© 2006 The McGraw-Hill Companies, Inc. All rights reserved.McGraw-Hill/Irwin

Part 2

FOCUS ON THE CUSTOMERFOCUS ON THE CUSTOMER

© 2006 The McGraw-Hill Companies, Inc. All rights reserved.McGraw-Hill/Irwin

Expectedservice

Perceivedservice

Customer Gap

The Customer GapThe Customer Gap

Part 2 Opener

3ChapterChapter

Consumer Behavior in ServicesConsumer Behavior in Services

Search, Experience, and Credence Properties

Consumer Choice Consumer Experience Postexperience Evaluation

© 2006 The McGraw-Hill Companies, Inc. All rights reserved.McGraw-Hill/Irwin

Objectives for Chapter 3:Consumer Behavior in Services

Objectives for Chapter 3:Consumer Behavior in Services

Enhance understanding of how consumers choose and evaluate services, through focusing on factors that are particularly relevant for services.

Explore how differences among consumers (cultural differences, group decision making) affect consumer behavior and influence services marketing strategies.

© 2006 The McGraw-Hill Companies, Inc. All rights reserved.McGraw-Hill/Irwin

Consumer Behavior in ServicesConsumer Behavior in Services

1. Review Unique Characteristics

Deeds, Processes, Performances

Intangible, Heterogeneous, Simultaneous, Perishable

2. Traditional Consumer Decision Process

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Figure 3.3

Stages in Consumer Decision Making and Evaluation of Services

Figure 3.3

Stages in Consumer Decision Making and Evaluation of Services

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Differences in StagesDifferences in Stages

A. Evaluation- Pre and Post

1. When and If – How Difficult/ Confident

2. Evaluation Qualities

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Consumer Evaluation Processes for ServicesConsumer Evaluation Processes for Services

Search Qualities attributes a consumer can determine prior to purchase of a

product

Experience Qualities attributes a consumer can determine after purchase (or

during consumption) of a product

Credence Qualities characteristics that may be impossible to evaluate even after

purchase and consumption

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Figure 3.2

Continuum of Evaluation for Different Types of Products

Figure 3.2

Continuum of Evaluation for Different Types of Products

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Re

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Va

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Ha

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Ch

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ep

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Difficult to evaluateEasy to evaluate

High in searchqualities

High in experiencequalities

High in credencequalities

MostGoods

MostServices

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Evaluation (Cont)Evaluation (Cont)

3. Situational Influences

a. Social

b. Task

c. Antecedent States

d. Temporal effects

4. Smaller Evoked Set

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SearchSearch

B. Information Search

1. Personal Sources/ Word of Mouth

2. Perceived Risk- function of:

a. the amount of uncertainty

b. the potential negative consequences

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Search (cont)Search (cont)

Types of Risk

Financial/ Economic

Performance/ Functional

Physical

Psycho – Social

Time/ Hassle

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Search (Cont)Search (Cont)

Perceived Risk Is Greater for Services

Why?

Intangibility

Heterogeneity

Perishability

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Perceived RiskPerceived Risk

How consumer deal with risk

More Info (Search)

Loyalty

Sub-contracting

Challenges

Difficulty of Search

What can be learned with experience

Variability

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Perceived RiskPerceived Risk

What are the Managerial Implications?

Generally, reduce PR

Information

Reassurance

Tangibalize Benefits

Guarantees

Trial Period

Category Risk versus Specific Risk

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PurchasePurchase

C. Purchase- Simultaneous production and

consumptionExperience/ Process1. Service Roles and Scripts

2. Service as DramaActors, Audience, Setting, Front Stage, Back Stage, Props

3. Customer Compatibility

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Post PurchasePost Purchase

D. Post Purchase

Word-of-Mouth (WOM)

Attribution

Positive / Negative Bias

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CultureCulture

3. Role of Culture (Experience)

a. Interpersonal/ Personalized

b. Language, values, manners, customs, etc.