The Servitization of Products

When considering the broader perspective, we can see our economy developing in a direction of a service economy, helped by the information technology and as such is called "The new economy". Modern authors are claiming that virtually every product today has a service component to it. The old dichotomy between product and service has been replaced by a service-product continuum. In the management literature this is referred to as the servitization of productsThe service, in a narrower sense, refers to quality of servicing: the measured appropriateness of assistance and support provided to a customer.
Looking at the service component in the e-commerce world, we can notice that it becomes crucial, since customers have more choice and loads of information on products instantly available. With growth of both the customer expectations and the operational capabilities of the supplier, there is a need of enhanced service towards the customer, before it turns into capturing the customer value. That means integrating the product and the service as a compatible pair, with service taking the bigger part.

How can we add the appropriate service component while selling online?

Marketing's job in e-commerce is to design intangibles into the product and then to use them to make products unique. Those intangibles are the service components of the products. While selling online, it is very important to use them to build trust, promote the competitive advantages of your products and manage to gain repetitive purchases.

The best part when selling online is the capacity to track customers' web based shopping habits. It enables companies to personalize their approaches to marketing and to realize the benefits of individualized (one-to-one) marketing. Ironically the same web-based marketing approach that allows companies to get so personal with their customers also can make shopping extremely impersonal. Entrepreneurs who set up shop on the Web will likely never meet their customers face-to-face or even talk to them. Yet those customers, who can live anywhere in the world, will visit the online store at all hours of the day/night and expect to receive individual attention. Making a web-based marketing approach succeed requires a business to strike a balance, creating an e-commerce strategy that capitalizes on the strengths of the web while meeting customers' expectations of convenience and service.

And I think that answers our question. Yes, service is extremely important and sometimes crucial component in the Internet environment.