Analyzing Consumer Behavior in Service Settings

The focus of this study is on consumer behavior and decision-making in a service-setting, across different cultures. More particularly, the relevance and significance of key behavioral concepts for services marketing and management.

Service managers must also understand that their employees’ behavior also is likely to be influenced by the degree of responsibility and autonomy invested in them, and by their own sense of control over the service encounter and delivery process.

Figure 3.2 in the text provides a model of the consumer decision-making, purchase, consumption and evaluation process.  You should however note that the entire process is embedded in a cultural setting.  It is important to stress that the purchase and consumption stages (for goods) in fact happens simultaneously with services.

This provides the marketer with a golden opportunity to influence the outcome in a way that goods marketers cannot.

Example of Consumer Behavior

In a restaurant the waiter might ask “Is everything OK with the meal”. If there is something amiss then this gives the service supplier an opportunity to rectify the situation during the consumption process, rather than have an unhappy customer at the end.

Consumer’s First-time Consumption of Services

Because services are dominated by experience and/or credence properties. Customers typically approach the prospective first-time consumption of services with a greater sense of apprehension and risk than with most consumer goods.

Furthermore, many services are highly customized, sometimes complex and often difficult for a customer to evaluate prior to purchase and consumption. This means that service providers must aim to identify and ameliorate this sense of apprehension, concern or risk for a customer to feel confident in making the decision to purchase the service.

Hofstede’s four cultural dimensions:

  • Power Distance – does society value equality or inequality in interpersonal interactions?
  • Uncertainty Avoidance – what is the attitude towards risk in society?
  • Individualism/Collectivism – do people rely on themselves or others?
  • Masculinity/femininity – to what extent and at whose expense should the weaker members of society be cared for?

These factors highlight some of the key differences that impact consumer behavior in both Eastern and Western cultures.  The implications of each dimension should be discussed.  This might be a good opportunity to get some overseas students involved in discussion.

Sources of customer satisfaction and dissatisfaction in service encounters

Drawing on insights from role, script and attribution theories, 774 critical service encounters reported by hotel, restaurant and airline employees are categorized and analyzed.  Implications for managing service encounters, employee empowerment and training, and managing customers also are discussed.

This reading can be used to draw students’ attention to the fact that service encounters involve at least two people and that, therefore, it is important to analyze and understand them from both perspectives.  In this way service organizations will be better able to design processes and educate both employees and customers to achieve quality in service encounters.

Significant managerial implications warranting discussion may be summarized in the following way:
  • Managers should point out to contact employees that customers are not always right and may not always behave in acceptable ways.
  • Managers must provide employees with appropriate training that develops their problem-solving and coping skills, helps them to recognize and deal effectively with situations that are likely to generate problems, and enables them to avoid or alleviate potential problems.
  • Managers must clarify a firm’s policies regarding the handling of difficult customers.
  • Customers need to be shown or “trained” in what to expect, and what is acceptable and unacceptable behavior.
  • Employees become frustrated when they have insufficient knowledge of an organization’s systems, policies and constraints; when they are unable to provide a logical explanation of something to the satisfaction of a customer; when they are burdened with poorly designed systems and cumbersome bureaucratic procedures; when they are discouraged from using their own initiative.
Concluding Notes

It is important to understand in what respects the pre-purchase decision-making and then ultimate consumption of services is different to that in relation to goods and, because of those differences, the challenges that face a services marketer/manager. 

Different theories of behaviour, combined with the distinguishing characteristics of services, serve to provide a framework for identifying and highlighting imperatives for successful services marketing and management, to the end of ensuring customer satisfaction and loyalty.

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