Lamb, Hair, McDaniel
MKTG2007-2008
11
CHAPTER
Designed by
Amy McGuire, B-books, Ltd.
Chapter 11
Services and
Nonprofit
Organization
Marketing
Prepared by
Deborah Baker, Texas Christian University
Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved
1
Learning Outcomes
LO1
Discuss the importance of
services to the economy
LO2
Discuss the differences between
services and goods
LO3
Describe the components of service quality
and the gap model of service quality
Chapter 11
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2
Learning Outcomes
LO4
Develop marketing mixes for services
LO5
Discuss relationship marketing in services
LO6
Explain internal marketing in services
LO7
Discuss global issues in services marketing
LO8
Describe nonprofit organization marketing
Chapter 11
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3
LO1 The Importance of Services
Discuss the
importance of
services to the
economy
Chapter 11
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4
Service
Service
The result of applying
human or mechanical
efforts to people or
objects.
LO1
Chapter 11
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5
LO1 REVIEW LEARNING OUTCOME
The Importance of Services
Services
Deed
Performance
Effort
Services as a percentage of GDP
10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
81%
Services as a percentage of employment
10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
81%
Chapter 11
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6
LO2
How Services Differ from Goods
Discuss the
differences between
services and goods
Chapter 11
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7
How Services Differ from Goods
Intangible
Inseparable
Heterogeneous
Perishable
LO2
Chapter 11
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8
How Services Differ from Goods
Intangibility
 Search Qualities
 Experience Qualities
 Credence Qualities
LO2
Chapter 11
http://www.webmd.com
Online
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9
LO3
Service Quality
Describe the
components
of service quality
and the gap model
of service quality
Chapter 11
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10
LO3 Components of Service Quality
Chapter 11
Reliability
The ability to perform the
service right the first time.
Responsiveness
The ability to provide
prompt service.
Assurance
The knowledge and courtesy
of employees.
Empathy
Caring, individualized
attention to customers.
Tangibles
The physical evidence
of a service.
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11
The Service Offering
Core
Service
The most basic benefit the
consumer is buying.
Supplementary
Service
A group of services that support
or enhance the core service.
LO4
Chapter 11
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12
Core and Supplementary
Services for FedEx
Problem
solving
Billing
statements
Tracing
LO4
Chapter 11
Advice and
information
Overnight
transportation
and delivery of
packages
Documentation
Order taking
Supplies
Pickup
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13
LO8
Nonprofit Organization
Marketing
Describe nonprofit
organization
marketing
Chapter 11
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14
Nonprofit Organization
Marketing
Nonprofit
Organization
Marketing
An organization that exists
to achieve some goal other
than the usual business
goals of profit, market share,
or return on investment.
LO8
Chapter 11
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15
Nonprofit Organization
Marketing
 Government
 Museums
 Theaters
 Schools
 Churches
LO8
Chapter 11
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16
Nonprofit Organization
Marketing
Market intangible products
Shared
Characteristics
with
Service
Organizations
LO8
Chapter 11
Production requires
customer’s presence
Services vary greatly
Services cannot be stored
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17
Unique Aspects of Nonprofit
Organization Marketing Strategies
 Setting of marketing objectives
 Selection of target markets
 Development of marketing mixes
LO8
Chapter 11
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18
Objectives
Provide services that respond to the wants of :
 Users
 Appointed officials
 Payers
 Media
 Donors
 General Public
 Politicians
LO8
Chapter 11
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19
Target Markets
Apathetic or
strongly opposed
targets
Unique Issues
of Nonprofit
Organizations
Pressure to adopt
undifferentiated
segmentation
LO8
Chapter 11
Complementary
positioning
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20
Product Decisions
Distinctions between
Business and Nonprofit Organizations
 Benefit complexity
 Weak or indirect benefit strength
 Low involvement
LO8
Chapter 11
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21
Promotion Decisions
Professional volunteers
Sales promotion activities
Public service advertising
LO8
http://www.adcouncil.com
Online
Chapter 11
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22
Pricing Decisions
Pricing objectives
Characteristics
Distinguishing
Pricing Decisions
of Nonprofit
Organizations
LO8
Chapter 11
Nonfinancial prices
Indirect payment
Separation between
payers and users
Below-cost pricing
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23
LO8 REVIEW LEARNING OUTCOME
Nonprofit Organization Marketing
Benefit
complexity
PRODUCT
Benefit
strength
Involvement
Professional
volunteers
PROMOTION
Special
facilities
TARGET
• Apathetic or
strongly opposed
• Undifferentiated
segmentation
• Complementary
positioning
Sales
Public Service
Advertising
Chapter 11
PLACE
Nonfinancial
Indirect
payment
Separation
PRICE
Below cost
pricing
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24