Controlled behavior (decisions)

Question 1

Extensive decision making:

and strategic implications

Answer 1

Extensive decision making:
intensive search for information and formal integration of product features.
Reduction of options through non-compensatory decision making rules
—> Decision in the reduced set through compensatory decisions

Strategic implications:
Important to satisfy the needs of the customer as good as possible.
Positive rating in as many categories as possible is especially beneficial

Question 2

Limited decision-making:

and strategic implications

Answer 2

Limited decision-making:
Humans do not invest in cognitive work unnecessarily
Extensive use of heuristics

Strategic implications:
Emotional advertisement —> High awareness —> Getting into Evoked Set
Concentration on peripheral arguments, which are easy to process heuristically

Question 3

Routinized choice behavior:

and strategic implications

Answer 3

Routinized choice behavior:
Common behaviors our processed automatically without usage of cognitive capacity
Behavior follows a learned and recalled decision plan.

Strategic implications:
Low market share: attention seeking actions to break consumer routine
High market share: distractions from the routine of the consumer should be avoided

Question 4

Compensatory decision:

Answer 4

Compensatory decision: consumer rates the average of all attributes —> bad attributes can be compensated

Question 5

Non-compensatory decision:

Answer 5

Non-compensatory decision: consume rates the important attribute (for him) —> K.O. criteria

Question 6

Decision by brand:

Answer 6

Decision by brand: consumer calculates a full rating for every product and compares them —> focus on whole product, usage of heuristics

Question 7

Decision by attribute:

Answer 7

Decision by attribute: consumer creates a ranking for every attribute and decides by attributes through this ranking —> Focus on details, analytical approach

Question 8

Multi-attribute-model:

Answer 8

Multi-attribute-model: creation of a rating, based on a combination of attributes. Comparing the ratings

Question 9

Additive-distance-model:

Answer 9

Additive-distance-model: calculation of differences between attributes of two products. Summation of the differences. One beats the other —> complex, therefore empirically not very often.

Question 10

Conjunctive-decision-model:

Answer 10

Conjunctive-decision-model: Setting a minimum level (K.O. criteria) for every attribute and eliminate all Products with attributes below this level. Then go on with other decision model (f.e.: Multi-attribute-model)

Question 11

Disjunctive-decision-model:

Answer 11

Disjunctive-decision-model: Setting a desired level for attributes and select products with this or a higher level —> Then go on with other decision model (f.e.: Multi-attribute-model)

Question 12

Lexicographic-decision-model:

Answer 12

Lexicographic-decision-model: first, sort all evaluation criteria by their importance. Then go from the important to the unimportant criteria and eliminate the bad alternatives, until there is only one alternative.

Question 13

Convenience goods:

Answer 13

Convenience goods: frequent consumption, automatic choice, satisficing —> heuristic and automatic

Question 14

Shopping goods:

Answer 14

Shopping goods: rare consumption, deep information processing, satisficing/maximizing, non-compensatory & by brand —> (K.O. criteria)

Question 15

Speciality Goods:

Answer 15

Speciality Goods: Very rare consumption, long search and very deep information processing, maximizing, compensatory & by attribute —> attribute offsetting

Question 16

Paradox of choice

Answer 16

Paradox of choice (Barry Schwartz 2004):
Maximizer: Search for perfect alternative —> frustration
Satisficer: Clear standards & criteria. As soon as there is an option fulfilling them, they take it —> Happiness

Question 17

Extensive Decisions: Choice of decision rule — mood

Answer 17

Extensive Decisions: Choice of decision rule — mood
Positive mood: Willingness to take more risks, more heuristics & other mental shortcuts (less rational), more creative, new approaches, inaccurate check of arguments, trust in prejudices and pigeonholing —> broad mental categories

Negative mood: No willingness to take risks, detail oriented, systematic approaches, Trust in proven thinking, exact check of arguments, small mental categories

Question 18

Extensive Decisions: Choice of decision rule — processing fluency

Answer 18

Extensive Decisions: Choice of decision rule — processing fluency
Contradictions break automatism —> think
Low processing fluency —> problematic stimulus constellation —> Exact check of information processing —> Higher possibility of extensive decision

Question 19

Extensive Decisions: Irrationality

Answer 19

Extensive Decisions: Irrationality
Rational behavior: exact checks of arguments —> judgement
Rationalizing behavior: Decision made intuitively —> In retrospect, reasons for judgements are generated

Question 20

Central concept: psychological distance

Answer 20

We can represent the same information differently: 
Concrete (very near) Abstract (far away)

Distance: chronological, spatial, social, probability

Near distance: Question about how to behave; Focus on needed steps to reach plans; concrete representation; narrow categories; specific details; focus on directly observable things; Analytical thinking

Great distance: Questions about why to behave like that; Mental simulation of the fulfilled plan; abstract representation; broad categories; focus on intangible and not directly observable aspects; High creativity.

Question 21

Cancellation and focus model:

Answer 21

Cancellation and focus model:
Only discriminating characteristics enter into the decision between alternatives. Features that only the comparison standard possesses are particularly weighted.

It gives an extreme advantage to be the comparison standard, since every attribute goes into the decision making process

Irrelevant Alternatives:
Added irrelevant alternative gives most expensive alternative more weight.

Question 22

judgmental heuristic:

Answer 22

judgmental heuristic: enlightened inferences.
Focus on less, but central information
Activated, if: No exact knowledge (Judgement under uncertainty); time pressure; Information-overload; little motivation

Question 23

Anchoring heuristic:

Answer 23

Anchoring heuristic:
Some value becomes an anchor for a judgement
NEEDS: Judgement under uncertainty + Anchor is a dominant information source.
Anchoring & Adjustment

Question 24

Feeling Heuristics

Answer 24

Feeling Heuristics
Affective mood serve as the basis for a judgement —> How satisfied are you with your life (good vs. bad weather)
—> Emotions/mood as heuristics —> FEELING AS INFORMATION

Question 25

Availability heuristics (fluency)

Answer 25

Availability heuristics (fluency)
Ease of retrieval is critical to a judgement. —> An easily accessible information is classified as important/true/known
„there are many reasons to choose a bmw — can you name one?“ —> 1 POSTIVE characteristics —> association (10 positive characteristics —> very bad association)

Question 26

Representativeness heuristics

Answer 26

Representativeness heuristics
Similarity to a common example is crucially influencing the decision. The characteristics are transferred to the other object.