Hotel Service Life Cycle

Faqar Saadoun Hassan
Asst. Lect. Haider Diaa Salman

Hotel service, like other services, goes through a life cycle consisting of four stages: “presentation, growth, maturity, decline”, and the characteristics of each stage are the same as in the commodity, but the difference lies in the strategies that can be used in each stage, and the service life cycle is longer than the product life cycle, and this is due to the fact that the service is slower to be exposed to obsolescence compared to the product” (Najm, 78: 2013).

Accordingly, the service life cycle consists of the following stages: (Jamal, 193: 2015).
1- Presentation stage
This stage begins when the service is presented for the first time, or the form of the current service has been changed, as this service witnesses a significant decrease in the rate of sales growth, and profit may also be absent, due to the large expenses in this stage, and the strategy of organizations in this stage focuses on gaining market acceptance for it, and here the advantage of the service appears, and this stage is characterized by the following:
A- Few competitors in the market for the service at this stage;
B- Low profit margin;
C- Negative cash flow;

Th- Lack of clarity in market sectors and difficulty in identifying them;

C- Decrease in sales.

2- Growth stage
This stage represents the period of rapid acceptance of the service in the market and improvement in profit rates, as the consumer’s purchase decision in this stage is affected by several factors, the most important of which are: – “Increasing the number of competitors, and the trend of the product price towards decreasing, and during this period, which represents the most economically viable stage, service organizations want to extend the life of the stage because it is in continuous growth and achieves increasing returns, and this is done through: (Jamal, 194: 2015)
A- Seeking to develop the service provided;

B- Searching for new parts of the market that can be entered.

C- Creating a broader promotional conviction and influence towards purchasing this service.
3- Maturity stage
At this stage, the level of services provided by organizations begins to slowly decline, and competition intensifies, as customers do not see any differences between the services provided by different organizations. This stage is characterized by the following:
A- Stability of the level of services provided by organizations;
B- Expansion of competition;
C- Exit of low-level organizations.
At this stage, organizations must enhance the quality of service technically and functionally and add free services as well as use the persuasive advertising method.
4- Decline stage
It is the last stage of the service life cycle, in which the level of service provided by service organizations declines as a result of the emergence of something new that better satisfies customers’ needs due to technological development. Therefore, there must be a new service so that the life cycle is repeated. This stage is characterized by the following: (Jamal, 195: 2015).
A- Decrease in the level of services provided by organizations;
B- Decrease in the intensity of competition.
C- Decrease in profits.
D- Decrease in capital