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Service Attributes in Marketing Explained

This document discusses various concepts related to services marketing. It provides examples of different types of attributes, risks associated with online purchases, needs that can trigger the pre-purchase stage, and models of the service consumption process. Specifically, it discusses search attributes like what a coffee shop sells, credence attributes like food quality at a restaurant. It also outlines functioning, financial, and time risks for online textbook purchases. The pre-purchase stage and three stages of service consumption are summarized. Finally, it distinguishes between service quality and customer satisfaction, and identifies the five dimensions of service quality.

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0% found this document useful (0 votes)
132 views4 pages

Service Attributes in Marketing Explained

This document discusses various concepts related to services marketing. It provides examples of different types of attributes, risks associated with online purchases, needs that can trigger the pre-purchase stage, and models of the service consumption process. Specifically, it discusses search attributes like what a coffee shop sells, credence attributes like food quality at a restaurant. It also outlines functioning, financial, and time risks for online textbook purchases. The pre-purchase stage and three stages of service consumption are summarized. Finally, it distinguishes between service quality and customer satisfaction, and identifies the five dimensions of service quality.

Uploaded by

CHIA MIN LIEW
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd

TUTORIAL 2

1. Give an example of a service’s search attribute.


 Starbucks coffeehouse company. Search attributes including what’s Starbucks is
selling (Espresso beverages, brewed coffee, chocolate beverages etc) 

2. Give an example of a restaurant’s credence attribute.


Examples of restaurant’s credence attributes are quality of chicken in chicken rice, quality of 
coffee bean to make coffee, hygiene condition to prepare roti canai.

3. What types of risks might be inherent in making an online textbook purchase?


Functioning risk
It refers to the risks associated with the functioning or performance of the product in which
the product may not perform up to expectations (unsatisfactory performance outcomes). For
example, the online textbook does not provide the information that customers want. 

Financial Risk
Financial risks are monetary loss. In terms of online purchases, financial risks means loss of
credit cards. For instance, insecurity of credit cards might be hacked by hackers during the
transaction of buying the online textbook. 

Temporal/ Time Risk


It refers to the consumer’s worry about time consumption when purchasing a new product.
The consumer here worries about how much of his time as well as the effort the new product
would consume. For example, how long would it take for the consumer to get the online
textbook once the transaction is made. 

4. How many needs can be triggered in the pre-purchase stage?


i. People’s unconscious minds
 This needs is due to the wishes or wants of a person toward the services. 
 For example: dream, aspirations, personal identity etc. 

ii. Physical conditions


 This needs is due to problems in physical which make a person seeks for the
services to solve it.
 For example: hunger, thirst, pain, cold etc.

[Link] sources
 This needs is due to the influences from outside environments or third parties.
 For example: Firm’s advertisement, third party website, marketing activities
etc.
5. Explain the three-stage model of service consumption.
i. Pre-purchase stage
1. Need awareness
 A service purchase is triggered by a need arousal. The needs may be
due to people’s unconscious minds (e.g. aspirations), physical
conditions (e.g. chronic back pain) and external sources (e.g.
marketing activities). When a need is recognized, people are likely to
take action to resolve it.
2. Information search
 When a need is recognized, people will search for solutions. Several
alternatives may come to mind, and these form the evoked set. When
there is an evoked set, the different alternatives need to be evaluated
before a final choice is made.
 Evoked set is a set of possible services or brands that a customer may
consider in the decision process. It can be derived from past experience
or external sources such as social media, online review, advertising,
retail displays and recommendations.
3. Evaluation of alternatives
 Once the consideration set and key attributes are understood, the
customer typically makes a purchase decision.
4. Purchase decision
 When possible alternatives have been compared and evaluated, the best
option is selected. It can be quite simple if perceived risks are low and
alternatives are clear. Very often, trade-offs are involved. The more
complex the decision, the more trade-offs need to be made. Price is
often a key factor in the purchase decision.
ii. Service encounter stage
1. Request service from a chosen supplier or initiate self-service.
 Service encounters range from high contact to low contact 
→ High-contact services: Active contact between customers and
service personnel
→ Low-contact services: Little or no physical contact with service
personnel
 Servuction system (service + production)
→ visible front stage and invisible backstage
→ Service operations system (backstage): Includes facilities,
equipment, and personnel
→ Service delivery system (front stage): Includes customer
interactions with operations and other customers

2. Service delivery by personnel or self-service


 Good metaphor as service delivery is a series of events that customers
experience as a performance
 Theater as a metaphor 
 Service facilities are like the stage on which drama unfolds and may
change from one act to another
 Personnel: Front stage personnel are like members of a cast while
backstage personnel are support production team
iii. Post-encounter stage
1. Evaluation of service performance
 Customers have expectations prior to consumption, they will observe
service performance and compare it to their expectations.
 Customers evaluate service performance based on this comparison:
positive disconfirmation if better than expected, confirmation if same
as expected and negative disconfirmation if worse than expected.
2. Future intentions and behaviors
 If customers are satisfied with the service, they will publicize your
service by word of mouth or repurchase again.

6. Describe search, experience, and credence attributes and give examples of each.
i. Search attributes
 It have attributes or tangible characteristic customers can refers to evaluate a
product before they purchase
 For example, hotel room price, quality of a chair, an airline schedule, etc.

ii. Experience attributes 


  It can be evaluated only after purchase or “experience” it. 
 For example, a new movie, a haircut from a barber shop you went to for the
first time, dinner in a new restaurant, etc. 

iii. Credence attributes


 Buyers or customers can’t confidently evaluate even after purchasing one time
or more. 
 For example, advertising services, consulting services, accounting services,
dentist, specialist etc.

7. Explain why services tend to be harder for customers to evaluate than goods.
Services tend to be harder for customers to evaluate than goods. When purchasing services,
the customer usually cares about the experience being provided. Therefore, the evaluation of
the service is usually based on comparison between what customers expect and what they
perceive. 

Service evaluated based on subjective evaluation while goods is based on objective


evaluation. Most service products cannot be inventoried. For example, mushroom instant
soup can be evaluated by looking at the label of the ingredient on it. However, mushroom
soup eaten in a restaurant can only be evaluated based on personal opinion. Each customer
may give different reviews on it. 

Other than that, service is usually more difficult to visualize and understand than goods.
Therefore, perceived risk will be higher associated with purchase decisions. For example, if a
patient doesn't understand the operation, he may have greater uncertainty then it’s hard for
him to expect the service and can’t evaluate the service provided by the doctor. (Credence
attribute)
8. What is service quality? How is it different from customer satisfaction?
Service quality is the high standard of performance that consistently meets or exceeds
customer expectations.

Customer satisfaction is an evaluation of a single consumption experience while service


quality refers to relatively stable attitudes and beliefs about a firm. 

For example, there is an economy rice restaurant near a university. The restaurant provides a
basic quality of economy rice only and the restaurant is not overly attractive, but at very
reasonable prices. Regular customers like students would know what to expect from this
restaurant. So they are generally satisfied with the food and price. This is customer
expectations. However, they may recognize the overall quality of this business is low because
of the physical environment. This is service quality.

9. What are the five dimensions of service quality? (Lecture 2 Slides 50 to 51)
The five dimensions of service quality are tangibles, reliability, responsiveness, assurance
and empathy.

Tangibles are the appearance of physical facilities, equipment, personnel, and communication
channels. It is the physical image of the service that customers will use to assess quality. For
example, are the gym facilities in TARUC attractive?

Reliability is the ability to perform the promised service dependably and accurately. It means
organizations perform a service correctly on the first time. For example, is a customer's car
being repaired right on the first time?

Responsiveness is willingness to help customers and provide prompt service. It includes


giving customers undivided attention, promoting services, and responding in accordance with
their requests. For example, when there is a problem, does the firm resolve it quickly? 

Under assurance, credibility is trustworthiness, believability, honesty of the service provider.


For example, does the hospital have a good reputation? Next, security is freedom from
danger, risk , or doubt. For example, is it safe for me to use the bank’s ATMs at night?
Moreover, competence is possession of the skills and knowledge required to perform the
service. The skills and knowledge must be ensured sufficient in order to perform better
service to customers. For example, can the accountant appear to be competent? Lastly,
courtesy is politeness, respect, consideration, and friendliness of contact personnel. A
courtesy is important to make a good impression of service in the customer mind. For
example, is the stewardess polite and friendly enough? 

Under empathy, access is approachability and ease of the contact. For example, is the hotel
conveniently located? Next, communication is about listening to customers and keeping them
informed in the language they can understand. For example, when I have a complaint, is the
manager willing to help me? Lastly, in understanding the customer, effort made to know
customers and their needs.  For example, is the moving company willing to accommodate my
schedule?

Common questions

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Service quality dimensions, such as tangibles, reliability, responsiveness, assurance, and empathy, provide a framework for assessing the overall standard of a service provider in delivering consistent, expected service . In contrast, customer satisfaction is more situational and occurs when there is a positive confirmation between expectations and actual service performance . While service quality is a systemic measure often spanning multiple interactions, customer satisfaction is typically an outcome of a specific service encounter . Service quality forms the foundation for developing long-term customer satisfaction through consistent experiences across the service dimensions .

Search attributes in a restaurant context are those qualities that customers can evaluate before purchase, such as the menu prices or the restaurant's location . Experience attributes are those that can only be judged during or after consumption, like the taste of a dish or the service received during a meal . Credence attributes are challenging to assess even post-consumption, such as the hygiene quality of the kitchen or the authenticity of specialty ingredients used . These attributes affect customer evaluation by shaping expectations and perceived quality based on different levels of tangible evidence, prior experience, and expertise .

Customer expectations, shaped by previous experiences, marketing, and word-of-mouth, set a baseline for service evaluation . Service quality is assessed based on how actual performance measures against these expectations. If performance aligns or exceeds expectations, it results in positive disconfirmation or confirmation, contributing to customer satisfaction and a high perception of service quality . Conversely, if actual performance falls short, negative disconfirmation occurs, driving dissatisfaction and a low perception of service quality . The interplay between expectations and performance dictates the sustainability of a service provider's customer base .

Credence attributes, by nature, are difficult for consumers to evaluate even post-consumption, as they require specialized knowledge or trust in the provider, such as in medical or legal services . These challenges lead to higher perceived risk, potentially deterring purchases . Providers can alleviate these challenges by building a strong reputation, offering guarantees, and promoting transparency in their qualifications and process excellence to build consumer trust and mitigate skepticism .

In the pre-purchase stage, upon recognizing a need, customers enter an information search phase where they gather possible service alternatives, forming an evoked set . This set is influenced by past experiences or information from external sources such as advertisements or online reviews . The significance of the evoked set lies in its role as a filter that establishes the initial pool of options a customer considers, shaping subsequent evaluations and eventually the purchase decision .

In the goods purchasing process, information search is typically straightforward due to the tangible nature of goods, allowing consumers to access detailed product specifications and reviews before purchase . Conversely, the information search for services involves more ambiguity due to their intangible and experiential attributes, relying heavily on subjective sources like customer reviews, past experiences, and marketing influences to form an evoked set . This complexity increases the importance of building a strong brand and presence in service industries to guide consumer decision-making effectively .

Perceived risks, which pertain to potential negative outcomes like financial or functional failures, can be higher in services due to their intangible nature compared to goods . Services lack tangible evidence and consistency, leading to difficulties in pre-purchase evaluation and heightened perceived risks . These risks can deter customers from completing transactions unless these are mitigated, for example, through reputation or guarantees, particularly in services where evaluation is dependent on experience and credence attributes .

Service operations involve managing aspects such as customer interaction, perceived quality, and delivery consistency that are not present in product management . The intangible nature of services compounds these challenges by making it difficult to define, measure, and manage service quality as services can't be inventoried or objectively evaluated prior to purchase . Intangibility increases perceived risk and variability, necessitating robust systems for managing expectations and ensuring consistent customer experiences .

Post-encounter evaluation involves the customer comparing actual service performance against their expectations, resulting in positive, neutral, or negative disconfirmation . These evaluations significantly influence future behavior as positive evaluations increase the likelihood of repeat patronage and positive word-of-mouth, whereas negative disconfirmations can lead to churn and negative reviews . The nature and extent of a customer's expectations and prior experiences also shape the impact of these evaluations on future behavior .

High-contact services involve significant interaction between customers and service personnel, like in healthcare or education, where personal attention and trust are critical . Low-contact services, such as automated online services, rely far less on human interaction and are often self-serve . These differences affect customer satisfaction as high-contact services can personalize experiences, but also pose risks if service delivery is inconsistent. In contrast, low-contact services benefit from scalability and consistency but may lack personalization, impacting customer engagement negatively if not managed thoughtfully .

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