marketing, namely:
• The "product" in question in this case the surgical procedure.
• The "place" which refers to the access to this procedure.
• "Promotion" refers to creating awareness and hence demand.
• "Price" refers to the cost of the procedure e.g. money, time, reputation etc.

"Health marketing" is a term rarely used in public healthcare and related disciplines. "Social marketing" or
"integrated marketing communication" are more commonly used in public health and other disciplines to refer
to marketing-based planning frameworks for public health communication.

Education Services Marketing:


Educational service providers, more than anything, need to be competitive. Often it is the key component of
success. The customer simply shows up at the service scape expected to be “serviced". The delivery system in
place will satisfy, dissatisfy, or please the customer. And it is always important to remember that the customer
cannot be completely separated from the service. Here, the service providers mean teaching fraternity and non-
teaching community directly and indirectly associated with the services rendered to the students. Satisfaction
and retention of the students solely depends on the way the teachers are in a position to deliver their best
services to them. Teachers are not treated as “guru”, rather they are known as facilitators / services providers.
Growth and existence of an educational institute, particularly the professional educational organization depends
on the competency, effectiveness, efficiency, sincerity, dedication and devotion of the teaching community of
the institute. People proved as the most vibrant component of educational services marketing mix.

In the present era, it is not natural resources or natural wealth, which distinguish an affluent society from a
backward one; it is the accumulation and development of the knowledge resource. Education was never as
important a utility as it is today. People however differ in the benefits they seek from the educational services
offered to them. It is important, then, in order to be able to satisfy these needs and wants effectively, that a
marketing orientation be applied to the conceptualization, design and delivery of educational service. Education
planners, in order to plan the service offer well and deliver it effectively, need to understand the behavior of the
target population, and the criteria they use to exercise choice. Another key issue to better delivery of the
education service is that it is performed for people and by people. People therefore represent the starting point
for analysis to precede conceptualizing the service offer and developing it into a marketable service package.
The education service offered by the institution must reflect the organizational response to the identified needs
and wants of the target segment, in a given socio-economic context. However, the beginning of successful
service delivery in this case is in satisfying the needs of service providers.

Professional Services Marketing:


Marketing thinking and practice has been gradually moving into service industries. Its role in service industries
is still limited, however. It has achieved some utilization in banks and airlines, to a lesser degree in insurance,
brokerage, and public transportation, and still less in law, accounting, management consulting, medicine,
architecture, and engineering. Even marketing research firms and advertising agencies tend to under-apply
marketing concepts to the marketing of their own services. Many professional practitioners in these industries
deny a role to marketing or, if they do accept it, have a very inadequate idea of its content and how it can be
implemented in a firm. Marketing, far from being a minor negligible function in managing a professional
services firm, is one of the most important functions for helping such firms meet the unprecedented challenges
they are facing.

Professional Marketing We define professional marketing as an approach to the service/market opportunities of


the firm that is consonant with the profession's canons of ethics. Its major attributes are:

• Stating long-range marketing objectives and strategies.


• Developing annual volume, growth and profit objectives, and detailed plans and budgets broken down
into individual responsibilities.
• Organizing regular training seminars to improve the professional person's effectiveness at marketing and
personal selling.
• Assigning formal responsibility to one or a few people to organize, manage, and motivate the marketing
activity.
• Allocating time and budget to support the marketing activity.
• Setting up a system of controls and rewards tied to individual and group performance in attaining
marketing goals.
• Ensuring that the quality of professional work does not suffer as marketing activity is increased.
• Using only those marketing tools and procedures that are consonant with the industry's code of
professional ethics.
Marketing in non-profit organizations
Non-profit organization attempt to achieve some other objectives than profit. This does not mean that they are
uninterested in income as they have to generate cash to survive. However their primary goal is non – economic,
e.g. to provide education.

Marketing is of growing importance to many non-profit organizations because of the need to generate funds in
an increasingly competitive arena. Even organization who rely on government - sponsored grants need to show
how their work is of benefit to society: they must meet the needs of their customers. Many non-profit
organizations rely on membership fees or donations, which means that communication to individuals and
organization is required, and they must be persuaded to join or make a donation. This require marketing skills ,
which are being increasingly applied.

Characteristics of non-profit marketing :


Education versus meeting current needs
Some non-profit organizations see their role as not only meeting current needs of their customers but also
educating tem in new ideas and issues, cultural development and social awareness. It can be done in harmony
with providing CE as an additional value of CE course.

Multiple publics
Most non-profit organization serve several groups or publics. The two broad groups are donors , who may be
individuals, trust , companies and governmental bodies, and clients, who include audiences and beneficiaries.
The need is to satisfy both donors and clients, complicating marketing task. For example a community
association providing also the CE courses may be partly funded by the local authority and partly by other
donors (individuals or companies) and partly by clients. To succeed all the groups must be satisfied.

Measurement of success and conflicting objectives


For profit oriented organizations success is measured ultimately on profitability. For non-profit organizations
measuring success is not so easy. In universities , for example, is success measured in research terms, number of
students taught, the range of qualifications or the quality of teaching? The answer is that it is a combination of
these factors, which can lead to conflict: more students and larger of courses may reduce the time needed for
research. Decision making is therefore complex in non-profit oriented organization.

Public scrutiny
While all organization are subject to public scrutiny, public sector non-profit organization are never far from
public‘s attention. The reason is that they are publicity funded from taxes. This gives them extra
newsworthiness as all tax-payers are interested in how their money is being spent. They have to be particularly
careful that they do not become involved in controversy, which can result in bed publicity.

Creating and delivering services:

Delivering Services: Designing, Planning, Creating and Evaluation:


All service organization face choices concerning the types of products to offer and the operational procedures to
use in creating them. Figure 14.3 shows the key steps involved in planning, creating, and delivering services.
The task begins at the corporate level with a statement of institution objectives and an appraisal of current or
obtainable resources. From market and competitive analysis, marketing opportunities can be identified.
Positioning statement can be developed for each service that the firm plans to offer to one or more specific
market segments, indicating the characteristics that distinguish it from the competition in meaningful ways.
This positioning strategy must then be related to a statement of the operating assets needed for execution. Can
the organization afford to allocate the necessary physical facilities, equipment, information and communication
technology, and human resources needed to support a given positioning strategy?

Alternatively, could the firm leverage its own resources by using off-balance sheet assets obtained by
developing partnerships with intermediaries or even with customers themselves? Does the positioning strategy
promise sufficient profits to yield an acceptable return on the assets employed after deducting all relevant costs?

The next step in the process involves establishing a service marketing concept, to clarify the benefits offered to
customers and the costs that they will incur in return. This marketing concept considers both core and
supplementary services, reliability levels for these services, and where and when customers will be able to have
access to them. Costs include money, time, mental effort, and physical effort.

A parallel step is to establish a service operations concept, which stipulates the geographic scope and
scheduling of operations, describes facilities design and layout, and indicates how and when operating assets
should be deployed to perform specific tasks.

The operations concept also addresses opportunities for leveraging through intermediaries or the customers
themselves. Finally, it clarifies which tasks will be assigned to front stage and which to backstage operations.

These two concepts interact with a set of choices that management must make in configuring the service
delivery process (Figure 14.4).

1. What should be the sequencing of the various steps in the service delivery process? Where (location) and
when (scheduling) should these steps take place?

2. Should service elements be bundled or unbundled for delivery purposes (for instance, should a service firm
take responsibility for all elements or delegate certain supplementary services, such as information and
reservations, to an intermediary?)

3. What should be the nature of the service process at each step? Should customers be served in batches or
individually, or should they serve themselves?
4. What should be the serving protocol: Should the firm operate a reservations system or work on a first come,
first served basis, with queuing as necessary? Alternatively, should a priority system be established for certain
types of customers?

5. What imagery and atmosphere should the service delivery environment (or service-scape) strive to create?

Product Support Services:


Product Support Services, more commonly referred to as PSS, is the Microsoft business unit with primary
responsibility for responding to end-user and partner requests for assistance with the company's products and
services.

Product support services refer to labor-based services for hardware or software, which can be performed by the
manufacturer of the product or parties other than the vendor that created the product. These services can be
provided by several types of vendors, typically including hardware OEMs, such as Dell, HP, EMC or IBM; and
software publishers, such as Microsoft, Oracle or SAP. Formal channel partners of hardware and software
vendors also provide support services.

Product support services are also delivered by additional independent service providers and third-party support
providers. An independent service provider delivers a broad range of services for hardware and/or software
products (such as consulting or support), and may have an alliance with the product manufacturer but not as a
primary means to its service business. A third-party support provider primarily delivers break/fix technical
support for hardware and/or software products and is not typically aligned with the product manufacturer but
may have a relationship in certain specific exceptional cases.

Relationship marketing
Relationship marketing is a facet of customer relationship management (CRM) that focuses on customer loyalty
and long-term customer engagement rather than shorter-term goals like customer acquisition and individual
sales. The goal of relationship marketing (or customer relationship marketing) is to create strong, even
emotional, customer connections to a brand that can lead to ongoing business, free word-of-mouth promotion
and information from customers that can generate leads.

Relationship marketing stands in contrast to the more traditional transactional marketing approach, which
focuses on increasing the number of individual sales. In the transactional model, the return on customer
acquisition cost may be insufficient. A customer may be convinced to select that brand one time, but without a
strong relationship marketing strategy, the customer may not come back to that brand in the future. While
organizations combine elements of both relationship and transactional marketing, customer relationship
marketing is starting to play a more important role for many companies.

Relationship Marketing – Meaning


Relationship marketing refers to those marketing activities that are aimed at developing and managing long-
term relationships with the customers. The details about the customer, his buying patterns, contacts, etc. are
maintained in a sales database and an account executive is assigned to fulfill the needs of the customers and
maintain the relationships successfully.

Relationship marketing has been receiving increasing attention in recent years as more and more organizations
focus their attention on retaining existing customers rather than attracting new ones.

Although the origins of relationship marketing are to be found in an industrial context, it is with the increasing
importance of the services sector during the last decade that relationship marketing has emerged as an important
topic in helping marketers focus on maintaining and enhancing customer relationship.

Relationship Marketing – Definitions Provided by American Marketing Association and Lee Iacocca
The term relationship marketing was first coined in America in the early 1980s. Although it has no single,
agreed meaning, most definitions have common factors defined in the dictionary of marketing terms of
American Marketing Association (1995), “Relationship Marketing is marketing with the conscious aim to
develop and manage long term and/or trusting relationship with customers, distributors, suppliers, or other
parties in the marketing environment”.
Other Definitions
Pathmarajah (1993) defines relationship marketing as “the process whereby the seller and the buyer join in
strong personal, professional and mutually profitable relationship over a time”

Relationship Marketing Process:


Relationship marketing is a much more effective method of building a business than the typical pushy salesman
approach.

Making the sale should not be your immediate goal. Connecting with your prospect and building a relationship
is what should be foremost in your marketing strategy. You want to accomplish a long-term relationship with
your customer not just a quick sale.

A customer needs to find a business they can feel comfortable with, and trust in, to provide what they need.
Building relationships is a crucial step in this process. It may take several interactions, whether by e-mail, phone
or in person, with a customer to make a sale. Do not make your customer feel pushed or intimidated into
buying. There are many things you can do to show your potential customer you are interested in more than just
“making the sale.”

1. Focus on Customer Needs – Don’t make your customer feel that all you want is their money. Take the time
to find out what they really need and let them know how you can fulfill those needs. You have to put your
customer’s need for problem solution above your need to make the sale.

2. Really Listen to Your Prospects – Listening to your prospect is common sense to us but, unfortunately, in
our need to make a sale, we might overlook this. Don’t let outside distractions take away any of your attention.
Reserve 100 percent for your customer and really listen to what he or she is saying to you. Do not let your
feelings or your ego stand in the way of listening to your customer. Don’t go by the book. Every customer and
situation is different and you have to follow the current conversation not a script.

3. Be Available – Always, always have your contact information such as e-mail address, phone number, etc.
readily available to give to your prospects and customers. They need to be comfortable in the fact that they can
reach you anytime they need you.

4. Offer Information and Resources – Offer free information, reports, resources, etc. on your website, blog, or
newsletter. Let your customer know you want to help them with all their needs. Provide a weekly mailing with
helpful tips, hints and information. Show them you are willing to go the extra mile to help.

5. Personalized Greetings – Don’t just take the money and vanish. Stay in touch with your customers to help
build that lasting long-term relationship. Send out personalized holiday greetings, well wishes etc. with greeting
cards, postcards or e-mail. Even just sending a hand-written thank you note will go a long way in forming that
lasting relationship.

6. Provide Ongoing Support – Many times after a person purchases something, customers have questions or
concerns about that purchase. Make sure you provide ongoing support by e-mail or phone so their questions and
their concerns can be addressed. Unfortunately, too many times, companies seem to disappear once the
purchase is complete. Don’t let that be you and your company.

7. Be Honest – In our eagerness to make the sale, we sometimes stretch the truth or completely abandon it.
Never make promises you cannot fulfill or claims you cannot live up to. If the customer needs something you
cannot provide, discuss possible options or alternatives or refer them to someone who can take care of their
needs. Never make false claims even if you do have good intentions.

8. Show Respect – This goes without saying, no matter how difficult the customer or situation. There are
customers that can certainly try our patience, but you must never lose your temper with a customer. Talk to
them calmly and let them know you will do what you can to take care of the problem. Show them that you can
work through their crisis and take care of the problem. Your calmness and confidence will help calm them
down and reassure them that all will be well again.
9. Customer Appreciation – Offer your customers discounts, incentives, prizes or rewards any time you can to
show them you appreciate them. There are companies that have incentives for new customers but nothing for
existing customers. This is definitely not right. You need to show your existing customers you appreciate them
as well. Send coupons, free gifts, etc. Doing so could mean a lot to your customer and your business.

10. Connect with Your Customer – Make the effort to actually connect with your customer as a person, not
just to make a sale. Gone are the old school ways of making sales with pushy sales pitches, intimidation, scare
tactics, etc. We now know relationship marketing and mutual respect and trust sets the tone for long-lasting
buyer/seller associations.

Even though you are in business for yourself, think of your customer as your boss. You work for your customer.
You are there for your customer. You need your customer more than he needs you. Always value your customer
and show them they can value you.

The Characteristics of Relationship Marketing:


RM is about healthy relationships, which are characterized by concern, trust, commitment and service.

1. Concern:
Strong relation can be maintained by knowing and understanding the needs of customers. Howsoever the size of
business either it is small retailer or big manufacturer all enterprise need loyal customers and it can be achieved
by showing concern towards customers. Relationship marketers should be concerned about the welfare of their
customers.

2. Trust and Commitment:


Relationship marketing focuses on developing strong relationship between buyers and sellers through trust and
commitment. Trust can only be achieved if the strategy is not only transactional but relational. Both buyer and
seller has to understand that strong trust full relation can only be achieved by avoiding focusing on short-term
benefits and investing into building long term relationship. And if both can establish, maintain and preserved
this trust objectives of both the parties will be meet.
When commitment and trust are executed together by managers, the outcomes are efficiency, productivity and
effectiveness. But the real challenge often lies in ensuring demonstrating commitment to the relationship and
inculcating trust in partners.

3. Service:
Those companies which see service to customer as a cost and only are concerned about their market share will
never be able to retain customers. Relation marketing is not a cost to the company; on the other hand it is a huge
return on investment that is worth every rupee and effort put in. One must always remember this sequence
“service quality leads to customer satisfaction which leads to relationship strength, which leads to relationship
longevity, which leads to customer relationship profitability.”

Relationship Marketing – Importance


It is important to keep and improve relationship with customers for the following reasons:

1. There are higher marketing costs associated with generating interest in new customers as opposed to already
informed existing customers.

The marketing costs involved in the creation of interest in an uniformed new customer far outweigh those
involved in maintaining the relationship necessary to continue exchanges between buyer and seller.

It has been estimated that the cost of attracting new customers can be as high as six times that of retaining
existing customers.

2. Close and long-term relationships with customers imply continuing exchange opportunities with existing
customers at a lower marketing cost per customer. Reichheld and Sasser observe –

Across a wide range of business, the pattern is the same – the longer a company keeps a customer, the more
money it tends to make.

3. Viewing customer exchanges as a revenue stream, as opposed to a compendium of isolated transactions,


enables cross-selling of related services over time and premium pricing for the customer’s confidence in the
business.

4. Strong customer relationships with a high degree of familiarity and communications on both sides can
generate more practical new product ideas from customers and contact personnel.

5. Good relationships with customers can result in good work for publicity from successful exchanges and
minimal bad work-of-mouth in the event of unsuccessful exchanges. Service quality cracks can often be
papered over where good relationships have existed previously.
MULTIPLE CHOICE QUESTION
&
SHORT AND LONG ANSWER
QUESTION
1. Which of the following is not a type of digital marketing activity?

a) e-marketing.

b) Social marketing.

c) Print advert.

d) Internet marketing. Answer: (c)

2. ________ is the process of marketing accomplished or facilitated via the use of internet
technologies (e.g. web, email, intranet, extranets).

a) Internet marketing

b) Search marketing

c) e-marketing

d) Mobile marketing Answer: (a)

3. Modern marketing is_________________


a) Price oriented
b) Consumer oriented
c) Product oriented
d) Profit oriented Answer: (b)

4. ___________are network that connect people within a company to each other and to the company
network.
a) Internets
b) Extranets
c) Bit streams
d) WWW Answer: (b)

5. Indentify the one which comes under service marketing ________________


a) Insurance
b) Motor cars
c) Refrigerators
d) Television Answer: (a)

6. Which of the following is not one of the benefits of e-commerce to sellers?


a) e-commerce can help to reduce costs
b) e-commerce is a powerful tool for customer relationship building
c) e-commerce increases the net cost per contact
d) e-commerce offers greater flexibility in meeting customers needs. Answer (c)

7. Which of the following social networks allow you to create pages to promote a brand or a company?

a) YouTube

b) Facebook

c) Twitter

e) Foursquare Answer (b)

8. What is internet marketing?

a) Promotion of goods and services through the internet

b) Promotion of goods and services through social media

c) Promotion of goods and services through search engine ads

d) Promotion of goods and services through newsletters Answer (a)

9. Besides having a website, what are other media that can be used for internet marketing?

a) Social media accounts

b) Social media accounts and emails

c) Social media accounts, blogs and emails

d) Emails and ads Answer: (c)


10. Internet marketing became an inseparable part of a modern business due to _______________.

a) The saturation of traditional advertising

b) The increased usage of the internet

c) The development of many online tools

d) The expansion of the market Answer: (b)

11. Being a primary source of information for millions of people, _______________ is a medium
enabling you to promote your business and stay competitive.

a) Internet

b) Web analytics

c) Website

d) HTML Answer: (a)

12. One of the biggest advantages of internet marketing is:

a) Customized strategy that can be applied to any business (large or small)

b) Ability to use a lot of free platforms

c) A lot of online tutorials

d) Simplicity of the strategy Answer: (a)

13. Which one of these is not a type of internet marketing?

a) Email marketing

b) Search engine marketing

c) Search engine optimization


d) Search engine result page Answer: (d)

14. _________________ is one of the online marketing trends.

a) Affiliate marketing

b) Mobile-friendly content

c) Social analytics

d) SEO Answer: (b)

15. Successful online marketing strategy demands ________________.

a) Creativity, planning, research and flexibility

b) Analysis of traditional marketing approach

c) Being restrictive towards changes

d) Imitating the approach your competitors use Answer: (a)

16. Web analytics refers to the usage of ____________________.

a) Social media to promote product pages

b) Web data to conduct analysis

c) Different tools to optimize the website

d) Paid ads to promote content Answer: (b)

17. Distinct characteristic of services is_____________


a. Intangibility
b. Inseparability
c. Variability
d. Perishability Answer: (a)
18. A ______________________ is a form of product that consists of activities, benefits, or
satisfactions offered for sale that are essentially intangible and do not result in the ownership of
anything.
a. Service
b. Demand
c. Need
d. Physical object Answer: (a)

19. Successful service companies focus their attention on both their customers and their employees. They
understand ___________________, which links service firm profits with employee and customer
satisfaction.
a. Internal marketing
b. Service-profit chains
c. Interactive marketing
d. Service differentiation Answer: (b)

20. The intangibility of services has implications for the choice of _________
a. Brand elements
b. Location
c. Price
d. Product features Answer: (a)

21. The services a customer expects are called the ______service package.
a. Expected
b. Augmented
c. Primary
d. Secondary Answer: (c)
22. Added features to an offering are called _________service features.
a. Expected
b. Augmented
c. Primary
d. Secondary Answer: (d)

Short Answer Questions

Q1. How are you going to explain digital marketing?

Ans: Digital marketing is all about brand marketing tactics via online channels. It includes various methods and
techniques like SEO, SEM, Link building, Email marketing, PPC, etc.

Q2. In what segments you can categorize digital marketing?

Ans. Are you a fresher and preparing a digital marketing interview questions and answers for freshers, then start
scratching from the basics. Digital marketing – the term can be easily categorized into two segments. Namely
inbound marketing and outbound marketing.

Inbound marketing refers to the technique whereby one can take up the assistance of social media, webinars, e-
books, newsletters as well as the increase in the number of clicks on the links i.e. PPC.

Outbound Marketing is a marketing aspect that deals with reaching out to potential buyers through digital
platforms, calls, email and placing advertisements.

Q3. What is SEO? What is a keyword and how important it is in SEO?

Ans. Search Engine Optimization or SEO is a technique in digital marketing that allows increasing the website
traffic quality through organic search engine results.

Digital marketing uses the keyword for user convenience when searching to find specific information on a
search engine. For a better ranking in SEO, keywords are important and the place of applying keywords in
content will reflect site ranking too.

Q4. What are on-page and off-page optimization?

Ans. On-page optimization directly handles the structure and content of a site whereas off-page optimization
boosts the search engine ranking by fetching external links to point back to it.

Q5. What are the different types of SEO Practices?


Ans. The SEO practices can be broadly classified into two categories – White hat SEO and Black hat SEO.
White hat SEO as the name refers, is the most legitimate practice to get higher rankings in the search engine
result pages. A white hat SEO practice strictly abides by Google’s guidelines for SEO. The most commonly
practiced white hat SEO techniques are publishing quality content on the website, HTML optimization and
restructuring of the website, link acquisition campaigns

Black hat SEO practices are considered to be illegitimate and against the guidelines provided by Google and
Google’s algorithms. Obviously, Black hat SEO includes the practices that aim at finding weaknesses and
loopholes in Google’s algorithms in order to rank higher in the search engine result pages. The most common
black hat SEO techniques include spam links, keyword stuffing, cloaking, hidden text, and hidden links, etc that
only mislead the users and redirecting to the sites that they didn’t vouch for

Q6. Why is online marketing preferred more than offline marketing?

Ans. Most people today go for digital marketing as it comes with numerous benefits. SEO, web development,
and hosting are some of the most useful platforms for online marketing.

The range of leads is extraordinary. It is capable of one to reach a huge number of individuals quite easily via
online marketing.

On the other hand, with technological development, a number of people reading newspapers, listening to the
radio or watching TV goes down.

Q7. What are the best ways to get a natural backlink to your site?

Ans. For a newly launched website, the chances of getting fast and natural links are almost zero. One common
method to get a natural backlink is to write guest posts on reputable websites in your niche. While you write do
not simply do it for the purpose of getting a link instead but instead, you can write for more than one time. What
is more important is that you must do it only for reputed websites.

Q8. Name some areas where keyword optimization is done?

Ans. For a better page ranking, keywords placement is important. The areas are:
• Website Title
• Website URL
• Meta tag
• Headings
• Web page content

Q9. Why you do a competitive analysis?

Ans. A competitive analysis is a very critical part while working out a marketing plan for any company. It is
identifying the competitors and evaluating their strategies to determine their strengths and weaknesses relative
to those of your own product or service. With this evaluation, you can establish your USP (Unique Selling
Preposition) and therefore decide on what attributes you can focus in order to attract your target market.

Q10. Can you explain about Google Adwords?


Ans. If you are searching for online marketing interview questions, then it is quite mandatory to know about
Google Adwords. Expect a question on this. It works on Pay per Click model and is the only successful PPC ad
system in the world. It helps a business to create ads that will be displayed on Google.

Q11. What are the different ways to promote digital marketing?

Ans.
• Search Engine Optimization (SEO)
• Search Engine Marketing (SEM)
• E-commerce Marketing
• Content Marketing
• Email Marketing
• Social Media Marketing

Q12. Name some channels to promote digital marketing?

Ans.
• Affiliated Marketing
• Email Marketing
• Display Marketing
• Search Marketing
• Social Media
• Social Networking
• Social Marketing
• Online PR
• Video Advertising

Q13. What is a responsive website?

Ans: A website that is capable of adjusting its layout according to the orientation and viewport size of the
device.
The content that is presented on the small screens and big screens appear the same but with a different layout
that offers an optimal experience over the display size.

Q14. How can you increase traffic to a website in the most efficient manner?

Ans: To effectively increase traffic to a website, you need to focus on SEO and referring links primarily. It will
not only help you gain visitors but also assist in brand recognition.
However, the essential factor you need to focus on is User Retention.
For example, getting Moz Link and around 10 thousand visitors to the website is a good result. Though, you
need to remember that the conversion ratio will be comparatively low.
However, converted leads are very certain to land on the website various times. But if you focus on retaining
the users, you are going to experience an increased conversion rate gained from a few thousands of visits in just
a few months.
By rendering focus on engaging users, you can go ahead with building a site whereby people will come back
again and again.
Q15. What are the top digital marketing tools you are aware of?

Ans: Here are some of the top Digital Marketing Tools:


• Keyword Discovery
• RankWatch
• Alexa Ranking
• Moz
• Google Analytics
• StumbleUpon
• Crazy Egg Heatmaps
• Favicon Generator
• XML Sitemap Generator
• Digital Point Keyword Tracker
• Submit Express Link Popularity

Q16. Are you aware of the difference between direct marketing and branding?

Ans: In the case of branding, the advertiser has to expose his brand to sites and applications having higher
audience reach. The most known methods here are YouTube ads, custom ads, display target ads and
remarketing.

But in the case of direct marketing, the advertiser is mostly interested in establishing communication with his
target audience, very common campaigns here are shopping ads, dynamic search ads, Search Network only and
others.

Q.17.What are the various ways by which service can be classified? Discuss.

Ans: Services are neither a homogeneous group, nor different in-between according to industry classification.
Services can be segmented into clusters that share certain marketing-relevant characteristics.
Classifications:
Import from tangible products domain:-
• Copeland’s convenience, shopping, specialty goods. (Retail service institutions can also
• use this approach; e.g., from financial services providers to restaurants).- Durability. (For services:
durability of benefits is relevant to repurchase frequency).-
• Consumer/industrial. (Different evaluation of competing alternatives, purchasing procedures and usage
behavior is also transferable to services).Operations approach to classification: every service is different
(insisting that airlines‟ marketing has nothing to do with banks, insurance, motels, etc.).
• However, marketing views demonstrate a lot of similarities in sharply different services; valid
classification highlights implications for managers– concepts and strategies can be shared between
industries. Classification will have managerial value if it offers strategic insight– i.e. implications for
managers. This includes both the core and supplementary services.

Q.18. What do you mean by Services ?

Ans: The service sector, also called the tertiary sector, is one of the three parts of the economy in the Three-
sector hypothesis. The service sector provides a service, not an actual product that could be held in your hand.
Activities in the service sector include (a) Retail, (b) Banks, (c) Hotels, (d) Real Estate, (e) Education, Health,
(f) Transport, (g) Media & Communications, (h) Recreation, (i) Electricity, (j) Gas And Water Supply; etc.
Q19. What do you mean by Service marketing?

Ans: Services marketing refers to the marketing of services as against tangible products. Services marketing are
a sub field of marketing, which can be split into the two main areas of goods marketing (which includes the
marketing of fast moving consumer goods (FMCG) and durables) and services marketing. A service marketing
typically refer to both business to consumer (B2C) and business to business (B2B) services, and includes
marketing of services like telecommunications services, financial services, all types of hospitality services, car
rental services, air travel, health care services and professional services.

Q20. What do you mean by service Product?

Ans: The service product is a service that can be sold and that is performed within Customer Service (for
example, inspection of your car). You can use the sales order and the service order to process these service
tasks. Service as a product represents a wide range of intangible products offerings that customers value and pay
for in the marketplace. Service products are sold by service companies and by non-service companies such as
manufacturers and technology companies.

Long Answer Questions


Unit-1
1. Explain how electronic marketing resources can be integrated into the traditional marketing process?
2. Explain the resources of electronic marketing.
3. What do you understand by e-marketing resources? Discuss in details the benefits of integrating
electronic marketing resources with traditional marketing resources.
4. Most business should engage in electronic commerce on the internet. Do you agree or disagree with this
statement explain your position?
5. How electronic marketing in differ from traditional marketing process. Discuss.
6. Discuss the challenges and opportunities of E-commerce services in rural and urban areas.
7. What do you understand by “Value added uses and perception to the product and services of E-
commerce”.

Unit-2
1. Define e-marketing mix and explain the elements of electronic process.
2. Explain the six steps in an e-marketing plan.
3. What are the benefits of implementing e-marketing activities in the marketing planning of an
organization?
4. What do you understand by e-marketing mix? Discuss in details elements of e-marketing mix and the
benefits of using e-marketing mix.

5. Describe the various elements of e-marketing mix strategies.


6. What do you understand by “Customer profile and data management”.

Unit-3
1. How does the value of distribution channel functions charge when they become internet based?
2. Explain ethics in context of electronic marketing.
3. Discuss various electronic mix strategies in details.
4. What is the future of online electronic marketing? Discuss in details the ethical issues concerning
electronic marketing in business.
5. “E-marketing and e-advertising is good platform form for players but they have to consider the social
legal and ethical aspects of online marketing”. Discuss.
6. Write a note on E-marketing mix strategies.
7. Discuss the ethical and security issues on the E-marketing site.
8. Discuss the following:
1) Electronic marketing implementation.
2) Internet.
9. Discuss the following:
1) Various preparation in the process of electronic marketing and e-commerce.
2) Long term marketing relationship

Unit-4
1. What do you understand by Services? Describe the characteristics of services and challenges of services.
2. What do you understand by relationship marketing and explain its process.
3. What are the characteristics of service marketing? Discuss various challenges facing service marketing.
4. Describe in details various steps involved in creating and delivering services.

5. Write a note on “Marketing of educational services”.


6. Define service marketing? Explain the classification and characteristics.
7. Discuss the factors contributing to the growth of service sector in India.
8. What do you understand by Services Sector? Explain its concept.
9. Discuss the following:
1) Marketing for Non-Profit Organisation.
2) Marketing for Health Services
10. Discuss the following:
1) Marketing for Financial Services
2) Marketing for Hospital Services
VIDEO REFERENCE
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https://youtu.be/YW9QTtXoHXo
https://youtu.be/Q62LHXYEnIQ
https://youtu.be/iUxEEGFkvXU
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