PART 3: PRODUCTS, GOODS AND SERVICES

PART 7: MAIN CHALLENGES OF CUSTOMER SERVICE

Based on Hudson, S. & L. (2017). Customer Service for Hospitality and Tourism. Goodfellow Publishers Ltd. Chapter 1: Introduction to Customer Service

PRODUCTS, GOODS & SERVICES

Goods are TANGIBLE. They can be seen, touched, smelled and/or tasted.

For example, a hamburger is a good that can be touched and tasted.

Sometimes TANGIBLE GOODS come with INTANGIBLE SERVICES.

For example, a cell phone (a tangible good) is a product that requires a service provider who provides you with a phone number and data (an intangible service).

Sometimes INTANGIBLE SERVICES come with TANGIBLE GOODS.

For example, air travel (a service) that provides meals and snacks onboard (accompanying tangible goods).

Sometimes SERVICES are COMPLETELY INTANGIBLE.

For example, travel advice about best honeymoon destinations.

In pairs, think of another example for each of the following: a tangible good, a tangible good with accompanying service, service with accompanying minor tangible goods, an intangible service. BONUS: Can you think of an intangible good?

A purely tangible good:

A tangible good with accompanying service:

A service with accompanying minor good(s):

An intangible service:

BONUS: An intangible good:

THE TANGIBILITY SPECTRUM

Essentially all products are a mix of goods and services with both tangible and intangible elements and these can lie somewhere on a continuum. We call this the tangibility spectrum.

Place each of the following on the tangibility spectrum. Be prepared to explain your idea.

a box of chocolates

staying at a hotel a car going to the movies fine dining

a massage a cell phone fast food airline education

tangible (a pure good) intangible (a pure service)

Source: https://www.marketingstudyguide.com/tangibility-intangibility-continuum/

CHARACTERISTICS OF HTL SERVICE PRODUCTS

HTL service products are generally activities and experiences. They are a combination of all goods, activities, and services offered to tourists by different sectors in order to satisfy their needs. Tourism products may be tangible goods, intangible services or a combination of the two. A tourism product, such as a vacation abroad, cannot be tested or evaluated before it is purchased. To the customer, buying a tourism product seems riskier than buying a physical good.

Hospitality products (services) are different from physical goods in several important ways:

intangible (adj.) intangibility (n.)

- you cannot see, taste, or touch it Unlike goods, services are intangible. This means services can’t necessarily be seen, touched, smelled or tasted.

EXAMPLE: Air travel is a service. Prior to boarding a plane, airline passengers have nothing more than an airline ticket and promise of safe travel. Therefore, passengers often look for tangible evidence that will provide information and give them confidence about the service. This can include staff dressed in uniforms and the cleanliness of the interior of the plane.

inseparable (adj.) inseparability (n.)

- the product/service is made at the same time as it is used

heterogeneous (adj.) heterogeneity (n.)

- it is different depending on the employee and the consumer Services are inseparable; they are interactions so they cannot be provided without the presence of the customer. If the consumer is not present, the service cannot take place.

EXAMPLE: You are on a relaxing beach vacation at a sunny seaside resort. The air is warm, the drinks are cold, and your accommodations are perfect. Unfortunately, you can’t take any of it home with you at the end of the week. Travel products like cruises, resorts and hotels are produced and consumed at the same time.

Source: https://study.com/academy/lesson/service-inseparability-in-marketing-definition-example.html

Service quality is heterogeneous (or variable); it differs depending on the interactions of the people involved, the situation and even the time of day. This is a challenge because it makes service quality hard to measure or standardize.

EXAMPLE: One member of staff can deliver different levels of service. They may be friendlier at different times of the day. Lack of consistency is a major factor in customer dissatisfaction.

perishable (adj.) perishability (n.)

- you cannot store it, save it, or return it Services are perishable; they cannot be stored or inventoried to use later and cannot be returned easily.

EXAMPLE: For example, if an airline seat, hotel room, daily pass or restaurant cover is empty on one day, the service provider loses revenue on that day. Therefore, if services want to maximize revenue, they must manage capacity and consumer demand since they cannot carry forward unused inventory.

Read the following examples. Do these examples illustrate intangibility, inseparability, heterogeneity or perishability?

1 A hotel room rate is 500 CNY per day so the maximum revenue from this room is 15000 CHY (assuming 30 days). However, if the room is unoccupied for 10 days, the hotelier loses 5000 CNY, which cannot be recovered.