ch. 10

• Consumer decision-making involves both rational and emotional processes.

The Consumer Decision Process

• The consumer decision process includes problem recognition, information search, alternative evaluation, purchase/product acquisition, and post-purchase experience evaluation.

Problem Recognition

• The decision process initiates when a consumer identifies a problem or need.
• A problem isn't necessarily physical, i.e hunger
• A consumer problem is a state of deprivation, creating physical or mental discomfort, and a gap between the current and desired state.
• Problem recognition is the consumer's realization of this gap.

Avenues of Problem Recognition

• Internal stimuli: perceived discomfort arising from within, such as physical conditions (hunger, thinning hair) or psychological states (boredom, anxiety).
• External Stimuli: Information from outside sources, like marketplaces and streets, triggering desires.
  • Problem stimuli: the problem itself is the source of information, like seeing dirty laundry.
  • Solution stimuli: information from a potential solution arousing a need, like seeing a dress in a store prompting the need for a party dress.
• Stock Depletion: Problems occur due to repeated stock depletion, like an empty cereal box.
• Life Stage Changes: New problems arise with new life conditions
• Developing New Tastes: New preferences or hobbies that cause a want for new items
• Encounter with New Technology/New Products: Realizing problems when presented with a solution.

Helping Consumer Problem Recognition

• Invisible problems: Marketers assist consumers in recognizing problems they may not be aware of through education/communication.
• Secondary Demand Creation: Marketers compete for market share by targeting existing users.
• Primary Demand Creation: Marketers target non-users by making them aware of a problem

Information Search

• Consumers seek information on available alternatives and their features.
• When unfamiliar with a product, consumers gradually learn about alternatives until they feel informed.
• Awareness Set: All brands a consumer is aware of.
• Evoked Set: Subset of brands remembered at the time of decision-making.
• Inert Set: Brands not remembered during decision-making.
• Inept Set: Brands remembered but deemed unsuitable.
• Consideration Set: Brands a consumer will consider buying, the most important set for evaluation.

Sources of information

• Internal Search: Recalling information from memory.
• External Search: Gathering information from marketing, media, and other consumers.
  • Marketer Sources: Sources associated with the product's marketers like ads, brochures, and websites.
    • Consumers may view these sources as less credible and biased
  • Non-Marketer Sources: Independent sources viewed as more credible.
    • Includes personal sources (known individuals) and independent sources (unaffiliated with marketers).

Search Styles

• Search Styles: refer to the consumer's preferences and practice relating to the extent of time and effort they are willing to dedicate to finding useful information
• Cognitive Style: Consumer mindset about processing information.
  • Extenders: Conduct systematic searches, consult various sources, and deliberate extensively.
  • Simplifiers: Prefer limited information and quick decisions with minimal processing effort.
• Information Overload: Difficulty processing too much information, influenced by the cognitive style.

Problem Complexity

• Routine Problems: Solved many times in the past with no new information or choices.
• Extended Problems: Purchase tasks never done before, with high risk and extensive information search.
• Limited Problems: Nontrivial but moderate risks, requiring some time and energy for searching and evaluating.

Determinants of Searching

• Perceived Risk: Degree of potential loss in making a wrong choice, involving uncertainty and severity of consequences.
  • Performance Risk: Product may not perform as well as alternatives.
  • Social Risk: Disapproval from reference groups.
  • Psychological Risk: Product may not reflect our self-image.
  • Financial Risk: Product may be overpriced.
  • Obsolescence Risk: Product may be replaced by newer substitutes.
• The higher the perceived risk, the more extensive the information search.
• Involvement: The interest a consumer has in a product, leading to a more thorough search for highly involving products.
• Familiarity and Expertise: Consumers familiar with a product engage in less elaborate searches.
• Consumer Shopping Style: Extenders search extensively, while simplifiers prefer convenience.
• Time Pressure: Leads to shorter information searches and quicker decisions.

Alternative Evaluation

• Evaluation criteria: are standards against which consumers evaluate a critters
• Judgment models: are procedures and rules consumers use so as to consider various product attributes to arrive at their product choices
• Evaluation Criteria: Standards consumers use to evaluate products.
• Determinant Attributes: Evaluative criteria on which alternatives differ.
• Markets should constantly monitor competing brands and consumer evaluative criteria

Decision Models

• Decision Models: Compensatory and Noncompensatory
• Judgment Model: Procedures and rules for taking into account various qualities of an alternative
• Compensatory Model: Consumers consider all attributes and trade off perceived weaknesses for strengths.
• Noncompensatory Models:
  • Conjunctive Model: Requires certain minimum cutoffs on all salient attributes.
  • Disjunctive Model: Consumers are flexible and trade one feature for another.
• Lexicographic Model: Consumers rank attributes by importance and choose the best on the most important criterion.
• Elimination by Aspects: Combines lexicographic model with minimum cutoff levels.
• Decision Heuristics: Shortcuts for making quick decisions.
• Systematic Decision Approach: Organized method for answering specific questions.
• Imperfections in Consumer Judgments
  • Framing Effect: The way information is presented influences perception and willingness to pay.
  • Inference Marketing: Assuming missing information to judge a product.

Imperfect Judgements

• Inter-attribute: The value of one attribute is inferred based on another attribute
• Evaluation Consistency: The missing attribute is assumed to conform to the overall evaluation
• Negative cue: The consumer may simply treat the missing information as a negative cue and then use of of the two sub-strategies
• Satisficing: Accepting a satisfactory alternative even if better options exist.
• Emotional Decision Making
• Affective choice mode: affect for the brand insures based not on attribute information but on judgements that have 3 properties:
  • holistic (overall style, appearance, and total impression),
  • self implicative (the product or service is judged in relation to oneself)
  • non verbalized (cannot be verbalized, picture/ appearance)

Step 4 : Purchases

• Choice identification: when the consumer identifies the most preferred alternative, based on the evaluation process just described
• Purchase intent: a determination that one should buy that product or service
• Purchases implementation: arranging the terms of the transactions, seeking and obtaining credit, and likewise, obtaining the transfer of the title or ownership from the seller, paying for the product or service and taking possession of it

Step 5 : Purchases

• The experience of buying and using the product provides information that we as consumers will use in the future decision making

Step 6:

• Level of Involvement will change which course of action the consumer takes

Problem recognition

• Low involvement purchases:
  • Frequently purchased items (cereal, milk, pencils)
  • First time purchases of small ticket items (new type of detergent or candy)
  • When things are out of stock
• High involvement: when a consumer experiences a first time (no recurring) internal discomforting condition
  • First time realization of weakening eyesight, thinning hair -Information Search Low /High inolvement will determine how consumers approach desicion making
• Alternative Evalution
• Low /High inolvement will determine how consumers approach desicion making
• Alternative elimination stage: consumers narrow down the set of alternatives for closer comparisons
• Alternative selection stage: the smaller set of alternatives is further examined