Introducing and innovating services is advocated as a means by which manufacturing firms in advanced economies can retain or enhance their competitivity. But little is known about how manufacturers innovate services. This paper is to examine how manufacturers innovate services, comparing this with how they innovate material products (i.e. goods) and production processes. We do this using two waves of the UK Innovation Survey. We find similarities and differences, with service innovations being especially associated with investments in training and marketing. We also find that, surprisingly, close engagement with customers does not significantly enhance the probability of service (or indeed goods) innovation.