Page 393 - Marketing Management

370 PART 5 SHAPING THE MARKET OFFERINGS

Trick My Truck, on satellite radio, in newspapers, and on-
line; employs Webinars and PR; and partners with AARP,
local organizations, and veterans’ groups. Even painting
the trucks Omaha orange was part of a branding strategy
to improve safety and create awareness. 60

INNOVATION WITH SERVICES Innovation
is as vital in services as in any industry. After years of
losing customers to its Hilton and Marriott hotel
competitors, Starwood decided to invest $1.7 billion
in its Sheraton chain of 400 properties worldwide to
give them fresher décor and brighter colors, as well
as more enticing lobbies, restaurants, and cafés. In
explaining the need for the makeover, one
hospitality industry expert noted,“There was a time
when Sheraton was one of the leading brands. But it
lagged in introducing new design and service
concepts and developed a level of inconsistency.” 61
Retail health clinics are reinvent-
On the other hand, consider how these relatively new service categories emerged and how, in
ing patient care for minor illnesses 62
some cases, organizations created creative solutions in existing categories.
and injuries.
• Online Travel. Online travel agents such as Expedia and Travelocity offer customers the
opportunity to conveniently book travel at discount prices.However,they make money only when
visitors go to their Web sites and book travel.Kayak is a newer online travel agency that applies the
Google business model of collecting money on a per-click basis.Kayak’s marketing emphasis is on
building a better search engine by offering more alternatives, flexibility, and airlines.
• Retail Health Clinics. One of the hardest areas in which to innovate is health care. But
whereas the current health care system is designed to treat a small number of complex cases,
retail health clinics address a large number of simple cases. Retail health clinics such as Quick
Care, RediClinic, and MinuteClinic are often found in drugstores and other retail chain stores
such as Target and Walmart. They typically use nurse practitioners to handle minor illnesses
and injuries such as colds, flu, and ear infections, offer various health and wellness services
such as physicals and exams for high school sports, and perform vaccinations. They seek to of-
fer convenient, predictable service and transparent pricing, without an appointment, seven
days a week. Most visits take no more than 15 minutes, and costs vary from $25 to $100.
• Private Aviation. Initially, private aviation was restricted to owning or chartering a private
plane. Fractional ownership pioneered by NetJets allowed customers to pay a percentage of the
cost of a private plane plus maintenance and a direct hourly cost. Marquis Jets further innovated
with a simple idea of combining prepaid time on the world’s largest, best-maintained fleet, offer-
ing the consistency and benefits of fractional ownership without the long-term commitment.

Many companies are using the Web to offer primary or secondary service features that were
never possible before. Salesforce.com uses cloud computing—centralized computing services de-
livered over the Internet—to run customer-management databases for companies. Häagen-Dazs
estimated it would have had to spend $65,000 for a custom-designed database to stay in contact
with the company’s retail franchises across the country. Instead, it spent only $20,000 to set up an
account with Salesforce.com and pays $125 per month for 20 users to remotely monitor franchises
via the Web. 63

Managing Service Quality

The service quality of a firm is tested at each service encounter. If employees are bored, cannot an-
swer simple questions, or are visiting each other while customers are waiting, customers will think
twice about doing business there again. One business that understands how to treat customers right
is USAA.