This document discusses consumer behavior in services. It covers several key topics: 1) The behavior consumers display when searching for, purchasing, using, evaluating and disposing of services. This includes understanding triggers of need, user costs of services, and information search. 2) Evaluating service alternatives including attributes that can be evaluated before or after purchase. It also discusses perceived risks of services. 3) Customer expectations of services which are formed by situational and personal factors. Expectations can change over time. 4) The service encounter stage where customers interact with service providers. Models for conceptualizing this include "moments of truth", high/low contact services, and viewing service as drama with roles and scripts

1. MBA 9011
Lecture 2
Consumer Behavior in Service,
Customer expectation of service and
Customer Perceptions of service
Course Instructor: Sneha Sharma (PhD*, MBA, Dip T & D)

2. MBA 901
Consumer Behavior in Services
2

3. MBA 901
Consumer Behavior
• The behavior that consumers display in
–Searching
–Purchasing
–Using
–Evaluating
–Disposing
Of products and services that they expect
will satisfy their needs.

4. MBA 901
Decision in a CB in Services
4

5. MBA 901
Need Arousal
5
Decision to buy or use a service is triggered by need
arousal
Triggers of need:
Consumers are then motivated to find a solution for their
need
Unconscious minds
(e.g., personal
identity and
aspirations)
Physical conditions
(e.g., hunger )
External sources
(e.g., a service firm’s
marketing activities)

6. MBA 901
Understanding User Costs for Services
Search Costs
Purchase and
Use Costs
After costs
Money
Time
Physical Effort
Psychological
Burdens
Sensory Burdens
Necessary Follow up
Problem Solving

7. MBA 901
Information Search
7
Need arousal leads to attempts to find a
solution
-Evoked set – a set of products and brands
that a consumer considers during the
decision-making process – that is derived
from past experiences or external sources
Alternatives then need to be evaluated before a
final decision is made

8. MBA 901
Evaluation of service alternatives :
Evoked Set
• The evoked set of alternatives likely to be smaller with
services than goods
• Competitive services can not be displayed for
comparison  always a single brand
• Available service providers in geographical area is small.
• Difficult to obtain adequate pre-purchase information
about service
• The Internet may widen this potential

9. MBA 901
Evaluating Alternatives – Service
Attributes
9
- Search attributes help customers evaluate a product before
purchase.
- E.g., type of food, location, type of restaurant and price .
- Experience attributes cannot be evaluated before purchase.
- The consumer will not know how much she/he will enjoy the
food, the service, and the atmosphere until the actual
experience .
- Credence attributes are those that customers find impossible to
evaluate confidently even after purchase and consumption.
- E.g., hygiene conditions of the kitchen and the healthiness
of the cooking ingredients.

10. MBA 901
How Product Attributes Affect Ease of
Evaluation
10

11. MBA 901
Perceived Risks of Purchasing and Using
Services
11
• unsatisfactory performance outcomes
Functional
• monetary loss, unexpected extra costs
Financial
• wasted time, delays leading to problems
Temporal
• personal injury, damage to possessions
Physical
• fears and negative emotions
Psychological
• how others may think and react
Social
• unwanted impact on any of five senses
Sensory

12. MBA 901
How Might Consumers Handle
Perceived Risk?
12

13. MBA 901
Strategic Responses to Managing
Customer Perceptions of Risk
13

14. MBA 901
Customer Expectation of
Services
14

15. MBA 901
Understanding Customers’ Service
Expectations
15
•Customers evaluate service quality by
comparing what they expect against what they
perceive
•Situational and personal factors also
considered
•Expectations of good service vary from one
business to another, and differently positioned
service providers in same industry
•Expectations change over time

16. MBA 901
Components of Customer
Expectations

17. Frustration
Customer Delight

18. MBA 901
Customer Gap
Expected
Service
Perceived
Service
GAP

19. MBA 901
Perceived
Service
Expected Service
CUSTOMER
COMPANY
Customer
Gap
GAP 1
GAP 2
Gaps Model of Service Quality
GAP 3
External
Communications
to Customers
GAP 4
Service Delivery
Customer-Driven Service
Designs and Standards
Company Perceptions of
Consumer Expectations

20. MBA 901
Service Encounter Stage
20

21. MBA 901
Service Encounter Stage
21
• Service encounter
– a period of time during which a customer
interacts directly with the service provider
– Might be brief or extend over a period of time
(e.g., a phone call or visit to the hospital)

22. MBA 901
Service Provision as Drama
• Drama: Create and maintain impression
– Actors, audience, setting, performance: Drama
– Actor: Service personnel
– Audience: Service customers
– Setting : Physical evidence
– Performance: Process of service assembly.

23. MBA 901
Service Roles and Scripts
• Viewing Service performance as drama:
–Each player as having a role to perform
• Customers role: Must be well informed
educated , cooperative : Service performance
is likely to be successful.

24. MBA 901
Service Roles and Scripts
–Script: A coherent sequence of events
expected by individual
• Consists of set of ordered actions ,actors and
objects
• Conformance with script –satisfying the
customer
• Deviation with script – dissatisfaction and
confusion

25. MBA 901
Service Encounter Stage
25
• Models and frameworks:
• “Moments of Truth” – importance of managing
touchpoints
• High/low contact model – extent and nature of contact
points
• Servuction model – variations of interactions
• Theater metaphor – “staging” service performances

26. MBA 901
Distinctions between High-Contact
and Low-Contact Services
26

27. MBA 901
The Servuction System: Service
Production and Delivery
27
• Servuction System: visible front stage and invisible
backstage
• Service Operations
– Technical core where inputs are processed and service
elements created
– Contact people
– Inanimate environment
• Service Delivery
– Where “final assembly” of service elements takes place and
service is delivered
– Includes customer interactions with operations and other
customers

28. MBA 901
Theatrical Metaphor: an Integrative
Perspective
28

29. MBA 901
Implications of Customer Participation in
Service Delivery
29

30. MBA 901
Post – Encounter Stage
30

31. MBA 901
Customer Satisfaction with Service
Experience
31

32. MBA 901
Customer Delight: Going Beyond
Satisfaction
32

33. MBA 901
33