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demand for this service output, though: its internal service facilities could make
it less dependent on the manufacturer’s technical service or repair facilities, and
it could have excess units in inventory that can be “swapped out” for a faulty
unit until it is fixed.
•
Assortment/variety demands refer to segments’ preferences for a deep assort-
ment in a given category and for a wide variety of product category choices.
In our laptop example, we might ask, how intense is each segment’s demand
for an assortment of computer brands, and how intense are their demands
for a variety of computers, peripherals, software, and so forth? The business
buyer probably has very precise brand demands (HIGH demand), because it
wants conformity across the units in use in the company. This end-user has a
LOW demand for assortment. Aggregated across the entire population of busi-
ness buyers, though, our laptop marketer may observe considerable diversity
in brand preferences. Thus, we must consider the different types of variety
demands when studying markets from a micro (customer-specific) versus a
macro (market-wide perspective) perspective. The business buyer may have
a MEDIUM to HIGH demand for variety (e.g., software to do word process-
ing, spreadsheets,
and database management; printer ports and PC cards as
peripherals), depending on the variety of tasks this buyer wants the laptops to
perform. Among personal use buyers, the demand for variety is probably very
LOW, because they tend to be the least sophisticated users and may demand
only the most basic word processing or gaming software. However, their
assortment (brand choice) demands may be HIGH; unsophisticated consum-
ers often want to see a broad selection of models and brands before making
a purchase decision. Student buyers probably fall in between, at a MEDIUM
level, in their demand for assortment/variety: they may have more applica-
tions
or uses for the laptop, and thus demand more peripherals and software
programs, but they may not need to see a wide assortment of brands before
making the purchase (the relevant brand set may be small if a school has dic-
tated “acceptable” brands).
•
Demands for
customer service differ widely among the business, personal use, and
student buyers in terms of not just levels but also
types of customer service. The
student buyer probably values home delivery very highly, as few students have
cars to carry large items back from the store; the personal use buyer may not
care about home delivery but value in-home installation services; and the busi-
ness buyer likely cares little about either of these benefits but demands trade-in
options on older machines.
•
Finally,
information-sharing demands can be separated
into pre- and post-sale
information elements. Before purchase, a buyer may need information about
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differences in physical product attributes, how components fit together in a
system, and how to use the new, state-of-the-art features. After purchase, the
buyer instead may have questions about which add-on peripheral devices can be
used with the computer and how or what software programs versions to install
onto the machine. The personal use buyer likely places the highest value on
both pre- and post-sale information sharing, because she or he is unlikely to
have a “support group” in place to provide
key information about what, how,
and where to buy. A student buyer may have more post-purchase informational
needs than pre-purchase ones, particularly if the school recommends a certain
subset of laptops for use. The business buyer probably has relatively low infor-
mational demands, both pre- and post-purchase, particularly if the company is
large enough to identify and specify approved laptop models, then support them
after purchase. However, a procurement specialist at the company may have sig-
nificant pre-sale informational needs at the time decisions are made about which
laptop models to select and support.
When completed with codified information, the service output segmentation
template supports several strategic uses:
1. It can reveal why sales tend to cluster in one segment, to the exclusion of oth-
ers.
If post-sale service is poor, it will be difficult to sell to personal use and
student buyers.
2. It may suggest a new channel opportunity for building sales among an
underserved segment. Perhaps a channel structure can be designed that is
ideally suited to the needs of student buyers. Competitors that otherwise
fight solely on the basis of price for these sales then would be locked out of
the sales channel.
3. Commonalities between and across segments, previously thought to be totally
distinct, might emerge. For example, personal use and student buyers may share
enough similarities that both can be served with only minor variations on a
single channel theme.
4. The template can suggest what channel form would be best suited for serving
each segment. Thus, it provides inputs to match segments to channels.
This list of service output demands cannot completely and fully characterize
every demand in a specific market. For example, the customer service demand
likely requires distinctions into pre-
and post-sale service elements, as does the
information-sharing service output demand. However, this framework provides an
initial means to understand the types of service outputs firms must provide to
appeal to end-users.