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Chapter 12: Services and Nonprofit Organization Marketing
1
Review and Assignments for Chapter 12
Review Quesons
1. Assume you are a manager of a bank branch. Write a list of the implications of
intangibility for your firm.
Although students’ answers will vary, they should address some of the following points.
2. Analyze a recent experience that you have had with a service business (for example, a
hairdresser, movie theater, car repair, or restaurant) in terms of your expectations
and perceptions about each of the five components of service quality.
Applicaon Quesons
1. To keep track of how service employment is affecting the U.S. economy, go to
http://www.bls.gov/bdm/. Look at the right sidebar, which gives the latest numbers for
Business Employment Dynamics. What trends do you see? Do the numbers support
the information from the chapter?
2. Over 25 years ago, Tim and Nina Zagat began publishing leisure guides containing
reviews of restaurants. Today, the renowned Zagat guides still contain reviews of
restaurants, but they also rate hotels, entertainment, nightlife, movies, shopping, and
even music. Go to http://www.zagat.com. In your opinion, are Zagat survey guides
goods or services? Explain your reasoning.
Reasons for service: Zagat guides provide information that consumers use to make
Reasons for good: Zagat guides are a tangible product—books. The guide books can not be
© 2018 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Chapter 12: Services and Nonprofit Organization Marketing
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3. Form a team with at least two other classmates, and come up with an idea for a new
service. Develop a marketing mix strategy for your new service.
Here is an example of the marketing mix for an auto-leasing company that specializes in
inexpensive leases for college students:
Product: two- to three-year-old compact cars with low mileage, maintenance included
4. For the new service developed in question 3, have the members of the team discuss how
they would implement a relationship marketing strategy.
Internal marketing means treating employees as customers and developing systems and
benefits that satisfy their needs. Happy employees are more likely to deliver high-quality
5. Choose a service with which you do a lot of business. Write a memo to the manager
explaining the importance of internal marketing and outlining what factors internal
marketing includes.
The memo should include the following: a definition of internal marketing (treating
employees as customers and developing systems and benefits that satisfy their needs) and
6. Return to http://www.zagat.com, and investigate what the site offers. How does Zagat
propose to help companies do internal services marketing?
Zagat has a corporate sales division that publishes special editions of its products for
© 2018 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Chapter 12: Services and Nonprofit Organization Marketing
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7. What issues would you have to think about in going global with the new service that
you developed in the questions above? How would you change your marketing mix to
address those issues?
Answers will vary depending on what kind of service was developed previously. However,
some issues in global business that students should consider are given below.
Political, legal, and regulatory issues (differences in regulations, the type of political
system in place, etc.)
Then, if necessary, students should apply those environmental factors to change their
marketing mix.
8. Form a team with two or three classmates. Using the promotion strategies discussed in
the nonprofit section of this chapter, develop a promotion strategy for your college or
university.
Four promotional strategies for dealing with the unique features of services are given
below.
Stressing tangible cues
Students should outline a strategy using all four of these concepts.
Application Exercise
All people know quality when they see it—or do they? Let’s take a look at some goods and
Activities
© 2018 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Chapter 12: Services and Nonprofit Organization Marketing
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1. Using the abbreviations in parentheses, place each of the following products and services
2. Once you have placed the items along the continuum, consider how easy it is to assess the
quality of each item.
3. What assumptions can you make about the ability to assess the quality of goods compared to
services? Is it easier to assess the quality of some goods than others? Is it easy to assess
services?
Purpose: The purpose of this exercise is for students to think experientially about how difficult
Setting It Up: The activity above provides three questions, two of which are each supported by a
This exercise was inspired by the following Great Idea in Teaching Marketing.
Stacia Wert-Gray, University of Central Oklahoma
Gordon T. Gray, Oklahoma City University
Assessing Service Quality
Students sometimes do not understand why service quality is difficult for consumers to assess.
Recognizing that most product offerings are a blend of physical goods and services, each student
Break students into groups of two or three. Provide them with the following worksheet, and
© 2018 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Chapter 12: Services and Nonprofit Organization Marketing
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All people know quality when they see it—or do they? Let’s take a look at goods and services
Activities
Using the following abbreviations, place these products and services along the continuum: a new
car (C), designer jeans (J), a car oil change (O), dress dry-cleaning (D), a haircut (H), tax
preparation software (T), and college education (E).
Each group is then asked to position the same product offerings on the following scale, which
addresses how easy it is to assess the quality of each product.
When the groups are finished, the instructor should fill in a class worksheet with input from the
groups. The class worksheet often looks something like the following:
During the class discussion after completion of the two exercises, the instructor may emphasize
at least two important aspects of service quality and consider the implications for marketing
practitioners.
1. Assessing the quality of physical goods is usually easier than assessing the quality of
products that consumers consider services.
© 2018 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Chapter 12: Services and Nonprofit Organization Marketing
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goods” component.
Ethics Exercise
Certain websites, such as CancerSource.com, offer cancer patients sophisticated medical data
and advice in exchange for personal information that is then sold to advertisers and business
1. Is this practice ethical?
One point that affects this issue is who actually owns the information once it is given out.
Some say that an individual owns his or her data no matter where it is disseminated and has
One way out of the dilemma is through consent. The practice of selling personal data
collected on the Web is ethical only insofar as the person whose data is being sold agrees.
2. Does the AMA Statement of Ethics have anything to say about this issue? Go to
http://www.marketingpower.com, and review the statement. Then write a brief
paragraph on what the AMA Statement of Ethics contains that relates to this
scenario.
Although the AMA Statement of Ethics does not specifically mention the sale of
information, it does state that “Information collected from customers should be
© 2018 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Chapter 12: Services and Nonprofit Organization Marketing
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Video Assignment: Pepe’s Pizzeria
1. In which category of processing does Pepe’s Pizzeria best fit?
a. People processing
b. Possession processing
c. Mental stimulus processing
d. Information processing
2. What is the unit of service consumption that Pepe’s charges for?
a. Server’s attentive service
b. Waiting in line (the longer you wait, the less you pay)
c. Food and drink
d. Length of time sitting in a booth
3. Based on what you heard in the video, what level of relationship marketing does Pepe’s
practice?
a. Level 1
b. Level 2
c. Level 3
4. Jennifer Kelly discusses how she understands that grumpy customers are hungry—just like
she gets grumpy when she is hungry. What component of service quality is she
embodying?
a. Assurance
© 2018 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
Chapter 12: Services and Nonprofit Organization Marketing
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b. Tangibles
c. Responsiveness
d. Empathy
5. If a server is hired and does not provide customers with drinks right away and instead
serves the salad with the pizza, which gap in service quality would this represent?
a. Gap 1
b. Gap 2
c. Gap 3
d. Gap 4
6. Of the promotion strategies listed, which best fits the strategy used by Pepe’s Pizzeria?
a. Engaging in post-purchase communication
b. Creating a strong organizational image
c. Using personal information sources
d. Stressing tangible cues
© 2018 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.
