Type And Quality Of Service Offering example essay topic

Table of Contents 1.0 INTRODUCTION 2 2.0 SERVICES 2 3.0 SERVICESCAPE DEFINED 3 4.0 ROLE OF SERVICESCAPE 4 5.0 PERCEIVED RISK 5 6.0 BRANDING 5 7.0 ATMOSPHERICS 7 7.1 AMBIENT CONDITIONS 8 7.2 SPACE AND FUNCTION CONDITIONS 8 7.3 SIGNS, SYMBOLS AND ARTEFACTS 8 8.0 BEHAVIOUR 9 9.0 CONCLUSION 10 LIST OF REFERENCES 11 ONLINE JOURNALS 11 ONLINE SOURCES 12 TEXTS 12 LECTURE CONTENT 13 APPENDICES 14 APPENDIX 3.0: AN EXPANDED MARKETING MIX FOR SERVICES 14 APPENDIX 3.1: PERCEIVED RISK 15 APPENDIX 5.0: AN EXAMINATION OF PERCEIVED RISK, INFORMATION SEARCH AND BEHAVIOURAL INTENTIONS IN SEARCH, EXPERIENCE AND CREDENCE SERVICES. 16 APPENDIX 5.1: PERCEIVED RISK, INFORMATION SEARCH AND BEHAVIOURAL INTENTIONS IN SERVICES. 17 APPENDIX 6.0: BRANDING IS NOT OLD SCHOOL 18 APPENDIX 7.0: COMPONENTS OF THE PHYSICAL ENVIRONMENT. 19 APPENDIX 8.0: FRAMEWORK FOR UNDERSTANDING THE IMPACT OF THE PHYSICAL ENVIRONMENT 20 1.0 Introduction The purpose of this review is to critically evaluate academic literature on the subject of the servicescape. It is acknowledged that each topic covered in this review is potentially more comprehensive than discussed here. For the purpose of this review, each topic will be confined to succinct points of relevance with focus on the concept, role and importance of the servicescape.

A number of journal articles and texts will be reviewed, their findings discussed and compared. A definition of services and context of the servicescape will be followed by discussion of the role of the servicescape in the marketing of service organisations. Branding and its relationship to the servicescape will be addressed, followed by discussion of the influence of atmospherics within the servicescape and their effects on consumer behaviour. Finally, the importance to marketers of the concept of the servicescape and relevant theories will be outlined throughout this review. 2.0 Services Services are defined as delivery of an experience or performance (Bitner. 1992).

Johns (1999) defines services as an output of activity, rather than a tangible object. He states 'service processes are frequently differentiated from manufacturing on the basis that they are instant and involve the customer. These characteristics can also be used to differentiate different types of services'. With the advent of the information age, the services industry has grown considerably in recent years.

In developed economies manufacturing is no longer a primary form of production, therefore, services are rapidly becoming the mainstream focus of marketing (Lovelock, Patterson & Walker. 2001). Johns (1999) claims that 'the traditional division between services and goods is long outdated'. His reasons being that customers do not differentiate between the two, but rather, they buy an offering, the value of which may be composed of different elements, some being activities, or services, and others being tangible things, or goods. From a marketer's point of view, strategies for marketing services need to be addressed due to the intangible element of services. Sureshchandar, Rajendran and Anantharaman (2002) identify five factors of service quality found to be critical in the process of the customer's evaluation: 1.

Core service or service product - the content of a service; 2. Human element of service delivery aspects such as reliability, responsiveness, assurance, empathy and service recovery, that are part of the human element in service delivery; 3. Systematization of service delivery - the processes, procedures, systems and technology that make a service seamless; 4. Tangibles of service - the equipment, signage, appearance of employees, and the man-made physical environment surrounding the service, which is commonly known as the "servicescape"; 5.

Social responsibility - the ethical behaviour of the service provider. (Sureshchandar, Rajendran & Anantharaman. 2002) It is therefore surmised that the tangibles of the service, as noted above, can assist the consumer and services staff to assess the type and quality of service offering. The context of the servicescape will now be defined. 3.0 Servicescape Defined The servicescape is defined as 'the total configuration of environmental dimensions' (Bitner 1992). This definition is supported by Lovelock, Patterson and Walker (2001), who maintain that as part of the marketing mix for services the servicescape, or physical evidence, serves to present tangible cues in the absence of any tangible good.

(Appendix 3.0) Bitner (1992) goes on to describe the servicescape as: 'a variety of objective environmental factors perceived by both customers and employees that both groups may respond to cognitively, emotionally, and physiologically'. The consumer's internal responses to the service environment have been found to influence behaviour and affect social interactions between and among customers and employees (Bitner. 1992; Aubert-Gamet. 1997). It is therefore surmised that the role of the servicescape can assist to define the type and quality of the service itself and reduce the consumers' perceived risk prior to purchase. (Appendix 3.1).

4.0 Role of Servicescape The elements of the servicescape assist to inform prospective customers of the type of service offered and to differentiate the service from others. The servicescape offers the consumer tangible cues of the quality and value of the service (Burgess. 2001; Bitner. 1992). Hogg and Gabbott (1998) support this theory to say that the use of symbols, logos, and tangible cues all contribute to defining a corporate image or brand. Zeithaml and Bitner (1996) concur that the servicescape it is a 'visual metaphor for the intangible service', meaning that the servicescape serves to identify the organisation through the use of tangible evidence.

Marketers need to be aware of the power of the servicescape to influence the consumer's perception of the type, quality and manner of the service offering. Bitner (1992) affirms that perceptions of the servicescape influence the way people rate the service business. She says 'the environment serves as a mnemonic in differentiating among firms'. In the absence of a tangible good, the physical surroundings and other visible and ambient cues can have a vital effect on consumer's perceptions and perceived risk of the service quality (Lovelock, Patterson & Walker.

2001). Perceived quality, according to Zeithaml (1987), is the customer's judgement about an entity's overall excellence or superiority (cited in Parasuraman, Zeithaml & Berry. 1998). 5.0 Perceived Risk The perceived risk (i. e., consequence and uncertainty) associated with pre-purchase of services is deemed to be greater than that of a product, due to the intangible elements of the service and because outcomes of a service exchange are uncertain.

This ultimately results in extended search and purchase effort (Mitra, Reiss & Capella. 1999; Stell & Donoho 1996; Hoffman & Turley 2002). (Appendix 5.0) The three types of attributes associated with the pre-purchase decision are: 1. Search attributes - those that can be determined prior to purchase; 2. Experience attributes - can only be assessed during and after the service process, and; 3. Credence attributes - cannot be evaluated conclusively.

(Hoffman and Turley. 2002; Lovelock, Patterson & Walker, 2001; Zeithmal & Bitner, 1996). Credence and experience attributes respectively, are the most dominant in relation to services because services have fewer physical elements than products by which to judge quality and outcomes (Appendix 5.1). Mitra, Reiss and Capella (1999) list the six specific types of perceived risk for services as: financial, performance, physical, social, psychological and temporal. Marketers can reduce the perceived risk for consumers by standard ising the servicescape and delivery, providing information, offering tangible cues to assess quality and fostering loyalty through branding (Services Marketing. 2003.

Lecture 2. USC). The role of branding through the servicescape will now be discussed. 6.0 Branding Numerous articles have recently been written with regard to the branding of services.

For this reason, the concept of branding is considered to be an important factor for services, and will be addressed in relation to the servicescape. Krishnan & Hartline (2001) confirm that branding for services is more critical than for goods because a service is more difficult to define. The servicescape can assist to identify the brand of the service and reduce levels of perceived risk for the consumer. Hoffman and Turley (2002) state that 'By packaging the service encounter, atmospherics send quality cues to consumers and adds value to the service encounter in terms of image development'. By branding the servicescape to include tangible elements such as staff uniforms, colours, logos, and atmospherics, the consumer attributes a level of perceived quality to that service and the service is positioned within the consumer's perception (Krishnan & Hartline. 2001; Bitner.

1992; Underwood, Bond & Baer. 2001). Krishnan and Hartline (2001) believe that 'the brand becomes an important tool for the marketer as the consumer uses it as a cue to infer certain product attributes, like quality'. Balmer (1998) states that corporate identity encapsulates 'a company's ethos, aims and values, and presents a sense of individuality that can help to differentiate the organisation within its competitive environment' (cited in McDonald, Chernatony & Harris.

2001) (Appendix 6.0). Simons and Dib b (2001) affirm that branding plays a significant role for services because strong branding serves to '... increase customers' trust of the invisible, enable them to better visualise and understand the intangible and reduce customers' perceived financial, social or safety risk' (cited in: Jones, Hillier, Shears & Clarke-Hill. 2002). Berry and Parasuraman support this assertion and state that: Strong service brands help customers to visualise, understand and believe in the service. They reduce customers' perceived monetary, social, or safety risk in buying services that are difficult to evaluate prior to purchase (Berry & Parasuraman.

1991. p 119-20). Review of literature shows that the branding of a service organisation is an important consideration for marketers because of the intangibility of the service offering. The atmospherics of the servicescape serve as powerful tools in establishing the service identity, and will now be discussed. 7.0 Atmospherics Atmospherics are comprised of three elements: ambient conditions; space and function conditions; and signs, symbols and artefacts (Zeithaml & Bitner. 1996). In contrast to this, Aubert-Gamet (1997) lists the three basic categories of atmospherics of the servicescape as: ambient factors, design factors, and social factors (Appendix 7.0).

Although there is a difference of definitions of atmospherics, it can be summarised that 'the dimensions of the physical surroundings include all of the objective physical factors that can be controlled by the firm to enhance (or constrain) employee and customer actions' (Bitner. 1992). Since the 1960's, interest in environmental stimulus and its effect on human behaviour has steadily grown in the field of environmental psychology (Zeithaml & Bitner. 1996, p 527). Hoffman and Turley (2002) agree that the use and study of atmospherics to influence behaviour has recently become of interest to services marketers and psychologists. Hoffman and Turley (2002) and Bitner (1992) concur that a marketer's understanding of the role of atmospherics can be vital to generate an identity for the service provider and influence the positioning and consumer's perception of the service.

The three elements of atmospherics, as addressed by Zeithaml & Bitner (1996) and their specific benefits and affects to the service organisation will be discussed as follows. 7.1 Ambient Conditions Bitner (1992) defines ambient conditions as those that affect the five senses. Ambient factors described by Berry and Parasuraman (1991) are 'background conditions that exist below the level of immediate awareness and typically draw awareness when absent or unpleasant'. Elements such as music, intimacy, lighting, comfort, scent, and colour can have great influence on customer perceptions of expected behaviour and the value of the service. To illustrate the effects of ambient cues, consider a comparison of servicescapes. For example, a McDonalds store has bright colours and lighting and the scent of food, whereas, a cosmetic store has low lighting, hushed tones and the lingering scent of perfumes.

Both servicescapes give the customer ambient cues of the nature of the service and expected social behaviour. 7.2 Space and Function Conditions Physical structure and spatial layout within the servicescape, such as walkways, barriers, counters, and furnishings, offer cues of expected behaviour to the customer and their role in the process of the service delivery (Hoffman & Turley. 2002; Bitner. 1992). These tangible elements define boundaries between consumers and service staff and also assist in informing the customer of the type of service offered. Aubert-Gamet (1997) further expands on the concept of physical elements to say that design factors and functional factors combine together within space and function elements.

She classifies design factors as 'architecture, style and colour', and functional factors as 'layout, comfort, and signage'. 7.3 Signs, Symbols and Artefacts Visible elements, such as signage, logos, staff uniforms and symbols within the servicescape, create a strong brand identity, offering consistency of the value and quality of the service (Berry and Parasuraman. 1991). Hoffman and Tu rely (2002) state 'employees who wear uniforms further influence perceptions by being perceived as more intelligent, more competent, and more interactive'. According to Berry and Parasuraman (1991) 'visual stimuli is far more likely to be apparent to customers than ambient factors. Consequently, design factors have a comparatively greater potential for producing positive customer perceptions and encouraging approach behaviour'.

Both Johns (1999) and Aubert-Gamet (1997) confirm the theory that consumers focus their assessment of service upon tangible aspects whenever possible. Visual elements of the servicescape may be the most powerful of the three types of atmospherics for informing the consumer of the brand, quality and expected behaviour within the service encounter. 8.0 Behaviour Studies of the servicescape have led behavioural psychologists to examine the affects of atmospherics, specifically the elements that influence approach and avoidance behaviours (Topor. 1999; Aubert-Gamet. 1997). Bitner (1992) states 'Approach / avoidance behaviours of employees and customers are determined largely by individual internal responses' (Appendix 8.0).

Mehrabian and Russell (1974) maintain that 'approach behaviours include all positive behaviours that might be directed at a particular place, such as desire to stay, explore, work, and affiliate' (cited in Bitner. 1992). Bitner (1992) and Aubert-Gamet (1997) agree that avoidance behaviour reflects the opposite. Bitner (1992) adds that 'in general, people respond to environments in three ways: cognitively, emotionally, and physiologically.

Their responses influence how they behave in the environment'. Hoffman and Turley (2002) state that 'atmospherics facilitate the categorization of service encounters, thereby, facilitate the selection of appropriate script behaviors and enhance the likelihood of a successful service transaction'. Bennett and Bennett (1970) support this statement to say that 'all social interaction is affected by the physical container in which it occurs' (cited in Topor. 1999).

Furthermore, in addition to its effects on individual behaviours, the servicescape can influence the nature and quality of customer and employee interactions. The servicescape has only recently become an area of interest for marketers, therefore, based on literature reviewed, further examination of the servicescape and its elements will be necessary to fully understand its value and meaning to marketers. 9.0 Conclusion This review has defined the concept of the servicescape and its importance to marketers. Academic literature and texts show that the effects of atmospheric cues of the servicescape have a vital role in consumer assessment of the service delivery. Through deliberate management of the servicescape and further research and understanding, service providers and marketers may be able to reduce consumers' perceived risk factors, create brand loyalty and manage behaviour of both the consumer and employees within the servicescape environment. List of

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Servicescapes: 'The Impact of Physical Surroundings on Customers and Employees. ' Journal of Marketing. Vol 56. Issue 2. pp. 52-76. New York. Available: web (27/02/03). Hoffman, K.D., & Turley, L.W. 2002.
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Marketing Services. The Free Press, NY. Hogg, G. & Gabbott, M. (ed). 1998.
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p 24. Appendix 3.1: Perceived risk Source: Services Marketing 2003.
MG 211. Lecture # 2. Appendix 5.0: An examination of perceived risk, information search and behavioural intentions in search, experience and credence services. Authors: Kaushik Mitra, Michelle C. Reiss, Louis M. Capella THE JOURNAL OF SERVICES MARKETING Volume 13 Number 3 1999 pp.
208-228 EXTRACT Past scholars have argued that service purchases are more uncertain than the purchase of goods / products (Murray and Sch later, 1990;
Gu seman, 1981).
As all services fall along a continuum from search based to credence based, the difficulty of obtaining pre-purchase information and knowledge increases as one moves from search-based to credence-based services. It has been observed that credence-based services are associated with a higher degree of customization (Guiltinan, 1987;
Zeithaml, 1981) and require the personal intervention of the service provider (Guiltinan, 1987).
The variability and the non-standardized nature of credence services lead to uncertainty about the actual cost and product performance (Murray and Schalater, 1990) and make it difficult for the consumer to evaluate alternatives before purchase (Guiltinan, 1987).
Such a predicament results in a reduced knowledge level about a particular service. For example, a consumer, facing a lawsuit, may find it difficult to choose between two lawyers, if he has not previously received legal advice from either of them. Moreover, a consumer may even experience opposite results (satisfaction / dissatisfaction) from different service encounters with the same provider. The heightened uncertainty resulting from the lack of knowledge and information implies higher perceived risk on the part of the consumer. Finally, a consumer of a credence service is faced with numerous alternatives with few perceptible differences owing to high customization and to minimal information about alternatives. Hence, a consumer is likely to purchase the service first and then evaluate and learn about it (Young, 1981).
This process necessarily entails higher perceived risk on the part of the consumer. Conversely, search-oriented services are not likely to be tailor-made and not likely to require special judgment in the delivery of the service (Guiltinan, 1987).
The standardized nature of search services, in contrast to credence services, makes it feasible for customers to evaluate alternatives and be knowledgeable about the buying consequences before embarking on a purchase decision. A consumer in such a situation is cognizant of the service needed, forms attitudes, makes evaluations, and finally arrives at the purchase decision. Thus, a consumer is cognitively aware of facets of the service (i.e. more knowledgeable) before making a buying decision. From the preceding discussion, we can infer that the purchase of a search-based service is likely to be associated with increased certainty and, consequently, lower perceived risk. Available: web 22/04/03 Appendix 5.1: Perceived risk, information search and behavioural intentions in services. Source: Mitra, K., Reiss, M. & Capella, L. 1999.
Vol 13. No. 3. Available: web 22/04/03 Appendix 6.0: Branding is not old school 10 May 2001 by Holly Winnall, Core Marketing Group I was sitting in a Client meeting the other day discussing the importance of maintaining a strong and consistent brand image when someone commented that 'branding is old school and we need to focus on retail advertising.
This comment then got me thinking about the strength of brands. What is a brand? Why are they so important? And lastly, where does retail advertising fit with branding? A brand is a bundle of values and expectations, benefits and attributes. A trusted brand is a promise of continuous satisfaction. Brands are now recognised as a business issue, not a marketing issue. And they are big business - in 1990, the top 5 global brands were valued at $220 billion - bigger than the GDP of many countries.
Brands affect product choices. For example in one research study 90% of the respondents preferred a company's product when it was tested unbranded but 75% wouldn't consider buying it once they knew the brand because of that brand's reputation. The strength of a brand can be illustrated very easily by taking one of the well known ones. Coca Cola for example. What words automatically come to mind when you read these two words? For me, Coca Cola says fun, bubbly, friendly, refreshing, summer, beach and excitement. What other soft drink brands conjure up such a clear image of personality and image on the mere mention of the name? Not many. Similarly, Mercedes Benz for me says class, refinement, European, prestige and quality. The fact that everyone has heard of these brands is proof in itself of their strength. Another interesting analogy in demonstrating the strength of a brand is to look at product parity. Let's compare Heinz Baked Beans with homebrand Baked Beans. Although the products are often identical (same ingredients, texture, taste, probably made out of the same factory!) there is such a substantial difference in the brand personalities. The Heinz brand means reliable, family orientated, quality, friendly, trusted, Australian. Homebrand says budget, lack of personality, bachelor. Amazing how people are prepared to pay more for a product because the brand speaks to them in their language and recognises who they are and what they believe in! It is so important to establish the personality of a brand with branded advertising, as opposed to retail 'special offer' advertising. Research shows that when there is low awareness of a brand, there is even lower preference to buy that brand. As brand awareness rises as a result of branded advertising, preference builds, but fairly slowly. It takes two years after advertising begins to create significant increases in preference to buy that brand. Well established brands require lower levels of advertising expenditure than lesser known brands. ie new brands need to spend more than their well known competitors when they are first launching. Available: web (31/03/03) Appendix 7.0: Components of the Physical Environment. Source: Berry, L and Parasuraman, A. 1991.
Marketing Services. The Free Press NY. P 95. Adapted from Julie Baker, The Role of the Environment in Marketing Services: The Consumer Perspective. Appendix 8.0: Framework for understanding the impact of the physical environment Source: Lovelock et al. Figure 8.1. p 220. (Adapted from P Mudie & A Cott am, The Management and Marketing of Services. Butterworth Heinemann, Oxford, 1993).