In your report, provide details of a specific service experience you have encountered (provide details of the date, time and duration of the service experience, the driver for its purchase and/or consumption, and other information that can help paint a clear picture of the service experience for the reader), and demonstrate your understanding of two sets of services marketing concepts/theories/models via its accurate and comprehensive application.
The customers while purchasing a product which may or may not be new they encounter some of the uncertainties regarding various aspects of the product and perceive certain risks. The business organizations should take care of the perceived risks when formulate the strategies which convert the potential customers to purchasing customers. The theory has recognized six different perceived risks and the business organizations must consider at least one or more than one of such perceived risks while shaping the strategies. The six perceived risks are discussed below:
• Functional Risk: It is one of the most common perceived risks where the customers develop the fear regarding the quality of the product to be as per the claims of the business organizations catering the products. The customers feel that the products might not be successful in meeting the commitments.
• Social Risk: It is the risk which the customers face while purchasing the products. It is the risk where the customers feel that by buying such products their status might get declined in front of their friends or family members. This is the social risk which the customers grow while purchasing products.
• Financial Risk: The customers with stable or variable income might develop financial risk when they purchase products. This type of risk is found even in case of any low-priced product. If the financial condition of the customers is poor or moderate then even in case of some low-priced products the financial risks are found to have developed. For purchasing any high-budgeted product like homes the customers with stable and high income might also have financial risks.
• Physical Risk: The customers might feel that any product can cause harm to another person physically and then the physical risks get developed in the minds of the customers while purchasing the products.
• Time Risks: The pace of life in the current scenario is much faster and the customers are growing some fears regarding the time factor. They might consider the time risks associated in waiting or standing in a queue. They also fear of the time lost while using a product but not getting the promised service utility (LAKE, 2017).
• Psychological Risks: In many cases the customers give a thought of the moral and ethical factors while making any purchase. It may happen that a customer might want to buy a product but grow the fear of psychological risks that whether the purchase would be morally correct or not (Dontigney, 2018).
My service experience:
• Functional Risk: Before visiting the outlet of McDonald’s I was apprehensive of the products and services regarding whether I would have a satisfied experience or not.
• Social Risk: Dining at McDonald’s, one of the most reputed fast food restaurant chains in modern time is a matter of prestige for me and my family. So the element of social risk does not apply in case of this brand.
• Financial Risk: Before visiting the outlet I was worried about the amount to be spent on dining as I took my entire family for the treat at McDonald’s which is a popular international fast food brand, where the prices of the deliverables are perceived to be higher than those of the local brands. But I found the amount to be affordable and value for money products which provided use with adequate satisfaction.
• Physical Risk: I was worried regarding the harmful impacts of consuming fast foods on the children in my family. I was also worried about the hygiene and food safety but I found that the foods of the company are safe and the outlets maintain hygiene aspects.
• Time Risks: I saw a crowded queue in front of the billing counter inside the outlet and perceived that we might get too late to get the payments done and to get the foods. But I saw that the personnel at the billing desks were handling the payment aspects effectively and that I did not have to wait for long for my turn to come.
• Psychological Risks: I did not have any such psychological risks as I knew that McDonald’s being a reputed organization could not be ethically and morally wrong.
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The Search, Experience and Credence Attributes Theory is one of the most widely used service experience theories that facilitates the classification of the products and services into three categories based on the type of experience gathered. The three categories according to this theory are as follows:
• Search Products or Services- These are the products or services regarding which the customers can form a prior idea and evaluate the experience before making the purchase. The most common forms of products or services in this category are prices of hotel rooms, schedule of airlines, reception quality of television, or the quality of an electronic devise such as home entertainment systems. Nowadays, the buyers have the opportunity to browse the social media regarding the product or service that they want to purchase (TheoryBiz, 2018).
• Experience Products or Services- Regarding these products or services the service experience for those can be perceived only after the consumption or purchase of such products or services. Some of the common examples of these products or services are dining in a restaurant, quality of service and reception in a hotel, the quality of performance in a movie or theater. These products are generally more differentiated than the search products. The brand name and equity plays a major role in determining whether the customers will go for experience products or services (Springer, 2007).
• Credence Products or Services- In respect of these products and services the attributes of the product cannot be effectively evaluated even after the consumer has purchased the product or service. The consumers mainly depend on the brand reputation when they go ahead with a purchase decision regarding these products or services. For example, these are the services such as healthcare, consultancy, IT, legal service and others. These services are highly customizable according to the needs of the customers and therefore it become very difficult to compare them (Collier, 2012).
Regarding my service quality experience at McDonald’s, I would apply the above theory for determining the nature of the service experience that I had in respect to the product and service from the reputed fast food brand. The dining experience that is referred to here was the last time I took my family for dinner at one of the McDonald’s outlets. Applying the said theory, it can be said that the dining experience at the fast food joint falls under the category of Experience Product because the quality attributes can be analyzed only after the product has been consumed and the services have been received. Hence, I can say that my experience at McDonald’s was quite good because they served us menus which were extremely fresh and hot. The services were highly prompt and we received the delivery within 10 minutes of placing our order. Apart from the standard product and service, the staff also offered my kid some gifts as it was his birthday. So, I am highly satisfied with my experience at McDonald’s and will go back to the brand for future services also.
Dontigney, E. (2018) Types of Perceived Risk, [Online], Available: chron.
LAKE, L. (2017) Learn About Perceived Risk and How to Overcome It, 28 October, [Online], Available: https://www.thebalance.com/what-is-perceived-risk-2295541.
Springer (2007) 'Experience and Credence Goods - An Introduction', Strategies in Markets for Experience and Credence Goods, pp. 1-5.
TheoryBiz (2018) Search, Experience, and Credence Attributes, [Online], Available: http://theorybiz.com/implementing-value-pricing/how-people-buy/584-search-experience-and-credence-attributes.html.