Chapter 2

Customer
behaviour, culture
and service
encounters
Student Notes

Digital Image PowerPoint to accompany:

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Learning objectives

2.1 Explain the three-stage model of service consumption

2.2 Describe the impact of culture upon consumer behaviour in
service settings
2.3 Explain the relevance of perceived risk and information search
at the pre-purchase stage of the buying process
2.4 Describe why role and script theory and control theory are
central to understanding customer behaviour in service settings
2.5 Explain why it is necessary to understand customers
psychological needs and values
2.6 Describe the basic mechanism that underpins the formation of
post-purchase satisfaction evaluations

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Understanding customer behaviour
Consumer behaviour is strongly influenced by culture
Asian (Eastern, collectivist) cultures are distinctly different from
Western (individualistic) cultures

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 Impact of culture
Culture is the sum of learned beliefs, values and customs
that create behavioural norms for a given society
Hofstede identified four underlying dimensions of cultural
values:
(1) collectivism/individualism
(2) uncertainty avoidance
(3) power distance
(4) masculinity/femininity

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On 12 September 2005, Hong Kong
Disneyland Resort and its theme park,
Hong Kong Disneyland, officially opened.

ALEX
HOFFORD/epa/Corbis

Hong Kong Disneyland

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 The three-stage model of service consumption
Pre-purchase decision making
Purchase and consumptionthe service encounter
Post-encounter stage

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 Stage 1: Pre-purchase decision making
Need arousal
Information search
Evaluating alternatives
Perceived risk
Risk and uncertainty aversion
Strategies for risk reduction
Information sources used to select business services

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 Need arousal
Peoples unconscious minds (e.g. personal
identity and aspirations)
A job interview may trigger recognition of need for
hairdressing services

Physical conditions (e.g. your hunger need

drove you to Starbucks for breakfast)

External sources
Commercial cues
Social cues
Physical cues

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 Information Search
Alternative solutions
Hire a contractor or do it oneself

Evoked set
Past Experience
External sources; advertising, retail displays, news stories, online
searches and recommendations from service personnel, friends
and family

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 Evaluating alternatives
Search attributes
Style, color, texture, taste, sound
Experience attributes
Vacations, sporting events, medical procedures
Credence attributes
Quality of repair and maintenance work

CandyBox
Images/Shutterstock.com

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 Several factors may enhance risk and uncertainty

When the service is highly intangible (a pure service)

When the service is relatively new
When the service is complex
(e.g. medical, legal, higher education and financial services)

When the customer is relatively inexperienced, and thus lacks

knowledge and confidence to evaluate different suppliers (e.g. pest
control)

When service brands are customised rather than standardised

When the purchase is important to the customer

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 Strategies for risk reduction

Seek more information, especially from respected personal sources (e.g.

friends and respected peers)
Rely on the reputation of the firm
Look for guarantees and warranties
Ask knowledgeable employees about competing services
Look for opportunities to try the service prior to purchase (e.g. first visit free
at the fitness centre)
Use the World Wide Web to search for information
Remain loyal to their current service because they know what to expect
Look for tangible cues or other physical evidence as a means of assessing
the quality of the service and reducing perceived risk

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Uncertainty and risk perceptions tend to be greater among consumers from Asian backgrounds
Blend Images/Shutterstock.com
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Consumers are highly brand-name conscious in many Asian cultures
nui7711/Shutterstock.com

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 Information sources used to select business services

Whether the client had used the supplier before

Degree of experience possessed by the client in buying this type of service

Variety of Organisational Buyers

Commercial enterprises
Government units
Institutions

Commercial Enterprises - Unique Characteristics

Manufacturing, construction, service, professional groups, resellers
Small in number; large in volume
Geographic concentration of industry

The Marketers Role in the Purchasing Process

a. Salesperson becomes an extension of the customers purchasing department - consulting
role, particularly in small firms
b. In large firms, salesperson must supply detailed technical information on product quality,
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performance, and cost
 Ulrich Perrey/dpa/Corbis
Advertisements for Singapore Airlines Suites created high expectations

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 Service encounters:
three levels of customer contact

High-contact services
hairdressing, medical services, education
Medium-contact services
establish relationship, define problem face to face, dropping off and
picking up physical possession that is being serviced
management consulting or financial services
Low-contact services
Little if any physical contact contact is remote through electronic
means or distribution channels
Banking and finance, possession processing services where the
items is shipped to the service site or remote fixes

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A high-contact service with experience propertiesa young child receiving private
Indonesian language lessons
Paul Patterson
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Role and script
theory
Customers and
employees have a role
to play, and satisfaction
relates to role
congruence; that is,
how well each party
acts out their role
Scripts are cognitive
structures that guide
service transactions
and specify the
alternatives available

Continues
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Continued

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A waitress in Thailand giving a Wai (and a smile) to a customer as a sign of respect, which
also has the effect of enhancing the customers self-esteem
Paul Patterson
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Theater as a Metaphor for
Service Delivery

All the worlds a stage and

all the men and women
merely players. They have
their exits and their
entrances and each man in
his time plays many parts

William Shakespeare
As You Like It

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 Control theory
Strong correlation between the extent to which a customer feels in control in a
purchase situation and the extent to which they feel the need for service.
Higher degree of control, less need for service.
Behavioural control
Cognitive control

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Understanding customers psychological needs and values

Security
Respect
Esteem
Face
Fairness

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It is becoming
increasingly
important to
understand the
psychology of
the Asian
consumer

Paul Patterson

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 Provider response to disruptive customers?
Provider response to existing injuries in clients?
Provider response to requests for special needs such as equipment adjustments and changes.

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Peter Bernik/Shutterstock.com
 Stage 3: Post-encounter stage

Customer satisfaction with service experiences

Service expectations

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