Chapter 7Developing the Service

Communication Strategy

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Chapter Objectives

• Discuss the steps necessary to manage the firm’s service communication strategy effectively.

• Understand the special challenges associated with developing service communications.

• Describe specific guidelines for developing service communications.

• Appreciate the special considerations faced by professional service providers and recommend solutions to overcome these challenges.

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Opening Vignette: Geico

• GEICO offers a classic illustration that as environmental forces change the course of a company’s overall marketing strategy, the service firm’s communication strategy should adapt to fit changing business conditions.

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Personal Selling

Personal Selling

AdvertisingAdvertising

Publicityand

PublicRelations

Publicityand

PublicRelations

SalesPromotions

SalesPromotions

Communication Mix

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SponsorshipsSponsorships

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Figure 7.1 Managing the Service Communication Strategy

Selecting Target Markets

Establishing Communication Objectives

Setting the Communication Budget

Formulating the Positioning Strategy

Establishing Message and Media Strategies

Monitoring, Evaluating and Controlling the Communication Strategy

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Product Life Cycle Stage

Introduction

Growth and maturity

Maturity and decline

Communication Objective

Informational

Informational and persuasive

Persuasive and reminder

Communication TacticsIntroduce the service offeringCreate brand awarenessPrepare the way for personal selling effortsEncourage trial

Create a positive attitude relative to competitive offeringsProvoke an immediate buying actionEnhance the firm’s image

Encourage repeat purchasesProvide ongoing contactExpress gratitude to existing customer baseConfirm past purchase decisions

Figure 7.2 PLC Stage and Communication Objectives

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Figure 7.3 Budget TechniquesBudget Setting Technique

Description

Top-down budgeting Set by upper management

Bottom-up budgeting Set by the product level or brand manager

Bottom-up/Top-down budgeting

Set by the product level and then revised by upper management

Top-down/Bottom-up budgeting

Set by upper management and then revised by product level

Percentage-of-sales Set based on a percentage of the previous year’s sales

Incremental Increased by a fixed percent every year

All-you-can-afford approach

Set based on what is left over after the firm pays for operating expenses and planned profits

Competitive Parity Set based on promotional spending behavior demonstrated by the competition

Objective-and-Task method

Set based on the amount necessary to achieve stated communication objectives

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8Source: Adapted from Philip Kotler, Marketing Management, 9th ed. (Englewood Cliffs, NJ: Prentice-Hall, 1997), p. 283.

Product DifferentiationPersonnel Differentiation

Image Differentiation Service Differentiation

FeaturesPerformanceConformanceDurabilityReliabilityRepairabilityDesign (integrates the above)

SymbolsWritten, audio/visual mediaAtmosphereEvents

CompetenceCourtesyCredibilityReliabilityResponsivenessCommunication Style

Delivery (speed, accuracy)InstallationCustomer trainingConsulting serviceRepairMiscellaneous service

Figure 7.4 Differentiation Approaches for Effective

Positioning

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Media Strategies for Targeting Users

• Type 1 Staff– Deal with customers quickly and effectively– “once only” situations

• Type 2 Staff– Requires some independent decision making – More intense communication than Type 1

• Type 3 Staff– Tasks are complex and often nonrepeatable

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Figure 7.1 Managing the Service Communication Strategy

Selecting Target Markets

Establishing Communication Objectives

Setting the Communication Budget

Formulating the Positioning Strategy

Establishing Message and Media Strategies

Monitoring, Evaluating and Controlling the Communication Strategy

©2011 Cengage Learning. All rights reserved.

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Special Challenges Associated with the Service Communication

Strategy• Mistargeted Communications

• Managing Expectations & Perceptions– Technical service quality

• Advertising to Employees

• Selling/Operations Conflicts

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Specific Guidelines for Developing Service

Communications• Develop a word-of-

mouth communications network

• Promise what is possible• Tangibilize the

intangible• Feature working

relationships between customer and provider

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Figure 7.5 The Impact of Intangibility: Different Communication Strategies for Different Products

Source: Adapted from G. Lynn Shostack, “Breaking Free from Product Marketing,” The Journal of Marketing (April 1977).

Tangibledominant

Tangible evidence

Intangibledominant

Intangibleimage

Perfume

Fast foodoutlets

Insurance

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Specific Guidelines for Developing Service

Communications• Reduce consumer fears about

variation in performance

• Determine and focus on service quality dimensions

• Differentiate the service product from service delivery

• Make the service more easily understood

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Special Consideration for Professional Service

Providers

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1. Third-party accountability

2. Client uncertainty

3. Experience is essential

4. Limited differentiability

5. Maintaining quality control

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Special Consideration for Professional Service Providers

6. Turning doers into sellers

7. Dividing the professional’s time between marketing and operations

8. Tendencies to be reactive rather than proactive

9. The effects of advertising are unknown

10.Limited marketing knowledge base

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Communications Tips for Professional Service Providers

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• Turn current clients into company spokespersons

• First impressions are everything• Create visual pathways that reflect

quality• Establish regular communications with

clients• Develop a firm brochure• An informed office staff is vital

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mechanical, photocopying, recording, or otherwise, without the prior written permission of the publisher. Printed in the United States of America.

Copyright © 2011 Cengage Learning.  

©2011 Cengage Learning. All rights reserved.