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Lavis (TN) in Italy.indd 2 3/10/17 10:59 AM Brief Contents Dedication v About the Authors vii About the Contributors of the Cases xi Preface xxii Acknowledgments xxxii Part I: Understanding Service Markets, Products, and Customers 3 Chapter 1 Introduction to Services Marketing 4 Chapter 2 Consumer Behavior in a Services Context 36 Chapter 3 Positioning Services in Competitive Markets 64 Part II: Applying the 4 Ps of Marketing to Services 89 Chapter 4 Developing Service Products and Brands 90 Chapter 5 Distributing Services through Physical and Electronic Channels 118 Chapter 6 Setting Prices and Implementing Revenue Management 152 Chapter 7 Promoting Services and Educating Customers 194 Part III: Managing the Customer Interface 235 Chapter 8 Designing Service Processes 236 Chapter 9 Balancing Demand and Capacity 268 Chapter 10 Crafting the Service Environment 298 Chapter 11 Managing People for Service Advantage 326 Part IV: Developing Customer Relationships 371 Chapter 12 Managing Relationships and Building Loyalty 372 Chapter 13 Complaint Handling and Service Recovery 412 Part V: Striving for Service Excellence 445 Chapter 14 Improving Service Quality and Productivity 446 Chapter 15 Building a World-Class Service Organization 490 Part VI: Cases 502 Glossary 641 Credits 651 Name Index 655 Subject Index 663 9781292089959_FM.indd 3 3/10/17 10:59 AM This page intentionally left blank 9781292089959_FM.indd 4 3/10/17 10:59 AM To Lorraine, Alexander, and Stefanie, the cool gang who brings Jeannette and me so much love and joy. Wishing you all the happiness and success in life! JW 9781292089959_FM.indd 5 3/10/17 10:59 AM This page intentionally left blank 9781292089959_FM.indd 4 3/10/17 10:59 AM About the Authors As a team, Christopher Lovelock and Jochen Wirtz provide a blend of skills and experience that’s ideally suited to writing an authoritative and engaging services marketing text. They have worked together on a variety of projects, including cases, articles, conference papers, as well as Services Marketing: People, Technology, Strategy and Essentials of Services Marketing.indd 7 3/10/17 10:59 AM Jochen Wirtz is Professor of Marketing and Vice Dean, Graduate Studies, at the National University of Singapore (NUS) and an international fellow of the Service Research Center at Karlstad University. Furthermore, he is the founding director of the dual degree UCLA-NUS Executive MBA Program (ranked globally #6 in the Financial Times 2016 EMBA rankings), international fellow of the Service Research Center at Karlstad University, and Academic Scholar at the Cornell Institute for Healthy Futures (CIHF) at Cornell University.
Wirtz holds a PhD in services marketing from the London Business School and has worked in the field of services for over 25 years. Previously, Professor Wirtz was an associate fellow at the Saïd Business School, University of Oxford, from 2008 to 2013, and a founding member of the NUS Teaching Academy (the NUS think tank on education matters) from 2009 to 2015. Professor Wirtz’s research focuses on services marketing and has been published in over 200 academic articles, book chapters, and industry reports. He is an author or co-author of over ten books, including Services Marketing: People, Technology, Strategy (8th edition, World Scientific, 2015), co-authored with Professor Lovelock, which has become one of the world’s leading services marketing textbooks and has been translated and adapted for over 26 countries and regions, with sales of approximately 800,000 copies.
His other books include Winning in Service Markets (World Scientific, 2015) and Flying High in a Competitive Industry: Secrets of the World’s Leading Airline (McGraw Hill, 2009). In recognition of his excellence in teaching and research, Professor Wirtz has received over 40 awards, including the prestigious Academy of Marketing Science (AMS) 2012 Outstanding Marketing Teacher Award (the highest recognition of teaching excellence by AMS globally) and the top university-level Outstanding Educator Award at NUS. He was also the winner of the inaugural Outstanding Service Researcher Award 2010 and the Best Practical Implications Award 2009, both by Emerald Group Publications. He serves on the editorial review boards of over ten academic journals, including the Journal of Service Management, Journal of Service Research, Journal of Service Science, and Cornell Hospitality Quarterly, and is also an ad hoc reviewer for the Journal of Consumer Research and Journal of Marketing.
Professor Wirtz chaired the American Marketing Association’s biennial Service Research Conference in 2005 when it was held for the first time in Asia.indd 8 3/10/17 10:59 AM Professor Wirtz was a banker and took the banking exam at the Chamber of Commerce and Industry in Munich. He has since been an active management consultant, working with international consulting firms including Accenture, Arthur D. Little, and KPMG as well as major service firms in the areas of strategy, business development, and customer feedback systems. He has also been involved in a number of start-ups, including in Accellion (www.
com), AngelLoop (www.com), TranscribeMe (www. com), and UP! Your Service (www. Originally from Germany, Professor Wirtz spent seven years in London before moving to Asia. Today, he shuttles between Asia, the United States, and Europe.
For further information, visit www. The late Christopher Lovelock was one of the pioneers of services marketing. He consulted and gave seminars and workshops for managers around the world, with a particular focus on strategic planning in services and managing the customer experience. From 2001 to 2008, he was an adjunct professor at the Yale School of Management, where he taught services marketing in the MBA program.
After obtaining a BCom and an MA in economics from the University of Edinburgh, he worked in advertising with the London office of J. Walter Thompson Co. and then in corporate planning with Canadian Industries Ltd. Later, he obtained an MBA from Harvard and a PhD from Stanford, where he was also a postdoctoral fellow.
Professor Lovelock’s distinguished academic career included 11 years on the faculty of the Harvard Business School and two years as a visiting professor at IMD in Switzerland. He has also held faculty appointments at Berkeley, Stanford, and the Sloan School at MIT, as well as visiting professorships at INSEAD in France and The University of Queensland in Australia. Author or co-author of over 60 articles, more than 100 teaching cases, and 27 books, Professor Lovelock has seen his work translated into 16 languages. He served on the editorial review boards of the Journal of Service Management, Journal of Service Research, Service Industries Journal, Cornell Hospitality Quarterly, 9781292089959_FM.indd 9 3/10/17 10:59 AM and Marketing Management and was also an ad hoc reviewer for the Journal of Marketing.
Widely acknowledged as a thought leader in services, Professor Lovelock has been honored by the American Marketing Association’s prestigious Award for Career Contributions in the Services Discipline. This award has been renamed as the SERVSIG Christopher Lovelock Career Contribution Award in his honor. His article co-written with Evert Gummesson, “Whither Services Marketing? In Search of a New Paradigm and Fresh Perspectives,” won the AMA’s Best Services Article Award in 2005. He had previously also received a best article award from the Journal of Marketing.
Recognized many times for excellence in case writing, he has twice won top honors in the BusinessWeek “European Case of the Year” Award. For further information, visit www.indd 10 3/10/17 10:59 AM About the Contributors of the Cases Karla Cabrera is a senior researcher at the Service Management Research & Education Group, EGADE Business School, Tecnologico de Monterrey, Mexico. Mark Colgate is a professor at the University of Victoria, Canada. Lorelle Frazer is Director of Online and Blended Learning at Griffith Business School, Australia.
Heskett is UPS Foundation Professor of Business Logistics, Emeritus, at Harvard Business School, United States. Roger Hallowell is Academic Director of Programs at HEC Paris and a former professor at Harvard Business School, United States. Hart is a former professor at Harvard Business School, United States. Loizos Heracleous is Chair in Strategy and Organization at Warwick Business School, and Associate Fellow at Oxford University.
Kimes is a professor of operations management at Cornell University, United States. Youngme Moon is Senior Associate Dean for Strategy and Innovation and Donald K. David Professor of Business Administration at Harvard Business School, United States. John Quelch is Charles Edward Wilson Professor of Business Administration at Harvard Business School, United States.
Javier Reynoso is Professor of Service Management and Chair of the Service Management Research & Education Group, EGADE Business School, Tecnologico de Monterrey, Mexico. Tang is a UCLA Distinguished Professor and the holder of the Edward W. Carter Chain in Business Administration. Rohit Verma is Dean of External Relations, Cornell University, United States.
Wright is a professor of marketing at California State College, Chico, United States.indd 11 3/10/17 10:59 AM Contents Preface xxii Acknowledgments xxxii Part I: Understanding Service Markets, Products, and Customers 3 1. Introduction to Services Marketing 4 Why Study Services? 7 Services Dominate the Global Economy 7 Most New Jobs Are Generated by Services 7 Understanding Services Offers Personal Competitive Advantage 8 What Are the Principal Industries of the Service Sector? 8 Contribution to Gross Domestic Product 9 Powerful Forces Are Transforming Service Markets 10 B2B Services as a Core Engine of Economic Development 10 What Are Services? 12 Benefits without Ownership 12 Defining Services 14 Service Products versus Customer Service and After-Sales Service 14 Four Broad Categories of Services—A Process Perspective 15 People Processing 15 Possession Processing 15 Mental Stimulus Processing 16 Information Processing 16 Services Pose Distinct Marketing Challenges 17 The 7 Ps of Services Marketing 18 The Traditional Marketing Mix Applied to Services 18 The Extended Services Marketing Mix for Managing the Customer Interface 22 Marketing Must Be Integrated with Other Management Functions 24 The Service–Profit Chain 25 A Framework for Developing Effective Service Marketing Strategies 27 2. Consumer Behavior in a Services Context 36 The Three-Stage Model of Service Consumption 39 Pre-Purchase Stage 39 Need Awareness 39 Information Search 40 9781292089959_FM.