75% of the economy is made up of service-oriented goods, meaning that we rely on each other and the services we provide in practically every area of our lives. With services dominating the economy, understanding what makes them unique is critical if you want your business to thrive.
If two people offer the same service on the same street, why would people pick one seller over another? What are people really buying? Which service characteristics are they looking for?
With products, it’s quite easy to understand and quantify the exchange process. The most important part of a product is that it works and provides satisfaction, but if you’re offering a service, the way you’re providing it is everything.
In this article, we’re going to discuss the critical components and features of a service while also discussing ways of delivering your service in such a way that people want to come back.
Understanding the Nature of Services
There are many people out there who believe that the global market downturn in 2020 was a direct result of people buying fewer products. They came to the conclusion that because people were no longer going to malls, they were buying less and causing the economy to slump, but this wasn’t the case at all.
Sales of products online skyrocketed, and many businesses saw an enormous boost in revenue as a result[1]. The sad truth is that spending at shopping malls has been in decline for years, even before COVID shut everything down. With all of us having grown accustomed to shopping online and being thrust into the boredom of being stuck at home, people shopped online more than ever. They stocked up on dry and canned food and spent big on frivolous purchases they’d never have time for during pre-pandemic times.
The real reason for the downturn was the decline of customers in the largest part of the economy, the service sector. Services comprise of products that are experiential rather than physical. Your hairdresser, doctor, and Uber driver are all providing you with services. The DJ at your local club and your local movie theatre are included too.
Often, a product is involved in the sale of a service. If you buy a coffee from a supermarket, this transaction is for a mere product. But if you have a coffee made for you at the first-class lounge of an airport, this is a service. The result is the same, but you paid a premium for the way you received it[2].
What’s Really a Service?
It can be really tough for people to understand the line between product and service, but this is easier when you evaluate where the priority is. What are people truly buying?
If you go to Disney World, you may buy a lot of products, but is that what you went to Disney World to do? Probably not. You don’t take a cruise for the purpose of travel, just as you don’t browse Amazon because it’s fun to scroll. Companies often enhance the experience of buying a product, but if the purpose is the sale of that product, it can’t be considered a service. Let’s now go through some of the key service features.
Here’s what makes services a unique beast:
- Intangibility: You can’t touch or take a service home like a product. It’s the experience and the outcome that matter.
- People Power: Services are delivered by skilled individuals. Their expertise is what you’re paying for. An air hostess will go through extensive training before seeing the inside of a plane and will work for years before being promoted to first class. Doctors go to medical school, and hairdressers are licensed.
- Inseparability: You can’t have a haircut without a hairdresser! The service cannot be separated from the provider.
- Variability: Services have a human element, so there will be some natural variation from one time to the next. This can be more difficult because a service can’t be displayed on a shelf. Apple can show you its new iPhone in a commercial, but a plumber can’t just show you a clean pipe and convince you that he’s worth paying for.
There’s only one way to grow your service business steadily and reliably, and it’s to focus on the experience of the guest you’re providing the service for. This can be the most challenging part for many professionals, who are in their line of work because they love performing the type of service they provide, but unfortunately, this isn’t enough. There are genius musicians who never book gigs because they’re bad with people. Some excellent animators aren’t getting jobs because they can’t collaborate.
Customer Experience Matters
Since you can’t “showcase” a service on a shelf, how it’s delivered dictates its value. Here’s how to optimize customer service:
- Deliver Excellence: Aim for the highest standard. Exceed expectations when possible.
- Be Consistent: Even if you can’t be perfect every time, consistency breeds trust.
- Emphasize Empathy: Understand your client’s individual needs, pain points, and goals.
- Personalize When Possible: Tailor the experience, adding touches that make the client feel special.
The Disney Model and Beyond
Customer experience giants like Disney understand the power of positive guest interaction. Decades of the highest levels of customer service have led to them buying up most of the entertainment industry, including 20th Century Fox. They meticulously train employees and establish clear guidelines to ensure guests feel valued. Take a cue from this approach to elevate your own service delivery.
Take a trip on a Disney cruise or visit a Disney Park and ask someone to direct you to a shop or a bathroom. When they do, take notice of the hand they use to point the way. Never will a Disney employee point with one finger because the company thinks it’s too rude. No matter where you are in the world, a Disney employee will always either gesture with two fingers or an open hand. Whether you’re at Tokyo Disneyland or the Disney Hotel in Hawaii, the standard is the same[3].
Disney understands that it doesn’t matter how incredible their parks and resorts are if their level of customer experience isn’t incredible. They know that how the customer feels while receiving the service will make all the difference when it comes to that person coming back and, crucially, whether they’ll recommend that service to their family and friends.
The Power of Connection
Even the best service can’t please everyone all the time – tastes differ! it’s impossible to please everyone, even with great service and winning experience. But while it’s impossible to please everyone with these two things, you will always please those who love you.
Building genuine bonds with your customers is your secret weapon:
- Get to Know Them: Listen attentively to your clients. Make them feel understood and valued.
- Relationships = Resilience: A loyal customer who loves you is more forgiving of minor slip-ups.
- Expectation Management: Clear communication from the start helps to head off potential misunderstandings.
Make them feel heard and cared for, because if they come to love you, their opinion of your service will always be positive. Once you’ve locked down their opinion, you can rely on their satisfaction and their endorsement every time[4].
Summary
Let’s review the key points about the features of services and how to deploy them for business success:
- Know Your Offering: Are you providing a product, a service, or a bit of both? Honesty is key.
- Experience is Everything: How you deliver the service can often matter more than the technical outcome.
- Human Touch Matters: Build those bonds with clients! It leads to lasting loyalty and word-of-mouth buzz.
Serving others is a rewarding way to make a living. When you focus on stellar experiences and building genuine connections, success is much more likely to follow!
[1] Berthene, April. Coronavirus Pandemic Adds $219 Billion to US eCommerce Sales in 2020-2021. Digital Commerce 360. 2022. https://www.digitalcommerce360.com/article/coronavirus-impact-online-retail/
[2] CFI Team, What Are Products and Services? Corporate Finance Institute. 2022. https://corporatefinanceinstitute.com/resources/knowledge/other/products-and-services/
[3] Yang, Lucy. You’ll Never See a Disney Employee Point with One Finger – Here’s Why. Business Insider. 2018. https://www.businessinsider.com/why-disney-employees-point-with-one-finger-2018-2
[4] Kappel, Mike. 6 Ways to Make Customers Fall in Love with Your Business. Forbes. 2018. https://www.forbes.com/sites/mikekappel/2018/03/15/6-ways-to-make-customers-fall-in-love-with-your-business/?sh=1a8481bb3c42
