Sequence effects in service bundles: Implications for service design and scheduling

Researchers in several academic disciplines have investigated the effect of the sequence of pleasure and pain on the customer in service, experience, or healthcare-related interactions. Specifically, past research from psychology, behavioral economics, and other related fields suggests that the sequence effect can significantly impact a customer's overall impression of a service interaction. In this article, we test the influence that the sequence of discrete events separated by several days or weeks plays on customers’ assessment of service bundles. If the relative importance of the sequence effect for discrete bundles is known, then a service designer and event scheduler can optimize and develop a better sequence of interactions for the customers, leading to higher satisfaction, loyalty, and repurchase. Using an extensive multi-year ticket purchase database from a world-renowned performing arts venue, we develop and test econometric models to predict season ticket subscription repurchase. The estimated models show that sequence effects do indeed play a significant role in determining customer repurchase of subscriptions. These results have important implications for effective service design and capacity planning for a wide range of service industries. This article suggests both managerial implications and future research opportunities related to sequence effects in service operations.