Advantages of Product-Service Hybrid Paper

Types of Product-Service Hybrid
Four different types of Product-Service Hybrid are commonly found in the markets these days.

Flexible Bundle – In this form of product-service hybrid, customers will buy the product and service separately. However, it will be better and more valuable when the product and service are brought together. An example of this would be the products of Microsoft. The customers will be able to purchase without its support features too. But it would be more beneficial when the Microsoft product is purchased along with its support services.

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Peace of Mind Bundle – In this form of product-service hybrid, the product and service complement each other to provide more value. The product and service will not be dependent on each other. An example of this would be Otis, the elevator company. They combined their products (elevators) with high-quality maintenance service. Thus, ensuring that their customers do not have to rely on another servicing company to service their elevators.

Multi-Benefit Bundle – In this form of hybrid, both the product and service would be inseparable. That is, the product and service would be complementary and dependent on each other. An example of this would be when a video recorder provides the product without its services like YouTube, on-demand movies, and music streaming is useless. That is how TiVo made huge profits in 2008.

One-stop Bundle – In this form of hybrid, the product and service would be completely unrelated. But they are always brought together for more convenience. It is seen in many Salons where hair styling and haircut services are provided to the customer. Regis Corporation is a company that operates several salons all over the world. Their services are completely unrelated to the products that are sold to the consumer. But customers end up buying the product at the time of checkout because they value the recommendations made by the stylists and the convenience.

Developing the Product-service Hybrid
It is not enough to introduce any Product-Service Hybrid in the market. Several factors need to be weighed before developing a Hybrid. The factors that need to be looked into are as follows:

Commoditization – When a product is too commoditized, new ways of increasing its value will have to be looked into. It can be made more valuable by adding it along with a high-quality service.

The complexity of the problem – If a product-service hybrid can solve complex problems and difficulties of the customer, it has more advantages. Competitors will find it difficult to copy a hybrid that is extremely efficient in solving complex problems.

Quality – A product’s performance may vary to a large extent. What can be changed or improved is the service provided along with the product. By adding a high quality and reliable service and the product, the product’s value can be made more profitable.

Scalability – A hybrid that cannot be scaled to meet the market’s growing demands will struggle to survive. It was seen in the case of Regis Corporation. They were able to scale their products and services.

Centralization -If a hybrid is to be made profitable, the services offered need to be productive. It would be preferable to have services provided in one location. Services can even be delivered through online platforms; this will ensure more profitability.

Lifespan – Factors such as how long customers will use the product or service need to be considered. The hybrid will have to ensure that the customers use the product and service for a long time to ensure profitability.

Advantages of Product-Service Hybrid
Selling a product service bundle has a lot of advantages more than selling a product and service separately. The advantages are as follows:

Selling a good and service together would help in generating more profits.

It makes customers’ dependence on the hybrid increase.

It is more effective in satisfying the needs and demands of the customers.

It gives more opportunities to interact with customers as it provides service touchpoints.

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