Marketing Management, Millenium Edition - epiheirimatikotita.gr

202 CHAPTER 11 DESIGNING AND MANAGING SERVICESTable 4.3Strategies for Improving the Match between Demand and SupplyDemand-Side StrategiesUse differential pricing to shift demand frompeak to off-peak periods; movie theaters andcar rental firms do this by lowering pricesduring off-peak periods.Cultivate nonpeak demand to build sales duringoff-peak periods; hotels do this with theirweekend minivacation packages.Develop complementary services to providealternatives for customers during peak periods;many banks do this by providing drop-offboxes for deposits and payments.Install reservation systems to better managedemand levels; airlines, hotels, and physiciansemploy such systems extensively.Supply-Side StrategiesHire part-time employees to meet peak demand;restaurants, stores, and Web-based businessesoften bring in temporary staffers to help outduring holidays and other peak periods.Introduce peak-time efficiency routines to keepproductivity high during periods of highdemand; paramedics often assist physiciansduring busy periods.Increase consumer participation to speedtransactions; this is one reason whysupermarkets are experimenting with selfservicecheckouts where shoppers scan andbag their own groceries.Plan facilities for future expansion to increasesupply; an amusement park can buysurrounding land for later development asdemand increases.Share services with other providers to helpmanage demand; hospitals can do this by sharingmedical-equipment purchases and scheduling.Source: Adapted from W. Earl Sasser, “Match Supply and Demand in Service Industries,” Harvard BusinessReview, November-December 1976, pp. 133–40.PerishabilityServices cannot be stored; once an airplane takes off or a movie starts, any unsoldseats cannot be held for future sale. Perishability is not a problem when demand fora service is steady, but fluctuating demand can cause problems. For example, publictransportationcompanies have to own much more equipment because of higherrush-hour demand, just as Charles Schwab must have sufficient server capacity to handleits brokerage customers’ on-line trading during peak stock market periods.Service providers can deal with perishability challenges in a number of ways.Table 4.3 shows some strategies proposed by Sasser for better matching demand andsupply in a service business. 9MARKETING STRATEGIES FOR SERVICE FIRMSIn addition to the traditional four Ps of marketing, service providers must pay attentionto three more Ps suggested by Booms and Bitner for services marketing: people,physical evidence, and process. 10 Because most services are provided by people, theselection, training, and motivation of employees can make a huge difference in customersatisfaction. Ideally, service employees should exhibit competence, a caring attitude,responsiveness, initiative, problem-solving ability, and goodwill.Companies should also try to demonstrate their service quality through physicalevidence and presentation. Thus, a hotel such as the Four Seasons will develop a look