Deck 13: Services Marketing

Question 1

Identify and discuss the four factors that affect the delivery of service quality. How can service marketers use these factors to their advantage?

Answer 1

Marketing channels for services usually are short and direct, meaning that the producer delivers the service directly to the end user. Some services, however, use intermediaries. For example, travel agents facilitate the delivery of airline services, independent insurance agents participate in the marketing of various insurance policies, and financial planners market investment services. Service marketers are less concerned with warehousing and transportation than are goods marketers. They are very concerned, however, about inventory management, especially balancing supply and demand for services. The service characteristics of inseparability and level of customer contact contribute to the challenges of demand management. In some instances, service marketers use appointments and reservations as approaches for scheduling the delivery of services. Health-care providers, attorneys, accountants, and restaurants often use reservations or appointments to plan and pace the delivery of their services. To increase the supply of a service, marketers use multiple service sites and also increase the number of contact service providers at each site. To make delivery more accessible to customers and to increase the supply of a service, as well as reduce labor costs, some service providers have decreased the use of contact personnel and replaced them with equipment. In other words, they have changed a high-contact service into a low-contact one.

Question 2

How do the target markets of nonprofit organizations differ from the target markets of for-profit organizations?

Answer 2

We must revise the concept of target markets slightly to apply it to nonprofit organizations. Whereas a business seeks out target groups that are potential purchasers of its product, a nonprofit organization may attempt to serve many diverse groups. For our purposes, a target public is a collective of individuals who have an interest in or a concern about an organization, a product, or a social cause. The terms target market and target public are difficult to distinguish from many non-product or social-cause profit organizations. For instance, the target public for ACCION International is anyone interested in supporting international development and relief work. However, the target market for ACCION's advertisements consists of people in developing nations who want microloans to start businesses and spur economic development.

Question 3

How can a service marketer smooth the fluctuations in demand from times of peak demand to times of off-peak demand?

Answer 3

Providers of time-sensitive services often use demand-based pricing to manage the problem of balancing supply and demand. They charge top prices during peak demand and lower prices during off-peak demand to encourage more customers to use the service.

Question 4

Explain how the characteristics of services affect the development and management of marketing mixes.

Question 5

What dimensions do customers use to evaluate service quality?

Question 6

List and explain the six distinguishing characteristics of service products. Then discuss some of the marketing issues and problems associated with each characteristic.

Question 7

Which of the following countries was the world's first service economy?

A) England
B) United States
C) Sweden
D) Canada
E) Germany

Question 8

Which of the following is not a service product?

A) Justin Bieber concert
B) Flight on Southwest Airlines
C) A 100% service satisfaction guarantee
D) Overnight stay at Holiday Inn Express
E) Dry cleaning of a suit

Question 9

Services are usually provided through ____ directed at people or objects.

A) tangible and intangible products
B) physical labor
C) the application of human or mechanical efforts
D) ideas and other intangible efforts
E) knowledge and technology

Question 10

Julianne is planning her upcoming wedding later this year. She has made a list of all the expenses that will be required for the wedding she has planned. Which of the following is not one of the service products associated with Julianne's wedding?

A) Delivery of the wedding cake
B) Hiring a limo and driver
C) Flowers for the church
D) Renting the reception hall
E) String quartet music

Question 11

Discuss the importance of services in the U.S. economy, and explain the growth of services in our economy.

Question 12

How does the promotion of services differ from the promotion of goods?

Question 13

In what ways do perishability and intangibility affect the pricing of services?

Question 14

Service industries account for ____ of the gross domestic product of most developed nations.

A) more than half
B) a small portion
C) approximately 25%
D) nearly all
E) nearly three-quarters

Question 15

How does the marketing mix (product, price, distribution, and promotion) differ in nonprofit marketing?

Question 16

Explain the role of "promises" and "trust" in the successful marketing of a service.

Question 17

What specific marketing problems are experienced by a provider of high-contact services that are not experienced by a provider of low-contact services?

Question 18

All services suffer from heterogeneity. Explain this problem, and discuss different ways that heterogeneity can occur in service delivery.

Question 19

In general, differences between goods and services are determined by the

A) degree of labor intensiveness.
B) type of target market.
C) degree of tangibility.
D) type of provider.
E) degree of consumer contact.

Question 20

Describe how nonprofit marketing differs from for-profit marketing.

Question 21

All of the following are elements of the inseparability characteristic of services except that

A) consumers are involved in production.
B) centralized mass production is difficult.
C) consumption and production are simultaneous.
D) many services cannot be performed without the customer being present.
E) services are easy to standardize and control.

Question 22

Because practically all marketers provide some services, ____ typically do not exist in today's business environment.

A) pure goods
B) pure services
C) customer services
D) service products
E) tangible-dominant products

Question 23

The continuum of tangibility goes from ____ on one end to ____ on the other end.

A) service-dominant products; good-dominant products
B) pure products; pure services
C) rational products; irrational products
D) mostly service goods; mostly product goods
E) easy to see; not easy to see

Question 24

The intangibility aspect of a service means that

A) there is a lack of perceived quality compared to a tangible good.
B) unused capacity cannot be stockpiled or inventoried for later use.
C) consumers may have a problem evaluating service offerings.
D) services are not produced at the same time they are consumed.
E) services are not labor-intensive.

Question 25

Maria asks Glenda what housecleaning service she would recommend in Oakview. Glenda responds that Pristine Cleaning is great if you can be assured that Janice will be the person assigned to your house. Glenda's recommendation addresses which of the following service features?

A) Heterogeneity
B) Intangibility
C) Perishability
D) Inseparability
E) Homogeneity

Question 26

The fact that the first massage Gretchen gives each day is better than the last massage demonstrates the ____ of services.

A) heterogeneity
B) customer contact aspect
C) intangibility
D) inseparability
E) perishability

Question 27

H&R Block, a major tax preparation firm, reported having a problem with its employees being inconsistent in the filing of returns. The firm is experiencing a problem with which of the following characteristics of the service offering?

A) Tangibility
B) Intangibility
C) Perishability
D) Inseparability
E) Heterogeneity

Question 28

The fact the services cannot be inventoried and then sold at a later date is called

A) intangibility.
B) heterogeneity.
C) inseparability.
D) perishability.
E) nonstorability.

Question 29

Services delivered through machinery such as computer kiosks, ATMs, and vending machines can reduce the ____ that comes from increased contact with human employees.

A) intangibility
B) perishability
C) inseparability
D) heterogeneity
E) tangibility

Question 30

Personal trainers cannot complete their work without their clients present because of the ____ feature of services.

A) perishability
B) intangibility
C) inseparability
D) heterogeneity
E) tangibility

Question 31

The more ____ involved with delivering a service, the greater the degree of heterogeneity.

A) mechanical efforts
B) phone contact
C) perishability
D) tangibility
E) human labor

Question 32

Because of a service's ____, standardization and quality are difficult to control.

A) intangibility
B) inseparability
C) homogeneity
D) heterogeneity
E) perishability

Question 33

What should marketers do to promote the consistency and reliability of their services most effectively?

A) Limit the number of employees in their organization
B) Train employees and develop standard procedures for dealing with customers
C) Encourage employees to be creative in solving customer issues and complaints
D) Perform as much of the service as possible before the customer arrives
E) Require employees to be shining, happy people all day long

Question 34

Services have six basic characteristics: intangibility, inseparability of production and consumption, perishability, client-based relationships, customer contact, and

A) labor-intensiveness.
B) orientation toward value.
C) homogeneity.
D) heterogeneity.
E) specialization.

Question 35

Hair stylists find it challenging to standardize their service because the customer must be involved in production (i.e., the haircut). This illustrates which of the following unique features of services?

A) Intangibility
B) Inseparability
C) Perishability
D) Heterogeneity
E) Homogeneity

Question 36

Which of the following services falls closest to the middle of the tangibility continuum?

A) College education
B) Dinner at the Olive Garden
C) A new Ford Escape
D) A custom built yacht
E) A trip to Brazil

Question 37

Many services base their success on building a group of satisfied customers who use their services on a regular basis over long periods of time. This critical component of success is referred to as

A) partnerships.
B) repeated customer contact.
C) inseparable clientele.
D) long-term customers.
E) client-based relationships.

Question 38

Lashawna is a concert promoter who works for singer Kanye West. She works very hard to make sure most of Kanye's concerts are sold out because she understands the concept of perishability, which means

A) because the concert is not tangible, customers will have a difficult time judging its quality in advance.
B) the production of the concert and the consumption of the concert by the fans cannot be separated so tickets must be sold.
C) a high level of interaction will exist between the customers and the musicians, which makes the customers' presence necessary.
D) that if the tickets are not sold, seats will remain empty and they can never be sold to anyone again.
E) that each concert is different and customers will miss a unique experience if they are not present at the concert.

Question 39

According to your text, one perspective from which to view services is as a ____ targeted at a(n) ____.

A) sporting event; spectators
B) concert; audience
C) play; actors
D) performance; audience
E) presentation; spectators

Question 40

Saresh owns the Change-ezz, a salon specializing in the unique hair needs of minority populations. Recently, Saresh has been trying to improve the quality of service received by his customers. However, he has experienced difficulty in finding ways to standardize and control the salon's quality of service. Saresh's problem illustrates which of the following unique features of service?

A) Intangibility
B) Inseparability
C) Perishability
D) Heterogeneity
E) Marketability

Question 41

Client-based relationships are least likely to be developed by

A) appliance repairmen.
B) accountants.
C) beauticians.
D) orthodontists.
E) psychiatrists.

Question 42

If Best Western bundles its rooms with services such as free local phone calls, cable television, wireless Internet access, and complimentary breakfast, these services are known as ____ services.

A) core
B) supplementary
C) bundled
D) business
E) complimentary

Question 43

Service marketers make promises to customers, suggesting that the customer place some degree of trust in the service provider. In this way, service marketers are trying to address the challenge of the service characteristic of

A) perishability.
B) heterogeneity.
C) inseparability.
D) intangibility.
E) customer contact.

Question 44

A sign in a doctor's office waiting room says "Please be courteous of the others waiting with you." The doctor's office is trying to positively influence the ____ aspect of services.

A) tangibility
B) perishability
C) inseparability
D) customer contact
E) heterogeneity

Question 45

Client-based relationships are most likely to be developed by

A) funeral directors.
B) electricians.
C) installers.
D) doctors.
E) bricklayers.

Question 46

The main characteristic of a ____ is that customers are satisfied to the point that they use a service repeatedly over a period of time.

A) service relationship
B) professional marketer
C) high-contact service
D) heterogeneous service
E) client-based relationship

Question 47

Which of the following service characteristics results in variability of service quality yet provides the opportunity for customizing services to match the specific needs of individual customers?

A) Homogeneity
B) Perishability
C) Heterogeneity
D) Intangibility
E) Inseparability

Question 48

One way service businesses communicate a higher level of service quality to their customers is by having their employees be clean, sharp looking, and dressed in appropriate uniforms. This is a way to address the ____ characteristic of services.

A) intangibility
B) perishability
C) tangibility
D) inseparability
E) heterogeneity

Question 49

When service companies change high-contact services into low-contact services, the

A) service becomes more expensive to deliver.
B) quality of the service declines.
C) service becomes less personalized.
D) time required to deliver the service increases.
E) service becomes less standardized.

Question 50

Which of the following statements about customer contact in services marketing is false?

A) Service employees are important in creating satisfied customers.
B) High-contact services are less expensive to deliver because they are typically equipment based.
C) The main principle of customer contact is that satisfied employees lead to satisfied customers.
D) Service companies can minimize customer dissatisfaction by changing high-contact services into low-contact services.
E) Employee training programs are an effective way to ensure good customer contact and reduce problems.

Question 51

The necessary interaction between service provider and customer that allows a service to be delivered is called

A) customer contact.
B) service exchange.
C) marketing.
D) relationship marketing.
E) service contact.

Question 52

Troy is a service provider for a low-contact type of service. Which of the services below is Troy most likely to provide?

A) Childcare
B) Website design
C) Health care
D) Auto detailing
E) Personal trainer

Question 53

Prudential Insurance uses "the rock" symbol to communicate stability and security to customers. This is Prudential's attempt to help customers better understand its services by

A) emphasizing tangible cues in promoting the service.
B) using word association.
C) personalizing the selling of the service.
D) utilizing publicity techniques to enhance the service.
E) distributing the service directly through television.

Question 54

Carlos is speaking to his brother about the interaction he had today with one of his clients. Since he is referring to his customer as a client, Carlos is most likely a(n)___.

A) Funeral director
B) House painter
C) Masseur
D) Dry cleaner
E) Auto repairman

Question 55

Brittany recently moved to a new city and is trying to find a new mechanic to do maintenance and repair on her car. She visits several places to judge their overall appearance, cleanliness, and organization and finally chooses a mechanic. Brittany was trying to overcome the ____ aspect of services.

A) heterogeneity
B) perishability
C) customer contact
D) intangibility
E) inseparability

Question 56

Which of the following is the best example of a high-contact service?

A) Appliance repair
B) Newspaper delivery
C) Dog training
D) Interior decorating
E) Plastic surgery

Question 57

Andrea has just opened a new service business called Paws n' Claws, which provides dog grooming and doggie day care. Andrea has done research about the role dogs play in today's culture, particularly for those people who do not have children. She knows that some of these people represent a target that is urban, professional, and travels frequently. Andrea's business is likely to have a _____ and she will probably refer to the dog owners as ___.

A) high level of tangibility; customers
B) high level of inseparability; customers
C) high level of customer contact; clients
D) low level of perishability; customers
E) low level of intangibility; clients

Question 58

A service is usually offered as part of a bundled package of services with a core service and one or more ____ services.

A) basic
B) tangible
C) supplementary
D) auxiliary
E) other core

Question 59

The heterogeneity characteristic of services provides marketers with tremendous opportunity to

A) customize their services to meet unique individual needs.
B) hold down the cost of providing services to customers.
C) create standardized packages that will appeal to many customers.
D) offer the same service as all of their competitors.
E) develop relationship marketing with their customers.

Question 60

In an attempt to attract customers, service marketers often promise great results and satisfaction to customers, but marketers should be careful not to

A) deliver on these promises and risk financial losses and the success of the company.
B) promise less than they can actually deliver and keep customers away.
C) make the appearance of their facilities consistent with their promises to customers.
D) promise too much and cause customer expectations beyond what they can deliver.
E) make the quality of their services too tangible in the eyes of the customer.

Question 61

When a theater entices customers to see movies during the daytime by offering tickets at a reduced price, it is trying to solve the services marketing problem of

A) inseparability.
B) intangibility.
C) customer contact.
D) off-peak demand.
E) heterogeneity.

Question 62

Which of the following service providers are most likely to use demand-based pricing?

A) Dentists
B) Lawyers
C) Doctors
D) Hair stylists
E) Cruise ships

Question 63

Production and consumption of services must simultaneously occur due to the ____ characteristic of services.

A) intangibility
B) heterogeneity
C) customer contact
D) perishability
E) inseparability

Question 64

Who judges service quality?

A) Employees
B) The company
C) Independent raters
D) Customers
E) Marketers

Question 65

Safe Auto Insurance advertises "minimum coverage for minimum budgets" for its automobile insurance. Which of the following best describes Safe Auto's approach?

A) Customers often use price as an indicator of quality, and Safe wants to be seen as a low-quality provider.
B) This type of advertising makes insurance more tangible to the customer.
C) Safe wants to reassure customers that they provide the highest level of service quality available.
D) Because market conditions limit prices on auto insurance, Safe uses this approach to gain customers.
E) For some services, customers look for the low-cost provider, which is what Safe claims to be.

Question 66

Compared to goods marketers, services providers are more likely to promote performance documentation, availability, guarantees, and

A) distribution.
B) tangible elements.
C) management expectations.
D) price.
E) customer expectations.

Question 67

Any service provider that offers time-sensitive services receives most of its revenue during

A) peak demand.
B) heavy use time.
C) the off-season.
D) preferred demand.
E) customer contact time.

Question 68

American Life uses leather-look portfolios and high-quality paper and printing for its life insurance policies in order to indicate

A) the success of its business.
B) the intangibility of its service.
C) the tastes of its management.
D) the inseparability of its agents and customers.
E) the quality of its services.

Question 69

What are the three primary ways that marketers deliver services?

A) Over the phone, online, or in-person
B) Continuously, periodically, or on demand
C) At the customer's home, in-person, or by telecommunications
D) Through service centers, delivery vehicles, or the mail
E) Service facilities, customer's home, or from a distance

Question 70

Some services are time sensitive, meaning that a significant number of customers desire the service around the same time. This point in time is called

A) peak demand.
B) preferred demand.
C) off-peak demand.
D) high-contact time.
E) high intensity time.

Question 71

Demand-based pricing most closely relates to the ____ of services.

A) perishability
B) intangibility
C) heterogeneity
D) customer contact aspect
E) inseparability

Question 72

Just Relax Massage Therapists have a large customer base although they do very little advertising. Their promotion strategy relies mostly on

A) news stories.
B) a webpage.
C) word of mouth.
D) newspaper ads.
E) television ads.

Question 73

Symbols such as the Travelers' Financial Services umbrella are designed to help customers overcome the ____ of services.

A) heterogeneity
B) unpredictability
C) inseparability
D) intangibility
E) perishability

Question 74

Consumers look closely at service quality when comparing competing services because

A) they perceive all services to be essentially the same.
B) they typically have very few services from which to select.
C) all services are priced about the same.
D) quality is the only relevant service characteristic.
E) services are very difficult to evaluate.

Question 75

The marketing channels for services are usually

A) complex and multifaceted.
B) characterized by two to three intermediaries.
C) dependent on the geographical location of the consumer.
D) determined by the customer.
E) direct from provider to customer.

Question 76

By installing automated check-in kiosks in some airports, airlines have increased production capacity and reduced the number of personnel. This results in a decrease in

A) perishability.
B) intangibility.
C) customer contact.
D) inseparability.
E) customer service.

Question 77

Many cellular phone plans contain a certain number of anytime minutes and then either significantly more or even unlimited night and weekend minutes. This is an example of

A) time-based pricing.
B) off-peak demand.
C) demand-based pricing.
D) time dependence pricing.
E) bundled costing.

Question 78

Flo, the spokesperson in Progressive Insurance TV commercials, is used to symbolize friendliness, reliability, and knowledge of the company's products. The part Flo plays in the promotion is designed to address the ____ characteristic of services.

A) intangibility
B) perishability
C) heterogeneity
D) inseparability
E) customer service

Question 79

A US Airways flight from Dallas to Houston was full, and the tickets were more expensive than the almost-empty US Airways flight from Chicago to Phoenix. This is an example of what kind of service pricing?

A) Bundled
B) Demand-based
C) Supply-based
D) Upfront
E) Customer-based

Question 80

Tina, a waitress at the Riverfront Grill, is angry that a customer complained that his soup was cold because of her slow service. Riverfront owner Max Griffin reminds her that she must focus on service quality as defined by

A) the health department.
B) restaurant management.
C) the customer's perceptions.
D) temperature guidelines.
E) general practices.