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is a concept which states that services are produced and consumed at the same time and can't be isolated or detached from their providers.

Providers can be company, institution, or individuals of these services through people, processes or equipment.

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A customer must be physically present and participating during the consumption of the service.

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Intangibility is something that is incapable of being perceived by the sense of touch. or in short it is. impalpable.

According to Kotler and Bloom , it is best defined as everything that cannot be seen, tasted, heard or smelled.

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The service profit chain is basically as business model created by harvard in the 1990's.

The Service-Profit Chain is a theory and business model. It establishes relationships between profitability, customer loyalty, employee satisfaction, loyalty, and productivity. Profit and growth are stimulated primarily by customer loyalty. Loyalty is a direct result of customer satisfaction. Satisfaction is largely influenced by the value of services provided to customers. Value is created by satisfied, loyal, and productive employees. Employee satisfaction, in turn, results primarily from high-quality support services and policies that enable employees to deliver results to customers.

This way, strong links develop between:

Profit – Customer loyalty

Employee loyalty – Customer loyalty

Employee satisfaction – Customer satisfaction

Based on the concept of the service-profit chain, a company should establish a link between employees and customer experience on the one hand and create profit and growth on the other.

Example:

-For example, fast-food giant Taco Bell found that its stores with low workforce turnover (a key marker of employee loyalty) enjoyed double the sales and 55% higher profits than stores with high turnover.

-Sm Advantage Card

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According to Merriam Webster (n.d.)

The word “PERISH” is defined as something to become destroyed or ruined.

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- A service cannot be made in advance and stored.

- Businesses can only store and sell certain products or services for a brief period of time.

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May vary in standard or quality from one provider to the next or from ocassion to the next.

Human involvement in service means that no two services are identical thus they are variable.

Ex.
1. A flight attendant from PAL and CEBU PAC have the same job but may offer different services to guests.

2. Mcdonald’s in different countries differ in terms of menus, price, and portions.

3. GrabFood and FoodPanda, although both are food delivery service providers, they differ in the availability of restaurants offered.

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Services are intangible and do not have a physical existence. Hence services cannot be touched, held, tasted or smelt. This is most defining feature of a service and that which primarily differentiates it from a product. As it something that let us experience which makes it much more memorable.

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These services and experiences entail tour adventures, events, conferences, festivals, and many more.

🏞🌄🌆🌠

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-Services are perishable, which means that services can not be stored for later sale or use.

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EXAMPLE NO. 2

• Booking accommodations, reservations,  transportation, etc.

An instance would be the recent MICE event where in alumnis and guest speakers were given accommodation on the 5th floor of BGPOP all throughout the event.

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Service that the cabin crew provides to the passengers in the aircraft

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Service differentiation
How one‘s service is different from another making it an excellent and priority option for the customer’s. Doing this requires uniformity towards the whole organization. In addition, it focuses on satisfying customer experience in a way that it leaves a mark or great impression. Having service differentiation is being distinct from others to increase brand recognition and awareness.

IN RELATION TO CAPACITY AND DEMAND

Matching capacity to demand over a period of time requires the consideration of demand curves currently faced.