Creating a service business

Creating a service business has particular challenges. In providing a service, you are trying to sell something invisible to the buyer; in fact, you are trying to sell a promise. It is much easier to sell products because they can be inspected and tried out. Services, in contrast, are usually not delivered on the spot and the buyer does not see an immediate benefit. Since you are trying to convince someone to buy something they cannot see to test, it is critical that you appear to be as credible as possible so that the buyer will take the risk, cross that imaginary line and take a chance that you will deliver what you promised.

Because the service cannot be inspected ahead of time, the approach to potential customers needs to be different. Traditionally, product marketing courses stress these four steps: present the product, talk about the features and benefits, overcome objections, and close the sale. With services marketing, you need to link your ability to create a service to what it is that the customer needs – creating the following four steps:

  • Build rapport
  • Probe the client’s services needs
  • Present the service, shaped around client need
  • Seek commitment

In fact services marketing is actually relationship marketing: building a trusting relationship with potential clients out of which a sale eventually results. Even how products and services are sold is different. Products can be sold at trade shows and in stores instantly because customers can handle them and try them out. This makes it possible for a distributor or sales agent to represent a manufacturer in an export market. But services cannot be inspected ahead of time. Usually, potential customers want to meet the service provider (not an agent) to judge for themselves whether or not they think the service provider can actually perform the service.

This also means that service firms face different marketing challenges than goods firms and need different types of market information and support:

  1. You are selling a promise to deliver, not a product that can be inspected; therefore, marketing must focus on building credibility and confidence in capacity to deliver.
  2. You cannot patent most services; therefore, you must stay competitive through continuous innovation.
  3. A service is often created in interaction with the customer; therefore, interpersonal and problem-solving skills are critical, especially in front-line staff.
  4. New customers of professional services want to meet the service provider; therefore, most professional services cannot be marketed by agents or sales reps.
  5. Profit is linked to addressing unmet needs; therefore, promotional efforts must focus onyour capacity to customize rather than on services previously provided.
  6. Usually customers will not switch to a new service provider until a relationship has been built; therefore, it usually takes multiple interactions before a sale is finalized.

When you create a new business, you need to be clear on your purpose, establish the proper infrastructure, identify your interdependent networks, and determine how you are going to evaluate your performance. Below are some resources to help with some challenging components of business development:

Marketing the benefits you provide

Developing integrated services

Managing your finances

In addition, Dr. Riddle has prepared a workbook that covers the entire process of creating a new business and, while specifically designed for those in complementary or alternative medicine practices, has material and worksheets relevant to any small service business:

Managing Your Complementary or Alternative Medicine (CAM) Business

CAMThis Workbook is designed to help the CAM professional set up and manage their practice as a successful business. Having learned about energy and energy flows, Dr. Riddle asks the question, “ Why would you want to set up and run a business in a manner that ignored the energetic matrix within which businesses exist?”

The CAM Workbook provides the user with managerial tools that you need for success . . . reframed and modified to leverage basic energy principles. The Workbook is intended for the full range of complementary and alternative medicine disciplines such as acupuncture, aromatherapy, chiropractic, cranial sacral therapy, Reiki, shiatsu, traditional Chinese medicine, yoga, and many others.

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