The 8 Ps of Services Marketing

 Advertising & Branding, Marketing, Marketing Theory, Sales & Distribution
Mar 202011
 

Services are radically different from products and need to be marketed very differently. So the classical 4 P structure of the Marketing Mix needs to be modified suitably to incorporate the 8 Ps for services marketing, which was previously known as the 7 Ps only.

Services can range from financial services provided by the banks to technology services provided by the IT company or hospitality services provided by hotels and restaurants or even a blog where an author provides a service (information presentation, interesting reading etc) to his audience. Services marketing are dominated by the 7 Ps of marketing namely Product, Price,  Place, Promotion, People, Process and Physical evidence.

To know more in details about the classical 7 Ps of services marketing do visit our article on The 7 Ps of services marketing

While everyone knows about the 7 Ps of services marketing, the 8th P of Services Marketing has emerged in research very recently. The 8th P is Productivity and Quality.

In integral services management, improving productivity is a requisite in cost management; but quality, as defined by the customer, is essential for a service to differentiate itself from other providers.

It has been recognized that overall profitability of a firm may be greatly impacted by focusing on not only at the top-line by improving sales but also focusing on the bottom-line by lowering over-all cost of delivering services. In services management, often the variable costs are a lot more than fixed costs, and so incremental costs, if managed properly can have a huge impact on productivity. So for services, a firm may greatly benefit through proper re-engineering of processes and remodeling the same if required to improve productivity at each stage.

It has also been established in research that process improvements deliver better standardization and hence better quality in services. Quality perception is a crucial differentiating factor on services management and for long term sustainability of the same. Business Process Remodeling can lead to major process efficiency improvements which again can impact overall quality as is actually delivered by the firm and is also perceived by the customers / clientele .

8-Ps

Do let us know if you liked our article or if you have any questions.

By the way, have you read our article on the 4 P’s on Social Marketing?

Also did you read our article on the The 4 P’s of Marketing – The Marketing Mix strategies from which the 7 P Marketing Mix theory actually evolves?

Last few popular posts by Arpan Kar

Arpan Kar

Dr. Arpan Kar (PhD) is a faculty of the globally renowned Indian Institute of Management. He has rich experience in research, training and consulting in e-business, e-commerce, digital marketing, technology marketing and technology enabled supply chain management. He was earlier associated with IBM Research and Cognizant Business Consulting besides handling advisory projects for multiple Fortune 500 MNCs. He is the Editor of Business Fundas and also writes for Technorati.
  • Jonathan

    well, never knew they had a 8th P too. really great article.
    geez thanks

  • UAA Student

    Hello Arpan, I am an undergrad currently learning about the differences between product marketing and service marketing. After reading your post and following it up with other readings, I was surprised to find my marketing textbook did not include the extended marketing mix (4 + 3 Ps). Your post actually introduced me to the process, people, and physical evidence portions. Of course, the 8th P (Productivity and Quality) makes complete sense in today’s market. Especially with the increasing use of TQM. I can see the difficulties there will be in measuring productivity and evaluating quality in the service sector (as opposed to goods).

    • http://business-fundas.com/author/admin/ Arpan Kar

      Hi,
      Thanks for your comment… actually for services, due to the intangibility of their nature, the extended marketing mix (3Ps and then the 8th P) becomes all the more relevant in terms of creating a differentiation. I am really glad you found the article useful.

  • http://business-fundas.com/author/admin/ Arpan Kar

    Well, first of all, thanks for your comment Peter..
    Point is in services, product is defined in the aspects of service dimension and characteristics while in “Productivity and quality” service delivery and consistency is often more of a focus, and hence the need for differentiation.

    • Pedro V

      Dear Arpan,
      Thank you but I totally agree with Peter Prevos. You are mixing Production Focus (TQM, performance, cost…) with Marketing Focus. TQM, Performance, cost control, QUALITY in deed, is not only relevant today in Services, also in Product oriented companies. Don’t you include this 8th “P” to the 4Ps of Products accordingly? We’re in a hurry of “discovering” new Ps and Theories. Customer is waiting outside this mix. Let’s think about Cs, no Ps.

      • http://business-fundas.com/author/admin/ Arpan Kar

        Dear Pedro,
        Thanks for you comment on my article.
        Service differentiation is a major challenge of services marketing. In services, process of delivery becomes as important as the offerings of the services itself. Value perception of a service comes not only from the core product but also from the augmented product which essentially is the process (which you are calling the production focus). This was established in research that the perception of quality of services was hugely dependent on the delivery process and productivity of the processes. Thus to ensure a focus on Customer Satisfaction, the 8th P was defined for services marketing.
        Product quality is very differently defined in business management literature than is understood in general usage of the construct. Product quality as per research depends on meeting the requirement specifications of the buyer firm and on the costs of a component rejection by the buyer at three locations. It does not incorporate process metrics.
        I hope this clarifies my article.

  • Peter Prevos

    Productivity and quality are aspects of the service product. There is no need for an 8th P.

    • HILDA GITAU

      Hae,
      .Thanks for a great article.I am a student pursuing CIM in advanced diploma level.Your article has really helped in my project Management in Marketing.It has clearly helped me state AND explain how organization can improve their overall product portfolio management using the seven Ps.

      • http://business-fundas.com/author/admin/ Arpan Kar

        A pleasure to know that my article helped you Hilda :-)
        You can subscribe to our articles via e-mail, if you like them…

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