Characteristics of services are fluctuating demand, intangibility, inseparability, heterogeneity, or variability, pricing of services, service quality is not statistically measurable, perishability, user participation, lack of ownership, etc.
Services are understood as the intangible activities that a business or individual offers to other individuals or businesses as customers and ensure customer satisfaction. A service firm may offer personal services, perishability services as well as personal care services, and complementary services to the target audiences by incorporating some special characteristics of services.
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Definition of Services
Services are the special types of products that are comprised of activities, advantages, or customer satisfaction offered and available to be purchased. These services are intangible, plus they don’t result in the ownership of anything.
Services are often differentiated from products. Generally, products are tangible, meaning they can be felt or touched while services are intangible. Users always crave better service while the service provider ensures consistent quality in its service to optimize customer satisfaction. Let us now delve into different characteristics associated with the service industries-
10 Characteristics of Services
Some of the characteristics of services that make them unique and different from the products are-
1) Perishability
It implies that services can’t be stored for later use or sale. In other words, services can’t be stored in an inventory or stock in the same way as a product.
This is perhaps the main characteristic of service because it might significantly affect the financial outcomes. When demands are consistent, the perishability of services is not a significant issue.
Notwithstanding, in the event of fluctuating demand, service providers might face troublesome times. Therefore, service organizations utilize different strategies for making an effective in between the demand and supply in the market. One such method is called demand shifting.
By using the strategy of charging various prices at various times, they move demand from peak periods to off-peak periods. Many service firms use this strategy to survive and make profits when the peak demand period is over.
Examples of perishable services include transportation services, event planning services, and airline ticketing services.
2) Fluctuating Demand
Service demand revolves around the great level of fluctuations due to the fluctuating demands of the service industry. Different changes in demand may take place occasionally, weekly, daily, or hourly.
A large portion of the services faces major demands in the peak hours while they have ordinary or low demand during the off-period time, and hence demand fluctuates in every service sector.
Professionals create and offer services by understanding the changing demands of their services and that is why fluctuation in demand is one of the important characteristics of services.
Examples of fluctuating demand are seasonal service firms that include snow removal and landscaping services.
3) Service Intangibility
It is one of the primary characteristics of services. It suggests that services can’t be seen, felt, tasted, or smelled. Users can’t try them in a way that they can do with products.
However, services also have tangible dimensions for example the place (massage parlor), gear (massage chair), and communication material (billboard promoting the massage parlor).
These substantial aspects are important for the experience that the users have after opting for the services. Additionally, these dimensions demonstrate service delivery and quality.
As may be obvious, theoreticalness is an interesting idea. While theoreticalness is one of the critical characteristics of services, they are rarely totally elusive. For most services, you will perceive that substantial components are essential for the experience. The center service, nonetheless, is in all cases immaterial.
Examples of intangible characteristics of services include consulting, accounting, banking, marketing, education, and healthcare.
4) Inseparability services
This one is again a significant characteristic of each service. It implies that services are delivered and consumed simultaneously. This additionally involves that services can’t be isolated from the service providers.
In opposition to services, products are created, then put away, later sold, and, in the end, they are consumed. While services are first sold, afterward created and finally consumed at the very same time.
Products can, after creation, be taken away from their manufacturers, nonetheless, services are offered at or close to the place of offering services. For example, while visiting a café, you request your coffee. And later you ordered some snacks.
Delivery of both of the items including the providers are integral parts of the services and therefore they all will be indivisible. In the world of services marketing, a service provider is also understood as a service.
Examples of inseparability services are travel and tourism, transportation, healthcare service, education, and entertainment.
5) Service Variability or Heterogeneity
Variability is the next and vital characteristic of services. Variability alludes to the way that the quality of services can fluctuate extraordinarily relying upon who offers them, how, when, and where. Even the quality of services is supplied simultaneously by two different individuals.
Though the brands do their best to ensure consistent service quality, still the service provided by them varies due to a wide range of factors. Due to the labor-sensitive nature, services incorporate a lot of contrast in their quality depending upon the service providers. We should consider an example, a major restaurant chain. As a famous restaurant chain, it might have gained popularity for offering better services than others.
Nonetheless, the service quality won’t always be the same. One representative might be extremely happy and give excellent services especially but there can be another representative who may have an awful day and have a little low energy level. Because of this, the quality of service level of the same service providers can be quite different. Hence, the features of a service provider can’t be uniform all the time.
Examples of services that may suffer from heterogeneity include hotel and restaurant services, legal services, and medical services.
6) User Participation
When we receive services from a service provider, we also participate in the process. Therefore, user participation is quite possibly one of the main characteristics of services, even in the event that it is often neglected.
To be sure, users take part in each sort of service offering. Even when you will not be expected to be where the service is performed, you will participate in each service offering.
Hence, it can be said that the services can’t be isolated from their provider, however, neither could it at any point be isolated from its users.
Examples of user participation include booking an appointment, giving feedback, or providing payment for services.
7) Lack of Ownership
This is again one of the characteristics of services that suggests that users can’t possess and store services as they can do with the products.
This nature of services is emphatically connected to a few other characteristics of services, like perishability, inseparability, and intangibility. The absence of ownership is very essential to comprehending services and their inherent nature
It is clear till now that services are an exceptional type of product that comprises activities, advantages, or satisfactions and is offered to be purchased, but which is elusive or intangible and doesn’t result in the possession of anything.
Examples of lack of ownership could be the renting of a car, or the use of a hair salon – none of which results in the ownership of something tangible.
8) Pricing of Services
Making price decisions for services is also a very important characteristic of services.
The pricing decisions of services are affected by fluctuations in demand, inseparability, and perishability.
Different approaches to pricing are utilized in the process and they can be cost-based pricing, competition-based pricing, and demand-based pricing.
Examples of pricing of services are the charges that a hospital makes or the fees that an accountant may charge.
9) Skill orientation
When a product is offered, its purchase is based upon its utility value in comparison to marketing skills to sell it.
In the same way, when it comes to service businesses, their fate will be based upon the skill of the service providers.
Hence, the skillset and efficiency of the service provider are very important in optimizing the sales of the service firms.
Examples of services that are highly skill-oriented include IT services, consulting services, and engineering services.
10) Direct distribution
Services are generally offered through direct distribution strategies and methods.
While in product marketing, dealers, retailers, and wholesalers can be seen playing a major role in distribution, in service marketing, they all are generally absent, as direct distribution takes place.
How in some cases, service marketers take the help of agents for example insurance business.
Examples of services that require direct distribution include financial services, education, and healthcare. However, other service industries such as hospitality and entertainment may use indirect distribution methods such as agents and distributors.
Importance of Services
Services are extremely important in the modern world as they allow people to get access to a variety of services like entertainment services, health services, education, etc. These play a major role in improving the quality of life and offering convenience to people.
Services are important in today’s economy because they make up a significant portion of economic output and employment. They provide greater flexibility to businesses and consumers, enabling them to customize experiences and create value.
Many service companies are differentiating themselves by providing high-quality service performance, creating unique customer experiences, and offering more personalized services. This has become increasingly important as customers have become more sophisticated and discerning in their needs.
Effective service delivery also enables businesses to understand their customers better and respond to their needs more quickly.
The service sector currently makes up more than 65% of the gross world product, and in developed nations, it is the main sector driving economic growth when compared to other sectors.
This means that service companies need to keep up with the latest trends and technologies in order to remain competitive. By creating a good customer experience, developing innovation, and continuously improving service performance, businesses can gain a significant competitive advantage. Also, by partnering with the same service provider in multiple locations or areas, businesses can benefit from economies of scale and further optimize service delivery.
Conclusion!
As a final observation, it is clear that services are without a doubt unique and special, as they comprise some special sets of characteristics. The meaning of services demonstrates that services can be of wide varieties. Likewise, services have characteristics that make them remarkable. They will turn out to be always significant for the growth of the economy.
Therefore, it is pivotal to have a comprehension of what is implied while referring to services, and we hope this post would have helped you understand all the different service characteristics.
Now, what according to you are the most crucial characteristics of services that services firms should know and incorporate in themselves? Also, if you want to add some other characteristics of services to our post, feel free to share that with us in the comment section below.
FAQs
What are Services?
A service is a non-material product that involves actions or activities aimed at solving a customer’s problem without the transfer of physical goods from the provider to the customer.
Some, like transportation, consultation, haircuts, car washes, education, and healthcare services, are intangible and cannot be saved or physically touched, but can still be experienced.
What is the difference between services and goods?
Goods are tangible objects that can be seen and touched, as well as moved from one place to another. They can also be stored and reused later. Lastly, goods can be evaluated based on their physical appearance.
Services do not possess measurable attributes and are intangible in nature. It is hard to objectively evaluate the quality of service provided and we rely only on the benefits it offers. As consumers, the physical elements of services play a significant role in shaping our perception, despite the intangible nature of the services themselves.
How to measure service quality?
A SERVQUAL framework is a tool for measuring service quality that was created by A. Parasuraman, Valarie Zeithaml, and Leonard L. Berry. The SERVQUAL Model of Service Quality is a method of measuring the quality of services to improve them.
It’s a qualitative analysis that focuses on the service quality experience. To deliver quality service, a service provider must provide five essential elements: reliability, assurance, tangibility, empathy, and responsiveness. These elements are commonly known as RATER.
What is Services Marketing?
Services marketing is a type of marketing that specifically targets intangible goods, meaning products that don’t have a physical form. Its goal is to understand customer needs, establish strong relationships and customer loyalty, and provide high-quality service.
Services marketing is crucial for any company’s success, as they aid in increasing awareness, generating leads, and maintaining customer loyalty. Therefore, companies need to explore creative methods of promoting their services whilst also developing a reliable customer service approach.
Liked this post? Check out the complete series on Services Marketing
I am a business student taking a marketing class. I find marketing challenging, at least when it comes to the learning and studying. Your article was easily understandable, and it helped me to realize that I know more than I thought I did. Thanks!
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Thanks for the feedback and i am glad i could be helpful to you.
thanks for the infor worthy taking. i was struggling on how i can answer my service procurement question but now im enlightened. thanks.
I am an engineer and have no formal training of Finance and Accounts. When I was thinking about service industry in general, I realized all the features mentioned by you. I noted them down. When I read about this, I realized that our thought process is parallel. I will be my pleasure to share thoughts with you.
thanks so much coz I had a question of service in procurement but you solved it