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Service Marketing SERVICE MARKETING BY

VIEWS: 1,696 PAGES: 35

									SERVICE MARKETING
BY:PRAVEEN PARMAR

PROFESSOR(C.M.)
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What is service ?
SERVICE IS ANY ACT OR PERFORMANCE THAT ONE PARTY CAN OFFER TO ANOTHER THAT IS ESSENTIALLY INTANGIBLE AND DOES NOT RESULT IN ANY OWNERSHIP

-PHILIP KOTLER
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Characteristic of Service
Intangibility  Inseparability  Heterogeneity  Perishability  Ownership

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What is Marketing ?
• Definition –It is the organization’s task is to determine the needs, wants, and interests of target markets and to deliver the desired product/service more effectively and efficiently than competitors in a way that preserves or enhances the consumer’s and the society’s well-being.

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Continue..
• Objective of Marketing –

• Sale

• Retain

• Refer - which is carried out by your own customers
• Marketing when 
 

Supply more Demand
Supply less Demand Supply equal Demand
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The main Steps of Marketing
R STP MM I C

R = Research STP = Segmentation, targeting and positioning MM = Marketing mix I = Implementation C = Control
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7 P’s OF SERVICE MARKETING
1. PRICE 2. PLACE 3. PRODUCT 4. PROMOTION 5. PHYSICAL EVIDENCE 6. PROCESS 7. PEOPLE
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PRICE
 Fixed Pricing  Differential pricing  Discount pricing  Diversionary pricing  Guaranteed pricing  High price maintenance pricing  Offset pricing

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JET AIRWAYS FARE

RAILWAYS FARE RAJADHANI AC I 3570 6485 AC II 1835 3550

RAILWAY FARE SUPERFAST AC I 2686 AC II 1421 2378

SECTOR NDLS-ADI NDLS-SBC

CURREN T FARE 4780 8710

REDUCED FARE 2462 5053

NDLS-MAS
NDLS-GHY NDLS-HYB NDLS-HWH

8960
6980 7285 6925

3293
4110 3278 2860

6065
5625 3793 4540

3415
3255 1991 2670

4353
4955 3583

2279
2159 2920 1883

NDLS-TVC
NDLS-BCT NDLS-BRC BCT-HWH BCT-HYB

11875
6095 5520 6855 4140

6685
3920 2558 3320 2443

8295
4280 3610 -

4315
2485 1880 -

3373 2813 4108 2286

2603
1775 1487 2153 1211 9

PASS. FARE STRUCTURE
(2001-2002)
Paise per PKM Number% Pass. Km% Revenue%

NON-SUBURBAN
AC-I AC Sleeper AC 3-Tier Chair Car Sleeper class M/E Sleeper class Ord. IInd class M/E IInd class Ord. SUBURBAN(all) No. of Pass. Pass. Kms. 237.54 103.6 73.2 62.4 26.2 17.6 21.6 14.4 0.81 5.75 21.5

3.1 6.6 30.6

48.70 26.10

27.8 22.7 17.6

12.4 58.9 19.45 10.4 Suburban – 3.0 Billion Non-Suburban 2.09 Billion Suburban – 93 Billion Non-Suburban 400 Billion

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Ratio of Passenger Earning per PKm to Freight Earning per TKm
1.8 1.6 1.4 1.2 1 0.8 0.6 0.4 0.2 0 1.7 1.4 1.35 1.4 1.0 0.85 0.33

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PLACE (DISTRIBUTION)
• SERVICE DELIVERY POINT • STATIONS, CITY BOOKING AGENCIES / OUT AGENCIES / RESERVATION CENTERS ARE OUR SALES OFFICES·  PLACES SHOULD BE CUSTOMER FRIENDLY.  PLACES SHOULD BE WELL MAINTAINED  NETWORK SHOULD BE INCREASED
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PRODUCTS
PASSENGER SERVICE PRODUCTS
 RAJDHANI / SHATABDI TRAINS
 JANSHATABDI TRAINS

 LONG DISTANCE MAIL & EXPRESS TRAINS  UNRESERVED PASSENGERS TRAINS

 COMMUTER SUBURBAN TRAINS
 MILLENNIUM PARCEL TRAINS
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FREIGHT SERVICE PRODUCTS



 



 

BLOCK RAKES (Varieties of wagons) MINI RAKES (Small Traders) CONRAJ (High speed) RO –RO Scheme FREIGHT FORWARDER (Collection of piece meal traffic) TWO POINT BLOCK RAKES STATION TO STATION RATES (Concessions)
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PROMOTION
 EACH PRODUCT FEATURES TO BE COMMUNICATED TO CUSTOMER IN THAT SEGMENT USING SUITABLE MEDIA (LOT OF WEAKNESS)  ADVERTISING  PERSONAL SELLING  PUBLICITY  SALES PROMOTION
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PHYSICAL EVIDENCE
 PERIFERAL EVIDENCE1. A RESERVED TICKET 2. CHEQUE BOOK  ESSENTIAL EVIDENCE  ACTUAL EXPERIENCE OF SERVICE
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PROCESS
PROCESS OF PRODUCTIN AND DELIVERY OF SERVICE. CUSTOMER INTERFACE PROCESSES SHOULD BE COMPUTERISED, MECHANIZED, RATIONALISED AND SIMPLIFIED. PROCESSES EXIST ARE COMPLEX ON RAILWAYS LIKE SOME PROCESSES ARE :
1. RESERVATION PROCESS/REFUND CLAIM PROCESS. 2. COMMUNICATION PROCESS. 3. ENTRAINING/DETRAINING PROCESS. PROCESS/

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PEOPLE
  1. 2. SERVICE PERSONNEL CUSTOMERS CAREFUL SELECTION AND TRAINING LAYING DOWN NORMS, RULES, PROCEDURES FOR PERSISTENCE PERFORMANCE 3. CONSTITANCE APPEARANCE 4. REDUCE INTERFACE – AUTOMATIONCOMPUTERISATION 18

STATUS OF MARKET SHARE OF INDIAN RAILWAY AS PER RAILWAY BOARD’S STATUS PAPER
Year Rail 1950-51 1996-97 89% 40% Freight Road 11% 60% Rail 80% 20% Passenger Road 20% 80%

Shift of Traffic from Rail to Road 100% 80% 60% 40% 20% 0% 1950-51 1996-97

Freight Rail Freight Road Passenger Rail Passenger Road
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PERCENTAGE OF TRAFFIC TRANSPORTED BY RAILWAYS
YEAR COAL I.ORE CEMENT F.GRAIN FERT. POL I&STEEL

91-92 92-93 93-94 94-95 95-96

63.9 66.2 67.9 64.98 64.97

66.1 70.6 65.3 63.66 65.15

57.0 56.2 56.1 49.52 47.45

16.4 15.2 14.5 10.79 13.76

66.6 67.8 71.7 71.56 69.15

52.9 51.1 50.7 43.67 40.16

71.9 70.81 69.38 63.71 58.30

96-97
97-98 98-99 99-00 00-01

65.95
66.37 63.99 65.67 67.67

66.68
69.72 65.63 66.97 72.93

46.42
44.93 41.80 43.42 43.10

14.85
13.51 13.38 14.78 13.57

70.23
74.58 75.77 78.6 74.17

37.47
37.52 37.66 35.96 37.49

45.38
44.04 40.90 39.70 34.44
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STRENGTHS/OPPORTUNITIES FOR INDIAN RAILWAYS
 A LARGE NETWORK OF 7000 STATIONS EXISTS IN THE COUNTRY.  A SUBSTANTIAL MARKET SHARE EXISTS, IN PASSENGER SEGMENT. FOR A COUNTRY OF 1000 MILLION PEOPLE WITH LOW PURCHASING POWER RAILWAY SYSTEM IS MORE SUITABLE.
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STRENGTHS/OPPORTUNITIES FOR INDIAN RAILWAYS
 FOR LONG DISTANCE AND BULK SECTOR RAILWAYS IS THE MOST ECONOMICAL COMPARATIVELY SAFER MODE OF TRANSPORT.  PETROLEUM PRODUCTS PROCURED THROUGH IMPORTS ARE VERY EXPENSIVE AND THUS ELECTRICITY BASED RAILWAY SYSTEM WILL ALWAYS HAVE AN EDGE ON PARAMERTERS OF POLLUTION, ENERGY COST, ENVIRONMENTAL FACTORS.
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WEAKNESSES / THREATS FOR INDIAN RAILWAYS
THE ORGANISATION PRODUCTION ORIENTED. THERE IS OVER EMPHASIS MAXIMISING PKMS, NTKMS. IS

ON

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WEAKNESSES / THREATS FOR INDIAN RAILWAYS
 MARKETING IS PERIPHERAL ACTIVITY AND COMMERCIAL DEPARTMENT IS BASICALLY ENGAGED IN SELLING BUSINESS ONLY
 CUSTOMER FOCUS IS MISSING AND CUSTOMER SATISFACTION IS NOT AN ORGANISATIONAL MISSION.
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WEAKNESSES / THREATS FOR INDIAN RAILWAYS
 INDIAN RAILWAYS IS LOOSING ITS MARKET SHARE IN PASSENGER AND FREIGHT BUSINESS.
 THERE IS CAPACITY CONSTRAINT HOW TO BALANCE DEMAND AGAINST AVAILABLE CAPACITY.
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WHAT SHOULD BE THE MARKETING STRATEGY FOR INDIAN RAILWAYS ?
 MARKETING KEY ISSUE  (PRODUCTION LED ORGANISATION — CUSTOMER LED ORGANISATION)  CUSTOMER SATISFACTION SHOULD BE MAIN ORGANISATIONAL MISSION.  FOCUS ON SERVICE PRODUCTS (BUSINESS PLAN FOR EACH PRODUCT).
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WHAT SHOULD BE THE MARKETING STRATEGY FOR INDIAN RAILWAYS ?  TQM IN ALL PROCESSES.  COMPUTERISATION OF CUSTOMER INTERFACE AREAS(TICKETING, INFORMATION SYSTEM, REFUND ETC.)  DYNAMIC RATING & MARKET RELATED PRICING.
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WHAT SHOULD BE THE MARKETING STRATEGY FOR INDIAN RAILWAYS ?  DEMAND MANAGEMENT / STAGGERING STRATEGY.(IN CAPACITY CONSTRAINT
SITUATIONS)

 TRAINING OF FRONTLINE STAFF IN CUSTOMER CARE / COURTESY.

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WHAT SHOULD BE THE MARKETING STRATEGY FOR INDIAN RAILWAYS ?
1. INTERNAL MARKETING - TRAIN AND MOTIVATE THE
EMPLOYEES TO SERVE CUSTOMERS WELL 2. INTERACTIVE MARKETING - EMPLOYEE’S SKILL IN SERVING THE CLIENT

We Treat Our Employees The Way We Want Them to Treat Our Guests‖

―A Knowledgeable, Satisfied Employee Is Our Best Marketing Agent‖
SATISFYING BOTH EMPLOYEES AND CUSTOMERS
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WHAT SHOULD BE THE MARKETING STRATEGY FOR INDIAN RAILWAYS ?  FORWARD / BACKWARD / HORIZONTAL INTEGRATION.(STRATEGIC

ALLIANCE WITH OTHER MODES)
 DEVELOP DEMAND FORECASTING MODELS, LONG RANGE DECISION SUPPORT SYSTEMS, COSTING MODELS, SYSTEMS FOR GATHERING COMMERCIAL INTELLIGENCE (OUTSMART COMPETITORS). 32

WHAT SHOULD BE THE MARKETING STRATEGY FOR INDIAN RAILWAYS ?  LOBBY WITH GOVERNMENT / OPINION MAKERS/ PLANNING COMMISSION FOR EVEN PLAYING FIELD FOR INVESTMENT IN RAILWAY PROJECTS (SOCIAL COST BENEFIT ANALYSIS DATA SHOULD PROMOTE RAILWAY AS BETTER CHOICE FOR TRANSPORT INFRASTRUCTURE).
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SERVICE RECOVERY



 

IMPROVE THE AFTER SALE SERVICE ADMIT & APOLOGISE RECTIFY COMPENSATE MINOR PERFORMANCE LAPSES NEEDS MONITORING



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MARKETING STRATEGY FOR INDIAN RAILWAYS
TO CONCLUDE :DESIGN, DEVELOP, DELIVER APPROPRIATE ―SERVICE PRODUCT‖ QUICKLY AND MODIFY / EXTEND THE PRODUCTS AS PER NEEDS AND WANTS OF CUSTOMERS.

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References
1. Services Marketing by Lovelock
2. The Essence of Services Marketing by Adrian Payne 3. The Marketing Management - An Asian Perspective by Philip Kotler 4. The Principles of Marketing by Philip Kotler

5. The marketing of services by Donal & Cowell

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