Marketing Profs

It's been called "selling the invisible"—delivering intangible services as a core "product" offering.

Law firms, management consultants, IT services and telecom providers, architectural groups, healthcare and educational organizations, financial and insurance institutions, and a multitude of business-to-consumer operations profit from performing and delivering people-based services.

But invisibility, or intangibility, is just one factor that distinguishes services marketing from product marketing. Along with inseparability, variability, and perishability, these four characteristics affect the way clients behave during the buying process and the way organizations must interact with them.

Additionally, these characteristics influence the development of marketing strategies and the more tactical marketing mix—from the "packaging" and pricing of services bundles, to defining distribution plans and promotions options.

To ensure business success, services marketing professionals must clearly understand these characteristics, how they affect client behavior, and how their organization can respond to diminish engagement risk, improve customer perceptions, and enhance market opportunities.

Intangibility

Services are not physical and cannot be "possessed." Because they can't be seen, touched, or made tangible in some way, assessing their quality and value is difficult.

A services client will never know how good the service is until after he receives it. In some cases, it actually may be months or years before a trigger event occurs to activate the service, at which time the client hopes to experience the promised service quality (e.g., an IT crisis triggers service, or an accident initiates an insurance claim).

This can be unsettling for the client, whose response is to look for tangible signals about the service process and quality prior to purchase to reduce uncertainty and reservation.

The Marketing Response: Services marketing professionals must determine how to effectively communicate the services process, deliverables, and benefits in order to build client confidence. Tangible signals that indicate services quality and value come from personal interaction, trusted recommendations, clear communications, equipment used or processes followed, pricing, and the physical environment in which the business operates.