Original Research

Consumer evaluation of perceived risks for goods and services

Mike Bendixen, Graham Gault
South African Journal of Business Management | Vol 26, No 3 | a827 | DOI: https://doi.org/10.4102/sajbm.v26i3.827 | © 2018 Mike Bendixen, Graham Gault | This work is licensed under CC Attribution 4.0
Submitted: 15 October 2018 | Published: 30 September 1995

About the author(s)

Mike Bendixen, Graduate School of Business Administration, University of the Witwatersrand, South Africa
Graham Gault, Graduate School of Business Administration, University of the Witwatersrand, South Africa

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Abstract

Perceived risk is known to be an important determinant of consumer behaviour. However, prior research has focussed on goods rather than services. The purpose of this exploratory research was to identify any differences between goods and services in terms of perceived risk and risk reduction strategies. Two new components of risk, namely specification risk and the risk of loss of control, were identified as being specifically associated with services. Empirical evidence gathered leads to the conclusion that as far as risk is concerned, a simple classification of products as goods or services is inadequate: an additional hybrid class comprising both goods and services is also necessary. These three categories of product are associated with different types of perceived ask. Also, risk reduction strategies were found to be dependent on product rather than on the type of risk.

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