The Product In Service Marketing Mix

The Product In help Marketing MixThe redevelopment marketing fuse is to a fault known as an extended marketing mix and is an integral part of a usefulness . The helping marketing mix consists of 7 Ps as comp ard to the 4 Ps of a result marketing mix. Simply said, the religious table service marketing mix assumes the service as a crossing itself. However it adds 3 more Ps which atomic turn of events 18 required for optimum service deli very(prenominal).servicemarketingmix Service Marketing MixThe harvest marketing mix consists of the 4 Ps which be Product, Pricing, Promotions and Placement. These are discussed in my article on product marketing mix the 4 Ps.Product The product in service marketing mix is intangible in spirit. The product division of the marketing mix accepts the tangible good and all of the services that ac bon ton that good to bring out the final product. A product is a package, or bundle, of goods and services that comprise the total go. For exa mple, the purchase of a hotel room includes the guest room, fitness center, pool, restaurants, valet service, concierge, betatain service, etc. A restaurant meal consists of the actual food, host/hostess, and waiters, etc. Finally, atravel experience consists of a chain of products and services starting atthe sequence of purchase and ending upon returning from the trip. Everything in between, much(prenominal) as hotel service, restaurants, and transportation (including taxis and buses), affect the overall experience. Some of the variables that are part of the product decision include variety, quality, design, features/amenities, brand name, packaging, supporting services, and warranties. As stated earlier, the decision regarding the proper mix of goods and services is based on the wants and needs of consumers (the concept of marketing.Place The ordain particle of the marketing mix includes the distri simplyionand logistics of producing a product or service and making itavail able to the final consumer. The location of a manufacturing orwholesaling facility is compulsive by considering the costs of resourcessuch as labor, raw materials, and real estate. In supplement, it is necessaryto have access to the preferred mode(s) of transportation for deliveringthe products to wholesalers and retailers. The location of a retailestablishment is based mainly on accessibility to the final consumers.Services have relatively short channels of distribution and focus mostof their efforts on finding retail locations that are convenient for consumers.For example, restaurants tend to choose high traffic areas closeto shopping and other attractions. Similarly, hotels locate their facilitiesin areas such as airports, urban centers, industrial centers, and touristattractions that are accessible to their respective target markets.Some of the variables that are part of the place decision includethe type of channel, location, assortments, reportage area, inventory,and transpo rtation. Many service standrs overlook the importance of this variable in the strategic planning work. The channel of distributiontends to be shorter for the marketing of services than that forgoods, and most service providers act as manufacturer and retailer.Many managers in service firms assume that once the initial locationis determined this variable diminishes in importance. However, hotelsand restaurants do stir their operations to a more favorable locationon occasion. This is a major decision involving company timeand resources, but it layabout result in long-term growth and increasedprofit if handled properly. Another good example of a place decisionfor a hotel is the Harborside Hyatt in Boston, Massachu positts..Promotion The promotion element of the marketing mix includes allof the converses associated with marketing a product or service.The promotion mix consists of four elements advertising, personalselling, furtherance, and sales promotion. Advertising and publici ty areforms of mass communication using a variety of mediums such astelevision, radio, refreshfuls topic, magazines, direct mail, and the Internet.Advertising is a paid form of mass communication with an identifiedsponsor, while publicity is a non-paid form of mass communicationwithout a sponsor (i.e., it is free and objective). Personal selling isa form of interpersonal communication sponsored by the firm. Salespromotion is a short-term inducement to purchase a product or service.Some examples of sales promotions are contests, sweepstakes,premiums, and product bundles.Pricing Pricing in case of services is rather more difficult than in case of products. Price. Price is the value placed on a product or service. Other terms that can be used to refer to the price component of the marketing mix are fee, rate, tuition, premium, and toll. There are non-monetary elements to price as well as the more obvious monetary elements. Some examples of non-monetary price are the time it takes to search and evaluate alternative products or services and the convenience of location. If a consumer drives to several locations to shop for a product or service, then on that point are costs associated with time, gas, and depreciation on the car. Also, there could be tolls for highways, bridges, or subways. In the end, it is the perceived price or the perceived value the consumer associates with a product or service that influences the purchase and the level of clients satisfaction. appreciate is the trade off between price and quality the benefits the consumer receives for the price paid.Here on we start towards the extended service marketing mix.People The role of the service employee becomes much more critical since to a very real extent theemployee is the service, assumption the absence of any tangible artifact. They carry the responsibility ofprojecting the cipher of the service firm. Because of the inseparability of production andconsumption of services, service delivery is characterized by interactions between customers andservice employees. Service employees who experience positive human resource practices can vowtheir energies and resources to stiffly serving their customers. The service firms humanresource attention practices can create an environment that elicit more positive, courteous andhelpful behavior from the employees toward customers. In turn, the behavior that employees display provide positively impact on service quality.Physical Evidence Physical evidence of service includes all the tangible representations of service such as clear signage,good ventilation, adequate space, internet presence, equipment and facility. As services areintangible, customers are searching for any tangible cues to help them interpret the nature of theservice experience. For example, in the hotel industry, the design, furnishing, lighting, layout anddecoration of the hotel as well as the appearance of its employees pull up stakes influence customerperce ptions of the service quality and experiences. For theme parks, restaurants, health clubs,hospitals or schools, the physical facility is critical in communicating the service and making theentire customer experience positive. Ambient conditions include background characteristics of theenvironment such as temperature, air quality, lighting, noise, music, and scent affect the five senses.Spatial layout of the equipment, and furnishings arranged, the size and shape of these items, and thespatial relationships among them are also crucial to influence customers perception. make Process is referred to as the procedures, mechanisms and flow of activities by which the service isdelivered i.e. the service delivery and operating systems. Delivering customer expectations dependson how well various steps function together. super bureaucratized services frequently followcomplicated and extensive series of actions, and the logic of the steps involved often confuse thecustomer. Customers may com plain that service firms are slow in response and bureaucratic with the some(prenominal) steps involved. They want easy access to the service process, and they want things to behandled quickly, preferably by the front service employee. Customers describe frustrating experienceswhen they have to run from pillar to post to complete a simple transaction, experience long waitingtime, rules and regulations, and personnel who decline to serve them with the excuse Im notallowed to do this or this is against our policy.ServiceLICAn Ordinance was issued on 19th January, 1956 nationalizing the Life insurance policy sector and Life restitution sess came into existence in the same year. The LIC absorbed 154 Indian, 16 non-Indian insurers as also 75 provident societies-245 Indian and foreign insurers in all. The LIC had monopoly till the late 90s when the Insurance sector was reopened to the private sector. HistoryLife Insurance Corporation of India (LIC) was formed in Sep 1956 after the Pa rliament of India passed the Life Insurance Corporation accomplishment in Jun 1956. The company was created with the objective of spreading life-time insurance more widely, especially to reach all the insurable people in the rural areas and provide them with adequate financial cover at a reasonable cost. Apart from its corporate office, LIC had five zonary offices, 33 divisional offices and 212 branch offices in 1956. The nature of life insurance contracts being long-term coupled with the need to provide a variety of services during the term of the policy, LIC re-organised itself by opening a number of new branch offices. After its re-organisation, operate functions were transferred to branches which were converted to accounting units.OperationsAs on Mar 2008, LIC had 2,048 fully computerised branch offices, 109 divisional offices, eight zonal offices apart from its corporate office. LICs net become connects all the branches with wide area network. The company also has tie-ups with certain banks and service providers to offer on-linepremium prayer facility in select cities. Besides, ECS and ATM premium payment facility to its customers, the company has also commissioned IVRS and in organic law centres at Mumbai, Ahmedabad, Bangalore, Chennai, Hyderabad, Kolkata, hot Delhi, Pune, amongst other cities. LIC has also launched Satellite Sampark offices in order to provide easy access to its policy holders.The company had 340 such offices as on Mar 2008. LIC also provides housing pay by LICHFL. It has also formed an asset management company known as LICMF AMC. The corporation has also extended its operations to the international arena by various JVs and subsidiariesit operates in as many as nine countries.Products ServicesLIC offers a wide array of insurance products to its customers such as insurance plans, reward plans, unit-linked plans, special plans and group scheme. During FY08, the company introduced certain new products such as Profit Plus, Fortu ne Plus, Jeevan Akshay, Jeevan Amrit Amulya Jeevan. As of Mar 2007, total number of agents of the company stood at 1.1 mn while the total number of policies issued was 38.2 mn. The premium earned by the company reported a growth of 41% in FY07 when compared to the previous year. During the year, the company insured 34.28 mn individuals for the first time7 Ps of Services Marketing in LICThe marketing mix is the combination of marketing activities that an arrangementengages in so as to best meet the needs of its targeted market. The Insurance business deals inselling services and therefore due weight-age in the formation of marketing mix for theInsurance business is needed. The marketing mix includes sub-mixes of the 7 Ps ofmarketing i.e. the product, its price, place, promotion, people, process physical attraction.The above mentioned 7 Ps can be used for marketing of Insurance products, in the followingmannerPRODUCTA product means what we produce. If we produce goods, it means tan gible productand when we produce or generate services, it means intangible service product. A product isboth what a seller has to sell and a buyer has to buy. Thus, an Insurance company sellsservices andtherefore services are their product. In India, the Life Insurance Corporation of India (LIC) isthe leading companies offering insurance services to the users. Apart from offeringlife insurance policies, they also offer underwriting and consulting services. When a personor an organization buys an Insurance policy from the insurance company, he not only buys apolicy, but along with it the assistance and advice of the agent, the prestige of the insurancecompany and the facilities of claims and compensation. . In short, the formulation ofproduct-mix should be in the face of in advance(p) product strategy. plot of ground initiating theinnovative process it is necessary to take into consideration the strategies adopted by privateand foreign insurance companies through various plans like Endowment plan, pension plan,ULIP.priceIn the insurance business the pricing decisions are concerned withi) The premium supercharged against the policies, ii) Interest charged for defaulting thepayment of premium and credit facility, andiii) counsel charged for underwriting and consultancy activities. . The pricing ininsurance is in the form of premium rates. The premium rates are revised if there areany significant changes in any of the below factors.a) Mortalityb) Expensesc) InterestPLACEThis component of the marketing mix is related to two master(prenominal) facets i) Managing the insurance personnel, and ii) Locating a branch. .While locating branches, the branch manager needs to consider a number of factors, suchas smooth accessibility, availability of infrastructural facilities and the management of branchoffices and premises. In addition it is also significant to provide safety measures and alsofactors like office furnishing, civic amenities and facilities, parking facili ties and interioroffice decoration should be given proper attention. Thus the place management of insurancebranch offices needs a new vision, distinct approach and an innovative style. This is essentialto make the work place conducive, lovely and proactive for the generation of efficiencyamong employees. The branch managers need professional excellence to make placedecisions productive.PROMOTIONAdvertising and Publicity, organization of conferences and seminars, bonus topolicyholders are neutral communication. Arranging exhibitions, participation in fairsand festivals, rural wall paintings and publicity drive through the mobile publicity van unitswould be effective in creating the impulse buying and the rural prospects would be easilytransformed into actual policyholders.PEOPLEUnderstanding the customer better allows designing appropriate products. creation aservice industry which involves a high level of people interaction, it is very important to usethis resource efficiently in order to converge customers. Training, development and strongrelationships with intermediaries are the key areas to be kept under consideration. Trainingthe employees, use of IT for efficiency, both at the staff and agent level, is one of theimportant areas to look into.PROCESSThe process should be customer friendly in insurance industry. The speed and accuracyof payment is of great importance. IT Data Warehousing will smoothen the processflow. IT will help in servicing large no. of customers efficiently and bring down overheads.Technology can either musical accompaniment or supplement the channels of distribution costeffectively. It can also help to improve customer service levels. The use of data warehousingmanagement and mining will help to find out the profitability and potential of variouscustomers product segments.PHYSICAL EVIDENCEThe physical evidence are includes such as policy document, statements, intimationletter, uniforms of personnel, vending machine of LIC enquiry o ption , LIC logo and their awards.AXIS BANK bloc Bank Limited was the first of the new private banks to have begun operations in 1994, after the Government of India allowed new private banks to be established. The Bank was promoted jointly by the Administrator of the specified travail of the Unit Trust of India (UTI I), Life Insurance Corporation of India (LIC) and General Insurance Corporation of India (GIC) and other four PSU insurance companies, i.e. National Insurance Company Ltd., The New India Assurance Company Ltd., The Oriental Insurance Company Ltd. and United India Insurance Company Ltd. The Bank today is capitalized to the extent of Rs. 358.56 crores with the public holding (other than promoters) at 57.60%. The Banks Registered status is at Ahmedabad and its Central Office is primed(p) at Mumbai. Presently, the Bank has a very wide network of more than 701 Branch offices and Extension Counters. The Bank has a network of over 2854 ATMs providing 24 hrs a day banking co nvenience to its customers. This is one of the largest ATM networks in the country. The Bank has strengths in both retail and corporate banking and is committed to adopting the best industry practices internationally in order to achieve excellence. bloc Bank Limited has been promoted by the largest and the best Financial Institution of the country, UTI. The Bank was set up with a capital of Rs. 115 crore, with UTI contributing Rs. 100 crore, LIC Rs. 7.5 crore and GIC and its four subsidiaries contributing Rs. 1.5 crore each.THE SERVICE MARKETING MIX OF AXIS BANKPRODUCTThe main products of AXIS Bank are Saving Account, Current Account and Demat Account. The other products are kinsperson loan, personal loan, Insurance, Credit cards, etc.For better marketing of products, the products are categorized under Axis Bank and Axis Sales.Products under Axis Bank areSaving AccountCurrent AccountForex Department lucre AccountsProducts under Axis Sales areHome loanPersonal loan,Demat AccountP RICEThe price of the product depends upon the services provided by the Bank on the respective product to the customers. Detailed pricing changes from time to time and the same can be found on the website of Axis bank.PLACEPlace plays an important role in tangibilizing service offerings. Quality of service is perceived by many customers in the form of place of delivery- locational appeal, interiors, ambience, etc. If a bank is located in a crowded market the place or location will be a negative tangibilizes. Providing excellent tangibles in the form of place or location and interiors is particularly important for appealing to the customers segment. More recently, some of the private banks in India like AXIS Bank are providing very attractive tangibles in the form of their locations, exteriors and interiors.PROMOTIONPromotion can tangibilize services in different formsVisualizationAssociationPhysical representationDocumentation.Visualization tangibilizes services through hoardings, TV and bring out campaigns or advertisements. Physical representation in services has a good promotional appeal to customers like use of colors to play wealth and status. Service providers use documentation in their promotions in support of their claims for dependability, popularity and responsivenessPEOPLEPeople are a common factor in every service. And people tangibilize services. Good people (means good performance) make good or successful services. Bad performers deliver bad services.PROCESSCustomer be business process- Process innovations and continuous improve-ment through people involvement.Result oriented approach- Each process has been designed by first planning the desired results.Axis Bank is constantly taking initiatives to offer the best in class service that seek to conjure up customer experience.PHYSICAL EVIDENCEReduce paper usage- Due to technological innovations such as use of Finacle software for core banking solutions.It has positioned it self as a bank which gi ves higher(prenominal) standard of services through product innovation.Satisfies the diverse need of individual and corporate clients.It is customer centric, and service oriented .Now we will compare the strategies of both axis bank and adlabs,LIC provides life insurance policy, like Endowment plan, pension plan,ULIP.Axis bank also offers variety of products like Saving Account, Current Account and DematAccount. The other products are Home loan, personal loan, Insurance, Credit cardsIn LIC the pricing decisions are concerned with i) The premium charged against the policies, ii) Interest charged for defaulting the payment of premium and credit facility, and iii) Commission charged for underwriting and consultancy activities. . The pricing in insurance is in the form of premium rates.The price of the product depends upon the services provided by the Bank on the respective product to the customers.LIC consider a number of factors, such as smooth accessibility, availability of infrastru ctural facilities and the management of branch offices and premisesQuality of service is perceived by many customers in the form of place of delivery- locational appeal, interiors, ambience, etc. If a bank is located in a crowded market the place or location will be a negative tangibilizes. AXIS Bank are providing very attractive tangibles in the form of their locations, exteriors and interiors.Advertising and Publicity, organization of conferences and seminars, incentive topolicyholders are impersonal communication. Arranging exhibitions, participation in fairs and festivals, rural wall paintings and publicity drive through the mobilepublicity van.Visualization tangibilizes services through hoardings, TV and print campaigns or advertisements. Physical representation in services has a good promotional appeal to customers like use of colors to symbolize wealth and status. Service providers use documentation in their promotions in support of their claims for dependability, popularity and responsiveness.LIC being a service industry which involves a high level of people interaction, it is very important to use this resource efficiently in order to satisfy customers. Training, development and strong relationships with intermediaries are the key areas to be kept under consideration.In axis bank Good people (means good performance) make good or successful services. Bad performers deliver bad services.The process should be customer friendly in insurance industry. The speed and accuracy of payment is of great importance. IT Data Warehousing will smoothen the processflow. IT will help in servicing large no. of customers efficiently and bring down overheadsCustomer defined business process- Process innovations and continuous improve-ment through people involvement.Result oriented approach- Each process has been designed by first planning the desired results.Axis Bank is constantly taking initiatives to offer the best in class service that seek to enhance customer experi encThe physical evidence are includes such as policy document, statements, intimationletter, uniforms of personnel, vending machine of LIC enquiry option , LIC logo and their awardsIn Axis bank physical evidenceReduce paper usage- Due to technological innovations such as use of Finacle software for core banking solutions.It has positioned it self as a bank which gives higher standard of services through product innovation.CONCLUSIONThere is littile bit similarity in the service marketing mix of LIC and axis bank but there is difference in the marketing strategy of the both companies