Chapter 5

Designing the
Communications Mix
for Services

Slide ©2004 by Christopher Lovelock and Jochen Wirtz Services Marketing 5/E 5- 1
 Advertising Implications for
Overcoming Intangibility (Fig. 5-1)

Problem Advertising Strategy

 Generality
- objective claims Document physical system capacity
Cite past performance statistics
- subjective claims Present actual service delivery incident

 Nonsearchability Present customer testimonials

Cite independently audited performance

 Abstractness Display typical customers benefiting

 Impalpability Documentary of step-by-step process,

Case history of what firm did for customer
Narration of customer’s subjective experience
Source: Mittal and Baker

Slide ©2004 by Christopher Lovelock and Jochen Wirtz Services Marketing 5/E 5- 2
 Other Communications Challenges
in Services Marketing

 Facilitate customer involvement in production

 prepare customers for service experience and demonstrate roles
 teach customers about new technologies, new features

 Help customers to evaluate service offerings

 provide tangible or statistical clues to service performance
 highlight quality of equipment and facilities
 emphasize employee qualifications, experience, professionalism

 Simulate or dampen demand to match capacity

 provide information about timing of peak, off-peak periods
 offer promotions to stimulate off-peak demand

 Promote contribution of service personnel

 help customers understand service encounter
 highlight expertise and commitment of backstage personnel

Slide ©2004 by Christopher Lovelock and Jochen Wirtz Services Marketing 5/E 5- 3
 Setting Clear Objectives: Checklist for
Marketing Communications Planning (“5 Ws”)

 Who is our target audience?

 What do we need to communicate and achieve?
 How should we communicate this?
 Where should we communicate this?
 When do communications need to take place?

Slide ©2004 by Christopher Lovelock and Jochen Wirtz Services Marketing 5/E 5- 4
 Common Educational and Promotional
Objectives in Service Settings (Table 5-2)

 Create memorable images of specific companies and

their brands

 Build awareness/interest for unfamiliar service/brand

 Build preference by communicating brand strengths and
benefits

 Compare service with competitors’ offerings and counter

their claims

 Reposition service relative to competition

 Stimulate demand in off-peak and discourage during peak
Slide ©2004 by Christopher Lovelock and Jochen Wirtz Services Marketing 5/E 5- 5
 Educational and Promotional Objectives (cont.)

 Encourage trial by offering promotional incentives

 Reduce uncertainty/perceived risk by providing useful info
and advice

 Provide reassurance (e.g., promote service guarantees)

 Familiarize customers with service processes before use
 Teach customers how to use a service to best advantage
 Recognize and reward valued customers and employees
Slide ©2004 by Christopher Lovelock and Jochen Wirtz Services Marketing 5/E 5- 6
 Marketing Communications Mix for Services
(Fig. 10.4)

Personal Advertising Sales Promotion Publicity & Instructional Corporate

Communications Public Relations Materials Design
Press
Selling Broadcast Sampling Web sites Signage
releases/kits

Customer Press Interior decor

Print Manuals
service Coupons conferences

Sign-up Special
Training Internet Brochures Vehicles
rebates events

Video-
Telemarketing Outdoor Gifts Sponsorship Equipment
audiocassettes

Word-of-mouth Prize Trade Shows, Software

Word Direct mail
(other of mouth
customers) promotions Exhibitions CD-ROM Stationery

* Media-initiated
coverage
Voice mail Uniforms

Key: * Denotes communications originating from outside the organization

Slide ©2004 by Christopher Lovelock and Jochen Wirtz Services Marketing 5/E 5- 7
 Originating Sources of Messages Received by a
Target Audience (Fig. 5-5)

Messages originating
within the organization
Front-line staff

duc tion
Pro nels Service outlets
Chan A
Mark
U
Chan eting Advertising D
nels Sales promotions
Direct marketing
I
Personal selling E
Public relations N
C
E
Word of mouth
Messages originating Media editorial
outside the organization

Slide ©2004 by Christopher Lovelock and Jochen Wirtz Services Marketing 5/E 5- 8
 What is Brand Equity and Why Does It Matter?
(From Berry, “Cultivating Brand Equity”)

Definition: A set of assets and liabilities linked to a brand’s

name and symbol that adds to (or subtracts from) the
perceived value of the product

Insights
 Brand equity can be positive or negative
 Positive brand equity creates marketing advantage for
firm plus value for customer
 Perceived value generates preference and loyalty
 Management of brand equity involves investment to
create and enhance assets, remove liabilities

Slide ©2004 by Christopher Lovelock and Jochen Wirtz Services Marketing 5/E 5- 9
 A Service Branding Model:
How Communications + Experience Create Brand Equity

Marketer-controlled communications

Firm’s Presented Brand Awareness of

(Sales, Advertising, PR) Firm’s Brand

Uncontrolled brand communications

Firm’s
What Media, Intermediaries,
Brand Equity
Word-of-Mouth Say re: Firm

Customer’s Experience Meaning Attached

with Firm To Firm’s Brand

Source: Adapted from L. L. Berry ( Fig. 1)

Slide ©2004 by Christopher Lovelock and Jochen Wirtz Services Marketing 5/E 5 - 10
 Marketing Communication and the Internet (1)

 International in Scope
 Accessible from almost anywhere in the world
 Simplest form of international market entry

 Internet Applications
 Promote consumer awareness and interest
 Provide information and consultation
 Facilitate 2-way communications through e-mail and chat rooms
 Stimulate product trial
 Enable customers to place orders
 Measure effectiveness of specific advertising/promotional
campaigns

Slide ©2004 by Christopher Lovelock and Jochen Wirtz Services Marketing 5/E 5 - 11
 Marketing Communications and the Internet (2)

 Web Site design considerations

 Memorable address that is actively promoted
 Relevant, up-to-date content (text, graphics, photos)
 Contain information that target users will perceive as
useful/interesting
 Easy navigation
 Fast download

 Internet advertising
 Banners and buttons on portals and other websites seek to draw
online traffic to own site
 Limits to effectiveness—exposure (“eyeballs”) may not lead to
increases in awareness/preference/sales
 Hence, advertising contracts may tie fees to marketing relevant
behavior (e.g., giving personal info or making purchase)

Slide ©2004 by Christopher Lovelock and Jochen Wirtz Services Marketing 5/E 5 - 12