Are we buying a Product or a Service ? (Part-II)
First, let us look at the Wikipedia definition of a service: "Service (economics), the non-material equivalent of a good in economics and marketing, within the service-product continuum"
The key differentiator of a service as compared to a product is that a service is intangible, and does have a value.
In essence both product and service does have a value. But the way we see and realize the value, is different for a product and service. The way we quantify the value does differ on a case to case basis, and especially in the case of a product the value is understood more easily than that of a service.
Well in real terms, every product is designed for a purpose and the purpose is to provide a service.
Let us look at some real life examples
- A shirt is a product, which provides the service of protecting our body, making us look & feel good and appreciated etc.,
- The value of the toothpaste we use daily is realized in the form of its refreshing taste felt and our perception of clean teeth.
- There is a perceived value and quality of service difference between India Post and the private players like Professional, DTCC, Blue Dart etc.,
- A savings account in a bank provides the service of managing money (storing, retrieving, transferring, receiving etc.,)
In all of the above, Consumer / Buyer satisfaction is the one key common aspect in evaluating a product or a service, and the perceived satisfaction level over and above the cost determines the market success of a product or a service. To assist buyer decision, product / service descriptions, specifications, service definitions etc., evolved and became norm & practice in the market place to compare and contrast products & services.
In reality, there exists only service - as a product is either an intermediary or a via media to deliver a service (or an intended purpose).
The differentiation exists and will continue to exist to support the larger socio - economic requirements and thus the evolution & existence of S&P as an enterprise function.