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1、Chapter 6Educating Customers and Promoting the Value Proposition Life is for one generation; a good name is forever JAPANESE PROVERBEducation costs money but then so does ignorance.SIR CLAUS MOSERCommunication is the most visible or audiblesome would say intrusive-of marketing activities, but its va
2、lue is limited unless it is used intelligently in conjunction with other marketing efforts. An old marketing axiom says that the fastest way to kill a poor product is to advertise it heavily. By the same token, an otherwise well-researched and well-planned marketing strategy, designed to deliver, sa
3、y, new Web-based services at a reasonable price, is likely to fail if people lack knowledge of the service, how to access it, and how to use it to best advantage. It's for good reason that we define the marketing communication element of the 8 Ps as Promotion and education.Through communication,
4、 marketers explain and promote the value proposition that their firm is offering. They inform existing or prospective customers in the target segments about service features and benefits, price and other costs, the channels through which service is delivered, and when and where it is available. Wher
5、e appropriate, they marshal persuasive arguments for using a particular service and seek to create preference for selecting their firm's brand. And through both personal instructions from customer contact employees and use of educational tools, marketers seek to help customers make well-informed
6、 choices and become effective participants in service delivery processes. Much confusion surrounds the scope of marketing communication. Some people still define this element of the services marketing mix too narrowly. Communications must be viewed more broadly than as just154the use of paid media a
7、dvertising, public relations, and professional salespeople. Today, there are many other ways for a service business to communicate with current and prospective customers. The location and atmosphere of a service delivery facility, corporate design features such as the consistent use of colors and gr
8、aphic elements, the appearance and behavior Of employees, the design of a web siteall con- tribute to an impression in the customer's mind that reinforces or contradicts the specific content of formal communication messages. The past few years have seen the emergence of new and exciting opportun
9、ities for reaching prospects through the Internet, with degrees of targeting and message specificity that were previously unimaginable, especially in consumer markets.In this chapter we explore the following questions: 1. What is distinctive about the nature of marketing communications for services?
10、2. What are the elements of the marketing communications mix and what are the strengths and weaknesses of each major element in a services context?3. How does the level of customer contact affect communication strategy?4. How should marketing communication objectives be defined?5. What is the potent
11、ial value of the Internet, cellular, and other new electronic media as communication channels?THE ROLE OF MARKETING COMMUNICATIONIn a service setting, marketing communications tools are especially important because they help create powerful images and a sense of credibility, confidence, and reassura
12、nce. Marketing communications, in one form or another, are essential to a company's success. Without effective communications, prospects may never learn of a service firm's existence, what it has to offer them, the value proposition of each of its products, and how to use them to best advant
13、age. Customers might be more easily lured away by competitors and competitive offerings, and there would be no proactive management and control of the firm's identity. Let's look at some specific tasks that can be performed by marketing communication. Adding Value Through Communication Conte
14、nt Information and consultation represent important ways to add value to a product. Prospective customers may need information and advice about what service options are available to them, where and when these services are available, how much they cost, and what specific features, functions, and serv
15、ice benefits there are. Companies also use marketing communications to persuade target customers that their service product offers the best solution to meet those customers' needs, relative to the offerings of competing firms. See Figure 6.1 for an advertisement about how Wausau conveys this, bu
16、ilding on its in-depth expertise in preventing and managing accidents in the workplace.Communication efforts serve not only to attract new users but also to maintain contact with an organization's existing customers and build relationships with them. Nurturing customer relationships depends on a
17、 comprehensive a. n d up-to-date customer database, and the ability to make use of this in a personalized way. Techniques for keeping in touch with customers and building their loyalty include direct mail and contacts by telephone or other forms of telecommunication, including email, web sites, and
18、even text messages sent via mobile phone. Doctors, dentists, and household maintenance services often post annual checkup reminders to their customers. Some businesses even send birthday and anniversary cards to155Figure 6.1Wausau Promotes Its lnnovative“Peoolework”Program, targeted at EmployeesCour
19、tesy of Wausau Insurance.valued customers. Banks and utility companies often include a brief newsletter with their account statements or print customized information on each statement in an effort to cross-sell additional services.COMMUNICATING SERVICES PRESENTS BOTHCHALLENGES AND OPPORTUNITIESTradi
20、tional marketing communication strategies were shaped largely by the needs and practices associated with marketing manufactured goods. However, several of the differences that distinguish services from goods have a significant effect on the ways we approach the design of marketing communication prog
21、rams in serviceTable 6.1Advertising Strategiesfor OvercominglntangibilitySource: Banwari Mittal and Julie Baker, "Advertising Srtategies for Hospitality Services." CorneU Hotel and Restaurant Administration Quarterly, 43 (April 2002): 53. Copyright Cornell University. All fights reserved.
22、Used by permission.Businesses.1 In particular, we need to consider the implications of intangibility in service performance, customer involvement in production, the role of customer contact personnel, the difficulty of evaluating many services, and the need to bring demand and supply into balance.Ov
23、ercoming the Problems of intangibilityBecause services are performances rather than objects, their benefits can be difficult to communicate to customers, especially when the service in question does not involve any tangible actions to customers or their possessions.2 Banwari Mittal suggests that int
24、angibility creates four problems for marketers seeking to promote its attributes or benefits: abstractness, generality, nonsearchability, and mental impalpability.3 Emphasizing that service marketers need to create messages that clearly communicate intangible service attributes and benefits to poten
25、tial consumers, he and Julie Baker discuss the implications of each of these problems4 and propose specific communications strategies for dealing with them (see Table 6.1). Abstractness. Because abstract concepts such as financial security, expert advice, or safe transportation do not have one-to-on
26、e correspondence with physical objects, it can be challenging for marketers to connect their services to those concepts. Generality. Generality refers to items that comprise a class of objects, persons, or events-for instance, airline seats, flight attendants, and cabin service. These general classe
27、s do have physical analogs, and most consumers of' the service know what they are, but a key task for marketers seeking to create a distinctive value proposition is to communicate what makes a specific offering meaning- fully different from (and superior to) competing offerings. Nonsearchability
28、. Nonsearchability refers to the fact that intangibles cannot be searched or inspected before they are purchased. Physical service attributes, such as the appearance of a health club and the type of equipment installed, can be checked in advance, but the experience of working with a trainer can only
29、 be determined through extended personal involvement. And, as we noted in Chapter 2, credence attributes, such as a surgeon's expertise, must be taken on faith.157Mental impalpability. Many services are sufficiently complex, multidimensional, or novel that it is difficult for consumersespecially
30、 new prospectsto under- stand what the experience of using them will be like and what benefits will result.Commonly used strategies in advertising include the use of tangible cues when-ever possible, especially for low-contact services that involve few tangible elements. It's also helpful to inc
31、lude "vivid information" that catches the audience's attention and produces a strong, clear impression on the senses, especially for services that are complex and highly intangible? Consider the advertising campaign created by Accenture, the international consulting firm, to dramatize
32、the abstract notion of helping clients capitalize on innovative ideas in a fast-moving world. It features the champion golfer, Tiger Woods, in eye-catching situations to highlight the firm's ability to help clients "develop the reflexes of a high-performance business" (Figure 6.2).Figu
33、re 6.2Accenture Promotes ltsAbility to turn Innovative ideas intoResultsCourtesy of Accenture158RESEARCH INSIGHTS 6.1Visualization and Comparative Advertising for ServicesExperts often recommend using visual stimuli and documentation in order to overcome service intangibility and better communicate
34、a firm's value proposition. To test the effectiveness of visualization and documentations strategies for hedonic and utilitarian services, academic researchers conducted a laboratory experiment.They showed 160 student subjects one print advertisement each, and then measured their responses. An a
35、d for a spring-break travel service was used as the hedonic service in the study, and one for a bank with specific student offers was used for the utilitarian ser- vice. In the visualization condition, one picture of the hotel and one of young adults in an ocean-side pool were added to the text for
36、the hedonic service. For the bank, photos of the exterior of the bank building and an ATM were shown. The study then compared the text- only condition with the ad that contained the pictures. Documentation was operationalized using an indirect comparative advertising copy stating the high performanc
37、e of the service provider along the three most important attributes for the respective two services.The findings showed that for both types of ser-vices, ads based on a visualization strategy were perceived as being more informative than text-only ads. Participants who viewed the visualization ads p
38、erceived the services to be of higher quality and were more likely to say they intended to use these services. By contrast, documentation worked well for the hedonic service but not the utilitarian one (further research is needed to explain why).The study has two important managerial implications.1.
39、 Use pictures to tangibilize the value proposition. Whether you market a hedonic or a utilitarian service, show pictures and photos to communicate the potential benefits of your service. For example, Hilton Hotels Corp. started using photos to market its Chef's Signature Catering Collection, rep
40、lacing its more traditional method of sending text-only menu information to clients who wanted to plan a dinner at the hotel. One Hilton executive noted, "people eat with their eyes, and when they see something they can relate to, something they can recognize, it develops a level of confidence
41、and comfort level for the customer."2. Comparative data help readers to visualize hedonic services. The study indicated that hedonic services can benefit from adding comparative information into their ads. For example, if Six Flags Great America advertises that its Deja vu roller coaster is 196
42、 ft (60 m) tall com- pared to only 120 ft of other top roller coasters, and that its speed is up to 65 mph (104 kin/h), compared to only 50 to 60 mph for other roller coasters, then one should expect readers to better visualize the Defa vu as one of the tallest and fastest roller coasters in the wor
43、ld. Simply listing the height and speed alone wouldn't be as effective-readers need the benchmarking provided by the comparative information.Source: Adapted from Donna J. Hill, Jeff Blodgett, Robert Baer, and Kirk Wakefield, "An Investigation of Visualization and Documentation Strategies in
44、 Service Advertising." Journal of Service Research, 7, no. 2 (2004): 155-166. As another example, an ad for a large law firm showed a picture of empty jurors' chairs to draw attention to its trial lawyers' skills in presenting complex cases to juries, which must then withdraw from the c
45、ourtroom to deliberate on the verdict. Similarly, MasterCard's TV and print advertisements emphasize the tangible things that can be purchased with its credit card-complete with a listing of the price of each item. In each ad, all of the items purchased with the card lead to a "priceless&qu
46、ot; experience (a clever and memorable reference to the concept of intangibility). Research Insights 6.1 shows how visualization and comparative advertising affect consumer perceptions of both hedonic services (those that bring pleasure and enjoyment) and utilitarian services (those that are consume
47、d for practical or functional purposes).Using Methaphors to Communicate the Value Proposition Some companies have created metaphors that are tangible in nature to help communicate the benefits of their service offerings. Insurance companies often use this approach to market their very intangible pro
48、ducts. Thus Allstate advertises that "You're in Good Hands," and Prudential uses the Rock of Gibraltar as a symbol of corporate strength. Professional service firms sometimes use metaphors to communicate their value propositions more dramatically and to emphasize key points of differen
49、ce relative to competing alternatives.6 When possible, advertising metaphors159Figure 6.3 AT Kearney Uses Bear Traps as a Metaphor for Problems"What Did Your Consultants Leave Behind," Copyright A. T. Kearney. All rights reserved. Reprinted with permission.should highlight how service bene
50、fits are actually provided.7 AT Kearney emphasizes that it includes all management levels in seeking solutions, not just higher-level management. Its clever advertisement, showing bear traps across the office floor, draws attention to the way in which the company differentiates its service through c
51、areful work with all levels in its client organizations, thus avoiding the problems left behind by other consultants who work only with top management (Figure 6.3).A challenge facing DHL, the international logistics and delivery firm, was to promote the efficiency of its import express service. Its
52、advertising agency's clever solution was to use the easily grasped metaphor of a heavily knotted string to represent160Figure 6.4 DHLUses a CleverMetaphor to Communicate Its Value PropositionCourtesy of DHL Express Singaporehow complex importing can be, and a straight string to show how easy it
53、would be using DHL's service (Figure 6.4).Facilitate Customer Involvement in ProductionWhen customers are actively involved in service production, they need training to help them perform well-just as employees do. Improving productivity often involves making innovations in service delivery. Howe
54、ver, the desired benefits won't be achieved if customers resist new, technologically based systems or avoid self-service alternatives.One approach to training customers, recommended by advertising experts, is to show service delivery in action. Television and videos are good media, because of 16
55、1their ability to engage the viewer as filmed or animated material displays a seamless sequence of events in visual form. Some dentists show their patients videos of surgical procedures before the surgery takes place. Shouldice Hospital in Toronto, featured in Case 16 on pages 592601, specializes in
56、 hernia repair. It offers prospective patients an opportunity to view an ordinal simulation and explains the hospital experience with hernia repair on its web site (see www. ). This educational technique helps patients prepare mentally for the experience and shows them what role they need to play in
57、 service delivery to ensure a successful surgery and a satisfying experience. Advertising and publicity can make customers aware of changes in service features and delivery systems. Marketers often use sales promotions to motivate customers, offering them incentives to make the necessary changes in
58、their behavior. Publicizing price discounts is one way to encourage self-service on an ongoing basis. At self-service gas pumps, for instance, the price difference versus full-service is often substantial. Other incentives to change include promotions that offer a chance to win a reward. And, if nec
59、essary, well-trained customer contact personnel can pro- vide one-to-one tutoring to help customers adapt to new procedures.Help Customers to Evaluate Service OfferingsEven if customers understand what a service is supposed to do, they may have difficulty distinguishing one firm from another and knowing what level of performance to expect from a particular supplier. Possible solutions include providing tangible clues related to service performance, highlighting the quality of equipment and fa
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