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L5: Distributing Services (2️⃣ Service Distribution Strategies (Mini…
L5: Distributing Services
1️⃣ Service Distribution
Can be distributed / delivered through physical and electronic channels
Service cannot be physically shipped and stored
2️⃣ Service Distribution Strategies
Information and promotion - get customer interested in buying the service
Negotiation - sell the right to use a service e.g. sell a reservation
What is distributed - 3 interrelated flows for core and supplementary services:
Product - people/possession processing require physical facilities for delivery info processing can be delivered via electronic channels
Mini-stores
Separating front and back stages of operations
Purchasing space from another provider in complementary field
Many small service kiosks to maximise geography coverage
Multi-Purpose Facilities
Proximity to where customers live or work
Service stations e.g. POPstations, Vending Machines
Locational constraints
Operational requirements, geographic factors, need for economies of scale
Cost, productivity and access to labour are key determinants in locating a service facility
3️⃣ Service Distribution Strategy
Service organisation comes to customer
Customer and service organisation transact remotely (via mail/electronic communications)
Customer goes to service organisation
4️⃣ The Role of Intermediaries
Splitting Responsibilities for Supplementary Service Elements
Supplementary services
[AS ENHANCED BY DISTRIBUTOR]
Total experience and benefits
[AS EXPERIENCED BY CUSTOMER]
Core product with some supplementary services
[AS CREATED BY ORIGINATING FIRM]
Franchising
Franchisor assists in all aspects of the business
Minimise monetary investments
Popular way to expand delivery of service
5️⃣ Service Delivery in Cyberspace
Order-taking
Billing
Consultation
Payment
Information
6️⃣ Time of Service Delivery
Traditional: Limited schedules
Today: 24/7 operations
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