Significance and Specifics of Communication in the Service Sector (p. 4)

1 Significance of Communication in the Service Sector

Communication is a crucial tool to build up a relationship with new customers and to cultivate the relationship with the existing customers within various marketing channels from both the theoretical and managerial perspectives. MOHR and NEVIN state that "communication can be described as the glue that holds together the channel of distribution". This statement supports the concept of integrated communication which provides clarity, consistency and a maximum of communication impact through planning, managing and controlling the communications under one hand.

Creating and maintaining competitive advantage through effective and efficient communication is gaining importance for the companies as the intensity of the competition is rising. In addition to this, it is becoming a necessity for the service companies to design a systematic communication because of the constitutive characteristic of services, especially immateriality and integration of external factors.

Effective and efficient communication in the service sector serves benefits both for the customer and the management in different ways. Gathering information by screening through reliable communication channels give the service customer the chance to evaluate different services offered, lower risks and increase certainty while buying services. While the management of the service company can benefit from communication by using tools such as personal sources, signaling, advertising, etc. in order to present the services it offers in addition to creating competitive advantage. In this respect both the customer and the management perspectives in the communication of the services are presented in this article.

1.1 The Information Dilemma for the new Service Customers

The new service customers usually pass through an external information search stage before buying a service. "External information search is a conscious goal-oriented behaviour whereby consumers acquire information to clarify or evaluate a particular brand or product class". The intensity and the way of conducting external information search differ for services from that of goods as the services show unique characteristics. ZEITHAML ET AL. list these unique characteristics of services as intangibility, inseparability of production and consumption, heterogeneity and perishability which separate services from tangible goods.

Intangibility is the fundamental difference between services and tangible goods which state that the services are performances rather than objects which cannot be felt, tasted or touched like the tangible goods. Inseparability of production and consumption stands for the simultaneous production and consumption of the services which is the case for most of the services. Heterogeneity in services reflects the high variability in the performance of services concerning quality and essence of the services which may vary from producer to producer, from customer to customer and from day to day. Finally, perishability states the fact that the services can not be saved which often causes the problem of synchronizing supply and demand.

The relationship between the characteristics of services defined by ZEITHAML ET AL. can be interpreted as services are perishable and can not be stored because they are intangible and inseparable which causes heterogeneity and high variability in the supply and performance of services. In addition to the definition of ZEITHAML ET AL. concerning the characteristics of services, classification of DARBY and KARNI which divides the performance characteristics of services as search, experience and credence qualities should be analyzed in order to figure out the differences between services and goods concerning evaluation of their quality by the customers.