Chapter 9 Flashcards
Informational Search
The process whereby a consumer searches for appropriate information to make a reasonable decision.
Habitual Decision Making
The consumption choices that are made out of habit, without additional information search or deliberation among products.
Heuristics
The mental rules of thumb that lead to a speedy decision.
Compensatory Decision Rule
A set of rules that allow information about attributes of competing products to be averaged some way.
Cybermediary
An intermediary that helps to filter and organize on-line market information so that consumers can identify and evaluate alternatives more efficiently.
Evoked Set
That alternatives actively considered during a consumer’s choice process.
Problem Recognition
The process that occurs whenever the consumer sees a significant difference between his or her current state of affairs and some desired or ideal state.
Rational Perspective
The view that the consumer is careful, analytical decision maker who tries to maximize utility in purchase decisions.
Mental Accounting
Decisions are influenced by the way a problem is posed and by whether it is put in terms of gains and losses.
Limited Problem Solving
Consumers are not motivated to search for information or to evaluate each alternative rigorously; they instead use simple decision rules to arrive at a purchase decision.
Non-Compensatory Decision Rule
A low standing on one attribute cannot make up for this position by being better on another attribute.
Experiential Perspective
An approach stressing the totality of the product and service experience, focusing on consumers’ affective responses on the marketplace.
Brand loyalty
Repeat purchases behaviour reflecting a conscious desire to continue to purchase the same brand.
Behavioural Perspective
The view that consumer decisions are learned responses to environmental cues.
Extended Problem Solving
The consumer tries to collect as much information as possible and carefully weighs product alternatives before making a decision.
Zipf’s Law
A buyer’s overwhelming preference for the market leader in a product category.
Retrieval Set
Alternative products already in memory that are considered during a consumer’s choice process.
Evaluative Criteria
The dimensions used by consumers to compare competing product alternatives.
Purchase Momentum
An increase in the likelihood of buying after initial purchases are made.
Exemplar Brands
Brands strongly associated with a product category. (Ties in with Zipf’s Law)
Perceived Risks
The belief that the product has potentially negative consequences. (expensive, complex, hard-to-understand products.
Determinant Attributes
Product features that are essential to the final product choice.
Variety Seeking
The desire to choose new alternatives over more familiar ones.
Inertia
Where purchases are made out of habit because the consumer lacks the motivation to consider alternatives.
Post Purchase Dissonance
Anxiety experienced by consumers after a major purchase. (Ties in with Cognitive Dissonance)
According to Chapter 9, why do consumers purchase goods and services?
It is in response to a problem they have.
What is one thing that can make a purchase complicated?
The purchase can be complicated by so much consumer choice.
List the steps in the Decision-Making Process
- Problem Recognition
- Internal Search
- Evaluation of Alternatives
- Product Choice
- Consumption and Learning
Use the steps in the Decision-Making Process to create an example of a consumer purchasing a new MacBook
EXAMPLE:
Problem Recognition: Kanye is tired of his PC taking 20 minutes to turn on.
Information Search: Kanye talks to some of his homies about their MacBooks and does some searching online.
Evaluation of Alternatives: Kayne goes to Future Shop and compares the different MacBook and PC models.
Product Choice: Kayne buys the MacBook Air because it is light and powerful.
Consumption and Learning: Kayne enjoys taking the MacBook Air wherever he goes.
List the Perspectives on Decision-Making
- Rational perspective
- Purchase Momentum
- Behavioural perspective
- Experiential perspective
List the types of behaviours on the Continuum of Buying Decision Behaviour
- Habitual Decision Making
- Limited Problem Solving
- Extensive Problem Solving
Challenge that marketers face with Habitual Decision Makers?
Consumers must be convinced to “unfreeze” their former habit and replace it with new one.
Explain the difference between Pre-purchase vs. Ongoing Search in Step 2: Information Search.
The pre-purchase search includes more involvement with the purchase itself. The consumer hopes to make better purchase decisions.
Ongoing Search is involved with the actual product being purchased. The motive is to build a bank of information for future use, however this leads to increased impulse buying.
Explain what the differences between an Internal Search and an External Search.
Internal Search: Scanning memory to assemble product alternative information.
External Search: Obtaining information from ads, retailers, friends, family, etc.
Incidental learning: Mere __________ over time to _________ ___________ and observations of others.
exposure, conditioned stimuli
Directed learning: _________ product knowledge obtained from previous ________ ________ or experience of alternatives.
Existing, information search
Examples of companies providing information online.
EXAMPLES:
Kraft Foods - provide information on their website on recipes, shopping tips, shopping lists, meal planners.
Do consumers always search rationally? Explain why or why not.
Not always!
External searches are surprisingly low. Low income shoppers search less. Consumers desire to choose new alternatives over more familiar ones.
Sunk-cost fallacy
Reluctant to waste something we have already paid for.
Prospect theory
Risk differs when consumer faces options involving gains versus those involving loses.
Explain the factors that contribute to greater search activity.
Purchase is important, there is a need to learn more about the purchase, relevant info is easily obtained/utilized. One might be younger and better educated. One is female (compared to male).
Moderately knowledgeable consumers tend to search _______ than product experts and novices.
more
Five types of Perceived Risk
- Monetary Risk
- Functional Risk
- Physical Risk
- Social Risk
- Physiological Risk
Type of risk that consists of money and property. Those with relatively little income and wealth are most vulnerable.
Monetary Risk
Type of risk that consists of alternative means of performing the function or meeting the need. Practical consumers are most sensitive.
Functional Risk
Type of risk that consists of physical vigour, health, and vitality. Those who are elderly or in ill health are most vulnerable.
Physical Risk
Type of risk that consists of self-esteem and self-confidence. Those whoa re insecure and uncertain are most sensitive.
Social Risk
Type of risk that consists of affiliations and status. Those lacking self-respect or attractiveness to peers are most sensitive.
Psychological Risk
Expensive personal luxuries that may engender guilt, durables, and services who use demands self discipline or sacrifice are most sensitive are most sensitive to ___________ Risk
Psychological
Socially visible or symbolic goods such as clothes and jewellery are most subject to _______ Risk
Social
Mechanical or electrical goods (such as vehicles), drugs and medical treatment, food and beverages are most sensitive to ________ Risk
Physical
Products or services whose purchases and use require the buyer’s exclusive commitment and preclude redundancy are most sensitive to ________ Risk
Functional
High-ticket items that require substantial expenditures are most subject to ________ Risk
Monetary
Using the five types of perceived risk in your analysis, would you begin using cocaine if I gave you a free bump?
Answer dependant on the consumer - just make sure you had the five risks: Monetary, Functional, Physical, Social and Psychological
Evaluation of Alternatives in Extended problem solving and Habitual decision making?
Extended - usual more choice conflicts
Habitual - consider few/no brand alternatives
Marketers must focus on getting their brands into a consumers’ _________
evoked set
Three decision rules for product choice
- Prior experience with (similar) product)
- Present information at time of purchase
- Beliefs about brands (from advertising)
What is neuromarketing?
Used functional magnetic resonance imaging (fMRI) to measure blood flow to the brain as we perform mental tasks. Marketers use this technology to measure consumers’ reactions to ads, loyalty to brands etc.
What are some common marketing beliefs?
- All brands are basically the same
- Larger stores offer better prices than smaller stores
- Items tied to “giveaways” are not a good value.
How does country of origin play a role in product choices?
We strongly associate certain items with specific countries (ex. Champagne with France, Chocolate with Switzerland). This leads to Ethnocentrism (“Buy Canadian”).
Consumer Inertia: The tendency to buy a brand out of _____ because it requires ______ effort.
habit, less
Define the two decision rules.
- Compensatory - evaluates the pro and con of each alternative
- Non-Compensatory - one attribute cannot compensate for the poor rating of another attribute
Compensatory decision making is applied in __________ involvement situations
high
Non-compensatory decision making ________ alternatives deficient in any of the chosen criteria.
eliminates.
Criteria of Consumption and Learning
Satisfaction and dissatisfaction of the purchase. Post purchase dissonance and anxiety.
What do companies do to reduce a consumers level of cognitive dissonance?
Answers may vary - example: offer “money back guarantees”, re-inforce that the consumer has made the right choice, insurance
