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Consumers usually experience pre-purchase uncertainty during purchase of most products. However, in the case of intangible service purchase, the amount of perceived risk would be expected to be higher as compared to product purchase. Intangibility often leads to a consumer’s evaluation of a service based on tangible evidence and price rather than the core service offer.

A number of factors influence the level of risk experienced by a consumer when approaching a service purchase.

• Level of intangible evidence which is available to support evidence of the service process and outcomes.
  Service providers often try to demonstrate service benefits using tangible cues. Other customers’ testimonials, service replicas or demonstrations provide visual clues and assurance that may help to mitigate some of the risks.
• Level of buyer’s involvement in the service.
  As services can be defined by the level of involvement of the buyers, the perceived risk of a decision in a highly-involved service (e.g. personal healthcare services) is likely to greater than a low-involvement service such rental of a video.
• Novelty of purchase.
  If the type of purchase is new to us, we are more likely to experience high levels of risk than if we are a repeat buyer.
• Buyer’s individual risk threshold.
  Some buyers are more prepared to take risks. A cheap holiday with an unknown foreign airline may appeal to some, but be perceived as too risky by others.
• Situational factors affect perceptions of risk.
  If we are desperate to use a service, we may lower our risk threshold. If we have just missed the last bus home, we may be more prepared to risk a taxi ride in a more "dubious" car which is perceived as being more risky than if we were choosing a taxi company in a more relaxed condition.
• There may be a perception of safeguards available to consumers which reduces perception of risk.
  In many cases, legislation protects consumer from non-delivery of financial services where it would be possible to defraud consumers. Most investors do not perceive risk of losing their money when putting their savings in a domestic bank, but perceptions of risk would be much higher if the bank was "offshore" and unregulated.

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