Chapter 4 Summary - Developing Service Products: Core and

Supplementary Elements
A service product is one that offers an experience rather than an ownership. It consists of
all the elements of a service performance, both physical such as a cooked meal and intangible
such as the ambience of a restaurant, that create value to the customer. The value proposition
of a service product should integrate three components – the core product, supplementary
services and delivery process. The core product is the direct benefit sought by the customer.
Supplementary services augment the perceived value of the core product. Delivery process
determines how fast and efficient the product and services are provided to the customer.

Supplementary service elements may be facilitating or enhancing in terms of adding value

to customers. Represented as ‘the Flower of Service’, the elements are as follows:

1. Information – Customers are eager to know more and more about the product before
investing in it. Apart from the conventional ways of providing information such as front-
line employees and brochures, companies like Flipkart use the internet and technology to
facilitate information flow to the customer.
2. Order-taking - Speedy, accurate and convenient method of taking orders will put the
customers at ease. For instance, airlines now facilitate e-check-ins for customers so that
they can save their time.
3. Billing – Clear and informative bills make the purchase experience hassle-free. Billing the
customer in excess of their consumption is a potential source of conflict that should be
avoided.
4. Payment – Upkeep and maintenance of payment systems is essential to complete the
billing process. Companies expect timely payment and customers expect secure ways of
doing so. Since online transactions are on the rise, people need alternate forms of
payment such as Net banking and e-wallets like Paytm.
5. Consultation – This involves an in-depth understanding of customer’s problem and
offering a customized solution. Counseling is another approach where we help the
customer take charge of his problem and come up with what he thinks is best for him.

Group No. 4 | Marketing of Services

 6. Hospitality – Customer satisfaction is determined by the quality of experience the
organization can offer. Services like that of hotels which are highly customer interactive
right from reservation to check-out need employees who are warm and friendly in order
to create a positive impression with the customers.
7. Safekeeping – Assisting customers with safety and security of their belongings will help in
building trust with the customer.
8. Exceptions – Service providers need to go beyond normal operating procedures if there
are special requests. Customers should be provided with immediate response for their
complaints and suggestions.

Branding services has become essential for providers of intangible services. Strategies differ
according to the marketing perspective of the organization. A Branded House uses a single brand
for all its offerings. Some organizations prefer Subbrands where the master brand is the primary
frame of reference but each product itself has a distinct identity. When the product brand
dominates the corporate brand, this strategy is known as Endorsed brands. Each brand delivers
a distinctive value proposition and targets a different segment of customers. This encourages the
customer to switch within the brand family when he wants to purchase a different product. A
House of Brands approach like that of Unilever which has 400 brands worldwide actively
promotes each product under a separate brand name. Companies also use service tiering and a
price-based classes of service concept.

Service providers innovate continuously to meet rising customer expectation and

competition. They can change the style of service delivery, bring in performance improvements
to the core product or redesign the supplementary service, extend the product line or process
line and introduce new products. For example, automobile manufacturers provide after-sales
services as an extension of their relation with the customer. Factors like market synergy and
product research play a key role in the achieving success in new service development.

Group No. 4 | Marketing of Services