When you buy a cake of soap, you can see, feel, touch and use it to check its effectiveness in cleaning.
But when you pay fees for a term in college, you are paying for the benefit of deriving knowledge and education, which is delivered to you by teachers.
In case of soap you can immediately check its benefits, there is no way you can do so in case of the teachers who are providing you the benefits. Teaching is an intangible service. Services cannot be felt, tasted, touched or seen in the same way as goods.
However, there are always some tangible components, which help consumers, evaluate services. On a flight, for example the total service experience is an amalgam of many disparate components, such as the experience at the airport, the nature of the services, on board and the in-flight entertainment. There are clearly many tangible able elements during the flight but this is hardly comparable with buying a television or a suit, where the total product can be seen, examined and evaluated.
We should see what are the result as well as marketing implication of intangibility: Intangibility actually presents several marketing challenges: Services cannot be inventoried, and therefore fluctuations in demand are often difficult to manage.
For example, there is tremendous demand for resort accommodations in XYZ in February, but little demand in July. Yet resort owners have the same number of rooms to sell Yet-round. Services cannot be patented legally, and new service concepts can therefore easily be copied by competitors. Services cannot be readily displayed or easily communicated to customers, so quality may be difficult for consumers to assess. Decisions about what to include in advertising and other pro-motional materials are challenging, as is pricing. The actual costs of a “unit of service” are hard to determine and the price/quality relationship is complex.
The distinguishing feature of a service is that its intangible aspect is dominant. These intangible features are:
.. A service cannot be touched
.. Precise standardisation is not possible
.. There is no ownership transfer
.. A service cannot be patented
.. Production and consumption are inseparable. There are no inventories of the service
.. The consumer is a part of the production process so the delivery system must go to the market or the customer must come to the delivery system
Get Daily Marketing Updates in your Inbox
About Hitesh Bhasin
[...] which differentiate a service from a product. These are Perishability, Heterogeneity, Intangibility and ownership. Here we discuss further 7 characteristics which are critical and help you understand [...]