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    1.2 Services - Reasons For Growth

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    Abhishek kumar
    The document discusses the growth of the services sector in India. It provides several key reasons for the rapid growth of services: [1] The services sector accounts for over half of India's GDP and is the fastest growing sector of the economy. [2] Increased incomes and spending, working couples with less time, and other socioeconomic changes have increased demand for services. [3] Factors like the IT revolution, globalization, health awareness, and economic reforms have further accelerated growth of the services industry in India.

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    1.2 Services - Reasons For Growth

    Uploaded by

    Abhishek kumar
    59 views16 pages
    The document discusses the growth of the services sector in India. It provides several key reasons for the rapid growth of services: [1] The services sector accounts for over half of India's GDP and is the fastest growing sector of the economy. [2] Increased incomes and spending, working couples with less time, and other socioeconomic changes have increased demand for services. [3] Factors like the IT revolution, globalization, health awareness, and economic reforms have further accelerated growth of the services industry in India.

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    1.2 Services_Reasons for growth

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    The document discusses the growth of the services sector in India. It provides several key reasons for the rapid growth of services: [1] The services sector accounts for over half of India's GDP and is the fastest growing sector of the economy. [2] Increased incomes and spending, working couples with less time, and other socioeconomic changes have increased demand for services. [3] Factors like the IT revolution, globalization, health awareness, and economic reforms have further accelerated growth of the services industry in India.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    59 views16 pages

    1.2 Services - Reasons For Growth

    Uploaded by

    Abhishek kumar
    The document discusses the growth of the services sector in India. It provides several key reasons for the rapid growth of services: [1] The services sector accounts for over half of India's GDP and is the fastest growing sector of the economy. [2] Increased incomes and spending, working couples with less time, and other socioeconomic changes have increased demand for services. [3] Factors like the IT revolution, globalization, health awareness, and economic reforms have further accelerated growth of the services industry in India.

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    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    of 16

    INSTITUTE –University School of

    Business
    DEPARTMENT -Management
    M.B.A
    Service Marketing
    Faculty Name : Rajeev Prasher Ph.D.
    DISCOVER . LEARN . EMPOWER

    1
    www.servicesblogspot.com

    Theory of
    Services
    Course Outcome
    CO Title Level
    Number Shall be discussed in this
    CO 1 students will be able to: Remember lecture
    remember that the service sector is a  
    dominant sector of Indian economy and is
    here to stay and grow further

    CO II List the determinants of the demand and Understand


    supply for a service product in a competitive  
    market

    CO III To understand the factors that affect consumer Understand


    behavior in service
    2
    CO IV Understand the concept services demand Understand
    determinants and their forecasting &Remember
    1.2 Services:
    Reasons for growth

    Source :shutterstock.com 3
    Growth in services sector

    • With growth in economy demand in ‘services increase.


    • Services sector accounts for 54% of India’s GDP; is fastest growing sector of economy.
    (Planning Commission 2006)
    • The contribution of services in the GDP of USA, UK, Australia and Canada is 79.6, 74.5, 69.8
    and 69.6 respectively. (2008)

    4
    • Increased automation

    • Growth in economy

    • Increased disposable income

    • Working couples consequently lack of time

    • LPG- Open economy

    • Time constraints
    5
    Services: Growth & Reasons

    6
    Reasons For Growth Of Services

    The growth of service industries can be traced to the economic

    development of society and the socio-cultural changes that have

    accompanied it. Changing environmental forces brought out of the services

    in forefront of the economy. Those environmental forces separately or in

    combination create new type of service. The following environmental factors

    are responsible to make a new service.


    Economic affluence

    One, of the key factors for the growth of demand for services is the
    economic affluence . The size of the middle income consumer is raising
    fast and the percentage of the very poor household’s declining. The rural
    households in the upper income category are growing at a much faster
    pace than the urban households in the corresponding categories. The
    Economic liberalization Process has had a positive impact on the Indian
    households. Their income as well as their expenditure has been pushed,
    creating a demand for many goods and services
    Changing Role of Women

    Traditionally the Indian woman was confined to household activities. But with
    the changing time there has been a change in the traditional way of thinking
    in the society. Women are now allowed to work. They are employed in
    defense services, police services, postal services, software services, health
    services, hospital services, entertainment industries, Business Process
    Outsourcing and so on.
    The percentage of working women has been growing rapidly. The changing
    role of women has created a market for a number of product and services.
    Earning women prefer to hire services in order to minimize the innumerable
    roles that they are required to perform. The demand by woman is forcing
    service organizations to be more innovative in their approach.
    Cultural Changes

    Change is the underlying philosophy of culture place of change in Indian


    culture is not uniform. However, during the last century the factors of change
    are prominent. The emergence of the nuclear family system in place of the
    traditional joint family system creates a demand for a host of services like
    education, health care, entertainment, telecommunication, transport,
    tourism and so on. There has’ been a marked change in the thought
    Processes relating to investment, leisure time perception and so on which
    has created a huge demand for services.
    I.T. Revolution
    For the last 15 years in India IT became one of the key service businesses of the
    country. India has the largest software skilled population in the world. The
    domestic market as well as the international market has grown substantially.
    Realizing the potential for this area many state governments have made IT as
    their most, prioritized segment states such as Karnataka, Andhra Pradesh,
    Madhya Pradesh Maharashtra and Delhi have already achieved substantial
    progress in Information Technology .

    Natural Resources
    The growth. Of’ population, industrialization and indiscriminate consumptions
    have affected the, natural resources, environment and the ecological balance.
    Due to this there is an imbalance of the ecology various service organizations
    have been promoted in order to take up social marketing. Thousands of crores
    of rupees are being spent on safeguarding the rare animals and birds, water
    pollution, conservation of oil & energy and research to develop new
    technologies that can promote effective use of natural resources and safeguard
    the environment.
    Development of Markets

    During the last few decades the wholesaler and the retailer
    population has grown in the country. Urban India has become a
    cluster of wholesaling and retailing business. In the Semi – urban
    areas, retailing has spread to the nooks and corners of the streets
    and in the rural areas retail business is significantly present. A new
    breed of organizations, offering marketing services has come up.
    The government also offers marketing services to the small-scale
    agricultural farmers, artisans and other traditional business sectors
    such ‘as promotion of regulated markets, export promotion
    councils, development boards etc
    Market orientation
    The changing competitive situation and demand supply positions
    has forced the manufacturing organization to shift their philosophy
    from production orientation to market orientation. Market is a
    service function that has been added in the organization. The
    pressures in the market has further forced the manufacturing
    organizations to have marketing research, accounting, auditing,
    financial management, human resource management and
    marketing research divisions – all of which are services functions.
    Health-Care Consciousness

    In India, the healthcare market has grown substantially. The


    increased life expectancy is the result of the consciousness of the
    people regarding the health issues. The growth of fitness clubs,
    diagnostic centers, medical counseling, and health-related
    information sites are the reflections of the growing demands for
    health care services. The government as well as the social
    organizations has taken up the mass campaigns in order to create
    awareness among the illiterate persons and the rural population on
    health service. Hence, the growth of health related services.
    Economic liberalization

    The economic liberalization of the 1991 has brought many


    changes in the Indian scenario. With the Disinvestment and
    the Privatization policies the state owned monopolies in many
    service areas came to an end Multinationals were permitted
    to enter the Indian market. Liberal lending policies and lower
    interest rates motivated many people to become self-
    employed. Different sectors like Banking, Insurance, Power
    projects, Telecommunication, Hospitality sector, Health
    Services, Entertainment, Air transport, and Courier services
    witnessed intense competition, due to the entry of
    multinationals. The flow of time-tested service technology
    from various parts of the world changed the attitude of the
    Indian consumer towards sources.
    Thanking You

    16

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