Hey there!
Let’s play a game, shall we? Imagine waiting in line at your favorite coffee shop for your turn to order a steaming hot cup of joe. As you walk up to the counter, you have a choice. Do you choose a simple, no-frills, readymade coffee—the core service or a creamy cappuccino with cocoa on top and a smiley face carved into the foam? That, my friend, is the value-added service.
In today’s fast-paced, customer-focused world, businesses always try to stand out from the crowd and give their customers something extra. Because of this, sometimes it’s hard to tell the difference between core services and value-added services. But don’t worry! This article will explain the differences between these two very important parts of any service-based business.
So, grab a fresh cup of your favorite brew, sit back, and explore the detailed concepts of core and value-added services. By the end of this article, you’ll know exactly what these terms mean and how they affect your everyday life as a consumer or provider.
Core Services Meaning
Core services are customers’ benefits when services are delivered to them. The word “core” means basic or important. So, the meaning of core service is the main or basic service.
These are the most important services a company offers its customers. They are like the main ingredients that make a dish taste good and fill you up. Core services are the heart and soul of a business because they directly meet customers’ needs and wants.
We could use a hotel as an example. A hotel’s core services are comfortable rooms, friendly staff, and good customer service. When you book a hotel, you expect a clean and cozy place to stay. Where staff members are ready to assist you if you need anything. These core services ensure that your time at the hotel is pleasant and memorable.
In the world of technology we live in now, a smartphone company’s core service is to make good phones that offer reliable software updates and provide good customer service. These key elements make people choose a particular brand over others. If a smartphone brand doesn’t offer these core services, customers will be unhappy and may switch to a different brand.
In short, a business’s core services are the most important parts that directly meet the needs and expectations of customers. They are like the best parts of a theme park, the nice rooms in a hotel, or the good phones made by a company that makes smartphones. These services make a business stand out and keep customers coming back for more.
Core Services Examples
Most core services are basic, support, and services that go with other services.
Examples of core services are given below:
- Risk management,
- Treasury management,
- Technology,
- Information security,
- Banking operations, and
- Customer service.
These are considered the core services of a business. Marketing, operations, IT, finance, and organizational development can also be included here.
Types of Core Services
Different types of core services are explained below:
- Communication Services: People can talk, chat, and share information with each other through these types of core services. Think about calling, texting, emailing, and social media.
- Transportation Services: These kinds of core services move people and things from one place to another. It includes buses, trains, taxis, planes, and even services like Uber Eats and Amazon that deliver food.
- Healthcare Services: These are services related to caring for people’s health. People go to doctors, nurses, hospitals, clinics, and pharmacies when they’re sick or need medical advice.
- Education Services: Each of these services is about teaching and learning. They include schools, colleges, universities, and online learning platforms where students go to study and learn new skills.
- Financial Services: Financial core services involve money and how to handle money. People can use banks, ATMs, insurance companies, and investment firms to save, borrow, invest, and protect their money.
- Entertainment Services: These types of core services provide fun and enjoyment. Things like movies, TV shows, music, video games, and amusement parks can help people unwind, have fun, and pass the time.
- Etc.
Features of Core Banking
Core banking is a back-end system that handles bank transactions and updates accounts and other financial records with new information.
A core banking system can also usually process deposits, loans, and credits and provide interfaces for accounting applications and tools for making reports.
Core banking’s main features include managing and calculating interest rates, recording and processing cash withdrawals, processing loans, opening new bank accounts, and clearing checks and payments. Transaction management, activities related to customer relationship management, management of accounts, loans, and payments, customer onboarding, management of deposits and withdrawals, etc., are also included here.
What Are Value-Added Services?
A value-added service is something a company gives its customers extra on top of the basic product or service. These extra things make the whole package more fun and appealing. And make you feel special and have a great experience.
Let’s use a fitness tracker as an example here. It keeps track of how many steps you take and gives you extra services like personalized workout plans, sleep analysis, and even reminders to get up and move around. These extras add more fun to your fitness journey and help you reach your goals more quickly and steadily.
In short, value-added services are like little surprises that companies or someone else give you to make your experience better, more enjoyable, and easier. They treat you like a VIP and make you want to return for more. So, the next time you come across a product or service with some awesome extras, remember that you’re getting some delightful value-added goodness!
Value Added Service Example
For example, a small business has five sources of added value: convenience, branding, quality, design, and a unique selling point.
Value-added services provide advantages for both customers and service providers. Customers have the opportunity to receive something above and beyond their basic needs.
Types of Value-Added Services
There are different kinds of value-added services associated with purchased products and services. You can’t specifically put them in types, but you can have a brief idea from the discussion below-
- Personalized Help: Get support from experts who are ready to help you with any questions or problems.
- Extended Warranties: An extended warranty gives you peace of mind by covering your product for longer than the standard warranty period.
- Installation and Setup: Don’t worry about setting up your new product. Let professionals do it for you.
- Rewards and Loyalty Programs: If you are a loyal customer, you can earn points, discounts, or special rewards. This will make your experience more rewarding.
- Training and Tutorials: Get full resources, guides, and video tutorials to help you learn how to use your product or service to its fullest.
- 24/7 Customer Support: You can call or email customer support anytime, day or night, for help with problems or questions.
- Upgrades and Improvements: If you already have a product or service, you can get free or discounted upgrades for the latest features and improvements.
Value-Added Services In Banking
Value-added services in banking are extra perks and benefits that go beyond basic financial transactions. They make your banking experience more special and enjoyable. These services are like little treasures that make your financial life easier, safer, and a little bit more luxurious. Let’s explore some of these remarkable value-added services-
- Personal Financial Advice: Imagine having your own financial advisor at your fingertips, ready to help you through the complicated world of money. With value-added services, banks give you expert advice that is tailored to your needs. This helps you make smart choices and reach your financial goals.
- 24/7 Access to Mobile Banking: You no longer have to rush to the bank during the few open hours. Value-added services give you a mobile banking app that is easy to use to manage your money anytime, anywhere. Your bank is just a tap away whether you want to check your account balance, pay bills, or move money.
- Better Security Features: Your peace of mind is priceless, and value-added services make sure that strong security measures protect your financial transactions. Banks have advanced ways to verify your identity, like biometric recognition and one-time passwords, which keep your account safe from fraud and people who shouldn’t be able to access it.
- Exclusive Rewards and Discounts: Who doesn’t like to be rewarded for their loyalty? Value-added services give you access to a wide range of special benefits, such as cash-back deals, discounts at partner stores, and even rewards that are tailored to your spending habits. It’s like getting extra happiness from your bank using their services.
- Concierge Services: Banking isn’t just about numbers and transactions; it’s also about making your life easier. Value-added services help you with more than just money. They offer concierge services that meet your different needs. Whether you want to buy plane tickets, reserve a table at a restaurant, or set up a special experience, you can trust your bank to help you get what you want.
- Priority Customer Service: Value-added services treat you like a VIP, which is what you deserve. You have access to customer support teams that can help you quickly and answer any questions or concerns you may have. Your bank values your time and puts your needs first, so you no longer have to wait in long lines or be put on hold for hours.
Core Service Vs. Value-Added Service
Core Services and Value-Added Services are not the same in all ways. The differences between them are given below:
- Definition: Core services are the basic things that people want from the things they buy. Value-added services set a company apart from its competitors and build relationships with customers that make them feel good about the company.
- Implementation: Core Services are a bit easier to imitate or copy. Value-added services are much harder to copy and put into place.
- Relying Factor: Clients do not always rely on Core Services. Value-Added Services are easy for customers to depend on.
- Pricing: Prices for core services are competitive. Value-Added Services are extras that can be added to a basic or core service and can be sold at a higher price.
- Performance Goals: Core Service’s performance goals are quality, flexibility, speed, and price (or production cost).
- Information, problem-solving, field support, and sales support are the performance goals for Value-Added Services.
- Operational Synergy: Core or basic services and Value-Added Services may work well together regarding operations. Core services don’t offer this kind of service in any way.
- Example: Convenience, branding, quality, design, and unique selling points are all core services for a small business.
- Value-added services include things like risk management, treasury management, technology, information security, banking operations, marketing, and customer service. Marketing, operations, IT, finances, and organizational development can also be included here.
Infographic or Comparison Table of Core Services And Value-Added Services
Infographic or comparison table of core services and value-added services are given below:
Core Services | Value Added Services |
---|---|
Core services are the things that customers expect to find in the products they buy. | Value-added Services set a company apart from its competitors and build relationships with customers that make them feel good about the company. |
Somewhat easier to copy or imitate. | Significantly harder to copy and use. |
Clients don’t always depend on it. | Clients can depend on it in a good way. |
Priced in a competitive way. | It can be an add-on to a basic or core service and, as such, can be sold at a higher price. |
Performance goals: quality, adaptability, speed, and price (or cost of production). | Performance goals: getting information, solving problems, helping people in the field, and helping salespeople. |
Core services don’t have any sort of operational synergy with the service. | Value Added Services may provide operational synergy with core or basic services. |
E.g., risk management, treasury management, technology, information security, banking operations, marketing, and customer service are considered core services of a business. Marketing, operations, IT, finance, and organizational development can also be included here. | E.g., for a small business: convenience, branding, quality, design, and unique selling points. |
Bottom Line
So, we have briefly discussed the difference between core services and value-added services is important. To determine what a product or service is really worth, knowing those distinctions is important actually. Core services include the basic features that meet consumers’ basic needs. On the other hand, value-added services go beyond the basics to offer extra benefits and improve the overall customer experience.
Businesses and customers can make smart decisions if they know the difference between core and value-added services. Value-added services can help a business stand out in the market, attract customers, and keep them returning. On the other hand, consumers can figure out what a product or service is really worth and choose something that meets their needs and wants.
So, don’t just look at a product or service’s main features the next time you want to judge it. Also, think about what else it could do for you. After all, sometimes the little extras make all the difference and make you smile.