Service-Dominant Logic of Marketing

Service-Dominant Logic of Marketing

Service-Dominant Logic is a new logic in marketing in which a service view substitutes the traditional, historic goods view.
Service-Dominant (S-D) Logic is a mindset for a unified understanding of the purpose and nature of organizations, markets and society. The foundational proposition of S-D logic is that organizations, markets, and society are fundamentally concerned with exchange of service—the applications of competences (knowledge and skills) for the benefit of a party. That is, service is exchanged for service; all firms are service firms; all markets are centered on the exchange of service, and all economies and societies are service based. Consequently, marketing thought and practice should be grounded in service logic, principles and theories.

In line with S-D logic, it follows that instead of service marketing “breaking free” from goods marketing, as has been the pursuit of the services marketing sub-discipline for the last several decades, all of marketing needs to break free from the goods and manufacturing-based model—that is, goods-dominant (G-D) logic. S-D logic embraces concepts of the value-in-use and co-creation of value rather than the value-in-exchange and embedded-value concepts of G-D logic. Thus, instead of firms being informed to market to customers, they are instructed to market with customers, as well as other value-creation partners in the firm’s value network.