Download Service Encounter Stage

Chapter 2
Customer Behaviour
in Service Encounters
Copyright © 2008 Pearson Education Canada
Services Marketing, Canadian Edition
Chapter 2- 1
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 Strategies
Part IV: Chapters 12-15
Copyright © 2008 Pearson Education Canada
Services Marketing, Canadian Edition
Chapter 2- 2
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 high-contact vs.
low-contact delivery
Post-Encounter Stage:
Evaluation against
expectations, future
intentions
Copyright © 2008 Pearson Education Canada
Services Marketing, Canadian Edition
Chapter 2- 3
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 act
 Better manage service encounters by understanding service
consumption, expectations and perceived risks
 Examine the 6 key elements of the “all important”
customer service encounter
Copyright © 2008 Pearson Education Canada
Services Marketing, Canadian Edition
Chapter 2- 4
How Differences among Services
Affect Customer Behaviour
Copyright © 2008 Pearson Education Canada
Services Marketing, Canadian Edition
Chapter 2- 5
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
Copyright © 2008 Pearson Education Canada
Services Marketing, Canadian Edition
Chapter 2- 6
Four Categories of Services
(Fig 2.1)
Who or What Is the Direct Recipient of the Service?
Nature of the Service Act
Tangible Actions
Intangible Actions
People
People processing
Possession processing
(services directed at
people’s bodies):
(services directed at
physical possessions):




Barbers
Health care
Mental stimulus
processing
(services directed at
people’s minds):


Copyright © 2008 Pearson Education Canada
Possessions
Education
Advertising/PR
Services Marketing, Canadian Edition
Refueling
Disposal/recycling
Information processing
(services directed at
intangible assets):


Accounting
Banking
Chapter 2- 7
Four Categories Of Services
People Processing
 Customers must:
 Physically enter the service
factory
 Co-operate actively with the
service operation
 Managers should think about
process and output from
customer’s perspective
 To identify benefits created and
non-financial costs:
― Time, mental, physical effort
Copyright © 2008 Pearson Education Canada
Services Marketing, Canadian Edition
Chapter 2- 8
Possession Processing
Possession Processing
 Customers are less physically
involved compared to people
processing services
 Involvement is limited
 Production and consumption
are separable
Copyright © 2008 Pearson Education Canada
Services Marketing, Canadian Edition
Chapter 2- 9
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
information-based
 Can be “inventoried”
Copyright © 2008 Pearson Education Canada
Services Marketing, Canadian Edition
Chapter 2- 10
Information Processing
Information Processing
 Information is the most
intangible form of service
output
 But may be transformed into
enduring forms of service
output
 Line between information
processing and mental stimulus
processing may be blurred.
Copyright © 2008 Pearson Education Canada
Services Marketing, Canadian Edition
Chapter 2- 11
Customer Decision Making:
Three-Stage Model of Service
Consumption
Copyright © 2008 Pearson Education Canada
Services Marketing, Canadian Edition
Chapter 2- 12
The Purchase Process for Services
Prepurchase Stage
Service Encounter
Stage
Post-Encounter Stage
Copyright © 2008 Pearson Education Canada
Services Marketing, Canadian Edition
Chapter 2- 13
Prepurchase Stage
Copyright © 2008 Pearson Education Canada
Services Marketing, Canadian Edition
Chapter 2- 14
Prepurchase Stage: Overview
Prepurchase Stage
 Customers seek solutions to
aroused needs
 Evaluating a service may be
difficult
 Uncertainty about outcomes
increases perceived risk
Service Encounter
Stage
 What risk reduction strategies can
service suppliers develop?
 Understanding customers’ service
expectations
Post-Encounter Stage
 Components of customer
expectations
 Making a service purchase
decision
Copyright © 2008 Pearson Education Canada
Services Marketing, Canadian Edition
Chapter 2- 15
Service Encounter Stage
Copyright © 2008 Pearson Education Canada
Services Marketing, Canadian Edition
Chapter 2- 16
Service Encounter Stage: Overview
Prepurchase Stage
 Service encounters range from high- to
low-contact
 Understanding the servuction system
 Service marketing systems: highcontact and low-contact
Service Encounter
Stage
 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
Copyright © 2008 Pearson Education Canada
Services Marketing, Canadian Edition
Chapter 2- 17
High Versus Low Contact Services
 Service marketers must manage the ways customers
encounter the service organization
 Each element they encounter must be consistent or the
organization’s credibility is weakened
 High contact services present marketing challenges
 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
Copyright © 2008 Pearson Education Canada
Services Marketing, Canadian Edition
Chapter 2- 18
The Servuction System =
Service + Production
 Service Operations (front stage and backstage)
 Where inputs are processed and service elements created
 Includes facilities, equipment, and personnel
 Service Delivery (front stage)
 Where “final assembly” of service elements takes place and service
is delivered and visible to customers
 Includes customer interactions with operations and other customers
 Service Marketing (front stage)
 Visible part of service operations, service delivery and other
contact points
Copyright © 2008 Pearson Education Canada
Services Marketing, Canadian Edition
Chapter 2- 19
Post-Encounter Stage
Copyright © 2008 Pearson Education Canada
Services Marketing, Canadian Edition
Chapter 2- 20
Post-Encounter Stage: Overview
Prepurchase Stage
Service Encounter
Stage

Evaluation of service
performance

Future intentions
Post-Encounter Stage
Copyright © 2008 Pearson Education Canada
Services Marketing, Canadian Edition
Chapter 2- 21
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 firm’s
financial performance
Copyright © 2008 Pearson Education Canada
Services Marketing, Canadian Edition
Chapter 2- 22
Summary – Chapter 2
 People, Possession, Mental Stimulus and Information
processing are the 4 Categories of Services
 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 stage
 Long term customer relationships are built on satisfying
customer expectations
Copyright © 2008 Pearson Education Canada
Services Marketing, Canadian Edition
Chapter 2- 23