Ecommerce: Online Services

  1. The core elements of a service (as opposed to a product) according to the text:
    • Intangibility: Unlike products, services are intangible or impalpable, they cannot be seen, held, or touched. Whereas products are palpable things, services are performances or experiences. The main problem that intangibility creates for services marketers is that they have nothing to show the customer. Thus, experience and credence qualities are significantly important in the case of services.
    • Simultaneity: In the case of goods, production and consumption are not simultaneous, and these activities do not occur at the same time or place. In the case of services, it is generally true that the producer and consumer both have to be present when a service is enacted.
    • Heterogeneity: Products tend to possess a sameness, or homogeneity, that is not achieved by accident. Manufacturing lines produce homogenous products and have quality control procedures in place to test products as they come off the line, and to ensure that defective products don’t reach the market. Services have the characteristic of heterogeneity. They vary in output, and mistakes happen in real time, in the customer’s face, which creates a number of challenges for the services marketer.
    • Perishability: Because services are produced and consumed simultaneously, they cannot be inventoried. For example, if there are twenty empty seats on an aircraft for a particular flight, the airline can’t say, “Don’t worry, stick them in a cupboard. We’ll certainly be able to sell them over Thanksgiving.” They are lost forever.
    • The trick is to build out service systems that can be scaled, even if the service isn’t scaleable:
      Example, software as a service (SaaS):
      We are entering the age of the narrative:
      You will need to think much more intentionally about what value you as an individual bring:
      And you will need to take action:

      For this activity write out your thoughts in the following areas:

    1. Think about some kind of specific knowledge or skill you have that can be potentially sold as a service.
    2. Think about how you would package that specific knowledge into a sellable service.
    3. Think about how that service has changed through the different ages:
      1. Stone age
      2. Bronze age
      3. Iron age
      4. Industrial age
      5. Information age
      6. Narrative age
    4. Think about how you might sell your service that will be specific and unique to you aka not generalizable (think the pain/gain canvas from our business model canvas work).
    5. Think about how would test your narrative.