Value perception and post-purchase behaviors of recurring customersevidence in hedonic services with contractual and non-contractual linkage

Abstract

Utility formation models have the ability to predict the benefit that consumers perceive in different goods and services. However, there is evidence in several sectors of the necessity to explore these models for the development of a value offer that is attractive to consumers over time, while also being profitable for the company. The perceived value of consumers in repetitive consumption, along with other factors, undergoes changes over the successive moments of interaction with the product category. The effect of these successive purchases has been considered in habit formation and satiation theories, which explain how the habitual level of consumption and satiation influence utility formation. With the aim of exploring how to maintain an attractive value offer over time for different consumer segments, this dissertation empirically examines the non-linear effect of the habitual level of consumption and satiation formation on perceived value and post-purchase behaviors of repeat customers in a hedonic services context. The study analyzes how willingness to pay for tourism accommodations changes based on habitual level of consumption and satiation in a non-contractual relationship setting. Upon confirming this effect, the study further explores the influence of satiation on perceived value and post-purchase behaviors over time in a contractual relationship setting (subscription retailing sector). The results obtained from the various studies lead to the conclusion that a consumer's willingness to pay is subject to change based on their habitual level of consumption. Specifically, there is an increase in willingness to pay compared to the previous stay if they are in a sensitization phase with the service, and a decrease in the case of habituation. Additionally, the effect of satiation plays a determining role in utility formation. It is concluded that consumers who experience satiation exhibit a lower willingness to pay and, therefore, greater price sensitivity. In turn, it is demonstrated that in subscription retailing, this variable has the ability to anticipate the decision to cancel the contracted subscription. This thesis contributes to previous literature by providing empirical evidence on utility formation in different hedonic services, clarifying that the influence of a reference price on willingness to pay is not always linear and positive, unlike previous literature. Second, it broadens the understanding of how satiation influences perceived value in high-risk services. Furthermore, it demonstrates the capability of this variable to predict unloyalty behaviors, as we examine both short and long-term subscription cancellation. Finally, we consider that the results obtained have important managerial implications being of utmost importance to incorporate these two customer segmentation variables, habitual level of consumption and satiation, into the analysis of consumer behavior in repetitive purchase products.