Chapter 3: Fundamental Differences Between Goods and Services Flashcards Preview

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Flashcards in Chapter 3: Fundamental Differences Between Goods and Services Deck (23)
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Philosophical viewpoint that the primary role of marketers is to deliver service. Consequently, goods are simply a means of rendering a service to the customer.

Service-dominant logic


A distinguishing characteristics of services that makes them unable to be touched or sensed in the same manner as physical goods.



The physical characteristics that surround a service to assist consumers in making service evaluations, such as the quality of furnishings, the appearance of personnel, or the quality of paper stock used to produce the firm's brochure.

physical evidence/tangible clues


Sources such as friends, family, and other opinion leaders that consumers use to gather information about a service.

Personal sources of information


Costing method that breaks down the organization into a set of activities, and activities into tasks, which convert materials, labour, and technology into outputs.

Activity-based costing


A distinguishing characteristic of services that reflects the interconnections among the service provider, the customer involved in receiving the service, and other customers sharing the service experience.



A specific interaction between a customer and a service provider.

Critical incident


The term used to describe customers who share a service experience.

Other customers


A strategy service personnel can implement that minimizes the impact of other customers on each individual customer's service experience (eg. separating smokers from non-smokers in a restaurant).

Consumer management


A way service firms that mass-produce combat inseparability, involving multiple locations to limit the distance the consumer's have to travel and staffing each location differently to serve a local market.

Multisite locations


Another name for multisite locations.

Factories in the field


A distinguishing characteristic of services that reflects the variation in consistency from one service transaction to the next.



Taking advantage of the variation inherent in each service encounter by developing services that meet each customer's exact specifications.



The goal of _______ is to produce a consistent service product from one transaction to the next.



A distinguishing characteristic of services in that they cannot be saved, their unused capacity cannot be reserved, and they cannot be inventoried.



Pricing strategies often used by service firms to help smooth demand fluctuations, such as offering "matinee" prices or "early bird specials" to shift demand from peak to nonpeak periods.

Creative pricing


A strategy to help smooth demand fluctuations in which consumers ultimately request a portion of the firm's arrives for a particular time slot.

Reservation system


Services provided for consumers to minimize their perceived waiting time, such as driving ranges at golf courses, arcades at movie theaters, or reading materials in doctor's offices.

Complimentary services


A strategy in which service providers use their downtime to prepare in advance for peak periods or to market to different target markets that follow different demand patterns than the firm's traditional market segment.

Nonpeak demand development


Strategy to increase the supply of service by forming a type of co-op among service providers that permits co-op members to expand their supply or service as a whole.

Capacity sharing


Planning for future expansion in advance and taking a long-term orientation to physical facilities and growth.

Expansion preparation


A supply strategy in which a service firm used an outside party to service customers and thereby save on costs, personnel, etc.

(Utilization of) third parties


A supply strategy that increases the supply of service by having the customer perform part of the service, such as providing a salad bar or dessert bar in a restaurant.

(Increase) Customer participation