How services marketing differs from product marketing. While companies use both services marketing and product marketing to acquire new customers, marketing services differs from marketing products in a number of ways. Some of the key differences between these two types of marketing strategies include:
1. Tangible products vs. intangible services
Tangible products may be easier to market than intangible services because advertisers can easily show them and demonstrate how they work. It can also be easier for customers to assign value to physical items. Since services are intangible, advertisers often focus on marketing the people who provide the service and building relationships with potential customers. This can help build trust and generate sales.
2. Customization
Unlike products that are often designed one way and sold to customers as is, businesses can customize their services to meet the unique needs of each customer.
Example: A company that offers digital marketing services may customize which platforms it focuses on to fit the needs of each individual customer. As an advertiser, your services marketing strategy can highlight this by focusing on how you can adapt a service to better suit a wide range of different customers.
3. Ownership
When a customer purchases a product, they own it. This means they can continue to use the product for as long as they see fit and resell the product if they desire to do so. When a customer purchases a service, the business still retains the employees, skills and capabilities that provided the service. While product marketing may focus on why a customer wants to own an item, services marketing focuses on building the brand and the personality of the service provider.
Example: A business that provides personal counseling services may highlight how empathetic, professional and well-educated their staff is to encourage potential clients to schedule a session with them.
4. Trust
While customers who are unhappy with a product may return it, customers who are unhappy with a service cannot return it after they have used it. This is why services marketing focuses heavily on building trust with their customers and continuing to provide an excellent customer experience at every interaction with their audience. Service-based businesses also want to ensure their customers are happy so they continue to purchase services from them.
Example: A hair salon that hires personable and talented hairdressers can increase the number of repeat customers and referrals they receive because customers trust them to provide excellent service.
5. Time
Usually, businesses provide services to customers at a specific time or for a specific duration. After this, customers must renew the service agreement to continue receiving the service. However, a customer may purchase a product once and continue using it indefinitely. Because of this, services marketing typically focuses on selling subscriptions, encouraging referrals and retaining customers instead of selling customers a product one time.
Example: A hotel might offer customers who have recently booked a stay with them a free night to use on a future reservation. This can encourage customers to return to the hotel during their next vacation.
6. Market size
The market size for service-based businesses may be smaller than the market size for product-based businesses. This is because most businesses can ship products to customers globally, while many businesses provide services only to a specific geographic region.
Example: A landscaping company may only serve customers within a 50-mile radius of their business location. As a result, advertisers who market services may place a heavier emphasis on developing strong relationships with their customers to earn referrals and repeat business. They may also focus on promoting upgrades to increase the amount of revenue they can collect per customer.
