Disection of an offer

Dissection of an offer

Levitt claims that "In the marketplace, differentiation is everything" (Levitt 1980, p. 83). This has proven to be the case not only for customer goods but also for services. Since the majority characteristics of a service are in general relatively easy to imitate the only way that companies can create a distinctive offering is through differentiation.

When the concept of differentiation is put in the context of one of the most dynamic business sectors i.e technology it can not be stressed enough how important it is for companies to somehow create the perception for uniqueness in order to enhance the perceived quality that their offerings have. The most successful company in the past years when it comes to creating perceived unique offerings is arguably Apple. They were probably the first to realize that the differentiation of mobile phones will shift from antennas and radios to software. One of their most successful software offerings that is accessible for every device that Apple manufactures is iTunes. It started as an online music store in 2003 and has since constantly grown and now includes books, movie trailers and according to recent information it will also add a movies catalog in the near future. iTunes has not only proven to be very well received from the customers but also has been a huge source of differentiation for the company and has provided it with the means to create offerings that are easily distinguishable from those of the competitors. Acquiring a better understanding of the nature of iTunes via an in depth analysis can thus provide a good example of how a once great idea can turn into an extremely successful customer offering.

Storey and Easingwood's model of the augmented service offering enables a more comprehensive analysis of iTunes. The model consist of three main parts-service product, which "describes the bundle of services and products that are offered to meet the requirements of the customer for a particular service", service augmentation, which is related to the parts of the service that are not direct part of the core offering but are nonetheless important for the successful execution of the service and finally the marketing support which even though is something that is not vital for the service delivery process and sometimes might even go unnoticed by the customer can make the difference between success and failure for any service offering (Storey and Easingwood 1998). As already stated iTunes is an online music store so the core "product" that it is offering its customers is music. Since people can buy music in so many different ways however it is clear that iTunes has managed to build the perception that it is offering something more. This was possible because first of all the quality of the online platform that is iTunes is very high. If that was not the case no matter how good the idea behind the offering was it could never translate into successful offering on the marketplace. Then comes the accessibility of the offering. It is built in every Apple product so it is not necessary for customers to make any efforts in order to access the iTunes store. That combined with the quality of the platform guarantees that customers will be provided with the service they desire in a timely fashion. More to the point