Consumers regard the purchase of a service to be a riskier proposition than purchasing a product. Discuss the role that branding plays in services and what impact it has on customer value.
In today’s economy, services are playing an increasingly important role. When considering how it is defined however, we realize that one major aspect of a service is that it is intangible. This means that it can neither be touched or seen but is rather an experience for the consumer at the time this particular service is delivered. This intangibility is also what makes the purchase of a service riskier for the customer. Because it is harder or almost impossible to evaluate a service before it is delivered, the value that it has for the customer can only be measured afterwards. However a brand in this domain can be seen as a risk reducer, because the attributes of that brand can reassure the customer of the value of a particular service. Therefore, in a first part, we are going to explore why services can be considered as a riskier purchase. The second part will analyze the role that branding plays in services. Further, a third part will demonstrate that branding in services has an impact on customer value.
As mentioned before, a service is considered to be mostly intangible. This means that it is difficult to evaluate the value of a service before it is delivered. An explanation for that could be the following: a service often includes an interaction between a customer and the person delivering the service. It can therefore entail that the “human” factor, the interaction, is subject to variations, depending on the person delivering the service. Thus the quality of the service can also vary each time a specific service is delivered. Compared to the simple purchase of ...