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Content 1. Introduction 2. Overview of Theories 3. Cases Discussing 4. Conclusion 5. Reference 6. Appendix: 6. 16 Journal entries 6. 2CRA for Report 1. Introduction In the modern sociality, people spend long time in their areas, therefore they do not have enough knowledge or time to do or work in other areas. Since this problem is appeared, service is becoming more important than old days when especially the world always developing fast. As many sociologists believe when the community is developing, the service industries will increase rapidly.
Therefore, the more developed countries had higher percentage of service industries. In this essay, it will give the ideas of the description for two marketing theories of flower of service and pricing strategy. By analysing the theories to indentify the key point of concept and find the weakness of company strategy. And in the next part , it will give the example by choosing the 2 journals as the case which is Land mark restaurant and Hungary Jacks to link with the 2 theories, to identify and easier understanding the success factors for each company. Followed by the Dr.
Doyle and Stern believe the more studies and researches can help people to obtain the core of truth. (2006) 2. Overview of the theories In the marketing field, service and product are the important elements to influence the degree of the customers’ satisfaction. (Ruyter and Lemmink, 1996) Many marketing researchers have created many concepts and theories about service to help the companies to understand the marketing process in order to make more profits. In this paragraph, there are two service marketing theories will be analysed to help understanding how the business can get profits and survive in the competition.
The first theory is flower of service as the figure 1 which can analyse the core of service and other attaching service. It can be seen clearly in the chart that in the middle of the flower is the core service which is the most significant one such as providing food for restaurant. The other eight attaching service are information, payment, billing, order, taking consultation, hospitality, safe keeping and exceptions. The eight attaching factors can be separate into two parts there are facilitating services and enhancing services.
Both of two supplement service have to considered in detail for business plan to enhance the service quality, because the consumer are fastidious group, they care each part of service. Therefore the well trained staffs and mangers play the important role of business; otherwise, it is hard to cover each part of service in depth. The marketers believe that a perfect management and plan of the business has to have whole eight service factors. Otherwise, there will have some weaknesses in the business to reduce the quality of service and affect the profits.
Figure 1: flower of service Another theory is pricing strategy. According to Dr. Kotler & Armstrong (2007) believe that price is always a key element to influence the consumers’ behaviour. The figure 2 illustrates that pricing strategy is affected by three reasons which are costs, competition and value of customer. it also means, the company have to consider the each parts to make right price strategy in order to increase the market share and profits. The first factor of setting an excellent pricing strategy is the costs. The costs decided the profits of the company decision.
If a firm can control its cost, it will make more money. Therefore, the cost which is can separate in many parts as the cost of training and goods, it is a main element to influence the pricing directly. The second one is competition. Business can not always the only one choice in their areas, the competitive always share the whole market. If the competitive prices of products are powerful and the products have high quality, the firm can occupy more market share. Otherwise, it may loss the market because of the weak competition power. The last one is the value of customers.
It the customers can accept the higher price of the product when they choose, the company will use higher pricing strategy. On the other hand, companies may use the lower price, because they only had lower value for their consumers compare with other companies. And the Value can be in many types in different areas and different faces, such as the quality of service, the power of brand…etc. For example, the Mercedes-Benz can match the social status of the customers, the customers also have brand loyalty, and they think that drive Mercedes-Benz is a kind of way to show their wealth.
Therefore, the customers may accept the higher price. Figure 2: Pricing strategy 3. Cases Discussing There are two case studies from the journals and to analyse by flower of service and pricing strategy. Case 1. The first example is Landmark Chinese restaurant which is a Cantonese style restaurant located in Sunnybank Plaza. In lunch time between 10am to 4pm, it provides the special food style which called “YUM CHA”. It is different from the traditional Chinese restaurant. You can select the Chinese side dishes and even the deserts which you like when the waiters push the dining car near your seat as the table service.
In this case, the core of the flower is the food for the restaurant. In addition, it provides attaching service to make your meal feeling more comfortable way. Information- In the information service, there is a card to record the price and menu information. Payment-When finishing the meal, the customers also can choose diversify ways to pay the meal, such as credit card, cash or debit card. Bill-The waiters will tick the foods which the customers have selected and help the caser to calculate the bill. Order Taking-The customers can order the foods which are in the dining cars, and also can order the foods hich are in the menu. Consultation-Complain can be told to the manager on the restaurant and can be solved in time. Furthermore, it provides the email address and mail box to the consumers to collect the suggestion. Hospitality-In the staff training course, all the staff must keep the smile face to the consumer and to guarantee the quality of the service. Safekeeping-There are some secretors in the restaurant. In the same time, the secretions are complement, such as digital camera and the fire control system. Exceptions- In the exception factor, the customers can reserve or require more personal service.
Though the flowers of services analysis, it can be seen that the whole plan of the services and the strategy are perfect. Additionally, the core of service which is foods also is delicious. Form the case; it is clearly to find the restaurant owned the whole eight factors of flower of service, and also keep the core service is on the correct direction. Therefore, Landmark is a successful case in the service marketing field. Case 2. Another case is the pricing strategy for the Hungry Jacks and McDonalds. From the personal experience, when I was first week arrived Brisbane.
I ate the big Mac meal in McDonald’s on Monday which spent $5. 90, and I ate a hamburger in Hungry Jack’s on Wednesday which was costed $7. 30. Though the hamburger in McDonalds was cheaper, but I still prefer to the one in Hungry Jack’s. In the fast foods industry, the differences of product and service costs are not very obvious. Because, they are not like the Hi-tech industries such as laptop or home entertainment products had the high cost of products and developing. Most of fast food industries cost are very similar, except the advertising fees.
The main forces to affect the pricing strategy are the competitive pricing strategy and value of the customers. Pricing setting to force competitive is the best attract weapon in the market. It is easer way to help business to increase market share. On the other hand, consumers always more concerned about the value they can received from the service and products. In this case, comparing to Hungry Jack’s competitors such as KFC and McDonalds, Hungry jacks provides large size of foods in the same price level and free retail soft drink(only in some main shops, as Queen St. hop). In hence, a suitable pricing strategy is a key factor of how to enhance the competitive power. Even though Dr. Lovelock and Wirtz (2006)claimed that the best value for the customers is the lower price, which is also the McDonalds believes and chosen for their strategy, but there are still some consumers will chosen the better value for them rather than cheapest one. Pricing is sensitive strategy is very easy inflection by many factors, therefore companies have always be careful in setting the price. 4. Conclusion
In the whole essay, using the two theories to described the different of each theory and also to analysis the difference for each case to indentify the strongest and weakness points. And in final it can be said, in service marketing areas, Dr. Lovelock and Wirtz also found the employees who work in front stage back stage play an important role in a company. (2006, p. 163) As the essay mentioned of the case for Land Mark restaurant, Hungary Jacks and McDonalds, followed by the theories there provided companies some distinct details of service factors when the mangers are considering making profit.
In the some industries that are core part of business is providing the good quality of service to customers, service is very emotional areas for consumers. Consumers not only concerned about the core service, they also think the value from the supplemental service presented to them. However, it is impossible to make all consumers feel satisfy for the company, the only thing company can do is considering more comprehensive to cover more consumers, which may help more customers feel better than before.
In conclusion, through the cases, the main core area for service marketing is increase the consumers satisfy, which not only helps build stronger relationship between consumer and companies, but also helps giving the value for both sides. 5. Reference Christine Moorman, & Roland T Rust. (1999). The role of marketing. Journal of Marketing, 63, 180-197. Retrieved June 4, 2010, from ABI/INFORM Global. Doyle, P. & Stern, P. (2006). Marketing Management and Strategy. Jersey: Pearson Prentice Hall. Kotler, P. , & Armstrong,G.. (2008).
Principles of marketing. 12th ed. New Jersey: Person Education Ltd. Lovelock, C. H. , Patterson, P. G. & Walker, R. H. (2004). Services Marketing: An Asia-Pacific and Australia Perspective. Prentice Hall. Lovelock, C. H. , J, Wirtz. (2006). Service marketing : people, technology, strategy. 6th ed. Pearson Prentice Hall Ruyter, Ko de, Wetzels, Martin, & Lemmink, Jos. (1996). The power of perceived service quality in international marketing channels. European Journal of Marketing, 30(12), 22. Retrieved June 4, 2010, from ABI/INFORM Global.