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Significantly revised, restructured, and updated to reflect the challenges facing service managers in the 21st century, this book combines conceptual rigor with real world examples and practical applications. Exploring both concepts and techniques of marketing for an exceptionally broad range of service categories and industries, the Fifth Edition reinforces practical management applications through numerous boxed examples, eight up-to-date readings from leading thinkers in the field, and 15 recent cases. For professionals with a career in marketing, service-oriented industries, corporate communication, advertising, and/or public relations.
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Editorial Reviews

A text for use in MBA and executive MBA courses, designed to complement material found in traditional marketing principles texts. Offers a strong managerial orientation and strategic focus in an integrated approach to studying services that places marketing issues within a broader general management context. This fourth edition contains four new chapters, seven new readings, five new cases, and more coverage of consumer behavior, people management, and Internet- based services. Lovelock gives seminars and workshops. He was on the faculty of Harvard Business School for 11 years. Annotation c. Book News, Inc., Portland, OR (
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Product Details

  • ISBN-13: 9780134558417
  • Publisher: Prentice Hall Professional Technical Reference
  • Publication date: 1/28/1996
  • Edition description: Older Edition
  • Edition number: 3
  • Pages: 660
  • Product dimensions: 7.35 (w) x 9.58 (h) x 1.45 (d)

Table of Contents

About the Authors
Pt. 1 Understanding Service Products, Consumers, and Markets 1
Ch. 1 Introduction to Services Marketing 3
Ch. 2 Consumer Behavior in Service Encounters 29
Ch. 3 Positioning Services in Competitive Markets 57
"Service Theater: An Analytical Framework for Services Marketing" 78
"How We Built a Strong Company in a Weak Industry" 88
Pt. 2 Key Elements of Services Marketing 93
Ch. 4 Creating the Service Product 95
Ch. 5 Designing the Communications Mix for Services 124
Ch. 6 Pricing and Revenue Management 151
Ch. 7 Distributing Services 181
"Cultivating Service Brand Equity" 207
"The Strategic Levers of Yield Management" 217
Pt. 3 Managing the Service Delivery Process 229
Ch. 8 Designing and Managing Service Processes 231
Ch. 9 Balancing Demand and Capacity 259
Ch. 10 Planning the Service Environment 285
Ch. 11 Managing People for Service Advantage 309
"How to Lead the Customer Experience" 341
"The High Cost of Lost Trust" 343
Pt. 4 Implementing Services Marketing 349
Ch. 12 Managing Relationships and Building Loyalty 351
Ch. 13 Customer Feedback and Service Recovery 381
Ch. 14 Improving Service Quality and Productivity 405
Ch. 15 Organizing for Service Leadership 437
"Where Should the Next Marketing Dollar Go?" 462
"Why Service Stinks" 466
"Linking Actions to Profits in Strategic Decision Making" 474
Case 1 Sullivan Ford Auto World 486
Case 2 Four Customers in Search of Solutions 491
Case 3 Commerce Bank 492
Case 4 Giordano: International Expansion 505
Case 5 Aussie Pooch Mobile 520
Case 6 Visiting Nurse Associations of America 533
Case 7 Accra Beach Hotel: Block Booking of Capacity during a Peak Period 546
Case 8 Coyote Loco: Evaluating Opportunities for Revenue Management 552
Case 9 Menton Bank 563
Case 10 Vick's Pizza Corporation 572
Case 11 Hilton HHonors Worldwide: Loyalty Wars 575
Case 12 Massachusetts Audubon Society 588
Case 13 The Accellion Service Guarantee 604
Case 14a Innovation at Progressive (A): Pay-As-You-Go Insurance 607
Case 14b Innovation at Progressive (B): Homeowners Insurance 620
Case 14c Innovation at Progressive (C): Auto Repair 625
Case 15 627
Credits 641
Name Index 643
Subject Index 648
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The world of services has changed in dramatic ways since the first edition of Services Marketing. This new edition represents a significant revision, restructuring, and updating of the book to reflect the challenges facing service managers in the early 21st century. We've pooled our skills in teaching, consulting, and research to create a versatile, flexible text for instructors teaching in a variety of environments.

Services Marketing, Fifth Edition, takes a strongly managerial perspective, but the text is rooted in solid academic research, complemented by memorable concepts and frameworks. We designed the book to bridge the all-too-frequent gap between the real world and academic theory. Practical management applications are reinforced by numerous in-text boxed examples within the 15 chapters, along with 8 up-to-date readings from leading thinkers in the field and 15 superb classroom-tested cases. Additional cases, teaching materials, and instructor aids are available on the course Web site.

Preparing this new edition of Services Marketing has been an exciting challenge. Services marketing, once a tiny academic field championed by a handful of pioneering professors, has become a thriving area of activity. Our new edition reflects growing research efforts in both academia and business. Student interest in courses that focus on various aspects of managing service organizations, including marketing, makes a great deal of sense from a career standpoint, as most business school graduates will be going to work in service industries, and managers report that manufacturing-based models of business practice are not always useful to them.


This edition has been both streamlined and restructured to sharpen the focus on essentials and to add in-depth coverage of new concepts and ideas.

New Topics, New Structure

  • The book features coverage of the latest research and developments in the service sector, ranging from customer relationship management (CRM) and Six Sigma quality to revenue (yield) management and customer feedback systems. In addition, there is substantive coverage of consumer behavior, people-management issues, branding, business-to-business services, and technology-based services.
  • We emphasize that marketing strategy takes place in a highly competitive environment, reflecting our belief that service firms must be competitively positioned as well as customer focused.
  • All chapters feature expanded references, with new published research findings being added to every topic.
  • The text has been streamlined to avoid unnecessary repetition and restructured to ensure an enhanced sequencing of topics. Despite the addition of new material, tighter editing has resulted in a leaner and more effective set of chapters.
  • We have streamlined the number of chapters to 15 (down from 18 in the previous edition). Every chapter has been revised, and some have been retitled to reflect a more focused emphasis. Material on technology and international strategy will now be found throughout the book rather than being presented in separate chapters. Coverage of demand and capacity management, queuing, and reservations has been consolidated in a single chapter, with material on revenue management being transferred to the pricing chapter.
  • Particular attention has been paid to making this new edition stimulating and highly readable. The result is a text that is clear, focused, and designed to capture student interest. Boxed inserts within each chapter feature numerous interesting examples that describe important research findings, illustrate practical applications of important service marketing concepts, and present best practices in services marketing. Many of these inserts are new to this edition.

New Readings

  • Six of the eight readings are new to this edition. They are drawn from recent issues of Business Week, Harvard Business Review, Journal of the Academy of Marketing Science, Journal of Service Research, and Marketing Management.
  • The readings have been selected to complement the text and explore key issues in greater depth. Selected for their readability and potential to stimulate classroom discussion, they present important insights from thoughtful practitioners and such leading service professors as Leonard Berry, Richard Chase, Raymond Fisk, Stephen Grove, Sheryl Kimes, Katherine Lemon, Roland Rust, and Valarie Zeithaml.

New Cases

The book features an exceptional selection of up-to-date, classroom-tested cases of varying lengths and levels of difficulty. We wrote a majority of the cases ourselves, and most are unavailable elsewhere. Others are drawn from the case collections of Harvard, INSEAD, and Yale.

  • To offer instructors greater choice, the number of cases has been expanded from 10 to 15 (including a three-part series of short cases that can be taught in a single class or separately, as desired). The new selection provides a broader coverage of both service issues and application areas.
  • Twelve of the cases are new to this edition. Most are copyrighted 2003 or 2004. All three of those cases carried over from the previous edition have been updated.

New and Improved Teaching Resources

  • Revised and enlarged supplements include an excellent online instructor's manual.
  • To further enhance the mix of teaching materials, several popular cases from previous editions of the book are being made available on the Web site for Services Marketing.
  • Additional cases that may be downloaded from the Web site include several new cases dealing primarily with nonprofit service organizations. The Web site also includes a "Note on Studying and Learning from Cases" for students.
  • Detailed teaching notes are provided for all cases, including teaching objectives, suggested study questions, in-depth analysis of each question, and helpful hints on teaching strategy.
  • Instructors can now select from more than 250 online PowerPoint slides, keyed to each chapter. These materials include both text slides and graphics. All slides have been designed to be clear, comprehensible, and easily readable.


This text is equally suitable for courses directed at advanced undergraduates or MBA and EMBA students. Services Marketing, Fifth Edition, places marketing issues within a broader general management context. Whatever a manager's specific job may be, he or she has to understand and acknowledge the close ties that link the marketing, operations, and human resource functions. With that perspective in mind, this book has been designed so that instructors can make selective use of chapters, readings, and cases to teach courses of various lengths and formats in either services marketing or service management.


Key features of this highly readable book include its strong managerial orientation and strategic focus, use of memorable conceptual frameworks that have been classroom tested for relevance to both undergraduate and MBA students, incorporation of key academic research findings, use of interesting examples to link theory to practice, and inclusion of carefully selected readings and cases to accompany the text chapters.

Services Marketing is designed to complement the materials found in traditional marketing principles texts. It avoids sweeping and often misleading generalizations about services, recognizing explicitly that the differences between specific categories of services (based on the nature of the underlying service process) may be as important to student understanding as the broader differences between goods marketing and services marketing. It also draws a distinction between the marketing of services and the marketing of goods through service.

The book shows how various technologies—and information technology in particular—are changing the nature of service delivery and can offer innovative ways for service providers and customers to relate to each other. (This is the people side of the business.)

The service sector of the economy can best be characterized by its diversity. No single conceptual model suffices to cover marketing-relevant issues among organizations ranging from huge international corporations (in such fields as airlines, banking, insurance, telecommunications, freight transportation, and professional services) to locally owned and operated small businesses, such as restaurants, laundries, taxis, optometrists, and many business-to-business services. In response, Services Marketing offers a carefully designed "toolbox" for service managers, teaching students how different concepts, frameworks, and analytical procedures can best be used to examine and resolve the challenges faced by managers in a variety of situations. Once introduced, many of these tools reappear in subsequent chapters.

Throughout the book, we stress the importance for service marketers of to understand the operational processes underlying service creation and delivery. These processes are grouped into four categories, each of which has distinctive implications for the nature of service encounters, the roles played by customers and service personnel, the strategic application of information technology to delivery systems, and management practice.


In response to adopter requests, the following pedagogical enhancements are available for the text:

  • An introduction to each chapter highlights key issues and questions to be addressed.
  • Four types of boxed inserts accompany many of the chapters:
    • Best Practice in Action (demonstrations the application of best practices)
    • Research Insights (summaries of highly relevant rigorous academic research)
    • Service Perspectives (in-depth examples that illustrate key concepts)
    • Management Memo (reviews of key concepts that apply to service management)
  • Interesting graphics, including reproductions of ads, are included to enhance both visual appeal and student learning.
  • Review Questions and Applications Exercises are located at the end of each chapter.
  • Each case includes suggested study questions.
  • The Instructor's Resource Manual for Services Marketing includes the following:
    • Detailed course design and teaching hints, as well as two sample course outlines
    • Chapter-by-chapter teaching suggestions, along with discussion of learning objectives and sample responses to study questions and exercises
    • An overview of each reading, with suggestions on how to use it and the best chapter(s) with which to assign the reading in question
    • A description of 16 suggested student exercises and 5 comprehensive projects (designed for either individual or team use)
    • Detailed teaching notes for each of the cases, as well as suggestions for possible chapters with which they might be paired.
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