CUSTOMER SERVICE

In industrial marketing, the customer service is sometimes more important than the physical product. The customer service supplements the sales of physical product and creates a total value for a customer. The nature of customer service varies based on the type of product and the stage of “ product life cycle”.

In case of mature markets and similar industrial products (i.e. with no major product differentiation), the major part of customer service, is “timely delivery”, and a minor part is the technical support service to the customers. When an industrial prodcut is available from several competitors at competitive prices, then delivery, product quality, and technical service are important differences for deciding major share of business among varies suppliers.

For excample, in case of “precision style tubes” product that was available from 14 different suppliers for a large bicycle manufacturer, the most important factor was just-in-time delivery which helped the bicycle manufacturer to hold minimum inventory and reduce the cost of inventory carrying. The next important factor was product quality which would reduce the rejection on the shop-floor and improve the productivity of the workers. The price became the third most important factor while deciding how much business share to be given to the three suppliers among the 14 suppliers.

For large equipment or machines, the important elements of the customer service are installation, maintenance and repair, including availability of spare parts and replacement unit. For instance, for diesel generating sets, the important elements of customer service to be considered by an industrial marketer are the installation and maintenance service, as well as, repairs and availability of spare parts. The industrial marketing organisation for diesel generating sets must provide these services through the service centres which should be located close to the customers. It would then be effective and succesful in marketing diesel generating sets in a competitive market.

For a large industri customer, the components and materials suppliers (vendors) build their production or distribution facilities close to the customer. Such arrangements require contractual obligations and long-term buyer-seller relationships.

For example, Escorts Motor Cycle Division has developed a large number of ancillary units very near to their factory. These ancillary units (or vendors) manufacture a large number of components which are required for the manufacture of motor cycles. Escorts were one of the first units in India to deveop ancillary units with long term business relationships and contractual obligations.

Thus, in industrial marketing, customer service is many times a key factor in differentiating suppliers having similar products to offer. We, therefore, find many articles written on the subject of “customer service”, practiced by many succesful organisations.