2
Consumer Behavior
IN A SERVICES
CONTEXT
WIRTZ LOVELOCK
Learning Objectives
2.1 Understand the three-stage model of service
consumption.
2.2 Use the multi-attribute model to understand how
consumers evaluate and choose between alternative
service offerings.
2.3 Learn why consumers often have difficulty
evaluating services, especially those with many
experience and credence attributes.
2.4 Know the perceived risks customers face in
purchasing services and the strategies firms can use to
reduce consumer risk perceptions.
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Learning Objectives
2.5 Understand how customers form service
expectations and the components of these
expectations.
2.6 Know the “moment of truth” metaphor.
2.7 Contrast how customers experience and evaluate
high- versus low-contact services.
2.8 Be familiar with the servuction model and
understand the interactions that together create the
service experience.
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Learning Objectives
2.9 Obtain insights from viewing the service encounter
as a form of theater.
2.10 Know how role, script, and perceived control
theories contribute to a better understanding of
service encounters.
2.11 Describe how customers evaluate services and
what determines their satisfaction.
2.12 Understand service quality, its dimensions and
measurement, and how quality relates to customer
loyalty.
4
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Consumer Behavior
in a Services Context
2.1
Understand the three-stage
model of service
consumption.
WIRTZ LOVELOCK
The three-stage model of service
consumption
• Overview
CONSUMER BEHAVIOR IN A
SERVICES CONTEXT
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The three-stage model of service
consumption
CONSUMER BEHAVIOR IN A
SERVICES CONTEXT
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The three-stage model of service
consumption
1. Pre Purchase Stage:
CONSUMER BEHAVIOR IN A
• Need Awareness
SERVICES CONTEXT
• Information search
• Evaluation of alternatives
o Multi-attribute model
o Service attributes
o Perceived risk
o Service expectations
• Purchase decision
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The three-stage model of service
consumption
Need Awareness
• A service purchase is triggered by
an underlying need (need arousal)
CONSUMER BEHAVIOR IN A
• Needs may be due to:
SERVICES CONTEXT
o People’s unconscious minds (e.g.,
aspirations)
o Physical conditions (e.g., chronic back
pain)
o External sources (e.g., marketing
activities)
• When a need is recognized, people
are likely take action to resolve it
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The three-stage model of service
consumption
Information Search
• When a need is recognized,
people will search for
CONSUMER BEHAVIOR IN A
solutions.
SERVICES CONTEXT
• Several alternatives may
come to mind, and these
form the evoked set
o Evoked set: set of possible services or brands that a
customer may consider in the decision process
• When there is an evoked set, the different
alternatives need to be evaluated before a final
choice is made
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Consumer Behavior
in a Services Context
2.2 multi-attribute
Use the
model to understand how
consumers evaluate and
choose between alternative
service offerings.
WIRTZ LOVELOCK
The Multi-attribute Model
CONSUMER BEHAVIOR IN A
SERVICES CONTEXT
Conjunctive Rule V/s Lexicographic Rule
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Consumer Behavior
in a Services Context
2.3
Learn why consumers often
have difficulty evaluating
services, especially those
with many experience and
credence attributes.
WIRTZ LOVELOCK
Service Attributes: SEC
• Search attributes help customers evaluate a product
before purchase
• Experience attributes cannot be evaluated before
CONSUMER BEHAVIOR IN A
purchase—must “experience” the product to know it
SERVICES CONTEXT
o Vacations, sporting events, medical procedures
• Credence attributes are product characteristics that
customers find it impossible to evaluate confidently even
after purchase and consumption
o Quality of repair and maintenance
work
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Service Attributes :SEC
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Consumer Behavior
in a Services Context
2.4
Know the perceived risks
customers face in purchasing
services and the strategies
firms can use to reduce
consumer risk perceptions.
WIRTZ LOVELOCK
Perceived Risks
• Functional―unsatisfactory performance
outcomes
• Financial―monetary loss,
CONSUMER BEHAVIOR IN A
unexpected extra costs
SERVICES CONTEXT
• Temporal―wasted time,
delays leading to problems
• Physical―personal injury,
damage to possessions
• Psychological―fears and negative emotions
• Social―how others may think and react
• Sensory―unwanted impact on any of five senses
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Perceived Risks
How Do Consumers Handle Them?
• Seeking information from respected personal
sources
CONSUMER BEHAVIOR IN A
• Using Internet to compare service offerings and
SERVICES CONTEXT
search for independent reviews and ratings
• Relying on a firm that has a good reputation
• Looking for guarantees and warranties
• Visiting service facilities or trying aspects of
service before purchasing
• Asking knowledgeable employees about
competing services
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Perceived Risks
Strategies for Firms to Manage Consumer Perceptions of
Risk
• Preview service through brochures, websites, videos
CONSUMER BEHAVIOR IN A
• Encourage visit to service facilities before purchase
SERVICES CONTEXT
• Free trial (for services with high experience attributes)
• Advertise (helps to visualize)
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Perceived Risks
Strategies for Firms to Manage Consumer
Perceptions of Risk
• Display credentials
CONSUMER BEHAVIOR IN A
• Use evidence management (e.g., furnishing,
SERVICES CONTEXT
equipment etc.)
• Give customers online
access to information
about order status
• Offer guarantees
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Consumer Behavior
in a Services Context
2.5
Understand how customers
form service expectations
and the components of these
expectations.
WIRTZ LOVELOCK
Service Expectations
• Customers evaluate service quality by
comparing what they expect against what
CONSUMER BEHAVIOR IN A
they perceive
SERVICES CONTEXT
o 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
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Service Expectations
CONSUMER BEHAVIOR IN A
SERVICES CONTEXT
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Service Expectations
Components of Customer Expectations
• Desired Service Level:
CONSUMER BEHAVIOR IN A
o Wished-for level of service quality that customer
believes can and should be delivered
SERVICES CONTEXT
• Adequate Service Level:
o Minimum acceptable
level of service
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Service Expectations
Components of Customer Expectations
• Predicted Service Level:
o Service level that customer believes firm will actually
CONSUMER BEHAVIOR IN A
deliver
SERVICES CONTEXT
• Zone of Tolerance:
o Range within which customers
are willing to accept variations
in service delivery
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Service Expectations
Purchase Decision
• When possible alternatives have been compared
and evaluated, the best option is selected
CONSUMER BEHAVIOR IN A
• Can be quite simple if perceived risks are low
SERVICES CONTEXT
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
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Consumer Behavior
in a Services Context
2.6
Know the “moment of truth”
metaphor.
WIRTZ LOVELOCK
Moments of truth
• The “moment of truth”
is when the customer
directly interacts with
CONSUMER BEHAVIOR IN A
the service firm.
SERVICES CONTEXT
• It involves the skills,
motivation and tools
employed by the firm
to prove to the customer that they are the best
alternative for them.
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Consumer Behavior
in a Services Context
2.7
Contrast how customers
experience and evaluate
high- versus low-contact
services.
WIRTZ LOVELOCK
High- versus low-contact services
• Service Encounters Range from High-contact to Low-
contact
CONSUMER BEHAVIOR IN A
SERVICES CONTEXT
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High- versus low-contact services
• High-contact Services
o Customers visit service facility and remain throughout service
delivery
CONSUMER BEHAVIOR IN A
o Active contact between customers and service personnel
SERVICES CONTEXT
o Includes most people-processing services
• Low-contact Services
o Little or no physical contact with service personnel
o Contact usually at arm’s length through electronic or physical
distribution channels
o New technologies (e.g. Web) help reduce contact levels
• Medium-contact services lie in between these two
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Consumer Behavior
in a Services Context
2.8
Be familiar with the
servuction model and
understand the interactions
that together create the
service experience.
WIRTZ LOVELOCK
The Servuction System
CONSUMER BEHAVIOR IN A
SERVICES CONTEXT
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The Servuction System
• Visible front stage and invisible backstage
• Service Operations system
CONSUMER BEHAVIOR IN A
o Technical core where inputs are processed and
service elements created, usually backstage
SERVICES CONTEXT
o Includes facilities, equipment, and personnel
• Service Delivery System (front stage)
o Where “final assembly” of service elements takes
place and service is delivered to customers
o Includes customer interactions with operations and
other customers
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Consumer Behavior
in a Services Context
2.9
Obtain insights from viewing
the service encounter as a
form of theatre.
WIRTZ LOVELOCK
Theatrical Metaphor
• Good metaphor as service delivery is a series of
events that customers experience as a
performance
CONSUMER BEHAVIOR IN A
• Service facilities
SERVICES CONTEXT
o Stage on which drama
unfolds
o This may change from
one act to another
• Personnel
o Front stage personnel are like members of a cast
o Backstage personnel are support production team
Copyright © 2018 Pearson Education Ltd. 2-36
Consumer Behavior
in a Services Context
2.10
Know how role, script, and
perceived control theories
contribute to a better
understanding of service
encounters.
WIRTZ LOVELOCK
Role and script theories
• Roles
o Like actors, employees have
roles to play and behave in
CONSUMER BEHAVIOR IN A
specific ways
SERVICES CONTEXT
• Scripts
o Specifies the sequences of
behavior for customers and
employees
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Perceived Control Theories
• Cognitive control
o Exercised when the customer understands why
something is happening and knows what will happen
CONSUMER BEHAVIOR IN A
next
SERVICES CONTEXT
• Behavioral control
o Allows the customer to change the service situation
by asking the firm to customize its typical offerings
• Decisional control
o The customer can choose between two or more
standardized options without changing either option
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Consumer Behavior
in a Services Context
2.11
Describe how customers
evaluate services and what
determines their
satisfaction.
WIRTZ LOVELOCK
How customers evaluate services and
what determines their satisfaction
• Expectancy-disconfirmation model of
satisfaction.
CONSUMER BEHAVIOR IN A
SERVICES CONTEXT
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How customers evaluate services and
what determines their satisfaction
Customer Satisfaction Is Central to the Marketing Concept
• Satisfaction defined as attitude-like judgment following a
service purchase or series of service interactions
CONSUMER BEHAVIOR IN A
• Customers have expectations prior to consumption,
SERVICES CONTEXT
observe service performance, compare it to expectations
• Satisfaction judgments are based on this comparison
o Positive disconfirmation if better than expected
o Confirmation if same as expected
o Negative disconfirmation if worse than expected
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Consumer Behavior
in a Services Context
2.12
Understand service quality,
its dimensions and
measurement, and how
quality relates to customer
loyalty.
WIRTZ LOVELOCK
Understand service quality
• Service quality is the high standard of performance that
consistently meets or exceeds customer expectations.
• Customer satisfaction and service quality are determined
CONSUMER BEHAVIOR IN A
by comparing customers’ expectations with their
SERVICES CONTEXT
performance perceptions.
o Satisfaction is an evaluation of a
single consumption experience
o Service quality refers to relatively
stable attitudes and beliefs about
a firm
• Transaction quality and attribute
satisfaction are also transaction-
specific and determine overall
customer satisfaction.
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Understand service quality
• 10 dimensions used by consumers in evaluating
service quality
CONSUMER BEHAVIOR IN A
SERVICES CONTEXT
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Understand service quality
CONSUMER BEHAVIOR IN A
SERVICES CONTEXT
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Thank You.
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