Services Marketing: Concepts, Cases and Strategies
Hoffman, Bateson, Wood & Kenyon
ISBN: 9781844808137
SHORT-ANSWER ESSAYS
Chapter 6: Service Development and Innovation
1. There are 4 new service categories of innovations – state the 4 categories and
provide industry examples of how a service organisation can use these strategies to
develop and move forward.
ANS:
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sell new services to existing customers
sell more existing services to existing customers
sell existing services to new customers
sell new services to new customers
2. Discuss the pros and cons of major service innovations. Give examples
of organisations that have introduced major service innovations.
ANS:
 pros - forward thinking strategy, new products and services for customers.
 cons – major innovations involve long-term planning, extensive training and
are expensive.
3. List and discuss the seven classifications of the continuum of new service
development.
ANS:
1.
2.
3.
4.
5.
6.
7.
Major service innovations
Major process innovations
Product-line extensions
Process-line extensions
Supplementary service innovations
Service improvements
Style changes
4. The service developments are summarized into four dimensions. State the four
dimensions and give examples of how organisations have customers use the new
services offered.
ANS:
 The four dimensions are Service Concept, Client Interface, Service Delivery
System, Technological Options
5. Discuss the eight activities that create and encourage innovation and creativity.
ANS:
 Challenge and involvement – ensure employees understand the visions and
long terms goals of the organisation and motivate employees
Services Marketing: Concepts, Cases and Strategies
Hoffman, Bateson, Wood & Kenyon
ISBN: 9781844808137
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Freedom – ensure there is independence within the organisation and across
employees so that ideas can be shared and people can work autonomously
Trust/openness – ensure people can count on each other for professional and
personnel help
Idea time – flexibility in time-lines, ability to discuss and test suggestions
Playfulness/Humour – spontaneity is key with a relaxed and fun atmosphere
Idea Support – people listen to each other and encourage initiatives
Debate – occurrence of encounters to debate, share, critique and value
opinions
Risk-taking – take the gamble, go out on a limb, and be bold
6. There are six drivers for change – list and discuss each one with examples from the
service industry.
ANS:
 Opportunities – when competitors withdraw from the marketplace this releases
a new opportunity for organisations. Also new opportunities emerge when
organisations complete their own research with consumers and staff.
 Regulations – governments include regulations with which organisations have
to comply. Organisations can use the regulations as a PR experience such as
green issues, waste management or fraud control.
 Perishability – new service processes and/or products need to be included to
take into account of Perishability – services need to ‘fill the space’ available
 Seasonal patterns – service organisations need to consider the different times
of the year, popular and cultural festivals and events and different times of the
day to take advantage of the seasonal opportunities.
 Fashions – latest fashion trends affect all markets at some time. Organisations
need to keep an eye on all external environments; particularly popular
fashionable industries.
 Competitors – service organisations need to understand their business, their
marketing strategies and sales. They also need to understand their competitors
so that they can become more innovative and creative than their competitors.