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Consumer Behavior in Services

• Overview the generic differences in consumer
behavior between services and goods
• Introduce the aspects of consumer behavior that a
marketer must understand in five categories of
consumer behavior:
• Information search, Evaluation of service
alternatives,Service purchase and consumption,
Post purchase evaluation
• Role of culture
• Study of factors which influence the consumer
behavior
Consumer 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
Continuum of Evaluation for
Different Types of Products

Most Most
Goods Services

Easy to evaluate
Difficult to evaluate
Clothing

Jewelry

Furniture

Houses

Automobiles

Restaurant meals

Vacations

Haircuts

Child care

Television repair

Legal services

Root canals

Auto repair

Medical diagnosis
{
{
High in search
qualities
High in experience High in credence
qualities qualities
{
Categories in Consumer
Decision-Making and Evaluation of Services
Information Evaluation of
Search Alternatives
 Use of personal sources  Evoked set
 Perceived risk  Emotion and mood

Purchase and Post-Purchase
Consumption Evaluation
 Service provision as  Attribution of dissatisfaction
drama
 Service roles and scripts  Innovation diffusion
 Compatibility of  Brand loyalty
customers
Categories in Consumer Decision-
Making and Evaluation of Services

Information Evaluation of
Search Alternatives
 Use of personal sources  Evoked set
 Perceived risk  Emotion and mood

Culture
 Values and attitudes
 Manners and customs
 Material culture
 Aesthetics
 Educational and social
institutions

Purchase and Post-Purchase
Consumption Evaluation
 Service provision as  Attribution of dissatisfaction
drama
 Service roles and scripts  Innovation diffusion
 Compatibility of  Brand loyalty
customers
Information search
• In buying services consumers rely more
on personal sources
• Personal influence becomes pivotal as
product complexity increases
• Word of mouth important in delivery of
services
• With service most evaluation follows
purchase
Perceived risks in purchase
• Economic risks
– Both value and benefit cannot be assessed by the consumer
beforehand due to intangibility of services.
• Physical risks
– Some services may be perceived to be dangerous or
causing bodily harm e.g. laser surgery for eye/ vision
correction, wrong massage or exercise techniques leading
to physical disabilities.
• Psychological risks
– Risk perceived by the consumer when he feels that the
purchase does not reflect his self concept, personality or
status that he wishes to project.
• Performance risks
– When effectiveness of offers cannot be assessed,
customers suffer from performance risks.
All these risks can be minimized through communication,
promotion, reliability and consistency of expected service.
Evoked Set
• The evoked set of alternatives likely to be
smaller with services than goods.
– If you would go to a shopping center you may only
find one dry cleaner or “single brand”
• It is also difficult to obtain adequate pre-
purchase information about service
• The Internet may widen this potential
• Consumer may choose to do it themselves,
e.g. garden services
Emotion and Mood
• Emotion and mood are feeling states
that influence people’s perception and
evaluation of their experiences
• Moods are transient
• Emotions more intense, stable and
pervasive
• May have a negative or positive
influence
Service Provision as Drama
• Need to maintain a desirable
impression
• Service “actors” need to perform certain
routines
• Physical setting important, smell, music,
use of space, temperature, cleanliness,
etc.
Role of culture in services
• Culture affects the way the customer
evaluates and uses services. It influences the
way the service employees interact with the
customers
• Important in international services marketing
• Countries with multi-cultural environment
affect the evaluation and purchase decisions
Elements of culture/ cultural
universals
• Language (both verbal and non-verbal)
• Values and attitudes
• Manners and customs
– Culture’s views of appropriate ways of behaving
• Material culture
– Consists of tangible products of culture (cars,
houses, clothes & furniture)
• Aesthetics
– Refers to cultural ideas about beauty and good
taste (reflected in music, art, drama and drama as
well as color or form)
• Educational and social institutions
Organization and household
consumer behavior
Buyers are typically organized either formally or informally
into buying centers
• Initiators identifies the organizational need
• Gatekeeper collects and controls information about the
purchase
• Decider determines what service to purchase
• Buyer or purchasing agent physically acquires the service
• User consumes the service

Organizational purchases tend to differ by buy classes (new
task buys, straight buys and modified re-buys)
Influences on
consumer behavior in services
• Situational factors- When, Where, What & Why
• Information sources
– Company-controlled stimuli: Service offer, Price, Advertising,
Display, Outlets
– Socially-controlled stimuli: Word of mouth, group influence
(reference groups)
• Social/group forces
– Family, Culture, Sub-culture, Reference groups, Social class
• Individual/ Psychological forces
– Perception, Motivation, Learning & Involvement, Attitude,
Personality
Social/group forces
• Family and households
– Nuclear family, Extended family, Family of orientation, Family
of procreation
– Family life cycle: Bachelor stage, newly married couples, Full
Nest-I, Full Nest-II, Full nest-III, Empty nest-I/II, Solitary
survivor –I/II
– Family decisions: autonomic decisions, husband dominant,
wife dominant, syncratic (joint)

• Reference groups: Points of reference for consumers in
making their buying decisions. Social groups with which
consumers interact and get influenced (informational, comparative
& normative influences).
– Types:
• Primary reference groups
• Secondary reference groups
Social/group forces
• Culture
According to Geert Hofstede, culture is the collective
programming of the mind that distinguishes the
members of one category of people from those of
another.
• Sub-culture
It is a group within group. E.g art enthusiasts, globe
trotters, rock-band fanatics.
• Social class
A consumer within the social-unsocial-anti-social
continuum.
Individual/ Psychological Forces
• Attitudes
a) Components: Tri-component model
- Cognitive : Person’s knowledge & beliefs
- Affective: Person’s feelings about the attitude object
- Conative: Person’s action or behavioral tendencies
toward the attitude object
b) Properties
Valence (positive, negative or neutral), Extremity
(intensity of liking or disliking), Resistance (degree of
resistance to change), Persistence, Confidence
Individual/ Psychological Forces
Perception
Meaning that consumers ascribe to what they see
around them. The meaning is influenced by past
experience, preconceived notions, prejudice and
assumptions, expectations & personality, family
background, previous acculturation, values, beliefs and
other social factors, genuine knowledge and awareness
External factors:size, position, movement, repetition,
intensity, contrast, color, directionality, format,
isolation, novelty, learned attention-inducing stimuli,
attractive spokesperson, scene changes
Internal factors: selective attention, selective exposure,
selective reception, comprehension and retention
Individual/ Psychological Forces
Learning and Involvement
Motivation
A service marketer views motivation in two ways:
a. The Content Approach- which seeks to analyze “ what
motivates people”. Maslow’s Need Hierarchial theory,
Herzberg’s Two-factor theory
b. The Process Approach- which studies the ways and
means of “how to motivate people”
Personality
Sum total of all physiological and psychological elements which
makes the world perceive people in certain ways. Personality
traits are reflected in interests, needs, temperaments,
morphology, aptitude, physiology and attitude.