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Discussing the similarities and differences in designing and managing marketing programs for tangible goods and brands versus services The growth of business, combined with an increase in the number of service offerings, underscores the importance of understanding effective design and management programs for services versus goods in international markets. The current paper examines the similarities and differences in marketing of tangible goods and services. Differences in marketing of tangible goods and services are caused by the essences of these two concepts. A service is an intangible act or performance by one party to another, which involves physical product. It also can be a process that creates benefits by facilitating a desired change in customers themselves, physical possessions or intangible assets. From the economic point of view, it is an activity that does not result in ownership (Tynan, 15).
Services, unlike products, are intangible commodities. A service is the provision of work, accommodations, or ministrations desired by a consumer. Consumers pay for a service as they would for a product. Already more people are employed in the provision of services than in the manufacture of products, and this area shows every indication of expanding even further. Services, like products, require marketing. Usually, service marketing parallels product marketing with the exception of physical handling.
Services must be planned and developed carefully to meet consumer demand. For example, in the field of temporary personnel, a service that continues to increase in monetary value, studies are made to determine the types of employee skills needed in various geographical locations and fields of business. Because intangibles are more difficult to sell than physical products, promotional campaigns for services must be even more aggressive than those for physical commodities. Through extensive promotion, temporary-personnel agencies have convinced many companies that hiring on a temporary basis only in times of need is more economical than hiring permanent, full-time personnel. Marketing mix (4 Ps) can help to underline the different approaches to service vs. products marketing.
Talking about the first P product, it is essential to say that tangibility is the main aspect here. Products are much easier to sell because consumers can touch, feel, taste, smell, etc. them, while opinion about services can formed only after the purchase, when a consumer has already paid the money. The nature of a service lies in its palpable and mental intangibility, inseparability, variability, perishability and ownership. Pricing of services and products is also quite different. Products are usually priced based on the cost of raw materials, labor, packaging, transportation plus the desired markup.
In pricing of services many more factors are considered. Many times customers do not see why a service is priced so highly, and the reasons for it that time drives value, variable costs for services are higher than they appear, intangibility and invisibility of back-stage operations, services are more or less valuable for different customers and labor costs are generally higher for services than for products. Pricing of products and services is similar in the following: increasing the perceived value of product / service for customers, at the same time decreasing the cost for them, can increase net value: get more for less. The third P is mainly about sales techniques, physical distribution, modification and service. Both for products and services place is a difficult P. It is extremely difficult to build effective distribution network for selling products, just as much as it is difficult for service companies to have good sales people who would win and keep the customers.
Promotion serves a very important role in an overall success of a service and product. They equally need to be introduced to customers, who must be convinced to make a purchase and want to do that again. Promotion creates additional value for product or service - people do not just buy products any more. They also buy the benefit this product or service gives them, whether it is better image, good looks or utility.
In order to successfully create, develop and sell both services and products, effective marketing needs to come into play. Businesses must strive daily to outdo competitors. The methods available to businesses for distinguishing their commodity from others in the market are subject only to their ingenuity. Such methods may include product improvement, a unique promotional campaign, a new twist in servicing, a change in distribution channels, or an enticing price adjustment. Works cited: Beckwith, Harry. Selling the Invisible: A Field Guide to Modern Marketing.
Warner, 1997. Kotler, Philip. Marketing Management: Analysis, Planning and Control. Levitt, Theodore. The Marketing Imagination.
Free Press, 1986. Tynan, Caroline. Services Marketing, Nottingham University, 2001
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Research essay sample on Product Or Service Similarities And Differences
