Dominant Logic are utilized in an assortment of orders to clarify a general rationality that is connected to direct how techniques and strategies are produced and actualized. In different ways, one might say that a dominant rationale is a typical state of mind about technique crosswise over various organizations.
That is, a dominant logic stays same regardless of what business receives it. In this way, while techniques and strategies will be distinctive between organizations, the logic or presumptions about nature in which the business works will continue as before for them (Baird, 2018, para.1). Inside advertising there are two dominant logics, one is Goods Dominant Logic (GDL) and another is Service Dominant Logic (SDL).
Products Dominant Logic is that where esteem is made by the trading of goods and service. Typically, these are for cash or different merchandise and ventures. Service Dominant Logic is that where esteem is made by the trading of administration (Baird, 2018, para.2).
The product view is goods-dominant logic and the customer or service view is called service dominant logic(site). In GDL, the consumer is the end-point in the process.
The producer creates value and the consumer consumes or destroys the value. In SDL, the producers create value when the consumer consumes. The consumer is co-creator(ppt). The purpose of service dominant logic is to assist customers in their own value creation processes as opposed to producing and distributing units of output. The role of customer is to create the value and they are not to ruin it. In GDL, the focus is on the product not on service. Their only focus is to sale the product as they do not believe in long term relationships.
In GDL, the whole concern is only on the tangible elements of the product. In SDL, the focus is on the intangible elements offered. For example, when customer buys any product then warranty of product is given by the company to the client. In GDL, transaction ends with the finished product for service being sold means there is no connection between the client and the company after the sale of product. In SDL, producer gets value from the consumer using the product or service.
To illustrate, real-time feedback is good example of this. As customer give feedback regarding the quality of product they buy, the environment provided by the store to them and the service provided to them. In GDL, Price is the measure used that means they focus on the cost earned and in SDL, Value is the measure used that means the customer is very important to them because they want that customer to come there again and again to do shop from them. As this will increase their market value and to connect more clients with them also (tutorial, 2018).
Individuals are supported by various other actors that together create and support the whole ecosystem. SDL states that the customer interacts with other parties as they go about obtaining value in their own lives. During these interactions exchanges occur. If everyone works together with the aim of gaining value through fair exchanges, the ecosystem continues to support itself.
Every interaction is an opportunity for customers and other actors (brands, customers other people) to share service with each other. Service is simply the utilisation of skills and knowledge for the benefits or oneself or another person. Therefore, sharing information with each other is a service exchange. There are two types of customers one is active customers and second is passive customers. Active customers are those who first check about the product on internet about its price and checks reviews about the demand as well as quality of product. Then they go to store to know more about that and then buy the product.
On the contrary, passive customers are those who just go and buy the product from the company. They come under the category of Goods dominant logic.Furthermore, customer-brand relationship is short term in goods dominant logic because they believe only in selling the product. Their main aim just to sell the product not provide best services to the customer.
But, in service dominant logic, customer-brand relationship is for long term as they always get connected with their customers through social media, emails and many other ways like apps. They provide their services through those mediums also as they send detail of products to their customers. The other way to be in touch with their customers they are ready to provide various kind of discounts, sales and gift vouchers.
In GDL, tangible assets have embedded value. Value is accured the more processes and complexity required to manufacture. Goods-dominant logic works because industrialisation works on scarcity. It is expensive to design, procure, mass-produce and market physical goods. In SDL, intangible becomes valuable. Value is accured the more that complexity is reduced. Interoperability is the key factor. The producers create value when the consumer consumes.
The consumer is a co-creator. Digitally, the production of goods and services is not burdened by actual scarcity. Every interaction is an opportunity for customers and other actors like brands, customers and other people to share service with each other. Service is simply the utilisation of skills and knowledge for the benefits or oneself or another person. So, sharing information with each other is still a service exchange.