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Customer Behaviour in

Service Encounters

A Framework for Developing Effective

Service Marketing Strategies
Understanding Customer Needs, Decision
Making, and Behaviour in Service Encounters
Chapter 2

Building the Service Model

Part II: Chapters 3-7

Managing the Customer Interface

Part III: Chapters 8-11

Implementing Profitable Service

Part IV: Chapters 12-15

A Framework for Developing Effective

Service Marketing Strategies
Two Key Themes in Part I of the
Services Marketing Strategy Framework:
Differences among Services Affect
Customer Behaviour
Three-Stage Model of Service Consumption
Prepurchase Stage:
Search, evaluation of
alternatives, decision

Service Encounter
Stage: Role in highcontact vs. low-contact
Post-Encounter Stage:
Evaluation against
expectations, future

Learning Objectives
Chapter 2
Deliver satisfied customers by understanding
the impact of the Nature of The Service Act
Determine the service management
challenges of the 4 categories of the service
Better manage service encounters by
understanding service consumption,
expectations and perceived risks
Examine the 6 key elements of the all
important customer service encounter

How Differences among Services

Affect Customer Behaviour

Differences among Services Affect

Customer Behaviour

Consumers often involved in service production and may have

preferences for service delivery
Service marketers need to understand how customers interact
with service operations
Based on differences in nature of service act (tangible/intangible)
and who or what is direct recipient of service
(people/possessions), there are four categories of services:

People processing
Possession processing
Mental stimulus processing
Information processing

Four Categories of Services

(Fig 2.1)

Who or What Is the Direct Recipient of the Service?

Nature of the Service
Tangible Actions

Intangible Actions



People processing

Possession processing

(services directed at
peoples bodies):

(services directed at
physical possessions):



Health care


Mental stimulus
(services directed at
peoples minds):

Information processing
(services directed at
intangible assets):

Four Categories Of Services

People Processing
Customers must:
Physically enter the service
Co-operate actively with the
service operation

Managers should think about

process and output from
customers perspective
To identify benefits created
and non-financial costs:

Time, mental, physical effort

Possession Processing
Possession Processing
Customers are less physically
involved compared to people
processing services
Involvement is limited
Production and consumption
are separable

Mental Stimulus Processing

Mental Stimulus Processing
Ethical standards required when
customers who depend on such
services can potentially be
manipulated by suppliers
Physical presence of recipients
not required
Core content of services is
Can be inventoried

Information Processing
Information Processing
Information is the most
intangible form of service
But may be transformed into
enduring forms of service
Line between information
processing and mental stimulus
processing may be blurred.

Customer Decision Making:

Three-Stage Model of Service

The Purchase Process for

Prepurchase Stage

Service Encounter

Post-Encounter Stage

Prepurchase Stage

Prepurchase Stage:
Prepurchase Stage

Service Encounter

Post-Encounter Stage

Customers seek solutions

to aroused needs

Evaluating a service may be


Uncertainty about
outcomes increases
perceived risk

What risk reduction

strategies can service
suppliers develop?

Understanding customers
service expectations

Components of customer

Making a service purchase


Service Encounter Stage

Service Encounter Stage:

Prepurchase Stage

Service encounters range from high- to

Understanding the servuction system
Service marketing systems: highcontact and low-contact

Service Encounter

Role and script theories

Theatre as a metaphor for service
delivery: An integrative perspective
Implications for customer participation
in service creation and delivery

Post-Encounter Stage

High Versus Low Contact

Service marketers must manage the ways
customers encounter the service organization
Each element they encounter must be consistent
or the organizations credibility is weakened
High contact services present marketing
More contact points, more moments of truth
Requires consistent messaging at each contact point

Low contact services have less contact points with

higher importance
Customer more reliant on the contact point chosen
Importance of self service technology (SST) that works

The Servuction System =

Service + Production
Service Operations (front stage and backstage)
Where inputs are processed and service elements
Includes facilities, equipment, and personnel

Service Delivery (front stage)

Where final assembly of service elements takes
place and service is delivered and visible to
Includes customer interactions with operations and
other customers

Service Marketing (front stage)

Visible part of service operations, service delivery and
other contact points

Post-Encounter Stage

Post-Encounter Stage:
Prepurchase Stage

Service Encounter

Post-Encounter Stage

Evaluation of service
Future intentions

Customer Satisfaction Is Central to

the Marketing Concept

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
Negative disconfirmation if worse than expected

Satisfaction reflects perceived service quality, price/quality

tradeoffs, personal and situational factors
Research shows links between customer satisfaction and a
firms financial performance

Summary Chapter 2
People, Possession, Mental Stimulus and
Information processing are the 4 Categories of
Services can be difficult to evaluate and
customers will use search, experience and
credence attributes to do so
Service marketers need to manage at least 6
key variables during the service encounter
Long term customer relationships are built on
satisfying customer expectations