Service marketing (What is Service Marketing?) is much different from say marketing a product. 

What is service marketing?

I get this question when I’m teaching college classes, mentoring a small business, or working with new clients:

It’s a great question and an important question. Services are an intangible product and goods are tangible products. When you can eat in the other is an experience.

If you’ve come from a product marketing background where you’re selling tangible products, the sales of goods. Then you might struggle if you have to market and sell service-based products that are intangible.

I read a book back in the 90s called Selling the Invisible.  It helped me understand the differences between product-base and service-based products.

A service-based business differs from a product-based business. Without a physical product and inventory, you must sell ideas, intangibles, and promises. This takes a different strategic approach and practices that many service-based business owners never understand. 

70% of the customer's journey is based on how the customer feels they are being treated. Click To Tweet

The American Marketing Association defines services marketing as an organizational function and a set of processes for identifying or creating, communicating, and delivering value to customers. And for managing customer relationships in a way, that benefits the organization and stakeholders.

What is service marketing?

services marketing agency

Service marketing is much different from product marketing where the sale of tangible goods is sold. Services, intangible goods, are broad categories and have different characteristics of services tend to make the services industry complex.

Service marketing requires you to understand that what you’re really selling is an intangible product something that can’t be physically touched.  There is no physical product with services because they are intangible.

So your marketing efforts require you to wrap around all of those intangible benefits. Your customer experience spot on at every moment touch-point.

90% of customers rate an "immediate" response as important or very important when they have a customer service question. 60% of customers define "immediate" as 10 minutes or less. Click To Tweet

How do you market a service-based business?

I mentioned before the service-based business is really an intangible service or product. Therefore it’s extremely important that every customer touchpoint is a delightful experience.

So before you get started you’re going to have to do your homework. For example, understanding your customer’s persona, the target market dynamics, and a customer journey. For example, how the customer will interface with your service offering and learn more about it and I’ll definitely purchase it.

What is a great service marketing strategy? 

Great service marketing strategies all begins with a plan and an honest assessment of where you are today.  You want to take a look at all of your lead sources and web traffic. What services offered are selling the best? The lowest? And which have high-profit margins?

It was back in the 90s when service firms lagged behind manufacturing firms in their use of marketing.

In comparison to manufacturing firms, service firms appear to be:

  • Generally less likely to have marketing mix activities carried out in the marketing department
  • Less likely to perform analysis in the offering area
  • More likely to handle their advertising internally rather than go to outside agencies
  • Less likely to have an overall sales plan
  • Less likely to develop sales training programs
  • Less likely to use marketing research firms and marketing consultants
  • Less likely to spend as much on marketing one expressed in a percentage of gross sales
  • Rely heavily on word of mouth in local markets

There are several reasons why service firms neglected marketing in the past. Many service businesses (flower shops, coffee shops, and salons) and do not use modern marketing techniques. 

They’re also service businesses (medical offices, law firms, and accounting firms) that formerly believed it was unprofessional to use marketing. Other service businesses (colleges, universities, hospitals)  face so much demand until recently that they saw no need for marketing.

 Brick-and-mortar colleges and universities are experiencing a decline in enrollment. Therefore, leading schools are looking for hybrid digital marketing agencies, like Matrix Marketing Group to inject some growth.

Moreover, service businesses are more difficult to manage using only a traditional marketing approach. Today you’ve got a deal with local SEO. This includes SEO localization directories reviews and more. 

For a product business, the product is fairly standardized and sits on a shelf, waiting for a customer to reach for it, pay, and leave.

Those were the old days. Today online businesses in e-commerce it’s easier than ever to purchase something and have it on your doorstep the next day. How about the same day?

Organic SEO is about 5.66 times better than paid search ads. Click To Tweet

However, in a service business, they’re more elements. For the service-based business, there is external marketing. Which is a normal work done by the company to prepare for price distribution and promote the service to customers? 

Internal marketing describes the work done by the company to train and motivate its internal customers. These include namely customer contact employees and supporting service personnel, to work as a team to provide customer satisfaction.

Everyone must practice a customer-centric orientation, or else a high and consistent level of service would not be forthcoming. The most important contribution the marketing department can make is to be exceptionally clever and getting everyone else in the organization to practice marketing.

Interactive marketing describes the employee’s skill in handling customer contact. These can be on the front end. For example, maybe a sales development representative or could be handling some back-end services post-purchase. 

84% of people will not make a purchase if they are dealing with an unsecured website. Click To Tweet

This is especially true for professional services like digital marketing agencies and accounting firms. The client judges service quality not only by its technical quality but also by its functional quality. 

Professionals cannot assume that they will satisfy the person simply because they provide good technical service. Therefore, the professional has to master the skills of interactive marketing as well.

At Matrix Marketing Group, we judge our quality in the eyes of the customer. That’s been our quality mission statement since 2002.

How are service-based firms managed differentiation? 

what is service marketing

Modern service marketers frequently complain about the difficulty of differentiating their services from those of their competitors. When the government goes through deregulation up several major service industries communications, transportation, energy, banking participated in intense price competition. 

Today we see the FANG stocks all the targets on their back with potential deregulation on the horizon.

The solution to the price competition is to develop a differentiated offer, deliver and image. The offer can include innovative features to distinguish it from competitor offers. But the customer expects is called the primary service package, and to this can be added secondary service features.

Matrix Marketing Group has differentiated itself by offering marketing strategies, marketing talent, and marketing technologies to startups to small- and midsized businesses. It’s a form of a hybrid of marketing services with a technology system integrator all in one.

The major problem is that most service innovations are easily copied. Few of them are preempted in the long run.

However, the service companies that regularly research and introduce service innovations will gain a succession of temporary advantage over their competitors. And they’re gaining an innovative reputation, for those customers who want to go with the best.

 The service company can differentiate its service delivery in three ways:

  • through people
  • through physical environment
  • through process

The service company can distinguish itself by having more able and reliable customer contact people than its competitors. A service company can develop a superior physical environment in which the service product is delivered. Finally, a service company can design a superior delivery process.

Service-based companies can also work on differentiating their image, specifically through symbols and branding.

One of the primary ways we have differentiated Matrix Marketing Group is through marrying marketing science with intelligent design.

What this means is that you can create a creative design with specific business outcomes and manage and adapt the program’s success with intelligent marketing data.

What is Service Marketing and managing service quality 

The brand should try to introduce a human element in its DNA. Matrix Marketing Group we allow our people to be themselves an express their personalities. This can be seen through many of our marketing materials.

Organizations that share these human characteristics maintain a robust, active online presence.  You can add some fun facts about your people and their journey and expertise.

The marketing team should make sure employees are active on relevant social media platforms like Twitter, Facebook, and LinkedIn.

Wrap up about what is service marketing?

Marketing goods and services is much different in each product category. Just remember that marketing a service at every customer touchpoint is important. It’s important that every touchpoint with the customer is an experience that the customer expected and move them to the next stage. 

Service industries have typically lagged behind manufacturing firms in adopting and using marketing concepts, but this is now changing.

Services marketing strategy calls not only for external marketing but also for internal marketing with great customer service. You need to motivate the employees, and their interactive marketing, to create skills in the service provider.

We’re listening.

Have something to say about what is service marketing? Share it with us on Facebook, Twitter or our LinkedIn.

General FAQ’s for Service Marketing

  • What is service marketing?

    Service marketing is marketing based on relationship and value. It may be used to market a service or a product. It marketing an intangible product vs a tangible product like an iPhone.

  • What are service marketing and its importance?

    Services are intangible products and goods are tangible products. When you can eat in the other is an experience.

  • How do you market a service business?

    Here are seven great techniques to market your service business.
    – Use Incentives
    – Stay in Touch with Email
    – Make Use of Social Marketing
    – Stock Up on Business Cards
    – Connect With the Community and Network
    – Get in the News with PR
    – Compete Based on Value, Not Price

  • What is the role of service marketing?

    Service marketing strives to achieve the following objectives: Attract new customers. Retain existing customers and sell them upgraded services referrals from existing customers.

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