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Consumer Behavior in Service Encounters

The document discusses customer behavior in service encounters. It explains that customers have varying levels of involvement depending on the type of service, from being physically involved throughout for people processing services, to only being mentally involved for information processing services. It also discusses the differences between high contact services where customers interact directly with personnel, and low contact services where interaction is reduced. Finally, it introduces concepts like moments of truth, critical incidents, and the importance of managing customer expectations in service delivery.

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Utsav Mahendra
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© Attribution Non-Commercial (BY-NC)
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Download as PPTX, PDF, TXT or read online on Scribd
271 views

Consumer Behavior in Service Encounters

The document discusses customer behavior in service encounters. It explains that customers have varying levels of involvement depending on the type of service, from being physically involved throughout for people processing services, to only being mentally involved for information processing services. It also discusses the differences between high contact services where customers interact directly with personnel, and low contact services where interaction is reduced. Finally, it introduces concepts like moments of truth, critical incidents, and the importance of managing customer expectations in service delivery.

Uploaded by

Utsav Mahendra
Copyright
© Attribution Non-Commercial (BY-NC)
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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Chapter 2

Consumer Behavior in Service Encounters

Where Does the Customer Fit in a Service Organization? (Fig. 2.1)


Consumers rarely involved in manufacture of goods but often participate in service creation and delivery Challenge for service marketers is to understand how customers interact with service operations Flowcharting clarifies how customer involvement in service encounters varies with type of process - see Fig. 2-1:
People processing (e.g., motel stay): customer is physically involved throughout entire process Possession processing (e.g., DVD repair): involvement may be limited to drop off of physical item/description of problem and subsequent pick up Mental stimulus processing (e.g., weather forecast): involvement is mental, not physical; here customer simply receives output and acts on it Information processing (e.g., health insurance): involvement is mental - specify information upfront and later receive documentation of coverage

High-Contact and Low-Contact Services


High Contact Services

Customers visit service facility and remain throughout service delivery


Active contact between customers and service personnel

Includes most people-processing services Low Contact Services


Little or no physical contact with service personnel

Contact usually at arms length through electronic or physical distribution channels


New technologies (e.g. Web) help reduce contact levels

Levels of Customer Contact with Service Organizations (Fig. 2.2)


High
N u r si n g H o m e

Emphasizes encounters with service personnel


M a n a g e m e n t Co n su l t i n g

H a i r Cu t
4 - St a r H o t e l
G o o d Re st a u r a n t A i r l i n e Tr a v e l (Eco n .)

Tel ep h o n e Ba n k i n g

Re t a i l Ba n k i n g M o t el

Ca r Rep a i r I n su r a n ce

Dr y Cl ea n i n g
Fa st Fo o d Movie Theater
Ca b l e TV

Subway Internet Banking Mail Based Repairs

Emphasizes encounters with equipment

Internet-based Services

Low

Managing Service Encounters--1


Service encounter: A period of time during which customers interact directly with a service
Moments of truth: Defining points in service delivery where customers interact with employees or equipment Critical incidents: specific encounters that result in especially satisfying/dissatisfying outcomes for either customers or service employees

Managing Service Encounters--2


Service success often rests on performance of junior contact personnel Must train, coach, role model desired behavior Thoughtless or badly behaved customers can cause problems for service personnel (and other customers) Must educate customers, clarify what is expected, manage behavior

The Purchase Process for Services


(Adapted from Fig. 2-3)

Prepurchase Stage Awareness of need Information search Evaluation of alternative service suppliers Service Encounter Stage Request service from chosen supplier Service delivery Postpurchase Stage Evaluation of service performance Future intentions

Perceived Risks in Purchasing and Using Services (Table 2.1)


Functional unsatisfactory performance outcomes Financial monetary loss, unexpected extra costs Temporal wasted time, delays lead to problems Physical personal injury, damage to possessions Psychological fears and negative emotions Social how others may think and react Sensory unwanted impacts to any of five senses

Factors that Influence Customer Expectations of Services (Fig. 2.4)


Personal Needs Desired Service Beliefs about What Is Possible Explicit & Implicit Service Promises Word-of-Mouth Past Experience

ZONE OF TOLERANCE

Perceived Service Alterations Adequate Service Situational Factors Predicted Service

Source: Adapted from Zeithaml, Parasuraman & Berry

Components of Customer Expectations


Desired Service Level: wished-for level of service quality that customer believes can and should be delivered Adequate Service Level: minimum acceptable level of service Predicted Service Level: service level that customer believes firm will actually deliver Zone of Tolerance: range within which customers are willing to accept variations in service delivery

Intangible Attributes, Variability, and Quality Control Problems Make Services Hard to Evaluate
Search attributes Tangible characteristics that allow customers to evaluate a product before purchase Experience attributes Characteristics that can be experienced when actually using the service Credence attributes Characteristics that are difficult to evaluate confidently even after consumption Goods tend to be higher in search attributes, services tend to be higher in experience and credence attributes Credence attributes force customers to trust that

How Product Attributes Affect Ease of Evaluation) (Fig. 2.5)


Most Goods Most Services

Clothing

Chair

Foods

Restaurant meals

Haircut

Easy to evaluate

Difficult to evaluate
Computer repair Legal services Complex surgery
Source: Adapted from Zeithaml

Motor vehicle

High in search attributes

High in experience attributes

Entertainment

Lawn fertilizer

High in credence attributes

Satisfaction defined as attitude-like judgment following a service purchase or series of service interactions Customers have expectations prior to consumption, observe service performance, compare it to expectations Satisfaction judgments are based on this comparison
Positive disconfirmation if better than expected Confirmation if same as expected

Customer Satisfaction is Central to the Marketing Concept

Customer Delight: Going Beyond Satisfaction


Research shows that delight is a function of 3 components
Unexpectedly high levels of performance Arousal (e.g., surprise, excitement) Positive affect (e.g., pleasure, joy, or happiness)

Is it possible for customers to be delighted by very mundane services? Progressive Insurance has found ways to

Service Operations (front stage and backstage)

A Service Business is a System Comprising Three Overlapping Subsystems

Where inputs are processed and service elements created. Includes facilities, equipment, and personnel
Service Delivery (front stage) Where final assembly of service elements takes place and service is delivered to customers Includes customer interactions with operations

Service Marketing System: (1) High Contact Service--e.g., Hotel (Fig. 2.7)
Service Marketing System
Other Customers

Service Delivery System Service Operations System


Interior & Exterior Facilities

Other Contact Points


Advertising Sales Calls Market Research Surveys Billing / Statements Miscellaneous Mail, Phone Calls, Faxes, etc. Random Exposure to Facilities / Vehicles

Technical Core

Equipment

The Customer

Service People

Backstage (invisible)

Front Stage (visible)

Other Customers

Chance Encounters with Service Personnel Word of Mouth

Service Marketing System: (2) Low Contact Service--e.g., Credit Card (Fig. 2.8) System Service Marketing
Service Delivery System Service Operations System Other Contact Points Advertising Mail Technical Core Self Service Equipment Phone, Fax, Web site etc.
Backstage (invisible) Front Stage (visible)

The Customer

Market Research Surveys


Random Exposures Facilities, Personnel

Word of Mouth

Service as Theater
All the worlds a stage and all the men and women merely players. They have their exits and their entrances and each man in his time plays many parts
William Shakespeare As You Like It

The Dramaturgy of Service Delivery


Service dramas unfold on a stage--settings may change as performance unfolds Many service dramas are tightly scripted, others improvised Front-stage personnel are like members of a cast Like actors, employees have roles, may wear special costumes, speak required lines, behave in specific ways

Support comes from a backstage production

Role and Script Theories


Role: A set of behavior patterns learned through experience and communication Role congruence: In service encounters, employees and customers must act out defined roles for good outcomes Script: A sequence of behavior to be followed by employees and customers during service delivery
Some scripts (e.g. teeth cleaning) are routinized, others flexible

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